Multi-Level Governance

Indian Federalism : Myth and Reality

Mahendra Prasad Singh

[Following is a slightly abridged version of the Valedictory speech delivered by Prof Mahendra Prasad Singh at International Conference on Indian Federalism organised by Shaheed Bhagat Singh College, University of Delhi at India International Centre, New Delhi, in March 2013]

When the federal scheme was first floated by the Imperial and British Indian government under the Government of India Act, 1935, federalisation meant partly centralisation but it partly remained a centralised federal structure, as federal union was compulsory for the provinces. But the princely states were given greater latitude in the sense that the federal union was voluntary for them with the threshold of at least 50 percent of princely rulers in the Chamber of Princes they had formed since 1920 opting to join it as the condition of the scheme being applicable to them. More-over, the scheme was only euphemistically "federal" as even in the case of the British Indian provinces only elementary aspects of public health and education and local self-government were among the "transferred" subjects handed over to the elective ministers responsible to legislatures and more sensitive subjects like finance, police, security, intelligence, etc. were "reserved" for the bureaucratic apparatus headed by the Governors in the provinces and the Governor General at the Centre. And at the Centre the system of government remained largely bureaucratic with no pretence of any scheme of even partially elected ministerial government responsible to the Central Legislature. As is well known, the 1935 federal scheme was only partly implemented at the provincial level because the princes finally refused to join the proposed union. So at the central level, the new scheme remained unimplemented except for the establishment of the Federal Court of India for settlement of intergovernmental disputes in the context of the British Indian provinces and the Centre, with the Judicial Committee of the Privy Council in London being the final court of appeal.

The  British Cabinet Mission Plan, 1946, which was a confederal scheme with a weak central government to appease Muslim League lobbying for more powers for provincial governments with the Muslim-majority provinces in mind, and to induce the princely states to agree to join the confederal union. The Indian National Congress wanted a federal scheme with greater powers for the Centre, including residuary powers, but it reluctantly accepted the confederal scheme for the sake of India's unity. However, the Muslim League finally rejected it and escalated its demand for a separate homeland for Muslims first made in a somewhat vague and complicated way at the Lahore session of the Muslim League in 1940. The princely states adopted a policy of wait and watch. The Constituent Assembly of united India had already been elected under the Cabinet Mission Plan in 1946 by the electoral college of the provincial legislatures under the 1935 India Act, with the provision in place for the nomination by princely rulers of their representation in the Constituent Assembly in due course. At the early sessions of the Constituent Assembly as the leader of the Indian National Congress, Jawaharlal Nehru moved the Objectives Resolution under the framework of the Cabinet Mission Plan, still with the hope that the Muslim League members would belatedly join the proceedings. But that was not to be. Finally, the Cabinet Mission Plan was replaced by the Mountbatten Scheme of independence in mid-August 1947 with the partition of India. Thereafter, the Congress-dominated Constituent Assembly proceeded to draft a federal constitution with a strong parliamentary Centre, which came into force on January 26, 1950.

In the early post-Independence decades India worked a highly centralised federal polity—even more centralised than its Constitution. This was due to the hangover of the nationalist ideology, presence of tall national leaders of the freedom struggle against the colonial rule, the impact of the dominance of the Congress party at the Union level as well as practically all or most states, and the unique All India Services manning top administrative echelons at both levels of government.

With the declining dominance or even majority of the Congress party by the late 1960s at the state level and the late 1970s at the Centre as well, the political dynamics tended to become more competitive. But the erosion of the electoral and organisational base of the Congress proved to be short-term affair. The unworkable confederal intra-party power structure of the Janata Party caused the fall of its government in New Delhi in July 1979 and its governments in major north Indian states also subsequently petered out in the next couple of years. Congress party got an opening to stage a comeback under Indira Gandhi in 1980 and maintained its majority at the Centre and in a considerable number of states with declining control over state governments throughout the 1980s. But Congress under Indira and after her assassination in 1984 under her elder son Rajiv was a different phenomenon than the Congress under Jawaharlal Nehru and Lal Bahadur Shastri. It was an institutionalised democratic party in the earlier phase, whereas it turned into a pack of personal, familial, and dynastic followers sans organisational elections in the party after 1972 and intra-party democracy in general. All these changes had their own impact on the working of the federal political system in general. This impact may be summarily put as a deinstitutionalised and excessive centralisation that destroyed the democratic vitality of both the parliamentary and the federal components of the polity.

After the parameter-altering transformation in the party system in the 1989 parliamentary and some state assembly elections, the federal features of the political system came into fuller and irreversible play. This phase has generally been characterised as the phase of greater "federalisation" of the polity. In truth three major factors brought about this larger transformation in the functioning of the political system without any substantial constitutional amendments. First, there was, as already mentioned above, the party system changes from Congress dominance and even majority, especially at the Centre, to a multi-party system with decisive balancing role in formation and maintenance of federal coalition governments alternately led by the Janata Party/Dal, Congress, or Bharatiya Janata Party (BJP). Second, the accelerated pace of economic liberalisation, privatisation, and globalisation of the national and state economies, especially since 1991, increased the space for the private sector in the economy as also expanded the autonomy of state governments. Third, there also followed some unprecedented changes in judicial behaviour since the 1990s. For example, in S R Bommai vs Union of India (1994), the Supreme Court by a creative and constructive re-interpretation of the Constitution declared the proclamation of President's rule in a state under Article 356 of the Constitution open to judicial review, which until before it had treated as a "political thicket" beyond judicial scrutiny and entirely subject to the discretion of the Union Executive.

But despite some positive trends, there have been some negative features as well. For about a decade since 1989 there followed a period of extremely unstable federal coalition governments none of which could survive in office even for a full year. There has also been political blackmails and rampant corruption by the government and opposition jockeying for power and political survival. Besides, the weakening of the Congress party and failure of other national parties to regain its dominance, indeed even majority, meant the unprecedented emergence of the number and power of regional parties. Their strategic decisive balancing role in government formation and maintenance made them a factor of instability and political blackmail. It is really a regionalisation rather than a federalisation of the Indian polity. During the phase of Congress dominance, the political pendulum remained stuck to the extreme of parliamentary centralism, and in the post-1989 phase it swung to the other extreme, that of regionalism gone haywire.

For example, for nearly five years the NDA Prime Minister Atal Bihari Vajpayee and for the subsequent five years the UPA Prime Minister Manmohan Singh kept convening Chief Ministers' conferences in order to get their support or creating consensus for setting up an National Investigative Agency, because the CBI is not a truly federal agency. The CBI is set up under a Delhi Police Act (1946) and therefore it cannot be either constitutionally or legally applicable to the state governments or a state government cannot be brought under its obligatory investigative jurisdictional control. In order for the CBI to operate in a state, it has to seek the permission of the state government concerned. Only in exceptional cases, where the Supreme Court orders CBI, it can enter into any jurisdictional area within the federal system—Union or state. So, the brief of Prime Ministers Vajpayee and Manmohan Singh for a full decade was to get a consensual endorsement of Chief Ministers to set up a national investigating agency that would have statutory power to operate in national as well as state jurisdictions and also simultaneously in cases of inter-state crime, international terrorism, and so on and so forth. However, the Chief Ministers routinely rejected the plan. It was only after the Mumbai terror attacks of 2008 that Prime Minister Manmohan Singh and his government decided to move regardless of lack of permission from the Chief Ministers and introduced the National Investgative Agency (NIA) Bill, which was passed by the Parliament by voice vote and the Agency is now in place. No chief minister has gone to the Supreme Court against it. The Chief Ministers may have murmured but none has objected to it in public or gone to the Court.

The same story is being repeated in case of the setting up of NCTC (National Counter-Terrorism Centre). Using its understanding of the federal division of powers in the Seventh Schedule of the Constitution and its power, the Manmohan Singh-headed UPA Government of India set up the NCTC' through a Cabinet decision, and thereby avoided the legislative route and the expected confrontation in the Parliament. Terrorism doesn't appear in any of the lists in the Seventh Schedule. Law and order is there in the state list but terrorism is not there in any of the three lists, and therefore under the Constitution, it becomes a residuary subject and therefore under Union Parliament's jurisdiction. That must have been the understanding of the Government of India, and therefore by executive order they set up the NCTC. However, the Chief Minister rose up in arms including the CM of West Bengal Mamata Banerjee who was then supporting the UPA coalition government. A Chief Ministers' conference was convened with an omnibus agenda, including the NCTC but the CM of West Bengal said that it could not be discussed in that conference and another Chief Ministers' conference had to be convened for exclusively discussing the issue. So, another Chief Ministers' conference was convened in which the Chief Ministers rejected the setting up of the NCTC. And as such, the Government of India did not proceeded with the matter. The NCTC was put in abeyance.

If the process of "federalisation" had actually taken place, the key constitutional forums like Inter-State Council, NDC, and others, could have become strengthened. These are the most important intergovernmental institutions in the Indian political system. India being a parliamentary-federal system in the British Commonwealth tradition, where "executive federalism" is the dominant mode of inter-governmental relations. In presidential federal systems, there are other such forums for this purpose, such as the Senate in the United States of America, the federal Second chamber, is a very powerful and is a very important federal forum. But in India which is a parliamentary-federal system, Rajya Sabha is a secondary chamber because the locus of political gravity is in the Lok Sabha. In a parliamentary system, the federal second chamber doesn't play that important role in intergovernmental relations as it does in a presidential-federal system. So, the most important federal instrumentalities in parliamentary-federal systems are the executive intergovernmental forums like the Interstate Council, National Development Council, CMs' conferences, ministerial conferences, secretarial conferences, which function as sites of Union-State policy formulation, harmonisation, and monitoring of policy implementation.

The Inter-State Council as a constitutionally sanctioned body could and should have been used as the preeminent to discuss and create consensus on all important intergovernmental affairs. Instead of unilaterally setting up the NC'TC, the Government of India should have referred the matter to the Inter-State Council, and the Chief Ministers in the Interstate Council should have and would have, in national spirit, allowed the Union to proceed with NIA or NCTC. These federal forums are, however, either left in limbo or ritualistically convened where each side states imposition in a spirit of confrontation sans negotiation. By convention decisions in these bodies are not taken by vote but by consensus as sensed by the chair. Therefore, most important decisions that could have been taken on these federal forums are taken elsewhere or taken by the centre unilaterally.

Regionalisation characterises the shifting of powers from New Delhi to the state governments and decentralisation can be used properly for giving more powers to the local political systems. But what has happened is neither federalisation proper nor decentralisation proper but regionalisation gone wayward. The state governments have become politically very powerful at the cost of the Union and the grassroots political systems.

In the phase of federal coalition governments there has occurred a phenomenon what may be called the situation of "divided government". For example, during this phase the President, the Vice-President, the Prime Minister, and the Speaker of the Lok Sabha have often come from different political parties. During the era of one-party governments, all these key functionaries had come from the same party. More-over, during this phase the Lok Sabha has been under coalitional majority of the ruling dispensation and Rajya Sabha under an oppositional majority.

Furthermore, if one looks at the states, one finds a large number of parties in power. So a chequered political chess board is there, when chief ministers belonging to a variety of parties and coalitions are ruling in various states. The speaker does not feel this is bad; rather considers it to be a positive development and natural in a multi-cultural society and federal polity. Thus today the ruling coalition in the Lok Sabha must create a consensus with opposition in the Rajya Sabha for legislation and constitutional amendments. For constitutional amendments in particular, a two-thirds majority in the Lok Sabha must be backed by a similar majority in the Rajya Sabha, and if the constitutional amendment has federal implications, it must also be ratified by at least 50% of a state legislature. That is why amendments to the Constitution have become virtually impossible today. The Constitution, which was so easily amended during the year of Congress dominance, has become virtually impossible to amend today.

Even in the phase of federalisation, the fact of the matter is that only a few states have real governmental capacity at the state level, even in this era of federalisation, which may be called "regionalisation", only a few states can take decisions and initiatives on their own without depending fiscally on the centre. For example, Maharashtra, Gujarat, Tamil Nadu, partly Andhra, Punjab and Haryana (although Punjab and Haryana have suffered economic decline of late). States in central and eastern India and all sub-Himalayan region states from J&K to North-East are ''special category states" under the Finance Commission dispensation that are heavily dependent on federal fiscal transfers for their revenue.

State-building at the provincial level or state-capacity-building is very important today because the capacity of the Union government to help the poorer and backward states has declined, and national and multinational capital is making a beeline for investment only in advanced states and backward states are languishing without any private sector investment, either national or multinational or FDI. And, therefore, regional disparities among states and class disparities are increasing enormously since neoliberal economic reforms since the early 1990s.

For one thing in the period under review, over the last 20 years or more, there has been a decline and deinstitu-tionalisation in some cases but other organisations and institutions have either regenerated or have become reincarnated themselves in an activist mode. The Judiciary, National Human Rights Commission, Election Commission, Vigilance Commission, Comptroller and Auditor General of India, etc. have become demonstrated greater vigour and activism. A good thing about India is that if there is degeneration in the political system in case of some sectors there is regeneration in other sectors; and this balances the situation.

The second Commission on Centre-State Relations chaired by Justice M M Panchhi, deserves serious attention. In its multiple-volume Report, the Commission has made a number of thoughtful recommendations.

Vol. 49, No.20, Nov 20 - 26, 2016