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Introduction to the Institute 39TH ANNUAL REPORT 2014-2015 NAT ONAL OF UBLIC FINANCE I NSTITUTE POLICY & page | 1 NIPFP Annual Report 2014-2015 ANNUAL REPORT APRIL 1ST, 2014 – MARCH 31ST, 2015 PRINTED AND PUBLISHED BY: THE SECRETARY NATIONAL INSTITUTE OF PUBLIC FINANCE AND POLICY AN AUTONOMOUS RESEARCH INSTITUTE UNDER THE MINISTRY OF FINANCE, GOVERNMENT OF INDIA 18/2, SATSANG VIHAR Marg, SPECIAL INSTITUTIONAL AREA (NEAR JNU), NEW DELHI 110067 TEL.: 011 26569303, 26569780, 26569784 FAX: 91-11-26852548 EMAIL: [email protected] WEBSITE: www.nipfp.org.in COMPILED, CONCEPT, DESIGN & EDITED BY: SAMREEN BADR COVER DESIGN, TEXT DESIGN ARTWORKS & PRINTED BY: VAP EMAIL: [email protected] TEL: 09811285510 NATIONAL INSTITUTE OF PUBLIC FINANCE AND POLICY, NEW DELHI PROVIDING POLICY ADVICE SINCE 1976 2 | page Introduction to the Institute CONTENTS Introduction to the Institute5 Annexures List of Studies 2014-2015i Research Activities17 ii NIPFP Working Paper Seriesv Fiscal/Taxation-related Studies of Central and ii Internal Seminar Series v State Government19 iii Macroeconomic and Financial Sector Policy List of Governing Body Members as on 31.3.2015i Studies20 x List of Priced Publicationsx State Development Studies 24 iv Published Material of NIPFP Facultyx Other Studies28 ix New Projects initiated30 List of Staff Members as on 31.3.2015x Workshops, Seminars, Meetings and xv Conferences3 List of Sponsoring, Corporate, Permanent and 1 Ordinary Members as on 31.3.2015x Training Programmes38 xxi Finance and Accountsx NIPFP Publications (2014-2015)39 xxiii Library and Information Centre40 Computer/IT Unit 42 Highlights of Faculty Activities43 page | 3 NIPFP Annual Report 2014-2015 CONTENTS Introduction to the Institute5 Research Activities17 Fiscal/Taxation-related Studies of Central and State Government19 Macroeconomic and Financial Sector Policy Studies20 State Development Studies 24 Other Studies28 New Projects initiated30 Workshops, Seminars, Events, Meetings and Conferences31 Training Programmes38 NIPFP Publications (2014-2015)39 Library and Information Centre 40 Computer/IT Unit42 Highlights of Faculty Activities45 Annexures Finance and Accounts 4 | page Introduction to the Institute INTRODUCTION TO THE INSTITUTE The 39th Annual Report of the National Institute of Public Finance and Policy, New Delhi is a reflection of the institute’s work in the financial year and accountability to the Governing Body and to the public. Given on the following pages is an overview of NIPFP’s activities during 2014-15. A digital copy of the Annual Reports can be accessed on the institute’s official website at http://www.nipfp.org.in/publications/annual- reports/. page | 5 NIPFP Annual Report 2014-2015 BOARD OF GOVERNORS The Ministry of Finance is represented by Shri Hasmukh Adhia, Revenue Secretary; Shri Shaktikanta Das, Secretary, Economic Affairs; and Shri Arvind Subramanian, Chief Economic The Board of Governors of Adviser. The Reserve Bank of India is represented NIPFP during its meeting on by Mrs. Balbir Kaur, Adviser, Department April 3, 2012, reconstituted the of Economic and Policy Research. Mr. Bibek Governing Body for a period of Debroy, Member, represents the NITI Aayog. The representatives of the sponsoring state four years, i.e. from April 5, 2012 to governments are: Dr. J.N. Singh, Additional Chief April 4, 2016. Secretary, Finance Department, Gujarat; Shri K. Shanmugam, IAS, Principal Secretary, Finance Dr. Vijay Kelkar heads the NIPFP Department, Tamil Nadu; and Shri Upendra Governing Body as Chairman. Nath Behera, IAS, Additional Chief Secretary (Finance), Government of Bhubaneswar. Shri Rakesh Jha is the nominee from the ICICI Three eminent economists in Bank; Shri Rana Kapoor, President, Associated the governing body are Prof. Chamber of Commerce and Industry of India Pulin B. Nayak, Delhi School of and Dr. Jyotsna Suri, President, FICCI, are Economics, Dr. D.K. Srivastava, nominees from institutions. Representatives from collaborative institutions are: Dr. Shekhar Chief Policy Adviser, Ernst and Shah, Director-General, NCAER; Dr. Ravi Young, and Dr. Sudipto Mundle, Kant, Director-General, Administrative Staff Emeritus Professor, NIPFP. College of India; and Dr. Pratap Bhanu Mehta, President and Chief Executive, Centre for Policy Dr. Rathin Roy, Director, is the Research. Shri Manoj Fadnis, President, Institute of Chartered Accountants of India is a co-opted ex-officio Member-Secretary; and member of the Governing Body. Special invitees Dr. R. Kavita Rao, Professor, to the Governing Body are Chairman, CBDT, represents NIPFP by way of Ministry of Finance and Chairperson, CBEC, rotation. Ministry of Finance. (Refer to Annexure IV for details). 6 | page Introduction to the Institute PROJECTS COMPLETED AND ONGOING Ongoing research focusses on support for expenditure management and addresses questions on fiscal, financial and monetary policy. The Our research goals in the institute provides continuous policy support in reporting year have been achieved the form of recommendations and reports to by teams working in five major solve upcoming challenges faced by departments areas: Taxation & Revenue, of the Ministry of Finance and to provide guidance to the State’s taxable capacity and Public Expenditure & Fiscal resource allocation. Management, Macroeconomic Aspects, Intergovernmental Fiscal The research canvas of NIPFP has encompassed Relations and State Planning & studies that are of critical importance to policy Development. reform and inclusive growth in the Centre as well as States. Recommendations were directed at expenditure management, macroeconomic policy modelling and tax-policy. Fiscal and taxation-related study of central and state governments sponsored by Government Institute Network International, Islamabad was completed as a cross-country study on the impact of tax policy on small-and-medium enterprises which also indicated that high compliance of cost of being in the tax system is perhaps hindering growth in this segment of the economy. The institute worked on the development of an analytical model for widening of the taxpayers’ base in an attempt to provide the Central Board of Direct Taxes an analysis of the evolution of number of taxpayers paying tax under personal income tax in India and construct an analytical model to predict the number of taxpayers that should be there in the system. page | 7 NIPFP Annual Report 2014-2015 The institute attempted to untangle the problems to the emerging conditions and policy questions. underlying GST reforms by revisiting the estimation of Revenue Neutral Rates (RNR) for In order to gain from the inputs provided by GST and calibrate a number for the year 2013- our research team, the term of NIPFP-DEA 2014. Research Programme was extended. The research programme will not only further address larger As requested by UIDAI, Planning Commission, questions of fiscal, financial and monetary Government of India, NIPFP conducted a policy in an open-economy setting, but also study on Pricing the Authentication and eKYC provide what is perceived as the indispensable - a Services to recommend a strategy for recovering research-oriented policy support framework for the costs of Aadhaar-enabled services. Under a topical issues that are of concern to the Ministry, collaborated consultation project with UIDAI, the including the FSLRC recommendations. institute developed models of business plan for continuous enrolment, update and other services In continuation with its tradition of expanding offered by UIDAI, and gave pros and cons of its research base, NIPFP initiated research on each of the model developed, recommending the business cycles phenomena in India. best model for implementation. In order to contribute to the academic literature Macroeconomic and financial sector policy on firm financing and borrowing decisions and studies such as “Financing for Infrastructure to understand the industrial dynamics in India, a Investment – G-20 Project” conducted on behalf study was undertaken by the institute to analyse of Multilateral Relations Division, Department the pattern of external borrowing by Indian firms. of Economic Affairs, Ministry of Finance, Government of India, looked into various sources Objective rating of governance performance, of financing infrastructure and the demands for based on clearly-defined and transparent indicators, infrastructure investments and highlighted the would be a useful device for strengthening the mismatch between demand and supply of funds emerging process of governance competition for infrastructure financing in India. among states. This finding is further studied by a team by evaluating the performance of Indian A team constructed “Macroeconomic Policy states with respect to governance as service Simulations” to review the macro-fiscal linkages delivery. over the 14th Finance Commission period of 2015-19 for the 14th Finance Commission. A comprehensive study, to estimate the level Macroeconomic Policy Modelling reports which and composition of subsidies in India, taken looked into whether there is any trade-off up by the institute will provide an updated between current account balance and the GDP and comprehensive re-estimation of subsidies growth for the period 2010-15, were submitted from 1987-88 up to the recent period while to the Planning commission. The report also incorporating conceptual refinements where evaluated the impact of various external shocks appropriate. during the 12th Plan period. Meanwhile, the NIPFP macroeconomic policy simulation