Governing Federal India: Political Institutions for a Diverse Society and a Resurgent Economy.

 India’s political system has attempted to structure its enormous diversity through

the application of the federal principle, and is today widely considered a robust

parliamentary democracy. The seeds of the federal idea were already present in the

Government of India Act 1935, which attempted to contain rising national sentiment with

the grant of limited provincial autonomy. As India celebrates the sixtieth anniversary of

its Republican Constitution 2, it is important to evaluate the strengths and weaknesses of a

system that has survived decades of unimpressive economic growth to manage today the

political challenges posed by a resurgent economy.

In the first part of this essay, we shall outline the basic structure of India’s federal

democracy, and the ways in which it has tried to represent a fragmented society within a

unified polity. Adopting asymmetrical treatment of states when required, and reinventing

institutions to suit changed contexts, Indian policy makers have innovated on basic

federal principles to create a hybrid system of centralised federalism.

Thereafter, we analyse the impact of the federal structure on the functioning of

India’s political processes, notably the formulation of public policies. We will discuss

how federal structures, which have led to the proliferation of political parties via the

federalisation of the party system, have impacted decision-making in the public sphere.

The growing prominence of local parties, having an electoral base in a single federated

state, has given rise to governments that can be described as federal coalitions.

In the third part, we reflect on the accommodation of diversity within a

democratic framework. With its 23 constitutionally recognised languages, the Indian

Union has developed a framework for reconciling the competing and often conflicting

1 Former Rector and Pro Vice Chancellor, Jawaharlal Nehru University, New Delhi and currently

Chairman, Centre for Multilevel Federalism at the Institute of Social Sciences, New Delhi.

2 The Constitution entered into effect on 26 January 1950 and the First Lok Sabha, elected through the first

ever general elections with universal suffrage, commenced in April 1952. The current Lok Sabha elected

in May 2009 is the fifteenth since that date

demands of its 28 states. The recent phase of rapid and sustained economic growth has

generated new tensions within the federal polity due to increasing regional inequalities

and the persistence of vast tracts of poverty even in the more developed states.

We conclude with some reflections on how these new economic inequalities are

being managed by the Union. We ask whether the role of the central government, referred

to as the Union in the Constitution, has changed under the impact of globalisation and

economic liberalisation.

I

The Union of India has a bicameral parliamentary structure, which is replicated

with some variations in its 28 states. The Lok Sabha or House of the People is the lower

house directly elected by universal adult suffrage. The Rajya Sabha or Council of States

is a permanent body, not subject to dissolution, whose members are chosen by the elected

members of State Legislative Assemblies.

The Rajya Sabha is empowered to give the consent of the States in some special

cases such as the transfer of states’ legislative powers to the Union Parliament (Art 349),

and approval of amendments to the Constitution (Art 368). However, its credentials to

speak in the name of states have been challenged on the grounds that its members have

weak links with the states that they represent.

Three lists in the Constitution define the respective jurisdictions of the Union and

State legislatures, as also areas where they are both competent. They reveal that while

some effort has been made to apply the criterion of handling matters at the appropriate

level, they have also been designed as a series of interlocking jurisdictions for purposes

of crafting an integrated Union. It is therefore extremely difficult to delink issues

according to levels because the same subject graduates from the lower to the higher level

as it gains in scale or complexity. A literal reading of the constitutional division of

powers can therefore be misleading. Multiple overlaps have occurred, not merely in the

concurrent spheres of jurisdiction but also in spheres explicitly assigned to the states.

It is important to recall that the original constitutional design vested substantial

legislative powers and responsibilities in state governments for key developmental

activities. The subsequent mismatch that has arisen between their responsibilities and

their resources, and the resultant dependency on the Centre, have their roots in policy

decisions taken at both levels of government, notably regarding strategies for

mobilisation of financial resources.

In practice, a rigid separation of levels is unattainable due to overlapping

concerns. For example, the power to legislate the implementation of international

agreements is vested in the Union Parliament under article 253, even when the subject

matter of the agreement falls in the state list, such as agriculture. While land is a state

subject, environmental and ecological concerns, notably forests, are covered by Union

legislation and industrial projects require clearance after an environmental impact audit.

Similarly, while public order is a state subject, internal security and terrorism have

increasingly become central concerns due to their international ramifications.

While the issue of distribution of responsibilities and powers in federal political

systems is generally contentious, a gross mismatch between the two can lead to tensions.

Table 1 illustrates the ways in which jurisdictions are interlinked in selected subjects

pertaining to socio-economic development. The jurisdiction of the Union Parliament, as

enumerated in List I, is subject to the prerogatives of the state legislatures in the spheres

enumerated in List II. Both legislatures have concurrent jurisdiction in matters mentioned

in List III, with the Union Parliament having pre-emptive power

Table 1: Distribution of Legislative Powers and Executive Responsibilities between the Union

Parliament and the State Assemblies in Key Areas.

Domain

List

I:

Union

Parliament

List

II:

State

Assemblies

List

III:

Concurrent

Powers

1.Defence

Defence

of

India

(1)

Armed

Forces

(2)

Para

Military

Forces

(2a)

2.Foreign

Affairs

War

and

Peace

(15)

Diplomacy

(11)

UN

(12)

International

Conferences

(13)

Treaties

(14)

Citizenship

(17)

3.Money

Public

Debt

(35)

Currency

&

Foreign

Exchange

(36)

Reserve

Bank

(38)

Foreign

Loans

(37)

Money

lending

and

money

lenders

(30)

Bankruptcy

and

Insolvency

(9)

Judiciary

Supreme

Court

(77)

High

Courts

(78)

High

Court

Personnel

(3)

Prisons

(4)

Criminal

Law

(1)

&

Code

(2)

Justice

Administration

(11A)

Civil

Code

(13)

5.Internal

Security

Para

Military

Forces

(2a)

Central

Bureau

of

Investigation

(8)

Preventive

Detention

for

Defence,

Foreign

Affairs

(9)

Public

Order

(1)

Police

(2)

Preventive

Detention

for

state

security,

public

order

(3)

6.

Land

Land

rights,

tenures,

rents,

transfer

(18)

Forests

(17A)

4

7.

Water

Inter-­‐state

rivers

and

river

valleys

notified

by

law

in

public

interest

(56)

Water

supplies,

storage,

power,

irrigation

and

canals

(17)

8.

Electricity,

Power

&

Energy

Atomic

energy

and

related

mineral

resources

(6)

Natural

and

Bio-­‐Gas

(25)

Electricity

(38)

9.

Agriculture

&

Fisheries

Fishing/Fisheries

beyond

territorial

waters

(57)

Agriculture

(14);

Livestock

(15),

Fisheries

within

territorial

waters

(21)

Wild

Animals

(17B)

10.

Industry

Industries

notified

by

law

for

national

defence

(7)

or

to

be

in

public

interest

(52)

Industries

other

than

those

in

List

I(24)

Factories

(36)

11.

Oil,

Mines,

Minerals,

Mineral

oil

/

Petroleum

(53),

Mines

and

minerals

notified

to

be

in

the

public

interest

(54)

Mines

and

minerals

other

than

those

in

List

I(23)

12.Trade

&

Commerce

Foreign

trade

and

commerce,

import/export,

customs

frontiers

(41)

Inter-­‐state

trade

&

commerce

(42)

Trade

&

commerce

within

the

state

(26)

Production,

supply

and

distribution

of

goods

(27)

Markets

&

Fairs

(28)

Trade,

commerce,

production

&

distribution

of

foodstuffs,

edible

oils,

cotton

&

jute

(33)

13.Transport

&

Communications

Railways

(22),

national

highways

(23),

national

waterways

(24),

maritime

shipping

(25)

major

ports

(27)

airways

(29)

rail/sea/air

transportation

(30)

Roads

and

means

of

communication

other

than

those

in

List

I(13)

Minor

ports

(31),

shipping

&

navigation

on

inland

waterways

(32)

14.

Education

Universities

&

Institutions

of

national

importance

for

scientific/technical

education

and

research

(63-­‐66)

Incorporation

and

regulation

of

Universities,

literary

and

scientific

societies,

associations,

cooperatives

(32)

Technical,

medical,

and

university

education

including

vocational

and

technical

training

(25)

15.

Information

&

Broadcasting

Posts/telegraph/telephone/wirel

ess/broadcasting

and

communication.(31)

Cinema

censorship

(60)

Theatre,

Cinema,

Sports

(33)

16.

Public

Health

and

Social

Welfare

Port

quarantine

(28)

Public

health

and

sanitation/

hospitals

&

dispensaries

(6)

Relief

of

disabled/

unemployable

(9)

Infectious

and

contagious

diseases

(29)

Economic

&

social

planning

(20)

Population

control

(20A)

social

security/insurance

&

employment

/

unemployment

(23)

Labour

welfare

(24)

17.

Local

government,

public

works

&

co-­‐operatives

Municipal

corporations

&

local

self

-­‐

government

(5)

Public

works

(35)

Co-­‐operative

societies

(32)

18.Taxation

Powers

and

Financial

Resources

Taxes

on

Personal

Income

(82),

Corporate

Income

(85),

Capital

(86),

Estates

(87),

Rail/Sea/Air

Transportation

(89),

Services

(92).

Land

Revenue

(45),

Agricultural

Income

Tax

(46),

Lands

and

Buildings

Tax

(49),

Alcohol

(51).

Electricity

(53),

Sales

of

Goods

(54),

Vehicles

(57),

Cinema

(62).

Source:

Compiled

from

Constitution

of

India,

Seventh

Schedule.

Numbers

in

brackets

refer

to

item

numbers

in

the

concerned

list.

Residuary

powers

are

vested

in

the

Union.

5

We have seen that the overlaps in the policy implication of jurisdictions are

increasingly numerous. One finds further explanations for this blurring of levels in the

logic of federal political processes. Union ministries deal with land-use issues through

their jurisdiction over environmental protection and ecological elements such as forests.

Recent tensions over land acquisition for mining and industrial purposes illustrate these

jurisdictional overlaps, since land per se is in the domain of the states.

An understanding of the role of institutions such as the Finance Commission,

which recommends the basis for sharing of tax revenues between the Centre and the

states, or the Planning Commission, which supervised the system of centralised economic

planning in the first phase, is crucial for appreciating the working of the federal system.

A particularly striking example of the reinvention of institutions is provided by the

Planning Commission, which sank from its earlier heights as a ‘Super Cabinet’ to quasiirrelevance

in policy making under Rajiv Gandhi during the first phase of economic

liberalisation. Conceived as an advisory body to the Prime Minister, it has become a

powerful player in policy formulation under Montek Singh Ahluwalia, and is represented

in most key decision-making bodies, such as the Groups of Ministers constituted by the

Cabinet from time to time on important but contentious issues.

II

The development of the federal system can be broadly divided into three phases.

The first coincides with the dominance of the Congress party (1947-67) at both levels of

government, a dominance that was challenged in the 1967 elections before being

decisively overturned ten years later after an unpopular national emergency regime.

Political parties are the lifeblood of any parliamentary democracy. Changes in this

arena are therefore closely linked to the passage from one phase to another. The second

phase, 1979-89, was marked by the transition to a vigorously competitive multi party

system, which initially took root in the states. The Congress party was again decisively

dislodged from the preeminent position it had regained at the Centre, inaugurating a third

phase of experimentation with coalition governments. The turning point in this

development came in 1998, when the Bharatiya Janata Party (BJP) succeeded in

fabricating a coalition that effectively presented a non-Congress alternative. This

6

National Democratic Alliance, (NDA) succeeded in getting re-elected after an initial

hiccup, and wielded power till it was ousted by the Congress-led United Progressive

Alliance (UPA) in 2004.

Parties represented in Parliament simultaneously wield power at the state level or

are contenders for it. The complexities of electoral federalism and the presence of a large

number of single-state parties in federal coalitions make it inevitable that state-level

concerns get reflected in the Union Parliament and government. Thus many of the

tensions concerning excessive centralisation through concentration of powers in the

central government were attenuated when state parties began to play a more prominent

role in national decision-making. The abuse of central intervention powers in the

governance of states, under article 356 (commonly known as President’s Rule), was

checked first by judicial intervention and then by the political clout of states resolutely

opposed to its utilisation.

If we look at the party composition of the Lok Sabha over the last five general

elections, we see the emergence of a bi-nodal polity in which the two polity-wide or All-

India parties are the two defining nodes. They compete for constructing a parliamentary

majority, with the help and support of state parties. Table 2 highlights the important fact

that the total share of the seats won by the two polity-wide parties saw a steady decline

during three successive elections before being arrested in the last election. There was a

corresponding rise in the seat share of single - state and multi-state parties. Table 3 shows

the distribution in terms of vote shares and tells a somewhat different story. The share of

state parties is sometimes more than that of the polity-wide parties even when their seat

share has declined.

Table

1:

Division

of

Seats

in

the

Lok

Sabha

between

All-­‐India

and

State

Parties

1996-­‐2009

Parties

11LS:1996

12LS:1998

13LS:1999

14LS:2004

15LS:2009

All-­‐India

Parties

%

Seats

%

Seats

%

Seats

%

Seats

%

Seats

Congress

25.8

26.0

21.0

26.7

37.9

BJP

29.6

33.5

33.5

25.4

21.4

Sub

Total

INC+BJP

55.4

59.5

54.5

52.1

59.3

State

Parties

Multi-­‐state

parties

18.8

11.8

13.3

14.9.

9.9

Single-­‐State

parties

&

Independents.

25.8

28.7

32.2

33.0

30.8

Sub

Total

State

Parties

44.6

40.5

45.5

47.9

40.7

Grand

Total

100

100

100

100

100

7

Table

2:

Division

of

Vote

Share

in

the

Lok

Sabha

between

All-­‐India

and

State

Parties

1996-­‐2009

Source: Balveer Arora and Stephanie Tawa Lama-Rewal ‘Contests in Context: Indian Elections 2009’,

Special Issue of e-journal SAMAJ, http://samaj.revues.org

III

How has the Indian federal system fared in its handling of diversity? Has it

redefined the way diversity can be organized and lived within a single democratic polity?

Or is it as fragile as it was when it all began, since significant numbers of at least two of

its dissatisfied populations, the Kashmiris and the Nagas, are still questioning their status

and situation in the Indian Union. We must bear in mind that diversities armed with the

power of universal franchise are formidable forces, not easily subdued or controlled in a

democratic polity.

Identities in India have a long past, but a recent history, in the sense that many of

them rediscovered their distinctiveness through the enumeration policies of the colonial

power and have been consolidated after independence with the establishment of electoral

democracy. The treatment of diversity by India’s Constitution has its roots in a culture

with a propensity and a readiness to not only recognise but also accommodate difference.

India’s pluricultural society was encompassed in a federal polity organized around

the founding belief of unity in diversity by the Constituent Assembly. The framers of the

Constitution were acutely aware of the vast range of diversity they had to contend with,

but were, in the context of the partition of the country that accompanied independence,

understandably obsessed with ensuring the unity essential for national cohesion.

The full force of linguistic and cultural diversities began to be felt even in the

early years of the republic. Political adjustments, mediated by the electoral process,

Parties

11LS:1996

12LS:1998

13LS:1999

14LS:2004

15LS:2009

All-­‐India

Parties

%

Vote

share

%

Vote

share

%

Vote

share

%

Vote

share

%

Vote

share

Congress

28.80

25.82

28.30

26.53

28.52

BJP

20.29

25.59

23.75

22.16

18.84

Sub

Total

INC+BJP

49.09

51.41

52.05

48.59

47.36

State

Parties

Multi-­‐state

parties

22.72

19.36

20.11

16.61

16.24

Single-­‐State

parties

and

Independents

28.19

29.23

27.84

34.80

36.40

Sub

Total

State

Parties

50.91

48.59

47.95

51.41

52.64

Grand

Total

100

100

100

enabled the political system to extricate itself from many difficult situations such as the

protest movements that arose around the demand for linguistic states and the official

language policy.

Accommodation is the key concept that characterizes this constitutional approach

to diversity. From the propensity to recognise difference to giving them constitutional

sanction and status is but a small next step. The existence of multiple identities,

superimposed on one another, is one of the key features of pluralism in India.

The states,

however, are not political units alone. The majority of them have distinct cultural

histories and personalities, and, in the case of the larger pluricultural states, there are

often distinct communities within each state. In the presence of multiple identities, the

overwriting analogy appears the most appropriate. There is a superimposition of layered

identities, where the succeeding layers do not erase the existing ones, but merely

overwrite them.

***

When it came into existence, India’s federal parliamentary system was given

very meagre chances of survival. The capacity to innovate pragmatic solutions in

response to the demands of new forms of diversity has been a constant challenge. Today,

the governance of economic growth has to be skilfully combined with the political

management of poverty.

How de we evaluate India’s efforts at organising an enormously wide range of

diversities, perhaps the widest ever organised by a democracy? India’s political system

has innovated in significant ways in its efforts to evolve a system of governance adapted

to the needs and traditions of an ancient country, which is at last emerging economically

from the ravages of colonial rule, and facing new domestic challenges and global

responsibilities.

Finally, how much has changed in the institutional arrangements for federal

governance under the impact of globalisation and liberalisation? India still remains a

centralised federation, despite some increase in the effective exercise of their powers by

state and local governments. New regulatory bodies have merged to replace the earlier

mode of governance based on licences and permits, held responsible for stifling growth.

These new regulatory organisations, with the ostensible mandate of benchmarking best

practices and ensuring minimum standards across the Union, have developed

considerable clout. They are the new pillars on which the federal governance of growth

now rests.