By Bijay Kumar Singh

NEW DELHI: (Jul 23) The 16th Finance Commission should focus on devolving more funds to local bodies, municipalities and panchayats to enable them effectively deal with problems facing the people, former RBI Governor Raghuram Rajan has said.

Observing that previous finance commissions devolved more funds to states, Rajan told PTI Videos, “Now we need to focus also on devolving funds from states to municipalities to panchayats, etc. That third level of devolution is what we need far more of.”

Citing examples of China and the US, Rajan pointed out that the number of local government employees in these countries is significantly higher than the share of local government employees in India.