DYNAMICS OF INDIA’S FISCAL FEDERALISM
Origins and Evolution of India’s Federation
– The Indian Constitution originated from a backdrop of multiple forces pulling the country in different directions before Independence.
– This Constitution has shown incredible resilience over its 73-year journey.
– While it aimed to “hold together” the federation, it also had a unitary bias.
Changing Dynamics of Fiscal Federalism
– India’s transition from a planned economy to a market-driven one has reshaped the fiscal landscape.
– Shifts such as the formation of the NITI Aayog, the passing of the FRBM Act, the introduction of the GST Act, and extensive use of cess and surcharges have had varied impacts on federalism in the country.
Equity in Intergovernmental Transfers
– There’s a pressing need to make intergovernmental transfers more equity-oriented.
– Statistics reveal that the top 1% earners in India have seen drastic fluctuations in their income share, largely influenced by policies during different eras.
– A study on per capita income over five decades shows a growing divergence among states. However, the Human Development Index (HDI) across states has displayed convergence.
– The 16th Finance Commission should prioritize equity, possibly using HDI as a significant factor in tax distribution decisions.
Revisiting Power Distribution
- Changing Governance Dynamics: India’s shift from a single-party to a multi-party system necessitates a review of power and functional distribution.
- Central Legislations’ Impact on States: Several acts, like the National Rural Employment Guarantee Act 2005, have put additional burdens on states.
- Need for Clarity: The division of functions and finances between the Center and states remains ambiguous, leading to confusion and inefficiencies.
Recognition of the Third Tier
– The third tier of governance in India, comprising local bodies, has not been adequately placed or recognized in the fiscal map.
– There’s a need for standardized financial reporting and more respect for the significant number of elected representatives in these local bodies.
Addressing Off-Budget Borrowing
– Off-budget borrowing by both the Union and states requires scrutiny.
– Such borrowings are usually neither scrutinized nor reported but have repercussions on the respective budgets.
– While states are kept in check through various regulations, the Union often bypasses these controls.
Conclusion
The evolving dynamics of India’s fiscal federalism demands a profound reconsideration, especially in the light of the upcoming 16th Finance Commission.
Proper distribution of functions, recognition of all governance tiers, and transparency in financial operations are vital for the nation’s continued growth and unity.
India's Path to Development: Challenges, Opportunities, and Inclusivity
Introduction:
India’s recent achievement of successfully soft-landing on the Moon reflects the nation’s capabilities and potential.
This achievement aligns with the vision of India@100, a goal to become a developed nation by 2047.
However, this journey is marked by challenges that require a comprehensive and inclusive approach.
The Challenges Ahead:
- Addressing Inequalities: While India has made progress in various sectors, stark inequalities persist in health, education, and wealth distribution. A significant portion of the population still lives below the poverty line, and the gap between the affluent and the disadvantaged remains wide.
- Fostering Inclusive Growth: Economic growth needs to extend beyond pockets of high income. The focus must shift toward skill development, job creation, and providing opportunities for marginalized groups, ensuring that development reaches all segments of society.
- Reliable Data and Governance: Accurate and updated data is crucial for effective planning and decision-making. Transparent, independent, and apolitical institutions, as well as a fair justice system, are essential to guide the development journey.
- Technology and Climate Change: Embracing technology is vital for progress, exemplified by innovations like the Unified Payments Interface. However, development must be accompanied by environmental responsibility, as climate change poses ongoing challenges that require awareness and solutions.
- Empowering Women: Inclusivity necessitates empowering women. Their increased participation in the workforce and public life requires equal opportunity workplaces, safe public spaces, and progressive mindsets in society.
Opportunities for Development:
- Infrastructure and Connectivity: India’s rapid infrastructure development and improved connectivity lay the foundation for progress. Continued investment in these areas can enhance economic growth and access to opportunities.
- Entrepreneurial Spirit: India’s robust startup ecosystem showcases its entrepreneurial spirit. This culture of innovation can be harnessed to address developmental challenges and drive economic growth.
- Climate Consciousness: While combatting climate change is a challenge, it’s also an opportunity to lead in sustainable practices. Raising awareness, adapting lifestyles, and developing climate-friendly solutions can contribute to both development and environmental protection.
Conclusion:
- India’s aspiration to become a developed nation requires more than economic growth; it demands social inclusivity, gender equality, environmental responsibility, and transparent governance.
- This path calls for collaboration across sectors and communities to ensure that progress benefits every citizen.
Building on India’s diversity and cultural richness, while actively addressing disparities, will be essential for a successful journey toward becoming a developed nation by 2047.
ANTHROPOGENIC INTERFERENCE AND HYDROMETEOROLOGICAL DISASTERS: A CALL FOR INTEGRATED FLOOD MANAGEMENT
Introduction:
- In the prehistoric age, natural processes of heavy rain and flooding in hills created fertile basins, fostering agricultural productivity.
- Water percolated naturally to sustain groundwater levels for drinking and irrigation.
- However, anthropogenic activities disrupted these systems, leading to extreme events like flashfloods and landslides.
Historical Hydrology and Development:
- During pre-industrial times, water followed natural courses in streams and rivers, enabling the growth of towns.
- As development escalated, habitation and infrastructure were established in vulnerable areas, obstructing water paths.
- Hills were modified for roads and buildings, and construction debris exacerbated flood damage.
- Irresponsible management of dams and hydroelectric projects compounded the problem.
Climate Change Amplifies Disasters:
- Climate change intensified hydrometeorological disasters, magnifying their frequency and impact.
- Recent events in Himachal Pradesh, Uttarakhand, Punjab, and Kerala demonstrate this trend.
- Heavy rainfall, cloudbursts, and dam releases triggered flashfloods and landslides, causing unprecedented loss of life, property, and infrastructure.
Neglected Strategies and Policies:
- Despite the National Policy on Disaster Management (2009), inadequate emphasis on proactive prevention, early warning, mitigation, risk reduction, and preparedness persists.
- The post-disaster response and relief-centric approach prevails. The cost-effectiveness of preventive measures is undermined.
Inadequate Disaster Response:
- Recent disasters revealed a lack of adherence to established strategies. Doppler radars and early warning systems were underutilized, and disaster response was inefficient.
- Relief distribution reportedly faced obstacles, hindering effective recovery efforts.
Call for Integrated Flood Management:
- A comprehensive approach is essential. A single authority must assess failures, while mainstreaming disaster risk reduction in development policies is crucial.
- Climate change demands an integrated flood management system. Technological solutions, like IT- and satellite-based early warning systems, should be operational around the clock.
Mitigation Measures for Sustainable Development:
- Mitigation and adaptive principles must guide sustainable development. Emphasis on maintaining well-managed catchments, allowing natural water flow, employing sound project execution, and adhering to safety regulations can avert loss of life and property.
- Integrated flood management can drive overall improvement.
Conclusion:
The detrimental consequences of anthropogenic interference in natural hydrological processes are clear.
Urgent action is needed to shift from reactionary to proactive strategies, emphasizing prevention, preparedness, and risk reduction.
An integrated approach, driven by scientific principles and technological advancements, offers hope for effectively managing the escalating challenges posed by hydrometeorological disasters.
