Ranchi: At the meeting convened on Friday with the 16th Finance Commission in Ranchi, Chief Secretary Alka Tiwari emphasized the vision set by Prime Minister to transform India into a developed nation by the year 2047. She stressed that all states must achieve comprehensive development to fulfill this goal.
Despite abundant natural resources, Jharkhand remains a low-income state. The Chief Secretary described Jharkhand as a prime example of the “paradox of plenty” and the “curse of natural resources.” About 30 percent of the state’s total area is forested. Consequently, most infrastructure projects in the state undergo stringent forest and environmental clearances, resulting in delays and increased project costs.
Jharkhand is rich in minerals, accounting for nearly 40 percent of India’s total mineral reserves. However, the state does not receive proportional benefits. Coal companies owe substantial dues to the state in land compensation and royalties. Alongside issues such as land degradation, air and water pollution, agricultural productivity, and health, local communities bear the social cost of displacement.
Traditionally, Jharkhand has been a manufacturing hub of the country, with India’s first steel plant established in Jamshedpur. The Chief Secretary drew the Commission’s attention to the fact that while the Goods and Services Tax (GST) benefits consumer states, Jharkhand as a producing state is expected to suffer a loss of approximately ₹61,677 crore during 2025-26 to 2029-30.
The state has a significant tribal population, with 39 percent belonging to Scheduled Tribes, Scheduled Castes, and Primitive Tribal Groups. This large demographic lags behind in key social indicators such as health and education. The state government is working at multiple levels for inclusive development and has launched schemes like the “Maaiyan Samman Yojana” to promote women’s empowerment and consumer-driven growth, which is resulting in significant additional expenditure from the state’s finances.
The Chief Secretary informed the Commission that Jharkhand was formed in 2000 with financial commitments and liabilities. Unlike other newly created states, Jharkhand was not granted special category status or special financial packages by the central government. The state is also battling left-wing extremism, which poses a serious threat to its development.
Efforts to increase revenue collection have shown progress, with a 16.5 percent increase in tax and non-tax revenues projected from 2019-20 to 2025-26. Highlighting the state government’s achievements, the Chief Secretary noted that according to the NITI Aayog’s Fiscal Health Index 2025 report, Jharkhand ranks fourth among 18 general category states. The government remains committed to strengthening Panchayati Raj institutions and local bodies and has urged an increase in grants from the central government.
The Chief Secretary proposed raising the vertical devolution of funds to 50 percent and emphasized that the horizontal devolution formula should incorporate factors such as population, income disparities with developed states, forest and open forest areas, and losses due to GST.