New Delhi, Feb. 4 -- A key subtext of Budget 2026 is the evolving fiscal compact between the Centre and the states-an arrangement recalibrated every five years by the Finance Commission. FY27 marks the first year of the five-year award period of the 16th Finance Commission (FC), which, like its predecessors, had to reconcile competing demands from a diverse set of stakeholders.

As part of its consultations, the 16th FC invited states to submit recommendations. For each state, the central question was straightforward but contentious: how should the Centre's tax revenues be distributed among states?

India's 28 states weighed in, and their submissions make for an interesting read on how they saw this exercise. There's an element of both co...