The delicate balance of power in a federal system requires maturity from all participants.
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Cooperative Federalism in India - Political, Fiscal and Operational
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- India, a union of states: Since 1950, the constitutional structure of India has ensured that enough decentralised powers were given to states to manage their own affairs, while Delhi (union government) retained a certain primacy, and a unitary structure. A delicate balance existed.
- Over the decades: In the decades of 60s, 70s, and 80s, states saw a lot of friction with the union government when contentious election results would come up, and governments would be dissolved (President's Rule imposed). That unsavoury experience was curtailed over time, with decisive intervention from the Supreme Court.
- In recent years, various State governments raised concerns about "Central unilateralism" in the enactment of laws on subjects in the Concurrent List.
- "Central unilateralism" refers to a one-sided decision making process by union government
- Controversies: In September 2020, when the Parliament passed the contentious farm laws, many states objected that it was done without consulting them. They were passed by Parliament even as the Centre did not have enough legislative competence to deal with agriculture. Why not? The laws are related to Entry 14 (agriculture clause) belonging to the State List, but were passed by Parliament citing Entry 33 (trade and commerce clause) in the Concurrent List.
- Some examples:
- State of Bombay vs F.N. Balsara case - If an enactment falls within one of the matters assigned to the State List and reconciliation is not possible with any entry in the Concurrent or Union List after employing the doctrine of “pith and substance”, the legislative domain of the State Legislature must prevail.
- Field for legislation of non-major ports is in Entry 31 of the Concurrent List.
- According to the Indian Ports Act, 1908, which presently governs the non-major ports, the power to regulate and control the minor ports remained with the State governments. But the new draft Indian Ports Bill, 2021 proposes to transfer the powers to the Maritime State Development Council, which is controlled by the Union.
- Electricity is traceable to Entry 38 of the Concurrent List. The power to regulate the sector was vested with the State Electricity Regulatory Commissions. But the proposed amendment seeks to establish a National Selection Committee, taking away the states’ power to regulate the electricity sector.
- What states say: The lack of enough consultation in a matter that deals with millions of farmers also led to massive protests. The Kerala Assembly unanimously passed a resolution against the Electricity (Amendment) Bill, 2020. The Tamil Nadu Assembly passed a resolution against the farm laws.
- Major Ports Authorities Act, 2021 passed by Parliament was opposed by Goa (ruled by the same party), stating that it would lead to the redundancy of the local laws.
- The Union government’s increasing take-over of the Concurrent affects the balance of the Constitution.
- Sarkaria Commission: The landmark report of the Sarkaria Commission had said that there should be a “coordination of policy and action in all areas of concurrent or overlapping jurisdiction through a process of mutual consultation and cooperation is, therefore, a prerequisite of smooth and harmonious working of the dual system”. The Union government, while exercising powers under the Concurrent List, must limit itself to the purpose of ensuring uniformity in basic issues of national policy and not more.
- Venkatachaliah Commission: Individual and collective consultation with the States should be undertaken through the Inter-State Council established under Article 263 of the Constitution.
- Supreme Court: In the landmark case "S.R. Bommai vs Union of India", it was said that States are not mere appendages of the Union. The essence of cooperative federalism lies in consultation and dialogue.
- Finance Commission (FC): This seems to be one of the few fully functional federal mechanisms, where largely there is little friction between the Union and states, though the terms of reference (TOR) for the 15th FC did cause some heartburn. The FC ensures fiscal federalism in India.
- EXAM QUESTIONS: (1) Explain the idea of federalism as applied to the Indian constitutional system. (2) What are the precautions to be exercised by both Union and States, when it comes to maintaining the Indian political system's framework. (3) Who is more important in India - the Centre or the States? Explain analytically.
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