Category Archives: Federalism

All over the world, cases are rising again. Ironically, we see a scene repeated far too often hospitalization rises, governments implement lockdowns, then reopen too quickly in the name of saving the economy. Soon enough, we are back at it again, and the blame game starts.

But thanks to an increase in vaccination, at least in Canada, we have a clear solution to prevent us from falling into the same rabbit hole for the fourth time through using a digital vaccine passport.

Implementing a unified approach to verifying vaccination credentials across all jurisdictions in Canada will not only reduce the risk of transmitting COVID-19 infections in our communities but will also ensure our brick-and-mortar businesses can stay open even during the worst outbreaks. It will also provide confidence to consumers to safely resume their pre-pandemic shopping activities with reduced fear of exposure or another lockdown, speeding up our economic recovery.

But instead, the lack of collaboration and coordination across provinces and territories on the subject is jeopardizing our hard-earned public health progress.

For instance, Manitoba is handing out immunization cards for access to non-essential services. Quebec also promised to adopt a similar vaccine passport system in the fall if case counts worsen. In the meanwhile, Saskatchewan, Alberta and Ontario have downright rejected the idea.

This discrepancy across our various jurisdictions is problematic as most provinces embark on a new round of reopening, at a greater and wider scale than we have yet seen, as part of a return to normal. Some governments are gambling on the assumption that administering vaccines into arms alone will end the pandemic and believe the country will never again be plunged into another lockdown.

But what they are forgetting is that anywhere from 40 per cent to 50 per cent of each province or territorys respective population has not yet received a second dose to achieve full protection. This is not to mention Alberta and Saskatchewan are already lagging far behind the nation on the first-dose uptake, while Quebec is having clear trouble increasing the second-dose uptake due to vaccine hesitancy and individual complacency.

Governments also forget that viruses dont have borders and wont stop transmitting, especially to those vulnerable or unvaccinated, until appropriate measures are implemented to contain them, even under a vaccinated environment. A vaccine passport is the best bet to get the job done in a domestic setting, especially as variants are fast spreading among unvaccinated across the country.

This is not a time to be worried about a split in our society. Special times require special measures, or else we are at risk of backtracking from our current progress.

We need to prevent a pandemic of the unvaccinated, already warned by multiple top public health officials. We also cannot afford another lockdown at the same scale we have seen before the damage from last year and a half has been too great. Our health and economic survival lie in the hands of sound policy-making from our political and public health leaders at this very moment.

On Friday, we heard that Los Angeles County is bringing back mask orders due to the surging Delta variant overwhelming local hospitals. In the UK, cases are surging with rising hospitalizations, and Prime Minister Boris Johnson is now quarantining following contact with his new Health Secretary, who tested positive on Saturday. Its a narrative weve all became too familiar with, and warning signs are printed all over.

We saw devastating results when provinces and territories failed to implement a co-ordinated approach to public health restrictions across the country for the past year and a half. One wave became three. Lockdowns in some areas lasted for over a year, which became the longest in North America.

It should not be the direction we are heading again with the vaccine passport. Instead, we need to tackle the challenge of managing coronavirus together as a federation before too late. After all, which province will pay for the economic damage of a fourth wave?

Susan Cui is a public affairs and communications professional based in Toronto.

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Opinion | Canada's troubles with federalism are hindering progress on vaccine passport - StCatharinesStandard.ca

The Narendra Modi government is clearly keen to rewrite the contours of the Centre-state relationships. The passing of the agriculture reform laws was perhaps the first major move in this direction. Agriculture continues to be, as per the Constitution, a state subject and the Centre used an obscure provision which allows it to pass laws controlling the production, distribution and marketing of goods to do so. This has now been followed up by the creation of a Union ministry for cooperation, helmed by no less a personage than Home Minister and de facto Number Two in the government, Amit Shah.

Predictably, the Opposition-ruled states have dubbed this as yet another attack on federalism by the Modi government, since cooperatives are also in the state list. The Centre has argued that the creation of the ministry will re-energise the moribund cooperative movement in the country by providing it with an appropriate administrative, legal and policy framework.

There is no denying the need to reinvent the cooperative sector, which has become a cesspool of financial mismanagement, corruption and misuse of political power. Success stories like Amul are the exception rather than the rule. While the Reserve Bank of India has taken some steps to regulate multi-state and urban cooperative banks the failure of the Punjab and Maharashtra Cooperative Bank is still fresh other cooperatives, particularly in agriculture and allied sectors, have seen little reform over the years.

The spirit of the cooperative movement of consumers or producers becoming owners and benefiting from collective power has been given the go-by, with many cooperatives becoming personal fiefs of politicians. The case for reform is strong, but since there is enormous political capital to be gained, the Centres view is being viewed with understandable suspicion by states. It is up to the Centre to live up to its oft-touted slogan of cooperative federalism to make the new ministry a successful agent of change.

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FPJ Edit: It's up to the Centre to live up to its slogan of cooperative federalism and make the new ministry of cooperation a successful agent of...

Federalism is a system of government in which power is divided between a national (federal) government and various state governments. In the United States, the U.S. Constitution gives certain powers to the federal government, other powers to the state governments, and yet other powers to both.

States have their own legislative branch, executive branch, and judicial branch. The states are empowered to pass, enforce, and interpret laws, as long as they do not violate the Constitution.

The federal government determines foreign policy, with exclusive power to make treaties, declare war, and control imports and exports. The federal government has the sole authority to print money. Most governmental responsibilities, however, are shared by state and federal governments and these include taxation, business regulation, environmental protection, and civil rights.

Federalism in the United States has evolved quite a bit since it was first implemented in 1787. Two major kinds of federalism have dominated political theory. There is dual federalism, in which the federal and the state governments are co-equals. Under this theory, there is a very large group of powers belonging to the states, and the federal government is limited to only those powers explicitly listed in the Constitution. As such, the federal government has jurisdiction only to the extent of powers mentioned in the constitution.

Under the second theory of federalism known as cooperative federalism, the national, state, and local governments interact cooperatively and collectively to solve common problems. Cooperative federalism asserts that the national government is supreme over the states.

Regardless of the kind of federalism, the Constitution does provide some very specific powers to both the states and the federal government. They are:

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Federalism System

Administrative divisions of Germany. (Clickable image).

Overview of federalism in Germany

Federalism in Germany is made of the states of Germany and the federal government. The central government, the states, and the German municipalities have different tasks and partially competing regions of responsibilities ruled by a complex system of checks and balances.

German federalism dates back to the founding of the Holy Roman Empire in the Middle Ages, to the reforms that came with the Peace of Westphalia and to the constitution of the German Empire from 1871.[1]

Following German unification, German federalism came into conflict with German nationalism. Nationalists argued for power to be concentrated in the central government in Berlin, but were resisted by monarchs and their governments in the various German states outside the Kingdom of Prussia, with the Kingdom of Bavaria in particular keen to defend the rights afforded to it in the Imperial constitution.

After the end of World War II, the federal nature of Germany was restored, after having been effectively abolished under the Nazis. The current German constitution, adopted in 1949, protects Germany's federal nature in the so-called eternity clause.

Since re-unification in 1990, the Federal Republic has consisted of sixteen states: the ten states of the Federal Republic before re-unification ("West Germany"), the five new states of the former East Germany, and Berlin.

The Basic Law for the Federal Republic of Germany divides authority between the federal government and the states (German: "Lnder"), with the general principle governing relations articulated in Article 30: "Except as otherwise provided or permitted by this Basic Law, the exercise of state powers and the discharge of state functions is a matter for the Lnder."[2] Thus, the federal government can exercise authority only in those areas specified in the Basic Law. The states are represented at the federal level through the Bundesrat, which has a role similar to the upper house in a true bicameral parliament.

The Basic Law divides the federal and state governments' legislative responsibilities into exclusive federal powers (Articles 71 and 73), competing powers (Articles 72, 74), deviation powers (Article 72), and exclusive state powers (Article 70). The exclusive legislative jurisdiction of the federal government includes defense, foreign affairs, immigration, citizenship, communications, and currency standards, whereas the states have exclusive jurisdiction on the police (excluding federal police), most of education, the press, freedom of assembly, public housing, prisons and media affairs, among others.[3] Even in cases where the states have exclusive jurisdiction, they sometimes choose to work with each other and come to a basic agreement with the other states, which is then passed by the sixteen state parliaments and thereby enshrined into law nationwide. This is done in order to avoid legal patchworks. An example of this is the states' online gambling regulations.[4]

In the areas of nature conservation, university degrees, and university admission, among others, state legislation can deviate from (i.e. amend or replace) federal legislation.[3]

The federal and state governments share concurrent powers in several areas, including, but not limited to: business law, civil law,[3] welfare, taxation, consumer protection, public holidays, and public health. In many concurrent powers, however, state legislation only remains in effect as long as there is no federal legislation that contradicts its contents,[3] though the passage of such federal legislation may be subject to additional legal requirements, as stipulated by Article 72, Section 2 of the Basic Law.[2]

The areas of shared responsibility for the states and the federal government were enlarged by an amendment to the Basic Law in 1969 (Articles 91a and 91b), which calls for joint action in areas of broad social concern such as higher education, regional economic development, and agricultural reform.

International relations, including international treaties, are primarily the responsibility of the federal level but, as in other federations, the constituent states have limited powers in this area. As provided in Article 23, Article 24, and Article 32 of the Basic Law, the states (Lnder) have the right to representation at the federal level (i.e. through the Bundesrat) in matters of international relations that affect them, including the transfer of sovereignty to international organizations and, with the consent of the federal government, have limited powers to conclude international treaties.[5]

Some older treaties between German states and other countries also remain in effect. The BavarianAustrian Salt Treaty of 1829 (German: Konvention zwischen Bayern und sterreich ber die beiderseitigen Salinenverhltnisse vom 18. Mrz 1829), for instance, is the oldest European treaty still in effect.[6] 1957 the government of Bavaria used a revision of the treaty to actively claim the states' rights against the will and claims of the federal government.[6]

The Bundestag (meaning Federal Diet) is Germany's federal parliament and the de facto lower house of the federal legislature, and the Bundesrat (Federal Council), which represents the states at the federal level, is the de facto upper house. The entirety of the Bundestag is elected in a single federal election, which is typically held every four years, unlike the Bundesrat, which is composed of the sixteen state governments and therefore prone to change in its composition frequently, as the various states hold elections at different times with little to no coordination. As a result, the federal governing coalition (which requires a majority in only the lower house, i.e. the Bundestag in order to be able to govern, like in most other parliamentary systems) rarely has a stable majority in the upper house, i.e. the Bundesrat, and is therefore required to compromise with opposition parties in order to pass legislation that requires the Bundesrat's approval.

The Bundestag is typically the dominant body in ordinary federal lawmaking, however the Bundesrat's explicit consent (an absolute majority of members voting in favour) is required for every approval law, i.e. bills that affect state finances or administrational duties in some way,[7] which makes up roughly 40% of all federal legislation,[8] otherwise the bill is effectively vetoed and this veto cannot be overridden by the Bundestag. The Bundesrat also has the ability to veto every other type of legislation, so-called objection laws, by an absolute majority and two-thirds majority of all members, though this veto can be overridden by an absolute majority of all members and a two-thirds majority of voting members representing at least of half of all members in the Bundestag, respectively.[7]

A two-thirds majority of all members in the Bundestag and a two-thirds majority of all voting members (representing at least half of members) in the Bundesrat is required for any constitutional amendment.[7]

In a rotating fashion, Federal Constitutional Court judges are elected by a two-thirds majority vote by the Bundestag and the Bundesrat.[9] By a majority vote, judges of other federal courts (e.g. Federal Court of Justice) are elected simultaneously by both the federation and the states with each having half of the voting power.[10]

The president of Germany, a largely symbolic position given Germany's parliamentary system but nonetheless the official head of state, is also elected by both the federal parliament and state legislatures coequally (see: Federal Convention (Germany)).

The makeup of the Bundesrat and therefore the representation of the states at the federal level is fundamentally different from the upper houses of some other federal systems, such as the Swiss Council of States or the United States Senate. In those countries, upper house legislators are elected separately and are therefore independent from their respective state governments. In contrast, the members of the Bundesrat are merely delegates of state governments and invariably vote and propose laws as instructed by their respective governments, meaning the states exert direct influence over federal politics.

Since Germany is a member of the European Union, some of the powers the federal government constitutionally possesses are, in practice, exercised by EU institutions, namely by the European Parliament, the European Commission, the European Council, and the European Court of Justice. The EU policy areas, shared or exclusive, include, but are not limited to: monetary policy (Germany being a member of the Eurozone), environment, agriculture, foreign policy, internal market, customs union, and consumer protection. However, all of these powers were freely delegated to the EU by Germany (unlike in a federation where power is inherent and does not require delegation) and Germany remains sovereign and maintains the right to leave the union, therefore, the EU is not part of German federalism. Germany also maintains a large degree of control over EU policy through the European Council and its MEPs in the European Parliament.

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Federalism in Germany - Wikipedia

Federalism is atype of government in which the power is divided between the nationalgovernment and other governmental units. It contrasts with a unitary government, in which a centralauthority holds the power, and a confederation,in which states, for example, are clearly dominant.

While the Constitution addressed only the relationship between the federal government and the states, the American people are under multiple jurisdictions. A person not only pays his or her federal income tax but also may pay state and city income taxes as well. Property taxes are collected by counties and are used to provide law enforcement, build new schools, and maintain local roads.

Throughout the 20th century, the power of the federal government expanded considerably through legislation and court decisions. While much recent political debate has centered on returning power to the states, the relationship between the federal government and the states has been argued over for most of the history of the United States.

Although the Constitution sets up a federal system, nowhere does it define what federalism is. However, the framers of the Constitution were determined to create a strong national government and address the shortcomings of the Articles of Confederation, which allowed the states too much power. In terms of the balance of power between the federal government and the states, the Constitution clearly favors the federal government.

The powers specifically given to the federal government are not as relevant to the expansion of its authority as the Constitution's more general provisions; that is, Congress is to provide for the general welfare (preamble) and ". . . make all laws which shall be necessary and proper . . ." (Article I, Section 8). In the Constitution as ratified, there is no similar broad grant of powers to the states. It emphasized what states cannot do (Article I, Section 10) and gave them authority in just a few areas namely, establishing voter qualifications and setting up the mechanics of congressional elections. This reduction in power was corrected through the Tenth Amendment, which reserved to the states or the people all powers either not specifically delegated to the national government or specifically denied to the states. The language in the general welfare and elastic clauses and the Tenth Amendment is vague enough to allow widely different interpretations. Because both federal and state governments can turn to the Constitution for support, it is not surprising that different concepts of federalism have emerged.

Dual federalism looks at the federal system as a sort of "layer cake," with each layer of government performing the tasks that make the most sense for that level.

The initial framing and ratification of the Constitution reflected this theory. Even those people supporting a stronger national government proposed that powers in the federal government be distinct and limited, with certain tasks enumerated for the national government in the Constitution and the remaining tasks left to the state governments. Because this theory leaves each government supreme within its own sphere of operations, it is also sometimes called dual sovereignty.

One more-extreme outgrowth of this theory is the idea of states' rights, which holds that, because the national government is not allowed to infringe on spheres left to state government, doing so violates the states' constitutional rights (especially the Tenth Amendment, which specifically reserves undelegated powers for the states). Federal government action in those spheres represents an unlawful seizure of power by one level of government at the expense of another. This view has historically been popular in the South, where it was viewed as preventing national government interference in the region's race relations, but it has been invoked elsewhere as well.

The problem with taking dual federalism this far is figuring out who defines where one layer ends and the next layer starts. Before the Civil War, some voices said that, to protect their rights, states could secede from the Union or declare national laws that affect them null and void but those arguments are no longer taken seriously. Instead, the U.S. Supreme Court resolves disputes within the federal structure, and because the Court is a national institution, it rarely favors the states.

The theory of cooperative federalism emerged during the New Deal, when the power of the federal government grew in response to the Great Depression. It does not recognize a clear distinction between the functions of the states and Washington, and it emphasizes that there are many areas in which their responsibilities overlap. For example, drug enforcement involves federal agents, state troopers, and local police. The federal government supplies funds for education, but the state and local school boards choose curriculum and set qualifications for teachers. (Interestingly, attempts to set national standards for students in certain subjects have raised concerns of federal intrusion.) The notion of overlapping jurisdictions is expressed by the term marble-cake federalism.

Cooperative federalism takes a very loose view of the elastic clause that allows power to flow through federal government. It is a more accurate model of how the federal system has worked over much of U.S. history.

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Concepts of Federalism - CliffsNotes

At no point since Independence has India experienced such healthy and vibrant sense of federalism, irrespective of what the Opposition claims

An oft-repeated criticism by the Opposition is that since the current Government came to power in 2014, there has been a dilution in federalism which, in a large country, is believed to be an important facet of democracy. The question is: Has there been such a dilution? The issue of federalism can be discussed subsequently. Elections, both at the Centre and in States, have been held regularly and on schedule. COVID or not, polls recently took place in Kerala, Puducherry, Tamil Nadu, Assam and West Bengal.

If I remember correctly, there might have been Presidents Rule in one of our smaller States for a few days. Other than that, one can assert that Article 356 has not been used by the Centre; this is in contrast to even Jawaharlal Nehru who had used Article 356 to dismiss the Kerala Government when Indira Gandhi was Congress president. As Prime Minister, she made it a habit of imposing Presidents Rule, with West Bengal being a particular target under its United Front Government. Deputy Prime Minister Chaudhary Charan Singh outdid Indira; as soon as the Janata Party Government was formed in early 1977, he dismissed all State Governments with a Congress Ministry.

The most federal step taken since Independence has been the introduction of the Goods and Services Tax (GST). Simultaneous with the levying of the tax, on a retail bill of even Rs 100, the GST is shared in half by the States and Centre. This tax comprises virtually the entire indirect taxation of the country. Earlier, the former Planning Commission used to make an allocation annually, when the Chief Ministers came to meet its Deputy Chairman with a bouquet of flowers. This allocation had no accountability, nor was the amount of grant determined by any just and equitable measure.

Take the case of Article 370. Does its abolition not place all States or Union Territories on an even keel? The birth of this Article was illegitimate. Approved by the Nehru Cabinet, it slipped into the Constitution as a purely temporary measure. Parliament never saw the light of this Article. Years ago, an Englishman visiting India had asked me whether this was a special favour by a Kashmiri Prime Minister to the Kashmiris? What could I reply? Whatever may be the extent of federalism prescribed by the Constitution, it must be applied blindfolded. The other aspect of federalism in practice is the quality of the regional politicians. Go back to the first two decades after Independence. Assam had Gopinath Bordolai, West Bengal had BC Roy and Atulya Ghosh, Srikrishna Sinha and Anugraha Narayan Singh in Bihar, Chandrabhan Gupta in Uttar Pradesh, Ravishankar Shukla in Madhya Pradesh, C Rajagopalachari and later K Kamaraj in Tamil Nadu, S Nijalingappa in Karnataka, and so on. Compared with these tall leaders, we do not uniformly have comparables today. To a great extent, they operated by principles, whereas today, national issues, whether health, defence of the country or foreign affairs, politics is made thereof.

One latest example is the COVID-19 pandemic and the acquisition of vaccines. Some regional leaders probably thought that purchasing vaccines was a pleasure which the Prime Minister was monopolising. In response, the PM declared that any State that chooses to acquire vaccines can do so. Within two weeks, they found it to be a difficult task and declared that it was the Centres duty to arrange for the vaccines. Such senior figures as Chief Ministers ought to realise the difference between political and social issues to make a success of true federalism. And certainly not contradict themselves within a fortnight.

Many do not realise the differences between a Union of States, federalism and quasi-federalism, or a unitary State. Also not realised is that there is a difference between a number of independent States voluntarily coming together to form a federation, as was the case with the US. In India, basically, the British handed over to us a number of provinces; plus, there were princely States that were asked to merge with either India or Pakistan. There was no other option. Given the variety of our population, in BR Ambedkars view, the polity was such that India had to be more centralised than, say, the US.

It is noteworthy that the concept of federalism was born with the inauguration of the US Constitution in 1781. During the times when monarchy was the general rule, the question of federalism never arose. In Europe, except for Russia, most countries were of a medium size or smaller, hence the question of federalism never arose. And Russia was an empire autocratically ruled by the Czars. Even democracy was not by any means a rule and Great Britain stood out as a shining example of democracy. Germany took to democracy after World War I and by 1934 it was back to a dictatorship under Adolf Hitler. France began flirting with democracy after Napoleon was finally defeated and imprisoned on the island of St Helena.

(The writer is a well-known columnist and an author. The views expressed are personal.)

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Democracy, Oppn and federalism - Daily Pioneer

Eric Adams speaks an election night party in New York City, June 22, 2021.(Andrew Kelly/Reuters)

Thank goodness for federalism.

New York City, that paragon of clean and fair politics, decided to tinker with its voting system and implement ranked-choice voting for its mayoral-primary elections this year. Some advocate ranked-choice voting for more elections. The waiting period we are in right now is the best argument for why ranked-choice voting should stay right where it is.

As things currently stand, Eric Adams won 29.3 percent of the first choice votes. Maya Wiley won 20.3 percent. Kathryn Garcia won 18.1 percent. Andrew Yang won 11.9 percent. Everyone else was below 5 percent.

So, of course, were currently waiting to see whether Garcia has enough votes to win the election the one who finished third initially and was eleven points behind Adams.

There are political scientists out there who will explain to you why this is better and why, on paper, more voters will be satisfied in the end with the results. But in a time when trust in election integrity is already low, we dont need a system thats hard to report and hard to comprehend.

Please imagine how this would work in, say, a national presidential primary with ranked-choice voting. Consider what would have happened if it turned out that in 2016, for example, Donald Trump won 29.3 percent of the vote, Ted Cruz won 20.3 percent, Marco Rubio won 18.1 percent, and John Kasich won 11.9 percent, just like the mayoral breakdown. And imagine that if a week after the election, we get preliminary results that indicate its a battle between Trump and Rubio. Oh, and we wont actually know the final results for possibly two months. Theres plenty wrong with our current primary system, but that does not sound like an improvement. And we have plenty of reason to believe a national presidential primary would be even worse because, unlike an election in New York City, it would involve the varying capabilities of the election authorities of every local government in the country.

Eric Adams has already put out a statement saying the way the results have been announced rais[es] serious questions, and we dont even have the final results in yet. Thats pretty predictable because, well, he got the most first-choice votes by a lot, and any voting system where the guy who gets the most votes doesnt win is going to be questioned by the guy who gets the most votes.

This has already happened when ranked-choice voting in Maine resulted in Bruce Poliquin, the last Republican U.S. House member from all of New England, losing an election where he won the most first-choice votes in 2018. He sued to have the law invalidated as unconstitutional, and his case rattled around the courts from the beginning of November until he dropped his lawsuit on Christmas Eve.

Do we really want to give politicians more chances to be sore losers and rile up voters who believe an election was stolen from them? Eric Adams won the most first-choice votes. If he ends up losing and wants to say the election was stolen from him, his supporters arent going to be interested in some animated data visualization and a 2,000-word thinkpiece explaining why theyre actually better off.

So what does this have to do with federalism? If youre one of the approximately 320 million Americans who dont live in New York City, you dont have to care about any of this.

We let local governments try stuff, which is great. If New York City wants to keep confusing the heck out of its voters, thats up to them. Ranked-choice voting, on the merits, is not a completely ridiculous idea. But now we know that in practice, its confusing and creates more opportunities for distrust in electoral processes. And now you cant say its never been tried.

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NYC Ranked Choice Voting Reminds Us Why Federalism Is a Blessing - National Review

Last week, China started operating the first bullet train in Tibet, linking Lhasa to Nyingchi near the border with Arunachal Pradesh. The construction of this 435 km line began in 2014 in one of the toughest terrains with 90 per cent of the track being 3,000 metres above sea level. A senior Chinese Communist party official who was formerly in charge of Tibet has spoken about rapid trade and economic benefits to the region and dropped ominous hints about the rail line acting as a fast track for the delivery of strategic materials in case of a border crisis with India. Over the last 15 years, China has developed the worlds longest high speed railway network with a total length of 37,500 km, accounting for two-thirds of the worlds high speed railway network.

Indias maiden effort in construction and operationalising a 508 km high speed railway corridor connecting Ahmedabad in the capital of the Prime Ministers home state of Gujarat with the countrys financial capital, Mumbai, stands in stark contrast to the clinical precision with which the Chinese have executed their mammoth infrastructure projects.

The construction was expected to begin in April 2020 with December 2023 as its initial completion date, which has now been pushed to December 2028, as only 23 per cent of 156 km of land has been acquired in Maharashtra as against 95 per cent of 348 km in Gujarat and 100 per cent of 4 km in Dadra and Nagar Haveli.

A closer look at the history of this marquee project of national importance will throw light on some of the key reasons for the delays and impediments.

The project was originally conceived in 2009-10 under the Congress-led UPA government as the 650 km Pune-Ahmedabad high speed railway corridor via Mumbai but the Pune-Mumbai leg was dropped in March 2013 under the UPA government by advancing specious reasoning of financial constraints.

A project that should have been a beacon of Prime Minister Narendra Modis cherished principle of cooperative federalism has ended up being badly embroiled as a centre-state dispute with simmering discontent among the citizens of Maharashtra. Both in the 2014 and 2019 Lok Sabha elections, 11.4 crore citizens of Maharashtra reposed their unflinching faith in the dynamic leadership and progressive, development-oriented policies of the Prime Minister by returning unprecedented mandates. A strong belief that the central government would espouse projects that would expedite rapid economic progress underpinned these mandates.

Of the total project cost of Rs 1.1 lakh crore, the Japan International Cooperation Agency (JICA) has agreed to provide 80 per cent (Rs 88,000 crore) as a 50-year term loan at a meagre 0.1 per cent interest rate and a moratorium on repayments for 15 years. The remaining 20 per cent would be infused as equity contribution with 10 per cent (Rs 11,000 crore) being contributed by the Centre and 5 per cent each (Rs 5,500 crore) by Maharashtra and Gujarat. The government of Maharashtra had initially readily agreed to provide its share of equity for the project.

The Centre was insistent that a large, prime piece of land in Mumbais financial hub of Bandra-Kurla Complex (BKC) be allotted for constructing a terminus in Mumbai. The previous Maharashtra government led by the BJP and its allies and those in the Opposition were strongly opposed to this as Maharashtra was intending to build the International Financial Services Hub at that very spot. Not only would this hub have catapulted Mumbai as one of the top global financial centers but would also have yielded the state thousands of crores in revenue over the years. There is a widespread belief that the previous state government had cravenly given in to the immense pressure from the Centre and compromised the interests of its citizens by not being able to convince the Centre to opt for another alternative plot for the terminus in Mumbai and include more cities from Maharashtra like Pune and Nashik in the proposed route.

Citizens of Maharashtra are happy that their brethren from the neighbouring state of Gujarat would derive enormous trade and economic benefits as a result of connectivity of key cities of Ahmedabad, Vadodara, Anand, Bharuch, Surat, Valsad and Vapi with Mumbai. Besides providing efficient and quick connectivity for the approximately 19 per cent citizens of Gujarati origin staying in the vibrant Mumbai Metropolitan Region (MMR) with their ancestral state, the bullet train would act as a force multiplier for trade and economic activities in Gujarat, especially for the Gujarat International Finance Tec-City (GIFT City) at Ahmedabad, the textile and diamond behemoth of Surat that is building Indias largest Diamond hub (Diamond Research & Mercantile city or DREAM), the chemical and pharmaceutical industries in Vapi and Vadodara etc.

The legitimate question being posed by the citizens of Maharashtra who are contributing an equal amount of equity capital as Gujarat and parting with a prime parcel of land that would have been its International Financial Centre is whether the Centre is not committing grave injustice by scrapping the Pune-Mumbai leg of the proposed original route and not including the emerging industrial hub of Nashik by building a short spur on the route. Nashik holds the distinction of being one of the four holiest of the holy places that hosts the sacred Kumbh. It is one of Indias leading agro-processing hubs particularly for onions and grapes (the wine manufacturing capital of India), has many key defense establishments at Deolali and Ozar like HALs plane manufacturing township, and is home to a vibrant engineering and automobile cluster of industries.

Reports of Nashik and Pune being part of future bullet train projects connecting Mumbai to Nagpur and Mumbai to Hyderabad, respectively, are widely perceived to be red herring intended to placate the rising discontent among the states citizens and kicking the can down the road to a distant and uncertain future. No wonder there is mounting opposition in the state for facilitating the acquisition of land for a project whose costs far outweigh the benefits for the citizens of the state. A resource crunch due to the once-in-a-century pandemic has put additional pressure on the states coffers to optimize its costs.

This simmering discontent and disenchantment can easily be addressed if the Honourable Prime Minister intervenes personally and upholds the principle of cooperative federalism, by including the cities of Pune and Nashik in the route and directing the implementing agency to consider any suitable alternative plot for the development of terminus allowing the state to develop its International Financial Centre. This singular intervention would go a long way in allaying unfounded apprehensions gaining ground about grave injustice being meted out to Maharashtra and its citizens and reduce the trust deficit. It would help in creating a conducive environment for the state government to convince its citizens to part with their land for a project that would benefit them. It would be a fitting example of adherence by the Centre to the precept of Sabka Saath, Sabka Vikas and Sabka Vishwas.

(Ajay Bodke is a politico-economic analyst. Views are his own)

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Time for Centre to embrace cooperative federalism for bullet train project? - Economic Times

In the passing away of Richard Miller Bird on June 9, the public finance fraternity, particularly in developing countries, has lost a vast reservoir of knowledge. Besides working on tax policy and reforms and fiscal federalism in Canada, Bird devoted much of the 60 years of his professional life on fiscal policy issues in developing countries across the globe, covering countries in Asia, Africa and Latin America. He was a professor emeritus at the Rotman School of Management at the University of Toronto besides being a distinguished visiting professor at the Andrew Young School of Public Policy in Atlanta and an adjunct professor at the Australian School of Taxation and Business law in Sydney. He was a recipient of several awards including the Lifetime Achievement Award and Queens Diamond Jubilee Award and Douglas Sherbaniuk Award by the Canadian Tax Foundation and a Daniel M Holland Award of the National Tax Association of the USA.

After graduating from Columbia University, Bird worked at Harvard University and later at the International Monetary Fund before settling down at the department of economics, University of Toronto. He was a part of several missions advising countries across the world including Argentina, Bolivia, Mexico and Columbia in Latin America and China, India, Indonesia, Japan, Philippines, Sri Lanka and Vietnam in Asia.

In India, he was extensively consulted by the Tax Reforms Committee led by Raja Chelliah in 1991. Reviewing the committees work in the Economic and Political Weekly, he stated: Fiscal necessity, compelled with the desire to let market forces to play a greater role in allocating resources virtually mandates major reforms in the cracking tax structure India has inherited from the past. He added, The three reports on the tax reforms in India generally offer clear and sound guidance to what can and should be done.

The book he edited with Oliver Oldman, Readings on Taxation in Developing Countries, was compulsory reading for all scholars and practitioners in the developing world. Later, he wrote Tax Policy and Economic Development, which continues to be a classic. Recently, he wrote a series of articles with Eric Zolt reviewing theories and best practice approaches to tax reforms in which he espoused the Broad Base Low Rate approach. His book on VAT in Developing and Transitional Countries written with Pierre Pascal Gendron is perhaps one of the most influential policy guides for countries introducing the GST. Reviewing the book in the Journal of Economic Literature, Michael Keen wrote, This is a rich and elegant book on a rich and (if we are to understand it properly) inelegant topic It does set out some key issues and challenges in what remains a largely untrodden area.

Bird underlined that there is no one size fits all approach to GST, contrary to what the IMF advocates, but agreed with the conventional wisdom that countries should: (i) aim for a global tax with few exemptions, credits, rebates or deductions, (ii) not use the tax system to achieve too many goals, (iii) keep the threshold at a reasonably high level to focus on the whales rather than minnows, (iv) have minimum rate differentiation to keep it simple, (v) continuously monitor the tax system and concentrate on collection of tax at source, (vi) not collect more information than that can be processed and (vii) encourage good record keeping and aim for long term goal of self-assessment. His concern was some bad features such as too high or too low thresholds, overly extensive exemptions, or multiple rates may be essential to successful adoption in the first place. However, once introduced it will be difficult to remove them. How true it is in the case of India.

Richards research on fiscal federalism was shown in several incisive articles and books. Apart from his work on Canada, he forayed into issues of intergovernmental finance in several developing countries. An important feature of his works was that they were not only based on a rigorous theoretical framework but also grounded in an understanding of systems and institutions. His work with Robert Ebel and Christine Wallich on Decentralisation of the Socialist State is a standard reference for all those who want to understand the decentralised systems in transitional countries including Hungary, Poland, Bulgaria, Romania, Russia and Ukraine.

In his passing away, I have lost a great friend and guru. He was my thesis examiner way back in 1977, but I actually got to interact with him when I visited the University of Toronto in 1991. Since then, we had been interacting closely, discussing many issues in public finance. He closely followed the public finance developments in India and commented extensively on them. I have collaborated with him on various occasions. Most recently, we collaborated on a paper Urban Governance and Finance in India, written at the request of the chairperson of the High Powered Committee on Urban Infrastructure and Governance. The last communication I had with Richard was on March 28 in which he wrote, So far, I am pretty healthy, and on the whole, continue to function pretty well. Alas, that assurance didnt last long, and cardiac arrest claimed his life. In his passing, we have lost a walking encyclopaedia on public finance and development. A man who was generous to a fault in his willingness to share. The public finance fraternity has lost a legend.

This column first appeared in the print edition on June 28, 2021 under the title My friend, my guru. The writer was member, Fourteenth Finance Commission and former director, NIPFP

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Economist Richard Bird was a reservoir of knowledge on public finance - The Indian Express

Harping on to federalism, the M K Stalin-led Government in Tamil Nadu on Monday said it was committed to achieving its ultimate goal of greater autonomy for states and establishment of true federalism at the Union level through constitutional means.

The customary address by Governor Banwarilal Purohit during the first session of the 16th Assembly devoted a significant portion to emphasise on the ruling partys well-stated positions on ensuring social justice, State autonomy, continuing with the 69 per cent reservation and exemption from NEET.

The Governors address, first after DMK stormed to power in May, used the term Ondriya Arasu (Union Government) and not Madhiya Arasu (Central Government) as it was referred to during the previous AIADMK and DMK regimes. Ever since Stalin took over as Chief Minister, the DMK government has been referring to the Centre as the Union Government quoting the Constitution which says India is a Union of States.

This Government is guided by the spirit of the Dravidian Movement and identifies social justice, gender equality, economic equity, opportunity-for-all through reservations, and progress through education and social reforms as its core values. These values will drive every action, every legislation, every scheme, and every initiative of this Government, Purohit said.

Contending that strong states are needed to create a strong Union, the Governor declared that the government stands fully committed to achieving its ultimate goal of greater autonomy for states and establishment of true federalism at the Union level through constitutional means.

This Government will staunchly stand in defence of the rights of the states and constitutionally oppose any infringement of such rights. At the same time, we will maintain a cordial relationship with the Union Government as partners in the process of nation-building, in line with our policy of extending our hand in friendship, even as we speak up for our rights, the Governor said.

The DMKs emphasis on federalism and resorting to the use of the term Ondriya Arasu had already irked the BJP, which sees ulterior motives in the new governments action. The ruling party has been a strong advocate of state autonomy and greater devolution of powers to states since it formed its first government in 1967.

Purohit said providing clean administration was the governments highest priority and promised to revitalise the LokAyukta and energising the Directorate of Vigilance and Anti Corruption (DVAC) to expeditiously deal with pending complaints. He also said the Right to Services Act will be introduced to streamline the delivery of various public services by Government agencies.

The government nudged the Union Government to reject the Mekedatu Project proposed by Karnataka, which it said violates a judgement of the Supreme Court, while it will seek permission to carry out remaining works for strengthening the Mullaperiyar Dam in Kerala. It also announced the expedition of the Cauvery-Gundaru link project being opposed by Karnataka.

Purohit also said the government was committed to promoting transparency and accountability in temple management while handing out an assurance that assets, lands and properties of temples will be protected. A State Level Advisory Committee for all major Hindu temples will be constituted to enhance facilities for devotees, improve the maintenance of temples and to advise on related issues, the Governor said.

The governor also said the government is determined to transform Tamil Nadu into a state with a society with self-respect, with an empowered citizenry enjoying their rights, and which is prosperous in all respects, as envisioned by Thanthai Periyar.

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Tamil Nadu Governor's speech stresses on state autonomy and federalism - Deccan Herald