Model Answer
0 min readIntroduction
Cooperative federalism in India signifies a collaborative relationship between the Union and State governments, working together to achieve national development goals despite the constitutional division of powers. While the Indian Constitution does not explicitly use the term "federal," Article 1(1) declares India as a "Union of States," embodying a system where the Centre and states are interdependent. This approach is crucial for effective governance in a diverse nation like India, facilitating shared responsibilities in areas such as economic policies, social welfare, and disaster management. However, the ideal of harmonious cooperation often encounters significant challenges stemming from political divergences and fiscal disparities.
The spirit of 'cooperative federalism' is foundational to India's governance, aiming for collaborative action between the Centre and states. Yet, its full realization is frequently impeded by two major factors: divergent political interests and financial constraints.
Divergent Political Interests as a Hinderance
Political differences between ruling parties at the Centre and in various states often create friction, hindering collaborative governance. This can manifest in several ways:
- Misuse of Constitutional Provisions: Provisions like Article 356 (President's Rule) or the Governor's role (Article 155) have historically been points of contention. Governors, appointed by the President, sometimes act in a partisan manner, leading to conflicts with elected state governments. For example, delays in gubernatorial assent to state bills, as seen in Tamil Nadu in 2023, can undermine cooperative spirit.
- Policy Resistance and Non-Cooperation: States governed by opposition parties may resist centrally sponsored schemes or policies, or the Centre may withhold support for state initiatives, driven by ideological differences or electoral considerations. This 'one size fits all' approach from the Centre often fails to account for diverse state-specific needs.
- Inter-State Disputes: While cooperative federalism aims to resolve inter-state disputes amicably, divergent political interests can exacerbate conflicts, particularly over shared resources like river waters. The long-standing Cauvery water dispute between Karnataka and Tamil Nadu, despite tribunal interventions, illustrates the persistence of political roadblocks.
- Trust Deficit: A widening trust deficit between the Centre and states, often fueled by political rhetoric and perceived centralization of power, makes genuine cooperation difficult. States may feel their autonomy is being undermined, leading to a confrontational stance.
Financial Constraints and Fiscal Imbalances
The financial architecture of Indian federalism, despite mechanisms for devolution, often places states in a position of dependency, which can impede cooperative efforts:
- Fiscal Centralization and Dependency: The Constitution grants the Union significant authority over major revenue sources, leading to states' heavy reliance on central transfers and grants. This fiscal imbalance can be detrimental to states' autonomy and their ability to implement policies effectively. The surrender of state taxation powers post-GST, for example, further reduced fiscal autonomy, making states more reliant on central funds.
- Allocation of Resources: States often feel short-changed in the allocation of financial resources, leading to disputes over fiscal transfers, grants, and shares of central taxes. The 15th Finance Commission's recommendations, for instance, saw some Southern states like Karnataka and Tamil Nadu alleging a reduction in their share of the divisible pool, citing factors like population control measures.
- Conditional Grants and Tied Funding: An increasing share of conditional or tied grants from the Centre for state-list subjects restricts states' flexibility in setting their spending priorities based on local needs. This can be seen in various centrally sponsored schemes.
- Debt Burden: Rising debt levels and interest burdens can reduce states' fiscal space, impacting their ability to fund essential infrastructure and social sector projects independently.
- GST Compensation Issues: While the Goods and Services Tax (GST) is considered a landmark example of cooperative federalism, issues surrounding GST compensation for revenue losses (especially during the initial years and the COVID-19 pandemic) have created significant friction between the Centre and states.
Impact on Cooperative Federalism
The interplay of these political and financial hindrances leads to:
- Reduced Policy Cohesion: Lack of consensus impacts the uniform implementation of national policies and programs.
- Inefficiencies and Duplication: States may pursue parallel policies due to a lack of trust or coordination, leading to inefficient resource utilization.
- Undermining State Autonomy: Centralized authority, both political and financial, can diminish the autonomy of state governments, hindering their ability to address specific regional challenges.
The table below summarizes some key areas of friction:
| Area of Friction | Divergent Political Interests | Financial Constraints |
|---|---|---|
| Constitutional Role of Governor | Partisan actions against elected state governments, delaying bills. | Indirect influence through Centre's fiscal leverage. |
| President's Rule (Article 356) | Perceived misuse by Centre to dismiss state governments. | Can be used to influence states through financial pressures. |
| Fiscal Devolution | Political battles over distribution criteria and shares. | States' dependence on central funds, limited revenue autonomy. |
| GST Council Decisions | States' dissent on rates, compensation, and inclusion of items (e.g., petrol/diesel). | Disputes over compensation for revenue loss, especially post-pandemic. |
| Implementation of Central Schemes | States' reluctance or selective implementation due to political differences. | Inadequate funding for centrally mandated schemes. |
Recommendations to Strengthen Cooperative Federalism
To mitigate these challenges, several commissions have offered recommendations:
- Sarkaria Commission (1987) and Punchhi Commission (2010): Advocated for strengthening inter-governmental mechanisms like the Inter-State Council, ensuring the Governor's office remains apolitical, and restricting the misuse of Article 356.
- Promoting Fiscal Federalism: Granting states greater fiscal autonomy and ensuring fair distribution of resources by the Finance Commission. The Centre should allocate more revenue to states and avoid 'one size fits all' financial policies.
- Strengthening Institutional Frameworks: Enhancing the roles of institutions like NITI Aayog, the Inter-State Council, and the Finance Commission to facilitate ongoing dialogue and consensus-building. The Inter-State Council should be made a permanent body with stronger enforcement powers.
- Regular Inter-Governmental Meetings: Fostering regular communication and consensus-building on policy issues.
- Empowering Local Governments: Strengthening Panchayati Raj Institutions with greater decision-making powers and financial resources can enhance cooperative federalism at the grassroots level.
Conclusion
While cooperative federalism is indispensable for India’s unity and development, the interplay of divergent political interests and inherent financial constraints frequently poses significant roadblocks. Political polarization can lead to distrust and non-cooperation, undermining joint efforts in policy-making and implementation. Simultaneously, the fiscal imbalance and states' heavy reliance on central funds erode their autonomy and capacity. Addressing these challenges requires a sustained commitment to institutional reforms, greater fiscal devolution, fostering political goodwill, and empowering states and local bodies. Only through genuine collaborative efforts can India truly realize the potential of cooperative federalism for inclusive growth and national progress.
Answer Length
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