Imphal, January 23 2009: LEAVING A strong suggestion that state government should assist in building a national consensus for prompt implementation of the GST (Goods and Services Tax) and stressing the benefits of it, the delegation of the 13th Finance Commission led by its chairman Dr Bijay Kelkar left Imphal today afternoon concluding its three-day visit in the state.

The country, mention may be made is expecting to introduce the goods and service tax in order to understand the change in the fiscal scenario from 2010 .

The thirteenth Finance Commission (TFC) has commissioned a study on the new tax.

The main objective of the study is to assess the impact of GST on the Centre and states' tax kitty and accordingly, come out with a new basis for devolution of taxes between the two.

The commission, headed by former finance secretary Vijay Kelkar who also the chairman of the 13th finance commission has also roped in a number of research institutes to conduct studies on a number of issues such as sustainable development with environmental responsibility.

The panel appreciated the state government for improvement in its own revenue/GSDP ratio from 2000-10 to 2005-06 and successful implementation of VAT (value added tax) in 2005, an official who attended a meeting with between the delegation and ministerial team led by Chief Minister, O Ibobi late yesterday evening said today.

The visiting 14-members team of the finance commission held the meeting with the council of ministers of the Secular Progressive Front, SPF led by the chief minister, O Ibobi Singh at Raj Bhavan, Imphal late evening and un the meeting, chief minister explained on the major measures taken by the Manipur government to reduce non-plan expenditure and wasteful expenditure among other, official said.

At the concluding part of the meeting, after hearing the chief minister's statement, the chairman Dr Bijoy Kelkar briefed on the unprecedented crisis in the world economy which id presently undergoing and emphasized the need for a collective response by all levels of the government of India to enable the country to rise above these challenges.

He also pointed out much lower per capita GSDP of the state compare to that of India average particularly the growth performance which is in the recent years "poor and also volatile" in the case of secondary and tertiary sector.

"Acceleration of growth is important for the state overcome its many challenges, including that of insurgency," the source quoted as stated by Dr Kelkar.

He also thanks the state government for improving its own revenue/GSDP ratio and successful implementation of the VAT in 2005, the source reiterated adding that he further emphasized the benefits of GST and urged the state government to assist in building a national consensus for the prompt implementation of GST.

The state government enactment of Fiscal Resource and Budget Management legislation and meetings its fiscal targets received thanks from the finance panel but expressed the felt need for a medium term strategy for accelerating productive public investment in key priority areas.

Before this, chief minister, O Ibobi Singh while highlighting many problems which are facing by the state in the way of taking up development activities blamed the insurgency for hampering the development of the state.

Decades of insurgency, is adversely affecting the socio-economic fabric of the state and is imposing considerable strain on the state's finance, the chief minister reportedly told the finance panel.

The 13th finance commission will finalize its recommendations by October 2009 after completing its discussion with all the state governments, the government of India ad relevant stake holder, source here said.

Today, before leaving Imphal, the delegation paid visit to the Singda Dam in Imphal west district and state museum in the heart of the Imphal city.

During the visit at Singda Dam, the delegation held discussion on the need of giving all round attention like the deployment of security and control of deforestation in the catchments areas at the dam with the official of the state irrigation and flood control department looking after the affairs of the Dam, the only source of water for supplying safe drinking water in Imphal city and its surrounding area.

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