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In political centralisation, CMs dont just belong to the same party that is in power
at the Centre, they often depend on the Central leadership for their power.

Written by Pratap Bhanu Mehta | Posted: October 22, 2014 12:05 am

As the BJP acquires political dominance in more states, a

question arises: will there be a transformation in the
nature of federalism in India? In a conventional narrative,
states had progressively become more significant as a
result of three developments. The rise of regional parties,
often on a local power base, was seen as a bulwark against
a dominant Centre. Second, liberalisation meant that the
states had, in theory, more room to compete with each
other. Third, coalition politics gave the states a lot of
leverage, and some states that were critical partners got

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undue leverage. How will this dialectic of centralisation

and decentralisation change?
The conventional narrative was often misleading because it
did not sufficiently distinguish between different vectors of
centralisation. To see how this plays out, we need to make
a distinction between several kinds of centralisation. All
these different forms do not track each other. Indeed, some
political centralisation may create the conditions for forms
of decentralisation.
The first is political centralisation where chief ministers
dont just belong to the same party that is in power at the
Centre, they often depend on the Central leadership for
their power. Single-party dominance at the Centre always
increases this tendency. The Congress adopted it with
aplomb, by and large reducing the power of regional
leaders. This was not just under Indira Gandhi. Even under
Nehru, chief ministers like K.N. Katju could practically be
imposed on states. At the current conjuncture, this risk
exists: the BJP will be riding to power in several states on
the coat tails of the Centre. So, much will depend on the
practices and conventions it evolves for selecting chief
ministers and giving them free rein. But the risk that they
will be seen to be depending on the pleasure of the central
high command is higher with one-party dominance.
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dimension is what you might call identity decentralisation.

This is where states acquired an ethnic political identity

that defined the basis of politics: the DMK in Tamil Nadu,
the Shiv Sena in Maharashtra, arguably even the CPM and
Trinamool Congress in West Bengal occupied that space.
This politics has run its course. First, it was actually
successful in pushing back what many feared would be the
Centres cultural dominance. And, notwithstanding some
exaggerated fears about north Indian dominance
(allegedly and somewhat ironically created by a state in
western India), any half-smart political party will recognise
that the agenda of linguistic and regional domination will
not fly. Second, ethnicity based political movements also
have to transcend into issues of governance at some point.
Third, in some states, including Maharashtra, the dynamics
of sub-regionalism are going to be increasingly prominent.
The BJPs expansion into Maharashtra, Tamil Nadu and
West Bengal rides on these conjunctures. Identity politics
in states will not disappear, but the time is ripe for a
fundamental mutation in its form.
The third dimension is constitutional centralisation, where
the Centre uses or abuses constitutional instruments to
keep states in check. Here, the story is complex and likely
to remain so. Thanks to the Supreme Court, it is not that
easy to abuse constitutional instruments: the power of the
Centre to dismiss state governments has been disciplined
after the Bommai judgment. The courts check Central
exercise of power: arguably, even the coal judgment has a
strong dose of federalism in it. But this will be tested, as the
case of Delhi is demonstrating. Elections are long overdue
in Delhi. Yet, even during decentralisation, more items
were moved to the concurrent list. But in an era of
globalisation, it needs to be asked whether the distinction
between the state and Central lists, as conventionally
understood, even makes sense. For example, if India were

to make some commitments on agriculture at the WTO, it

would be using the Centres treaty-making powers to
impinge on federalism. Legal globalisation may have an
impact on the nature of our federalism.
The fourth dimension is administrative decentralisation.
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decentralisation. The Planning Commission had usurped
the states right. The design of centrally sponsored
schemes, even though implemented by the states, was
dictated by the Centre. So one interesting development to
watch will be the degree to which states now get
administrative flexibility and exercise it. The government
made some promising moves in this regard, but with
schemes like the Adarsh Gram Yojana, signals are now
more mixed. It is likely that in this incarnation, political
centralisation might be accompanied by more
administrative decentralisation.
The fifth dimension is fiscal decentralisation. This will
partly depend on two developments: what the next Finance
Commission report recommends and whether the tendency
to increase allocations that were not Finance Commissionbased is checked. The second is the shape of the eventual
compromise on the GST and the states share in it. The good
news is that more funds will be allocated to states as block
grants. But the other dimension of fiscal decentralisation is
the states own capacity. We forget that what we think of as
the rise of the states was facilitated by Central
restructuring of states debt in the late 1990s, which
allowed them some fiscal space. The issue has always been
that states dont use their existing powers or put in enough
of a resource effort. The condition of state electricity
utilities is a case in point. How much power a state has is a

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function of whether it chooses to beg or be creative.

The sixth dimension is competition. It is a myth that states
could compete with each other only during the last two
decades. Even in the 1960s, Kerala had a different socialsector model, and Partap Singh Kairon would always tout

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the Punjab model. How much states innovate is a function

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of their capacity, fiscal space and political
creativity.
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one thing hugely disappointing about the phase of political

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decentralisation was, apart from a few exceptions, how

little the states innovated on their own. Variation in

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implementation is not the same thing as genuine creativity.

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The final dimension is more participatory and multilayered

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governance. The real test of inclusive governance will be
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whether structures become more participatory: in cases

like Uttar Pradesh, by creating more states; in other cases,

by having more meaningful city-level politics; in others
still, by strengthening panchayati raj. This decentralisation
has been largely incremental, and may remain so. But the
story of the multiple dialectics of centralisation and
decentralisation is about to get interesting.

The writer is president,Centre for Policy Research,Delhi,

and a contributing editor for The Indian Express
express@expressindia.com
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