Toothless Centre, powerful States

Over the past months, the Central government has been forced to defer, or roll back, policy decisions on a number of key issues. These include the National Counter Terrorism Centre (NCTC), FDI in retail, Teesta water sharing, Sri Lanka human rights, rational pricing of oil/fertilisers, etc — the list seems endless.

Delhi is beginning to look like a toothless tiger, unable to do more than articulate the need for reforms, which remain on paper. The federalist spirit has asserted itself: whether it turns aggressive and confrontational, or constructive and cooperative, will depend on how the players at the Centre and the States handle it.

Indian democracy has passed through evolutionary phases. The first 17 years was the “great leader” phase under Jawaharlal Nehru, the builder of modern India. The second, post-Nehru, phase was a transition to a system dominated by a few national parties.

Now, we are seeing phase three where the major national parties have steadily lost ground and some 47 regional parties have emerged in Parliament.

The failure of national parties to turn themselves into truly federal decentralised structures has opened the door to more narrow regional parties, which can reflect more closely the aspirations of the people in the State.

The tendency of certain national parties to enter into alliances with regional players, whereby political control is left to the latter in exchange for support at the Centre, has weakened national parties at the state level. Unfortunately, this trend, which started in the 1990s, seems likely to continue. A consequence is that elections will produce coalition governments at the Centre composed of a nucleus of one large national party and a cluster of regional parties. In this scenario, State governments will become more demanding, often browbeating the Centre to score political points.

While the Seventh Schedule of the Constitution has listed the subjects to be handled by the Centre, the States, and jointly, this cannot be cast in stone, as new subjects and situations arise.

Unfortunately it seems very difficult to make changes to the Constitution, given the climate of distrust between the Centre and many States. Indeed, this distrust is a natural reaction to perceived misuse of some central institutions for political ends.

Partial agreements

Some imaginative ways around this impasse could be explored. For example, why not call the NCTCs ‘Joint CTCs', to reinforce the message that this is a joint effort? The JCTCs should then be managed, funded and operated jointly. This would more effectively harness the grass-roots capability of the state agencies and the political support of the State.

States that want to set up JCTCs should do so on the basis of a special enabling agreement between the State and the Centre. This would allow those States that are more serious about CT to move ahead, while others can take more time to decide.

The same model of partial agreements can be applied to other issues as well. Why should FDI levels in retail or in other sectors be the same for the entire country? Let those States that want to allow more FDI go ahead. If there is concern over “level playing field” issues, the Competition Commission of India can handle these, as against arbitrary decisions from bureaucrats.

Foreign policy is an area where the Centre needs to consult and work more closely with the States. Issues such as water sharing and border management may have an especially strong impact on our border States. The security of diaspora and Indians working abroad in far-off areas can become a problem.

Focus on development

Regional parties need to build up capacity to independently analyse foreign policy issues, especially in those areas that affect them, and feed their concerns into the policymaking process.

In the case of Sri Lanka, pressure from the State parties forced the government to change its vote in the United Nations Human Rights Commission, Geneva, at the last minute, causing damage to good bilateral relations.

Should this not have been carefully discussed and a strategy worked out to manage the issue better? Caution would dictate that it would be better to abstain than take a position, if one is not sure.

There no models of large federal democracies with high levels of cultural diversity comparable with India. The closest would be South Africa, a country paralysed by federalist schisms, and Belgium. The other large federal countries, such as the US, Canada and Australia, are culturally far more homogenous.

India has to find its own way — either descend into chaos and paralysis and possibly a repeat of the Emergency, or move ahead to a truly federalist system with all players focused on the one issue that matters: development.

As for foreign governments, the lesson is clear. They need to invest more in discussing, and persuading State governments and parties to support their point of view. Delhi may declare policy, but be powerless to deliver. The focus of action is shifting from Delhi to the State capitals, and foreign envoys need to spend more time there.

(The author is a former Ambassador of India to Greece and Cuba)

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