(1) The functions, duties and powers of the National Natural Resources and Fiscal Commission shall be as follows:

(a) to determine detailed basis and modality for the distribution of revenues between the Federal, State and Local Governments out of the Federal Consolidated Fund in accordance with the Constitution and law,

(b) to make recommendation about equalization grants to be provided to the State and Local Governments out of the Federal Consolidated Fund,

(c) to conduct study and research work and prepare parameters as to conditional grants to be provided to the State and Local Governments in accordance with national policies and programs, norms/standards and situation of infrastructures,

(d) to determine detailed basis and modality for the distribution of revenues between the State and Local Governments out of the State Consolidated Fund,

(e) to recommend measures to meet expenditures of the Federal, State and Local Governments, and to reform revenue collection,

(f) to analyze macro-economic indicators and recommend ceiling of internal loans that the Federal, State and Local Governments can borrow, 170

(g) to review the bases for the distribution between the Federal and State Governments of revenues and recommend for revision,

(h) to set bases for the determination of shares of the Government of Nepal, State Government and Local level in investments and returns, in the mobilization of natural resources,

(i) to do study and research work on possible disputes that may arise between the Federation and the States, between States, between a State and a Local level, and between Local levels, and make suggestions to act in a coordinated manner for the prevention of such disputes.

(2) The National Natural Resources and Fiscal Commission shall carry out necessary study and research work about environmental impact assessment required in the course of distribution of natural resources, and make recommendations to the Government of Nepal.

(3) Other functions, duties and powers and rules of procedure of the National Natural Resources and Fiscal Commission, detailed bases required to be followed in the mobilization of natural resources or distribution of revenues, and other matters including conditions of service of the officials of the Commission shall be as provided for in the Federal law. 171