The Hindu Editorial Analysis- 8th June 2024 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

The Centre is Notional, the States the Real Entities

Why in News?

The 2024 general election results in India have surprised many, with regional parties gaining significant representation in Parliament.This shift is expected to enhance federalism and address contentious Centre-State relations, as States push for greater autonomy and equitable resource allocation amid ongoing political and financial disputes.

General Election 2024 Results and Its Implications

Surprise Outcome and Democratisation:

• The results of the 2024 general election have surprised many, indicating a shift towards greater democratisation in India.
• Regional parties have performed well, securing representation on both the ruling party benches and the Opposition side in Parliament.
• This outcome is expected to strengthen federalism, crucial for India’s diverse nation, which had been experiencing strains recently.

Contentious Centre-State Relations:

• Centre-State relations became contentious during the election campaigning.
• The ruling party’s campaign ideas like ‘one nation one election’ and threats against Opposition leaders were perceived as threats to Opposition-ruled States.
• Opposition-ruled States have complained of step motherly treatment by the Centre, leading to protests in Delhi and State capitals.
• The Supreme Court noted a steady stream of States compelled to approach it against the Centre, indicating growing friction.

Specific Complaints from States:

• Kerala complained about inadequate transfer of resources.
• Karnataka highlighted issues with drought relief.
• West Bengal raised concerns about funding for the Mahatma Gandhi National Rural Employment Guarantee Scheme.
• These complaints suggest attempts to show Opposition-ruled States in a bad light.

Federalism and Cooperative Federalism:

• The Supreme Court emphasised the need for amicable resolution of Centre-State issues.
• Initially, the ruling party in 2014 talked about cooperative federalism.
• The introduction of the Goods and Services Tax in 2017 exemplified cooperative federalism, but since then, federalism has frayed, increasing discord between the Centre and Opposition-ruled States.

Diversity and Autonomy of States

Need for State Autonomy:

• India’s States are highly diverse, necessitating unique approaches to address their specific issues.
• Greater autonomy for States is essential for addressing local issues, which aligns with both democracy and federalism.
• A dominant Centre imposing its will on States does not bode well for India’s progress.

Resource Allocation and Conflicts:

• States handle education, health, and social services independently, but need inter-State agreements for infrastructure and water sharing.
• Currency and defence matters require a unified approach managed by the Centre.
• Financing expenditures through taxes, non-tax sources, and borrowings frequently causes conflict.

Role of the Centre in Resource Collection:

Finance Commission’s Role:

• The Finance Commission is appointed to decide on fund devolution from the Centre to States and the share each State receives.
• The Centre’s control over setting the Commission’s terms introduces bias favouring the Centre, creating conflict with States.
• Commissions often imply that States are fiscally irresponsible, reflecting the Centre’s bias.

Inter-State Tussles and Centre-State Relations

Divergent State Needs:

• States cannot have a common position due to their different stages of development and resource positions.
• Rich States contribute more but receive less, causing resentment despite poorer States providing them with markets and contributing to their growth.
• The Finance Commission tries to devolve more funds to poorer States to reduce inequality, but the gap remains wide.

Centre’s Allocation of Resources:

• The Centre allocates resources to States through the Finance Commission award and expenditures in States.
• Each State benefits from Centre’s expenditure within its territory, leading to job creation and prosperity.
• Accusations of the Centre favouring certain States, such as Gujarat and Uttar Pradesh, have been raised, causing friction.

Call for ‘Double Engine Sarkar’:

• The call for a ‘double engine ki sarkar’ implies that States with the same ruling party as the Centre will benefit more, undermining the autonomy of Opposition-ruled States.
• This approach weakens federalism and reduces State autonomy.

Issues in Federalism

Role of the Sixteenth Finance Commission:

• The Sixteenth Finance Commission is working to reverse fraying federalism and strengthen India as a ‘Union of States’.
• It could suggest even-handed treatment of States by the Centre and reduce friction by transferring more resources to poorer States.
• The Commission should also address governance issues at both Centre and State levels to improve investment productivity and development pace.

Devolution of Resources:

• Increasing the devolution of resources from the Centre to States beyond the current 41 percent level could reduce the Centre’s dominance.
• Joint schemes like the Public Distribution System or the Mahatma Gandhi National Rural Employment Guarantee Scheme often see the Centre taking credit and penalising non-compliant States.
• The Centre’s assertiveness with public funds, which are collected from and spent in States, undermines federalism.

Need for Joint Decision-Making:

• Utilisation of the country’s resources should be jointly decided by the Centre and States as equal partners.
• This has become more feasible with the changed political situation following the 2024 general election results, emphasising collaborative federalism for a diverse and democratic India.

PYQ: 

From the resolution of contentious issues regarding distribution of legislative powers by the courts, ‘Principle of Federal Supremacy’ and ‘Harmonious Construction’ have emerged. Explain. (150 words/10m) (UPSC CSE (M) GS-2 2019)