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Wednesday, June 29, 2022

The Centre-state mindset

It is patronising to the states. It reflects in inadequate media coverage of state matters.

Written by Bibek Debroy |
Updated: December 10, 2015 12:06:40 am


Recently, I had a chat with a correspondent who covers the Northeast for a national newspaper. I asked him for the name of the state that has the highest literacy rate in India. He thought for a while and said Kerala, before adding Mizoram as an afterthought. He was somewhat surprised when I told him that both of them had been overtaken and the answer was Tripura. There is an obvious point about general ignorance and indifference towards the Northeast. But there is more to it than that.

Journalist T.N. Ninan once told me, “national media” is what is watched and read between Noida and Gurgaon. Depending on the year and the Indian Railways’ performance, 95 per cent of national income is produced in the states. How often do you find coverage of states in the English-language media? How often do you find state-related coverage in the English-language business press (the so-called pink papers), as opposed to the general media? Compared to the hype and hysteria over Union budgets, how often are state budgets discussed and dissected?

With product market (except in agriculture) reforms being addressed in the post-1991 flush and with financial sector liberalisation being more incremental in nature, most of the reforms still pending concern the factor markets. The factor markets are largely in the states’ domain, featuring either in the Concurrent or the State List. How often are those reported?

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In fairness, there is some coverage when labour laws are changed, or when a major investment project gets the nod. Moreover, policy changes are often relatively mundane. But to me, it’s a big development that the Rajasthan government repealed around 12 per cent of its statutes, having identified them as old and dysfunctional. Was it reported? You may recall one particular column, but may forget that the chief minister herself authored it.

Even if policy is somewhat covered by the media, there is rarely any reportage on public expenditure. The 14th Finance Commission (FC) recommended 42 per cent of the divisible tax pool to be devolved to states as untied funds. But how do we know that states are responsible enough to make judicious use of the additional funds?

Part of the answer lies in further fiscal and non-fiscal devolution to the local bodies. But how many states have state-level FCs? Moreover, as an issue, how often is this concern for further devolution covered?

I try not to use the expression “Centre-state” unless I am quoting someone.

The word “Centre” doesn’t figure in the Constitution. More importantly, it smacks of a centre-periphery kind of relationship and is vaguely patronising towards the states. Metaphorically, “Centre-state” probably conjures up more centrifugal forces than centripetal. The right expression should be “Union-state”. The point I wish to make is that the kind of reportage I underlined also suffers from this Centre-state mindset. After untied devolution, after deficit reduction commitments and after addressing items of expenditure in the Union list, the leftover revenue is to be used for what can loosely be called the Central-sector (financed fully with the Union government’s funding) and the Centrally sponsored (partial Union funding, with a higher Union contribution for northeastern and Himalayan states) schemes. In an earlier era, the now defunct Planning Commission would have devised these public expenditure schemes. However, in March 2015, a sub-group of chief ministers was set up for this purpose, with parallel sub-groups for the Swachh Bharat mission and skill development.

The report of the sub-group on the rationalisation of Centrally sponsored schemes was submitted in October 2015 and has been reported in the media. It divided schemes into a national development agenda (mandatory for all states) and an optional basket. From 2016-17, states will presumably realign their schemes, with or without Union funding.

I personally don’t think any state should have more than 30 departments, although there is a state where the number of departments is as high as 56. Isn’t it, therefore, news that Jharkhand has rationalised the number of departments and reduced it from 43 to 31? For instance, a standard problem is that state departments looking after rural development, rural works and panchayati raj work in silos. Jharkhand has combined them.

Similarly, it has combined the planning and finance departments. Part of NITI Aayog’s job is the collation of such best practices and their dissemination. And there are plenty of interesting examples
of innovative public service delivery across different states. We will certainly do that, but I wished to draw attention towards the inadequate media coverage received by the states.

If untied funding to states has increased to 42 per cent, surely states warrant greater coverage. Let’s stop debating how much the Union government spends on health and focus on state-level expenditure.

Let us also debate capital expenditure in the states, not just by the Union government. Let us recognise that the Indian polity is a union of states.

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The writer is member, NITI  Aayog. Views are personal

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