Structural and Functional Issues in Indian Federalism

Q: Examine the issues in Indian federalism.

Indian Federalism is often described as "Sui Generis" or "Quasi-federal" because it balances a strong Centre with autonomous States. However, this asymmetric and centralized structure has led to several persistent issues that strain the relationship between the Union and its constituent units.

1. Fiscal Federalism and Vertical Imbalance

  • Revenue Gap: The Centre possesses the most elastic sources of revenue (Income Tax, Customs), while States bear the burden of social sector spending (Health, Education). This creates a chronic dependency on Central Transfers.
  • The GST Regime: While GST promoted a "One Nation, One Tax" philosophy, it curtailed the fiscal autonomy of States to levy local taxes. Issues regarding GST compensation often lead to trust deficits.

2. The Office of the Governor

The Governor is often seen as an "Agent of the Centre" rather than a constitutional bridge.

  • Political Interference: Disputes frequently arise regarding the appointment of Chief Ministers in hung assemblies or the withholding of assent to State Bills (Art. 200).
  • Article 356: Despite the Bommai judgment, the threat of President’s Rule remains a point of contention in Centre-State friction.

3. Centralization of Power

  • Concurrent List Encroachment: The Union often legislates on subjects in the Concurrent List without adequate consultation with States (e.g., the now-repealed Farm Laws).
  • Centrally Sponsored Schemes (CSS): These often force a "one-size-fits-all" approach, ignoring the regional specificities of states like Odisha.

Definition of Key Term

Asymmetric Federalism: A system where some constituent units are granted greater autonomy or special protections than others (e.g., Special Status under Art. 371 for various states).

Conclusion

The resilience of Indian federalism depends on moving from Conflictual Federalism to Cooperative and Competitive Federalism. Strengthening constitutional forums like the Inter-State Council and respecting the autonomy of States are essential to ensure that the "Union of States" remains a cohesive and progressive entity.

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