Cooperative Federalism-Foundation of Strong India, Development of States is Nationalism

Cooperative federalism

A thought where Narnedra Modi Govt.(Centre) and Arvind Kejriwal Govt.(States) engages as a equal partners in development is emerging, this is a perfect example of Foundation of strong India.

Now fair and logical decision to be taken while fund allocation which is indeed necessary for the development of a country.

From where Cooperative Federalism came from?

Its a term coined by India's PM Narendra Modi - phrase "Cooperative Federalism" first mention by him in the context while replacing the Planning commission with the NITI Aayog.

Niti Ayog
  • National Institution for Transforming India (NITI) Aayog.
  • Chairman Narendra Modi
  • Vice Chairman: Free market  economist Arvind Panagariya
  • CEO: Ms.  Sindhushree Khullar (IAS)
  • Fulltime Members: Economist Bibek Debroy and former DRDO Chief V K Saraswat.
  • Better read the whole article here for structure and membership.

Cooperative Federalism has been implement via recommendations of 14th Finance Commission,- headed by former RBI Governor Y.V. Reddy.

What are the Changes by Cooperative Federalism?

 There are many changes but the major one is - Center will share 42% of the divisible pool with the states.
 (what is Divisible pool? - "Pool" from which money is shared between Center and States.)

this change in the divisible pool make jubilation of states which express there gratitude via thanks giving ads in leading newspapers in many stats like Gujrat, Madhya Pradesh, Chathisgarh, Rajasthan.

  • States are grateful to center for the historic decision to devolve 42% of states share of Central taxes.
  • Incremental of 10% in devolution of divisible pool of resources to all the states from 32% to 42%.

What will happen by decision taken by govt.

  • All states now to get Rs. 5.74 lakh crore  this year.
  • Rs. 1.40 lakh crore more, as compared to that of the previous year.
  • Special provisions for municipal corporations and towns.
  • Liberty of states to deploy funds as per their needs rather, `one size fits all ' approach.
  • Flexibility for States to determine their own priorities in implementing centrally sponsored schemes.

This steps marks the beginning of a new era in the history of cooperative federalism in our country.

Golden moments in the socio-economic development story of our country, as resources transfer to states jumps substantially. 

Strengthening cooperative federalism gives radical changes in composition of transfer of resources to states.

Belief and trust in the capacities of state government.

Transparent, fair and swift action of coal blocks resulting in additional resources to States.

Implementation of Goods and service tax (GST), is main task for center by Cooperative Federalism it gave greater freedom and responsibility by developing greater resources.