Sambhav-2024

• Briefly introduce the concept of Centre-State relations in India.
  Discuss the evolution of Centre–State Relations and the Challenges of Centre–State Relations.
• Conclude with a solution-based approach.

Introduction

Centre–State Relations in India is a complex interplay of power and authority between the central government and the state governments. The Indian Constitution, which is based on the principles of federalism, divides the legislative, executive and financial powers between the centre and the states. However, the Constitution also provides for a strong centre that can intervene in the affairs of the states in certain situations.

Body

Evolution of Centre–State Relations:

• Post-Independence Period (1950s-1960s):
  • The initial years witnessed a strong Centre with a focus on consolidating the nation.
  • The Seventh Amendment (1956) reorganized the states on linguistic basis and introduced the concept of Union Territories.
  • The Planning Commission played a crucial role in shaping development policies, fostering a centralizing tendency.
• Era of Various Amendments (1970s-1980s):
  • The Forty-second Amendment (1976) transferred five subjects from the state list to the concurrent list, and gave more powers to the centre to deal with national emergencies and internal disturbances.
  • The Forty-fourth Amendment (1978) reversed some of the changes made by the Forty-second Amendment and restored the balance of power between the centre and the states.
  • The emphasis shifted towards cooperative federalism, marked by the recommendations of the Sarkaria Commission and the establishment of the Inter-State Council.
• Decentralization and Empowerment (1990s-2000s):
  • Economic reforms in the 1990s furthered the process by encouraging states to take an active role in economic development.
  • The 73^rd and 74^th Amendments (1992) to the Constitution marked a significant step towards decentralization, empowering local bodies and enhancing state autonomy.
  • The Finance Commission became a critical tool for fiscal federalism.
• Goods and Services Tax (GST) Era (2017 Onwards):
  • The One Hundred and First Amendment (2016) introduced the Goods and Services Tax (GST), which replaced the multiple indirect taxes levied by the centre and the states and created a uniform tax system.
  • The GST Council exemplifies cooperative federalism in addressing issues related to indirect taxation.

Challenges of Centre–State Relations:

• Ineffective Functioning of Several Bodies: The Planning Commission has been scrapped, the Inter-State Council has met only once in the last seven years while the National Development Council has not met at all.
  • These events have led to obstructions in upholding the cooperative spirit between the Union and states.
• Issues in Tax Regime:The misconceived Goods & Services Tax (GST) has already taken away much of the autonomy available to states and has made the country’s indirect tax regime unitary in nature.
  • During the pandemic, the Union government repeatedly violated the compensation guarantees to the States under the GST regime. Delay in paying the States their due worsened the impact of the economic slowdown.
• Encroachments Upon States’ Autonomy in State Subjects: Many important and politically sensitive decisions have been taken in the past few years, without reference to, and consultation with, the concerned states such as:
  • The three farm laws which were introduced in 2020 were criticised of being violative of Stated’ power as agriculture is a subject under State list.
  • The New Education Policy 2020 has also been flagged as encroaching on the federal nature of the polity.

Conclusion

India's Center-State Relations are adaptable and dynamic, responding to changes in politics, society, and the economy. Continuous dialogue, trust-building, and innovation are key to navigating challenges and seizing opportunities in the federal system.