Shaping the Future of Federalism in India

Context 

The return of coalition politics at the national level has raised regional parties to significant power brokers, bucking the tendency of centralized policy decision-making.

In recent years, the government has placed a greater focus on cooperative and competitive federalism through institutions such as the National Institution for Transforming India (NITI Aayog). However, numerous state governments have expressed concerns over the Union government’s alleged withholding of GST compensation monies, resulting in cases of confrontational federalism.

Concept of Federalism in India

• Inner-Party Federalism (1950-67) – During the first phase of federalism (1950-67), disagreements between the federal government and states were addressed through Congress party forums, referred to as the “Congress System” by political scientist Rajni Kothari. This contributed to the containment or prevention of significant federal conflicts, as well as the development of a consensus-based kind of “inner-party federalism”. 
• Expressive Federalism – In the second phase, beginning in 1967, the Congress party remained in power at the Centre but lost power in numerous states, where many regional party-led and anti-Congress coalition administrations were created. 
• Multi-Party Federalism (1990-2014) – The 1990s saw the coalition period, sometimes known as multi-party federalism, in which national parties were unable to secure a majority in parliament. National coalitions retained dominance in the union with the assistance of regional forces. This time saw a decrease in the intensity of Center-state disputes, as well as the Center’s arbitrary use of Article 356 to destabilize state governments. 
• Confrontational Federalism – Federalism under the “dominant party” reemerged with the single-party majority in the 2014 Lok Sabha elections. Concurrently, the ruling party strengthened its hold on power by gaining control of numerous states.

Challenges to Federalism in India

• Balancing Centralization and Regionalism – India walks a fine line between central authority for national unity and state autonomy for regional needs. powerful central governments can be viewed as overstepping, whilst powerful regional movements can jeopardize national unity. 
• Regional Discontent – Regionalism emerges from calls for autonomy on the basis of language and culture. The nation thus faces the difficulty of internal security in the form of insurgency, which generates upheavals in the fundamental concept of Indian federation. 
• Dispute in Power Division – The Constitution divides powers between the Centre and the States (Union List, State List, and Concurrent List). However, this split can be ambiguous, resulting in jurisdictional disputes, particularly on Concurrent List matters such as agriculture or education. The three farm laws passed by the central government in 2020 were contested by states such as Punjab, citing the fact that agriculture is a State List subject.  
• Misuse of Governor’s Powers – Misuse of the Governor’s office has become a source of concern, particularly in cases of arbitrary dismissal of state governments, manipulation in government formation, withholding assent to bills, and frequent transfers and appointments, often directed by the central ruling party.  
• Misuse of Article 356 – Article 356, often known as the President’s Rule, is intended to be used when a state cannot function constitutionally. It empowers the Union Cabinet to dismiss democratically elected state administrations and dissolve legislative assemblies. Until 2000, Article 356 has been utilized more than 100 times to impose President’s Rule, undermining state autonomy. Although its use has declined, its potential for abuse remains a worry. 
• Fiscal Imbalances – The 15th Finance Commission recommended that states receive a greater share of central taxes, up from 32% to 41%. However, states frequently complain that monies are insufficient and not disbursed on time, resulting in fiscal stress. Furthermore, the southern states regularly complain about receiving less cash despite paying more in taxes than the northern states, attributing the difference to their smaller population. 
• Asymmetric Representation in Parliament – In Lok Sabha, representation is based on population, with larger states having more seats. However, smaller states argue this dilutes their voice in national politics. 
• Inter-State Disputes – Inter-state disputes in India cover a wide range of concerns, including water sharing, boundary disagreements, and resource allocation. These issues, if left unsolved, can strain the federal structure by instilling distrust and impeding cooperative government.

Necessary Measures to strengthen India’s Federalism

• Enhancing Devolution of Power – Federalism can be improved by expanding the devolution of functions and resources to states and local entities through constitutional revisions, raising states’ share of national taxes, providing states with more fiscal autonomy and flexibility, and so on. 
• Ensuring Equitable Distribution – Develop a transparent and objective formula for allocating central money to states, taking into account criteria such as population, poverty levels, and infrastructure needs. The Raghuram Rajan Committee (2017) proposed formula-based devolution of central money to states based on objective criteria.  
• Strengthening Inter-Governmental Institutions – Make the ISC a more effective venue for resolving interstate conflicts and fostering collaboration on national problems. This might include giving it more authority to develop common policy. The government established a permanent inter-state council in response to the Sarkaria Commission’s recommendation, although it has yet to completely realize the Commission’s goal. 
• Fostering Cooperative and Competitive Federalism – In cooperative federalism, the centre and states work together on issues of national importance like national security, disaster management, and economic development. This ensures a unified approach to achieving common goals. For instance, establishing the GST Council and approving the Finance Commission’s suggestion to raise the states’ funding share. 
• Respecting Federal Principles – The Centre should avoid overusing its powers under Articles 355 and 356 of the Constitution, which allow for the installation of President’s rule in states. This ensures greater state autonomy. Increased participation by state officials ensures that their issues and goals are heard on a national level.

Way Forward

The changing political landscape, characterized by the resurgence of coalition politics and the growing influence of regional parties, presents an unprecedented chance to rethink and reinforce the federal structure. A forward-thinking approach to federalism in India will celebrate its variety, develop cooperation, and create a peaceful and prosperous future for all of its residents. This is more than simply a political need; it demonstrates the resilience and togetherness that define the Indian Republic.

SOURCE: The Indian Express

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