Economy

Finance panel chief N K Singh calls on RBI Governor Urjit Patel

Updated : September 17, 2018 11:34 PM IST

The meeting at the central bank headquarters on Mint Road lasted for nearly an hour in the afternoon, sources said.

The meeting comes amid concerns over states breaching fiscal deficit and borrowing extra from the market.

Fifteenth Finance Commission chairman NK Singh Monday began his Maharashtra visit with a meeting with Reserve Bank Governor Urjit Patel.

The meeting at the central bank headquarters on Mint Road lasted for nearly an hour in the afternoon, sources said. However, the contours of the discussions and the other participants at the meeting were immediately unclear.

The meeting comes amid concerns over states breaching fiscal deficit and borrowing extra from the market. The RBI brass has also gone public with thier concern on the deteriorating state finances.

Ahead of the three-day visit, the national resource allocation panel has already caused a flutter by saying that the state is facing problems managing revenue deficit and has had to depend on borrowings to finance the gap.

"...a revenue deficit of 0.5 per cent of GSDP continues to be a worrisome factor for Maharashtra; the revenue deficit to GSDP ratio has increased even as the fiscal deficit to GSDP ratio has fallen. This indicates that debt is being used for revenue expenditure," it has reportedly said. The panel has, however, appreciated work done to reign in fiscal deficit within the targeted levels and also the industrial progress.

The 15th Finance Commission is required to submit its recommendations next year and is in the phase of stakeholder discussions across the states and the three-day Maharashtra engagement is part of that.

Singh is scheduled to meet the representatives of political parties, trade, industry and local bodies from both the rural and urban areas tomorrow, which will be followed with meetings with chief minister Devendra Fadnavis and finance minister Sudhir Mungantivar the day after.