NEW FEDERAL COMPACT FROM SOUTH INDIA

The peninsular states must begin fostering cooperation among themselves. This is feasible and desirable as the South is relatively economically and socially advanced

- RATHIN ROY

IN 2014, the term ‘cooperative federalism’ was in vogue. Twelve years on, it rings hollow. A fiscally weak central government has steadily increased cesses, not taxes; because cesses, unlike taxes, are not shareable with the states.

The Niti Aayog, which replaced the Planning Commission, is both ineffective and a mouthpiece of the Centre. When it refers to the states at all, it does so like a classroom monitor, obsessed with regulation and comparative evaluation. It’s ludicrous ‘aspirational districts’ programme, the Prime Minister’s direct annual meetings with police and district chiefs, reductions in contribution to centrally sponsored schemes, the disgraceful behaviour of some of the governors in opposition-ruled states, and the withholding of resources from states that do not agree with central policies (like language policies), all point to a centralising Union government scrambling to deny the states resources and extracting maximum credit for joint ventures.

In such a situation, it is important for states to reclaim agency. This is particularly true of the five peninsular states, which are at the cutting edge of economic growth and human development. They are especially hobbled by the removal of their legitimate resources in the form of cesses and by borrowing limits. Also, these states currently do not belong to the National Democratic Alliance, with one recent exception. But I see no kinder treatment for Andhra Pradesh, as a consequence of the shrimp tariffs imposed by US President Donald Trump, for instance.