The Government of India is developing reforms to address the lack of fiscal discipline among India’s States. On behalf of India’s Ministry of Finance, the International Studies Program provided an assessment of India’s intergovernmental fiscal system and a review of international experience in promoting fiscal discipline among subnational governments in federal systems.

The review of international experience focused on the experiences of Australia, Brazil, Canada, Germany, Russia, and the United States. Based on this review, the project team also offered reform options. This study was conducted between November 2004 and April 2005 and financed by a grant from the United States Agency for International Development under USAID'S Fiscal Reform Project.

Dr. Mark Rider was the principal investigator for the study, and the project team also included Dean Roy Bahl, Ms. Eunice Heredia-Ortiz, and Dr. Jorge Martinez-Vazquez. The main findings of the final report have been captured in ISP Working Paper Number 05-14.