Four southern Chief Ministers – from Kerala, Andhra Pradesh, Puducherry and Karnataka – have yelled blue murder about the terms of reference (ToR) of the 15th Finance Commission, which has been asked to use the latest Census data (2011) while determining overall fiscal transfers.

The widespread assumption is that this will benefit the northern states, which have higher and faster-growing populations, at the cost of the southern states, which have managed to cluster around replacement levels of fertility (2.1 kids per woman). Finance Minister Arun Jaitley has pointed out that this is a needless controversy, when the ToR actually balances the need to help states with larger populations by also weighting their efforts to achieve “progress towards population control”, which should benefit the southern states.

His predecessor, P Chidambaram added fuel to the political fire by pointing out that between the 10th and 14th finance commissions, the southern states’ share of revenues fell by a hefty 6.34 per cent (from 24.31 per cent to 17.97 per cent), largely due to their better performance in controlling population growth. That he himself did nothing to arrest this trend, despite representing a southern state as MP and having been finance minister thrice during the same timeframe, speaks volumes for his hypocrisy. One can be certain that once the Karnataka elections are over, he will pipe down.

However, Jaitley would be foolish not to take note of the protests by the southern chief ministers, if only for the optics. A marginal change in the ToR is not a bad idea at all.

The southern challenge, though, needs to be met head-on politically, and past data on population trends shows that the northern states are currently bringing down population growth rates at least as fast as the south did earlier.

According to 2011 Census data, decadal population growth has begun falling dramatically in the Hindi belt states, with Uttar Pradesh, Madhya Pradesh and Rajasthan recording four to seven per cent drops in decadal population growth (between 2001 and 2011), with only Bihar and Jharkhand showing far slower drops. MP’s decadal growth fell dramatically from 28.41 per cent in 2001 to 21.44 per cent, while UP’s fell from 25.85 per cent to 20.09 per cent.

In contrast, the southern states show large divergences in their decadal population growth rates, with Kerala showing the largest absolute drop of 4.57 per cent (9.43 per cent to 4.86 per cent), Andhra Pradesh 3.49 per cent and Karnataka 1.84 per cent. But Tamil Nadu and Puducherry actually reported a rise in their decadal population growth rates, the former from 11.72 per cent to 15.6 per cent, and the latter from 20.62 per cent to 27.72 per cent.

Put simply, Tamil Nadu and Puducherry could well gain from using raw 2011 population figures in the 15th Finance Commission, though we don’t know how exactly the commission will weight population numbers.

The 2011 Census presentation (see here, especially statement 4 and figure 6) also makes another point. Taking the key northern and central states of India as one group – administratively called the Empowered Action Group (EAG) for some reason, and which included the states of UP, Uttarakhand, Rajasthan, Madhya Pradesh, Chhattisgarh, Bihar, Jharkhand and Odisha – and the rest of India as another, the one point of divergence is that EAG and non-EAG states reacted differently to population control measures.