Model Answer
0 min readIntroduction
Cooperative federalism, a concept gaining prominence in Indian governance, signifies a horizontal relationship between the Union and States, characterized by mutual trust, consultation, and collaborative action rather than a strictly hierarchical structure. While the Indian Constitution originally leaned towards a quasi-federal structure, the 73rd and 74th Constitutional Amendment Acts (1992) marked a turning point, empowering local bodies and initiating a shift towards greater decentralization. Subsequent measures, driven by economic reforms and evolving socio-political dynamics, have aimed to redefine and execute cooperative federalism, though with varying degrees of success. This answer will examine the efficacy of these measures.
Constitutional and Institutional Mechanisms
Several constitutional and institutional mechanisms have been implemented to foster cooperative federalism:
- Finance Commission: The Finance Commission (Article 280) plays a crucial role in recommending the distribution of tax revenues between the Union and States, aiming for a more equitable allocation. The 15th Finance Commission (2020-2026) emphasized performance-based incentives and fiscal consolidation.
- Goods and Services Tax (GST) Council: Established under Article 246A, the GST Council is a prime example of cooperative federalism in action. It brings together the Union and State Finance Ministers to make decisions on GST rates, exemptions, and other related matters.
- NITI Aayog: Replacing the Planning Commission in 2015, NITI Aayog aims to foster a collaborative approach to policy-making, involving States in the formulation of national development strategies.
- Inter-State Council: Revitalized in 2017, the Inter-State Council (Article 263) serves as a platform for discussing issues of common interest between the Union and States.
- Zonal Councils: Established under the States Reorganisation Act, 1956, these councils promote cooperation among States within a specific zone.
Policy Initiatives & Recent Developments
Beyond institutional mechanisms, several policy initiatives demonstrate a commitment to cooperative federalism:
- ‘One Nation, One Market’ (ONOM): This initiative, aiming to create a common national market, requires significant cooperation between States to remove barriers to inter-state trade.
- National Education Policy (NEP) 2020: The NEP emphasizes the role of States in implementing educational reforms, promoting flexibility and adaptation to local needs.
- Agricultural Reforms (2020): While controversial, the farm laws (later repealed) were presented as attempts to liberalize agricultural markets and promote inter-state trade, though they faced strong opposition from States.
- Cooperative Multi-State Cooperative Societies Act, 2023: Aims to strengthen cooperative movement in the country, promoting cooperative federalism in the sector.
Efficacy and Challenges
The efficacy of these measures is mixed. The GST Council, despite initial challenges, has largely functioned effectively, demonstrating a willingness to compromise and reach consensus. NITI Aayog has facilitated dialogue and knowledge sharing, but its influence on policy-making remains limited. However, several challenges persist:
- Fiscal Imbalance: States continue to rely heavily on Union transfers, limiting their financial autonomy.
- Centralizing Tendencies: The Union government often exercises its powers under Article 356 (President’s Rule) and other provisions, raising concerns about encroachment on State autonomy.
- Political Differences: Ideological differences between the Union and States can hinder cooperation and lead to conflicts. The recent debates over environmental clearances and agricultural policies exemplify this.
- Implementation Gaps: Even with consensus on policies, effective implementation often suffers due to bureaucratic hurdles and lack of coordination.
| Aspect | Positive Outcomes | Challenges |
|---|---|---|
| GST Council | Streamlined taxation, increased revenue collection | Compensation issues, complexities in implementation |
| Finance Commission | Equitable distribution of funds, incentivizing performance | States’ concerns over devolution criteria, fiscal discipline |
| NITI Aayog | Platform for dialogue, knowledge sharing | Limited policy influence, bureaucratic inertia |
Conclusion
While India has made significant strides in redefining and executing cooperative federalism, particularly through institutional mechanisms like the GST Council and the Finance Commission, challenges related to fiscal imbalance, centralizing tendencies, and political differences remain. Strengthening inter-governmental coordination, enhancing State autonomy, and fostering a spirit of mutual trust are crucial for realizing the full potential of cooperative federalism and ensuring inclusive and sustainable development. A more nuanced approach, acknowledging the diverse needs and priorities of States, is essential for building a truly cooperative federal structure in India.
Answer Length
This is a comprehensive model answer for learning purposes and may exceed the word limit. In the exam, always adhere to the prescribed word count.