Although fiscal imbalance and its adverse effects on macro economic equilibrium in India have been receiving wide attention, the issue at States' level has not so far been adequately analyzed. In many respects, fiscal situation in States is more critical than that at the Centre as States have...

Andhra Pradesh is one of the pioneering States to earnestly initiate economic and fiscal reform at the Subnational level in India. Prior to the 1996 reform program, the State's budgetary position was under severe stress as in many States in India. The economic growth was below potential,...