May 2019

FEDERALISM in India is at an important juncture. In the last five years, India has witnessed significant changes in its political, fiscal and institutional landscape that have substantially influenced the dynamic of centre-state relations. These include the formation of a single-party majority government at the Centre, greater congruence between the Centre and state governments and the emergence...

AS the election season kicks into high gear, a ragtag collection of regional parties1 have a chance to play spoiler for the two big national parties, Bharatiya Janata Party (BJP) and Congress. These parties have won enough vote share to be pivotal in forming almost every government since the 1990s onwards. But since its sweeping victory in the 2014 national election, a reinvigorated BJP has begun...

ARTICLE 1 of the Constitution stipulates that ‘India, i.e. Bharat, shall be a union of states.’1 Hence, fiscal powers – to tax, charge for services, acquiring of assets, spending resources, acquiring and repayment of debt – have to be exercised at two levels of government. How these powers are exercised depends on the distribution of revenue assignments and expenditure responsibilities; the...

THE last five years have heralded a new phase in India’s fiscal federalism reflected in several changes in the planning and design of Inter-Governmental Fiscal Transfers (IGFTs). In August 2014, the Planning Commission – an apex body responsible for formulating central plans for national development – was disbanded. It was replaced by the NITI Aayog, which unlike its predecessor moved away from a...

IN its 2014 election manifesto, the BJP announced the abolition of the Planning Commission, a non-statutory body that had a significant influence on the strategic deployment of public resources across India since its inception in March 1950.1 Shortly after it took power as a majority government, the BJP followed through on its election promise and replaced the Planning Commission with the NITI...

THE Indian economy today is on a growth turnpike. The deep determinants of India’s remarkable growth have been institutions, demographic transition, modern technology and accumulation of both human and physical capital. In my view, the most important of these factors has been our democratic framework, a key foundational institution. In a country as beautifully diverse as ours, federalism as an...

THIS article argues the case for a radical transformation of the architecture of fiscal federalism in India. The debate on reform of fiscal federalism has gained considerable traction in recent months, particularly following publication of the book Indian Fiscal Federalism by Y.V. Reddy, Chairman of the 14th Finance Commission, and his co-author G.R. Reddy (henceforth the Reddy volume).1 As the...

The World Bank provides the most commonly available definition of administrative decentralization on the web: ‘Administrative decentralization seeks to redistribute authority, responsibility and financial resources for providing public services among different levels of government. It is the transfer of responsibility for the planning, financing and management of certain public functions from the...

IN its election manifesto in 2014, the Bharatiya Janata Party (BJP) dismissed the tenure of the United Progressive Alliance (2004-14) as the ‘decade of decay’ and promised among other things to ‘place centre-state relations on an even keel’, ‘strive for harmonious centre-state relations’ and ‘revive and make more active moribund forums like the National Development Council and Inter-State Council...

IN our current phase of being a federalized polity and globalized economy, an offbeat attempt to look at the Rajya Sabha as the federal second chamber is long overdue. How globalization and federalization have impacted the Rajya Sabha, which has been designed to represent the states comprising our Union, is a dimension worth exploring. Erstwhile studies on the Rajya Sabha have reflected upon its...