[Answered]“Pushing for greater autonomy for States and protecting federalism is need of the hour, if India has to emerge as a major economic super-power.” Comment.

Demand of the question

Introduction. Contextual Introduction.

Body. Discuss the need of more autonomy and protecting federalism.

Conclusion. Way forward.

Indian economy is slowing down and is being pushed into state of recession due to various reasons. The government is being criticised for being over-centralised and thereby impacting working and smooth running of the economy. More autonomy and preservation of federalism is important in order to ensure effective running of the economy and inclusive growth.

Need of more autonomy and protecting federalism:

  1. The Central government makes laws for the entire country but the diversity of the culture, the people and the states is overlooked. States then have to apply the law in the same form whether the state is Nagaland or Jammu and Kashmir. Sometimes it is very difficult to implement such laws. This hampers the progress.
  2. To deliver change on the ground but also to prevent the national political system from imploding, there are compelling systemic reasons to revisit the issue of autonomy of the state to seemingly unrelated changes.
  3. Regularisation and decentralisation have over the years disempowered the state governments by eroding their policy making space. A better policy can be formulated only when states are involved and policies are tuned to local needs.
  4. Cooperative federalism promoted by the GST council is must be accompanied by autonomy to states to take more independent decisions. The cooperative federal system that has been envisaged by the founding fathers of the Constitutionneed to be encouraged.
  5. If the nation has to grow stable and strong, the structural imbalance has to be addressed. The only way to do it is to give more autonomy to the states which is in line with the democratic trends reflected in the growth of regional economies.
  6. Economic liberalisation has cause huge regional imbalances between states. Agenuine economic decentralisation is thus needed to ensure equality and inclusive growth.Devolution under the Finance Commission also misses the need and opportunities of states, that could be better incorporated if given more autonomy.
  7. The legislative powers under the concurrent list provide for both the state and union laws. But in situation of conflict union law prevails. It is better to follow, the NCRWC recommendations that the states must be consulted before any legislation under the concurrent list in order to avoid conflicts.
  8. Geographically challenged states can’t deliver theeconomic progress without a healthy dose of autonomy—fiscal as well as political economy, as their local and economic needs are different. E.g. Hill statesneed autonomy to develop in a sustainable way incorporating the local needs.
  9. More autonomy should be given to the states to develop badly neglected infrastructure by taking decisions on their own.

What should be done?

  1. First, the new framework of the Centre-state relations must be designed for an open economy that is driven by the private sector rather than the public sector.
  2. The Centre should introduce rewards linked to performance against specific parameters.
  3. A large number of central sponsored schemes have been introduced by the Government such as the SarvaShiksha Abhiyan, National Rural Health Mission etc. So while such schemes are welcome and have benefited the states immensely, there is a need to make these schemes flexible so that states can tailor them to suit their own conditions.
  4. The difficulties experienced by the states in implementation of developmental activity must be resolved through delegation of powers.
  5. The centre needs to set better standards for the states to follow in their approach towards revenue generation and their utilisation.

Although Various indices to rank states based on their performance by the NITI aayog promote a sense of competitive federalism, more autonomy is needed. The states need to develop their own tax collection and utilisation mechanisms, while the centre needs to keep a stern eye on their resource application.The central government should encourage states to utilise their own resources. The political class is ought to provide better services to the taxpayers and increase the actual level of decentralisation, rather than only dealing with it on paper.