Prime Minister Narendra Modi always make tall claims of increasing funds devolution to the state by 10% like never before. But in fact, the central government had cut down the funds flow by about 90000 Crores per year after it had lowered its share in various central schemes.
With the 10% additional devolution, the states will get 1.78 Lakh Crores additionally as their share in central taxes. However Center is saving 2.68 Lakh Crore by cutting down their shares from central schemes which means the states are losing out 90000 Crore.
Starting this year, center will totally stop funding to 12 central schemes and will stop funding to 34 schemes partially. These schemes will become a huge financial burden to the states like Andhra Pradesh and other deficit budget states.
