Challenges before Indian Federalism

Federal systems are a form of governance that distributes power and authority between a central government and subnational entities such as states, provinces, or regions. The distribution of powers in federal systems can vary significantly, leading to distinct models of governance. Two prominent models within federal systems are centralized and decentralized approaches. In a centralized federal system, power and authority are concentrated primarily in the central or federal government. The central government has a significant role in decision-making, policy formulation, and implementation across the entire country. Centralized federal systems often exhibit a stronger central authority, uniform policies, and limited autonomy for subnational entities. In contrast, a decentralized federal system grants significant power and authority to subnational entities, allowing them greater autonomy in decision-making and policy implementation. Subnational entities, such as states or provinces, have more independence in managing local affairs, including legislative powers and control over certain policy areas. Decentralized federal systems tend to exhibit more diversity in policies and practices across different regions. States have considerable autonomy in areas such as education, health, and transportation. The choice between centralized and decentralized approaches in federal systems has significant implications for governance structures, decision-making processes, fiscal arrangements, and policy
The Indian Constitution establishes a federal system with some unitary features. It is sometimes called a quasi-federal system, as it contains elements of both federation and union. The Constitution specifies the distribution of legislative, administrative and executive powers between the union government and the state governments. The legislative powers are categorized under a Union List, a State List and a Concurrent List, representing the powers conferred upon the union government, the state governments and the powers shared among them. The Constitution also provides for the establishment of a multilevel or multi-layered federation with multiple modes of political power distribution. The Indian federalism is unique in its context, as it has evolved from a unitary system under British rule to a federal system after independence. Indian federalism has faced several challenges and issues over time, such as the integration of princely states, linguistic reorganization of states, regional movements and demands for autonomy, centre-state relations and conflicts, fiscal federalism and resource sharing, cooperative federalism and inter-state coordination, etc.
Challenges Before Indian Federalism are: Regionalism; Division of Powers; Absence of Fiscal Federalism; Unequal Representation of Units; Centralized Amendment Power. The rise of regional parties and movements based on linguistic, ethnic, religious or cultural identities has posed a challenge to the national integration and unity of India. Some regions or groups have demanded more autonomy, special status or even secession from the Indian union. For example, the demand for Gorkhaland in West Bengal, Bodoland in Assam, etc. The division of powers between the Centre and the states is not clear and balanced. The Centre has more powers and resources than the states and can interfere in their affairs through various means such as President’s rule, Governor’s role, central laws, etc. The states have limited autonomy and fiscal space to pursue their own development and welfare policies. For example, President’s rule was imposed in Arunachal Pradesh and Uttarakhand in 2016 on grounds of constitutional breakdown, but was later revoked by the Supreme Court. The fiscal relations between the Centre and the states are not equitable and transparent. The Centre collects most of the taxes and distributes them to the states according to its discretion or criteria. The states depend on the Centre for grants-in-aid, loans and other transfers. The states have limited taxation powers and borrowing capacities. For example, many states have complained about the inadequate compensation for revenue losses due to GST implementation. The representation of states in the Parliament  and other federal institutions is not proportional to their population, area or contribution. Some states are over-represented while others are under-represented. For example, Uttar Pradesh has 80 Lok Sabha seats while Sikkim has only one. This affects the voice and influence of different states in national decision-making and resource allocation. The power to amend the Constitution is vested in the Parliament with a special majority. The states have no role or say in the amendment process except in some matters affecting them. For example, the Centre’s decision to abrogate Article 370 and bifurcate Jammu and Kashmir into two union territories in 2019 was done without consulting the state government or other stakeholders and the creation of Telangana from Andhra Pradesh in 2014 was opposed by the latter state and led to protests and violence.
There is a Need to Strengthen Federalism by Preserving Diversity and Pluralism to protect and preserve the diversity and pluralism of India’s society, culture, language, religion, etc. in the face of increasing homogenization and assimilation pressures from the Centre or dominant groups. Safeguarding Autonomy and Rights to safeguard and enhance the autonomy and rights of the states and other sub-national units in the face of increasing centralization and interference from the Centre or other external forces Improving Quality and Efficiency of Governance to improve and ensure the quality and efficiency of governance and service delivery at various levels by empowering and enabling the states and other sub-national units to formulate and implement their own policies and programmes according to their needs and capacities. Promoting Balanced and Inclusive Development to promote and achieve the balanced and inclusive development and welfare of all regions and sections of India by ensuring equitable and transparent distribution of resources and opportunities among different levels or units of government. Fostering Harmony and Cooperation to foster and sustain the harmony and cooperation among different levels or units of government by resolving disputes and conflicts through dialogue and consultation rather than confrontation and coercion.
Institutions Promoting Federalism are: The Supreme Court which is the apex judicial body of the country and acts as the guardian and interpreter of the Constitution. It has the power to adjudicate disputes between the Centre and the states or among the states. The Inter-State Council which is a constitutional body established under Article 263 of the Constitution to promote coordination and cooperation among the Centre and the states on matters of common interest and concern. It consists of the Prime Minister, Chief Ministers of all states, Chief Ministers of union territories with legislatures and six central ministers nominated by the Prime Minister. The Finance Commission which is a constitutional body established under Article 280 of the Constitution to recommend the distribution of revenues between the Centre and the states. It also suggests measures to augment the resources of states and grants-in-aid to states in need. The NITI Aayog which was established in 2015 to replace the Planning Commission. It acts as a think tank and advisory body for the Centre and the states on matters of economic and social development. It also fosters cooperative federalism by involving states in policy formulation and implementation. It consists of a chairperson (the Prime Minister), a vice-chairperson, a CEO, full-time members, part-time members, ex-officio members (chief ministers of all states and lieutenant governors of union territories) and special invitees.
Ways to Strengthen Federalism in India include: Enhancing Devolution of Powers and Resources; Ensuring Greater Representation and Participation; Fostering Cooperative and Competitive Federalism; Addressing Regional Imbalances and Inequalities; Respecting Federal Principles and Spirit.
(Writer can be reached at: sjugeshwor7@gmail.)