AT the risk of repeating cliches, any discussion on an institutional structure for mediating centre-state relations, must begin with a reaffirmation of why federalism is so critical to the survival of our democracy.
Conventionally, federalism is treated merely as a power sharing arrangement between two or more levels of government, at most as a dual polity. It is, in fact, much more. It is first a means of celebrating our plurality as a rare civilizational asset. The shared celebration of our diversity is what unites us and should offer an organizing principle for the architecture of political power and governance and not just a means of mediating inter-governmental relationships. Second, it is a means of democratic devolution and decentralization to the farthest extent thereby making government as participatory as possible. Above all, it is a means to protect individual liberty against the might of a centralized, homogenized, monolithic state – our biggest bulwark against the hegemonic and autocratic tendencies presently in evidence.
For a society as plural and diverse as ours, federalism of the most devolved and decentralized variety should have been the most natural constitutional choice. Indeed, such an architecture was central to Mahatma Gandhi’s vision of independent India – a confederation of thousands of autonomous, self-ruled village republics with a shared commitment to truth and nonviolence. Unfortunately, then as now, this was dismissed as an utopian fantasy.
Our constitution makers, on the other hand, were fearful of our diversity, seeing it as a centrifugal force which could break a fragile union. While recognizing that we could not be a unitary state given our bewilderingly complex plurality, classical federalism in the manner of the US or Switzerland or Canada was also ruled out. We opted instead for a hybrid system in which the power sharing arrangement between the Union and the states was heavily weighted in favour of the Union.
Despite this inherent bias and despite the dominance of the Congress party across India, federalism in practice was much healthier in the first decade and a half of the Constitution coming into force. There are several reasons for this. First was the experience gained after the Government of India Act of 1935, which had several provinces with elected premiers and legislative assemblies functioning with a considerable degree of autonomy. These were formidable political leaders with a strong political base of their own. They did not derive their power from the central leadership nor were they beholden to them for their position. Second was a strong commitment to democracy on the part of the prime minister and his cabinet which treated chief ministers with respect and the states as important partners in a common endeavour rather than as subordinates.
Third, the Planning Commission was not then an instrument of economic control over the states that it became in its later years. Fourth, the bogey of ‘national security’, particularly ‘internal security’, had not come to dominate the political power discourse and the role of the central paramilitary forces in the maintenance of law and order, even in politically troublesome states, was peripheral. In many ways these were the heydays of cooperative federalism in practice. The elbow room that the states had for taking their own initiatives independent of central control was considerably larger than it has ever been thereafter. In several states (Maharashtra, Karnataka, Kerala, Tamil Nadu, for example) the panchayati raj institutions were very strong especially at the district levels with the elected chairperson and the appointed CEO often treated as hierarchically superior to the district officer.
Ironically, it is when the polity turned more federal with Congress losing its hegemony in the landmark election of 1967 that centralizing trends became even more pronounced. The constitutional provision which allowed the Centre to impose President’s Rule was repeatedly misused for partisan ends, chief ministers of the Congress ruled states were reduced to being chattels and the institutions of democracy were subordinated to instruments of arbitrary executive power. The centralization trend continued unabated till the imposition of the Emergency and even though the Emergency was lifted two years later, the damage that those years did to democratic and federal traditions and institutions was incalculable.
The post-Emergency years have been marked with three dominant trends which pose an extraordinary threat to federalism, irrespective of which party has been or is in power. The bogey of ‘national security’ – both internal and external – which has been used to justify a proliferation of both military and paramilitary forces to unprecedented levels; the determination of economic welfare priorities by the Centre and the corresponding pre-emption of financial resources for mega central flagship schemes in which states and Panchayati Raj Institutions play a role as mere ‘implementers’ of someone else’s priorities; and relatedly, the emasculation of the capacity of the states to raise their own resources for their own priorities. Each successive regime has only accentuated these trends rather than contain them.
Much was expected from Prime Minister Modi by way of making the states more powerful, especially as the BJP owed its electoral success in 2014 substantially to strong chief ministers in several states and because Modi had transited directly from the state to the Centre, making him more alive to the fears of debilitating central control and the rule of the Delhi Sultanate. But all the initial talk of cooperative federalism and the importance of carrying the states along as equal partners vanished quickly. More mega central schemes have been initiated in the last five years than ever before in areas which clearly belong to the states, with the states expected to simply implement them or risk losing substantial central assistance if they show any reluctance. States which show any signs of independence or protest against central high-handed-ness, are either ignored or deliberately harassed.
These are very troubling times for federalism in practice, because it is not just that the Union has encroached into the sphere of the states, but that executive power has been concentrated in the hands of a single authoritarian leader who believes he has the people’s mandate to impose his will everywhere across the land and it is incumbent on all states to follow that without asking questions. Given its brute majority, the party in power at the Centre has no political motivation to make its decision making processes more federal and restore and strengthen institutional mechanisms that can mediate intergovernmental relations and make governance a more federal exercise.
For federalism to spread, therefore, needs someone to champion it politically – carry out an evangelical campaign for devolution and decentralization. While some chief ministers and state governments have articulated their resentment about the way the states are treated, and some have argued for decision making to be made more devolved and participatory, federalism is not yet a burning political issue. For most states the focus is on seeking a larger share of resources through the Finance Commission and on seeking special status and other state specific concessions rather than demanding fundamental changes in the way the Union takes policy decisions or formulates its flagship programmes and schemes.
The fact that even the Finance Commission recommendations beyond the devolution of funds, remain on paper with no institution pursuing their implementation or overseeing and monitoring the action taken, shows that weak federal systems, institutions and processes do not seem to cause sufficient concern at the political level. It is not seen as an issue having an electoral significance.
A glaring example of the weakness of the federalist cause is the complete neglect both by the Centre as well as the states of the one institution which could and should have been central to the mediation of intergovernmental relations, to providing a strong federal dimension to policy making, programme formulation and policy coordination, and serving as a forum for sharing good federalist practices. That institution is the Inter-State Council established by Presidential Order in 1990 under Article 263 of the Constitution. Despite its obvious potential utility, no government – Union or state – has ever agitated forcefully enough for its revitalization. In 29 years of its existence it has had just 11 meetings, seven of which were between 1996 and 2003, two between 2005 and 2006 and one after 10 years in 2016.
The relatively more active period between 1996 and 2003 was when the council was processing the Sarkaria Commission recommendations and had a substantive agenda given to it. Once that task was over the council was relegated to the backwaters of the Vigyan Bhawan Annexe and its meetings became increasingly infrequent with a gap between meetings stretching to 11 years in the case of the last two. Several opportunities that arose using the ISC as the most appropriate forum for resolving differences and building consensus were muffed. The Centre would go into a sulk each time its recommendation was rejected by the states. The states in turn found it inappropriate for the Centre to change land acquisition laws, the Lokpal Act, as well as enforcing a decision by using its brute majority in the Lok Sabha or the authoritarian ways of the PMO.
The biggest opportunity that arose for reinventing and repositioning the ISC was when it was decided to fold up the Planning Commission. As long as the Planning Commission controlled the business of allocation of ‘plan’ funds and approval of state plans along with its role as a policy planner, there was not enough room for any other agency or forum to step into the policy arena even as just a policy coordinator or a consensus builder or a mediator, at least in the realm of economic policy. Centralized planning is completely antithetical to a federal approach to policy making and therefore as long as the Planning Commission held sway, the role of the Inter-State Council was considerably limited.
Its demise, therefore, created an extraordinary opportunity to make the states (and even local governments) vital stakeholders in policy and strategy planning, partners in programme formulation and in designing common standards and measures for evaluating performance and outcomes. With the creation of one of the most awkwardly designed in house agencies for doing God knows what – the Niti Aayog – that opportunity too was frittered away.
Before we try to understand why, despite its obvious usefulness, the Inter-State Council has languished, and consider what can possibly be done to reinvent the Inter State Council, it is necessary, at the risk of repetition, to restate some generalizations about what is wrong with the existing ways of doing things.
The federal dimension is sorely missing from policy or programme or plan or scheme or project or mission. In the centralized thinking mindset that prevails, states, local governments and grassroots organizations are treated as recipient beneficiaries of central dispensation rather than as partners in a collective, cooperative endeavour. Stakeholder consultation happens after policies, strategies and programmes have been framed, not before. Lack of capacity is often used as an argument to deny their participation. Even the tradition that Nehru and many in his cabinet followed at a personal level, formal and informal, today consultations with chief ministers have been completely forgotten.
* Central Financial assistance through central schemes is structured in a manner as to make the states subordinate and dependent. They are not seen as participants in policy and plan formulation as equals.
* Policies are made with a narrow sector focus and cross sectoral linkages are ignored. Protecting Departmental turfs is more important than addressing the multidimensionality of the problem.
* Stakeholder consultation is half hearted, and the consultation processes archaic, poorly and haphazardly structured, bureaucratic and done more for the sake of form than for a genuine exchange of thoughts and views.
* Parliamentary consultation and consultation with political parties is generally avoided until after policies have been formulated and is done at a stage when major changes as a result of interaction cannot be made without derailing the whole exercise.
* There is a huge divide between research and policy and there are no institutional bridging mechanisms. Little emphasis is placed on specially commissioned, interdisciplinary research which can feed into policy. In the absence of proper bridging mechanisms, the policy relevance of much research output is inadequate, the anchorage role which needs to be provided for research processes to be really useful, is missing, there is little to no capacity for synthesizing research inputs and integration skills are weak.
* The ‘urgent’ invariably takes precedence over the ‘important’ as there is no institution which can devote its full attention to long-term thinking unperturbed by current crises.
It is these gaps in the decision making process which the Inter-State Council is ideally positioned to fill. The ISC has some unique features which make it different from other institutions.
* It is the only intergovernmental platform specifically dedicated to policy coordination which derives its authority from the Constitution.
* Its architecture is built on an equality of relationship between the PM and the chief ministers.
* It has a flexible, open ended remit which does not restrict its sphere of activity.
* It is required to ‘investigate’ and research into issues before taking them up for deliberation.
* Stakeholder consultation is inbuilt into its procedures.
By virtue of its Constitutional position it is equidistant from the Centre as well as the states.
* The prescribed procedure for the council functioning require the discussions/deliberations to be ‘in camera’ so that the tendency to strike postures for public consumption or to seek popularity are curbed and the discussions can be candid, held in a collegial environment and be free of rancour.
* It has a permanent secretariat, headed by an officer who in terms of the original scheme was meant to be of the same rank and seniority as the cabinet secretary reporting directly to the prime minister (as the chairperson of the council) and have the powers to call for papers from any Department of the Union government or the state governments. This is not a power available to any other officer of the government.
* It can devote unstinted attention to long-term policy issues unencumbered as it is from having to deliver short-term outcomes or deal with crisis management.
Yet, the fact that the ISC has never been activated as a forum indicates that there are some major flaws in its architecture which make governments – Union as well as the states – reluctant to use it. There are three possible reasons.
1. Lack of clarity about its legal status because it is neither a department of the Union government under the Allocation of Business Rules nor an independent statutory authority like the Election Commission. Its parking slot in the Ministry of Home Affairs (MHA) makes many suspicious of its neutrality and independence. Though it has been set up through a Presidential Order under Article 263 of the Constitution and has no direct formal relationship with any Union ministry, it is unclear whether its secretariat is to be treated as an appendage of the MHA or as an autonomous organization with its own administrative rules and practices. Though it began differently with the secretary of the ISC reporting directly to the prime minister, over the years it gradually came to be treated as a part of MHA and that has considerably eroded its credibility.
2. The states have no sense of ownership of the council as they are at a considerable distance from its day to day working and have to raise issues, if they ever think of doing so, through the prime minister/home minister. They also lack the confidence that given the council’s proximity to the Centre it will be able to represent the interests of the states impartially
* Unlike the National Development Council (or now Niti Aayog) which was serviced by the Planning Commission, the Inter-State Council does not have a similar agency of top level professionals who can serve as a think tank or prepare policy documents or perspective plans nor is the council’s secretariat adequately manned to carry out ‘investigation’ of/conduct policy relevant research into complex inter-sectoral issues. Its meagre budgetary sources limit its ability to contract out research, nor is it adequately equipped to provide anchorage to outsourced research.
While these structural flaws are easily remedied, what is more challenging is enhancing its political value. No central government would readily yield its decision making space to an independent agency which is not fully controlled by it and therefore has little political interest in revitalizing it. The initiative for that has to come from the states.
In the current political context federalism has the potential to become an oppositional force against those of a homogenized, unitary cultural nationalism. Most regional parties, e.g. the Trinamul Congress, the Telugu Desam Party, the Janata Dal United, the Biju Janata Dal, the Samajwadi Party, the Bahujan Samaj Party and the DMK have been vocal in their opposition to BJP’s unitarism and have been wanting to form a federalist alliance. Trends show that the regional parties will most likely grow in strength and even if they do not come together in a formal alliance and win a majority sufficient to form a government at the national level, they will remain a formidable force to reckon with. What is needed is to try and situate the demand for a reinvented Inter-State Council in the agenda of the regional parties. As such a demand is squarely within the bounds of the Constitution and as the Inter-State Council, however dormant, exists, it will be difficult for any central government to resist it.
It should be possible to have the states where the regional parties are in power, insist that all central flagship schemes relating to subjects in the State List or Concurrent List are filtered through the Inter-State Council, whether these are new schemes or schemes already operational. It should also be possible for the states to proactively suggest an agenda for the deliberations of the council, including a concrete action plan for its revival and its strengthening.
In the short-term, it should be possible to:
* Take the ISC Secretariat out of its parking slot in MHA and treat it as an independent department under the Allocation of Business Rules same as the Prime Minister’s Office. This requires a simple executive order with the approval of the cabinet. It requires no changes in the rules/council procedure as the PM is the chairman of the council. The secretary was always expected to be of the same level as the cabinet secretary with the same authority and was to report directly to the chairman and such an executive order will help clarify that.
* Amend the Presidential Order through a simple cabinet decision to merge the NITI Aayog, mutatis mutandis, with the Inter-State Council.
* Task the revamped council to work on a medium-term strategy for making the council into a statutory body like the Election Commission.
The reason why it is essential to revive the ISC rather than depend on the Niti Aayog as a platform for cooperative federalism is that the ISC has a constitutional mandate which makes it independent of the Union executive and thereby be in a position to play a mediating role more effectively. As practices evolve and conventions grow the ISC is capable of being an extremely powerful force not merely to harmonize and better coordinate central interventions, but if necessary, become a fierce guardian of federalist practice and prevent the growth of an overweening, hormonally imbalanced central leviathan.
Anyone, willing to bell the cat?
