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August 24, 2003
Federalism on trial
Jyotirindra Dasgupta analyzes the struggle between the centrists and those seeking regional autonomy in India
THE regional explication of the national project assumed many forms. Its initiatives boldly reminded the centralists led by the Nehru vision that their misgivings about the region’s struggle for autonomy; greater federalization, and democratic rights needed radical revision. Their contention against the centralists, though widely misunderstood in the country and abroad, proved to be the most valuable resource to reconstruct the nation and its multicultural ethos whenever the centralists strayed from the course.
Fortunately, the regional initiatives were aided by the wider rules of the democratic institutional system even when the federal government at the centralists’ command was deployed against them. The system’s ability to incorporate the lessons of the regional initiatives, even when their contentious forms looked disquieting signalled an assurance that augured well for renewing the foundations of democracy and federalism at critical moments of national transition.
It would be a mistake to assume that these regional initiatives for change and their contentious expressions were necessarily induced by exclusive cultural territorial, or ethnic drives. The large-scale insurrectionary struggles of the communist movement in the south of the late 1940s, though unsuccessful unmistakably registered a note of radical urgency for social transformation in the national agenda of development.
When the communist leaders shifted their strategy in favour of parliamentary methods, the democratic system in the country legitimized their national participation at a time of world history when democracy was supposed to be in mortal combat with communism. Going against the grain of the red scare induced by the advanced democracies, the Indian system’s willingness to give parliamentary communism a fair trio yielded an amazing inclusionary dividend.
Within a few years, in 1957, the first case in the world of a democratic induction to power of a communist party took place in Kerala. Thus began a long history of parliamentary communism in three states of India that significantly enhanced the quality of democratic and national development in terms of national ideological inclusion and endorsement of radical social and economic reforms pursued by the communist governments.
The gains of these reforms clearly benefited the lower classes in these regions covering more than 80 million people. If these transformative gains deepened the social reach of the national project, the centralist leaders of the Congress Party during their decades of control of the national government resolutely tried to frustrate them from the beginning of their tenure of regional power.
Here was a case when the regional contribution to National development clearly demonstrated that the centralist right to speak for the nation in a tutelary voice, as intended by the then Congress leaders including Nehru, was indeed unwarranted. The class emphasis of politics in these radical states also indicated that the civic content of a sub-national scale of politics need not lag behind that of the national level as practised by the centralist leaders.
The role of the civic dimensions of regional politics also emerged clearly in the autonomy initiatives organized by the popular movements to realize the reorganization of states along linguistic lines. As in the case of a systemic induction of communist radicalism in the national democratic institution, the interaction of the popular movement with the federal government paved the way for a negotiated reconstruction of the institutional structure of the federation.
The Andhra case is instructive. The demand for a separate Andhra state to express the autonomy aspirations of the Telugu speakers was not motivated by any opposition to Indian nationalism. It was basically a move to reorganize the Telugu speakers, who during the colonial period remained dispersed in several administrative units (mainly Madras and Hyderabad), into an integrated, autonomous state within the federation.
But in 1951, the Andhra movement succeeded in gaining strong popular support across a wide band of political persuasions. But the Congress leaders led by Nehru initially hesitated, then opposed, and finally agreed to concede the demand after the movement became desperate and violent.
Some of these issues were anticipated during the founding moments of the federal system. Those were the years of centralist fascination for the magic of planned economic and social transformation. Not surprisingly, the initiative for national planning under central guidance was led by Nehru and his Congress followers. The constitutional distribution of resources left a margin of disadvantage for the states that gave an opportunity for privilege to the planners at the centre.
The constitutionally warranted Finance Commission supposed to safeguard the financial autonomy of the states accounted for nearly the same proportion of the total central transfers to the states as that determined by the Planning Commission of the central government (about 45 per cent in the middle 1990s, for example). Total net transfers about that time amounted to approximately 44 per cent per year of the expenditure of all the states and the union territories taken together. The average annual figure registered during 1987-90 was 46 per cent. The discretionary element in plan transfers gave an advantage to the centre that violated standards of federal fairness.
It took several election setbacks for the Congress Party in the late 1960s to adopt a more sensible system of allocation of plan transfers on the basis of population, relative backwardness, and fiscal competence of the states to reduce the element of discretion. The regional voice became stronger after the Congress Party lost power in 1977.
However, the idea of a single divisible pool involving a mandated sharing of gross proceeds of all central taxes with an assured proportion of the share for the states had to wait until 1997 for official endorsement when a coalition of regional parties (the United Front) was in power.
The seriousness of the issue was also recognized by the NDA government when it set up a commission for constitutional reform in early 2000 to review, among other issues, the problem of financial autonomy of the states. With three more states added in 2000 to the federation, the case for a review may become more compelling.
The growing importance of regional authority, and autonomy highlights the problems of interdependence between the centre and the states, and also among the states themselves. The diversity of resource bases among states raises some questions of fairness regarding transfers that call for federal negotiation mainly from the vantage point of the centre...
What is much easier to notice is the poor capacity of the states to raise their own resources. The states in Canada or Brazil mobilize resources that take care of nearly 80 per cent of their expenditure, but in India the corresponding figure would be about 45 per cent. The rapid rise in state revenue expenditure despite modest increases in revenue receipts along with persistent increases in the non-developmental component of the expenditure, in the 1990s for example, indicate a trend that is disturbing.
The subsidies and losses associated with the public sector enterprises of the states serve populism by draining away peoples’ resources. Between 1998 and 2000, the revenue deficit of the states more than doubled, according to one estimate.
The dependence of the poorest states on the centre increased, as the lectures on autonomy became more strident. When these poorer states make little effort to mobilize internal resource, they impose a burden on the better performing states like Tamil Nadu whose tax effort in the 1990s was 12 per cent of the state national product versus Bihar’s 5 per cent.
Fortunately, the centrally coordinated system has continued to work irrespective of changes in leadership, ideology, or regional weight in governments providing organized support for national collaboration. Even after a marked shift towards liberalization, the larger share (59 per cent) of the total public sector outlay in the 1992-97 plan was accounted for by the central government’s resources...
Liberalization since the early 1990s, however, has offered a new opportunity for attracting resources by the better performing states. A study comparing the annual growth rate of states (gross state domestic product [SDP]) in the 1980s and 1990s reports an increase in the degree of dispersion in growth rates across states in the latter period. States which experienced strong cultural autonomy movements turned out to be some of the best performers like Gujarat, 9.6 per cent and Maharashtra, 8.01 per cent. They were followed by those with a record of a communist movement; West Bengal, 6.9 per cent and Kerala, 5.81 per cent.
Some of the worst performers were Uttar Pradesh and Bihar, two of the largest states that once were supposed to be the heartland of the country. They are associated with the largest bloc of language community legislators from the Hindi region dominating parliament and presuming to provide the centre of national stability and vitality...
The combined effect of political and economic competition is increasingly likely to generate a new assurance to cultural regions and groups who were previously intimidated by political numbers. This is not a question of the necessary superiority of economic numbers. It is an admission of the importance of new accomplishments by groups deserving new eminence.
Take literacy for example. Some impressive strides have been made in the 1990s in this area by a number of states. While the large Hindi states have lagged behind the national average rate of 62 per cent, by 1997, four states have exceeded the 70 per cent mark and Kerala reached the level of 93 per cent. The former insurgency area of Mizoram did still better, in 1998, at 96 per cent.
In fact, following the stabilization of autonomous statehood in the northeastern area, six out of seven states attained the highest rate of growth of literacy in the nation. Between 1991-97, when India’s average rate of growth of literacy was 9.8 per cent, Meghalaya attained the rate of 27.9 per cent. These performance records should intimate impressive possibilities of social and political mobility displacing older patterns of dominance in the course of national development and generating new inclusionary assurance.
Political competition contributing to inclusionary assurance can also be turned inward within each cultural community. The logic of inclusion that drives activated citizens to struggle against entrenched groups can also induce them to question their own community leaders or privileged strata.
Democratic opportunities and electoral contention are often feared by insurgent leaders precisely because their own followers may challenge their credentials to speak for the whole group or community. Particularly, after a community gains autonomy, the less privileged members may seek to realize their own rights of access or even self-determination. The sub-regional movements for a separate Telangana in the 1960s or for the separation of the Andhra region from Andhra Pradesh in the 1970s clearly indicates how the claims of collective solidarity can induce significant segments of cultural communities to go their own way to seek autonomy. The switching of identity claims in such cases is interesting.
Excerpted with permission from
India’s 1999 Elections and 20th Century Politics
Edited by Paul Wallace and Ramashray Roy
Sage Publications, B-42, Panchsheel Enclave, Post Box 4109, New Delhi-110017, India. Tel: 91-11-2649 1290-7
Email: marketing@indiasage.com Website:
www.indiasage.com
ISBN 0-7619-9598-6
443pp. Indian Rs850
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