A PUBLIC policy statement made by Prime Minister Narendra Modi deserves a clinical analysis and a close scrutiny because the real meaning behind publicly stated goals may be lying hidden and it is essential to bring into public focus the reality of pronouncements and announcements of the prime minister. Modi has claimed that his government is determined to usher in the era of ‘Cooperative federalism’ and ‘Competitive federalism’ in place of the earlier systems of centralised federalism in which the state governments were reduced to the states of subordinates to the central government’s overwhelming authority over all the 29 states and 7 union territories of India. The first step taken by the Modi government to make people believe the new federal balance of power is being created has been the abolition of sixty-five year old institution of Planning Commission of India which has been replaced by a ‘think tank’ like the National Institution for Transforming India, popularly described as the NITI Ayog. The centralised federal system of sixty-five years of post-independence India is a child of the system of centralised planning and if a new system of federal relations has to be stabilised, the old centralising institution has to be abolished and replaced by a new one like the NITI Ayog. Modi addressed a meeting of all chief ministers of the states and union territories to announce this grand new design of federalism by making a statement that a chief minister, unlike the past, will not have to look towards the centre for policy guidance and fiscal resources because in the new scheme of ‘fiscal federalism’, the share of resources of each state will be transferred to be spent by the state government in an ‘autonomous’ manner depending on their own priorities which will be decided by each and every state on its own.

The Modi government in pursuit of its commitment for ‘New Federalism’ tabled in parliament on February 24, 2015 the recommendation of the Fourteenth Finance Commission of India. The salient feature of new fiscal federalism is that there is a ten per cent increase in the share of states in the centre’s tax revenue from earlier 32 per cent to 42 per cent. The government stated that the states will have freedom to plan their own expenditure priorities and Modi himself stated that the “states are free to change” centrally sponsored schemes and they should “decide for themselves”. Modi’s hyperbolic language stated that the new Team India will be of all chief ministers who will be ‘partners’ in the governing council of NITI Ayog. Arun Jaitley, the finance minister, said that all “Centrally sponsored schemes are discretionary. Payments should end,” and in spite of Abhijeet Sen’s note of dissent appended to the Fourteenth Finance Commission, the Modi government has steamrolled its new project of ‘Cooperative federalism’ without paying any attention to the different needs of different states like ‘deficit states or the backward regions’ or the states under debt. The states of Bengal, Bihar, Orissa, Assam have all protested against such a steamroller approach because of their special situations in which the central government has to provide special funds to these states.

                The Modi government’s rhetoric of new ‘fiscal federalism’ and ‘cooperative federation’ in which the state governments are freed from the excessive controls of the central government is oblivious of the reality of diversities of India in which developed states co-exist with relatively less developed and extremely backward states and one formula of fiscal distribution cannot meet the requirements of all different ‘categories’ of the states and union territories. It is not only that the Modi government has completely ignored the complex and contradictory situations which prevail ‘across the states’, its tall claims of deconcentration and decentralisation of powers of the central government while dealing with the state governments is quite untenable in the light of a few salient facts mentioned here to substantiate the argument that behind the facade of cooperative federalism lies the real goal of centralisation of Modi’s authority over the whole of India. First, Modi is enthusiastically pursing political economy of liberalisation, globalisation and privatisation (LGP) and completely opening the Indian market to both Indian and foreign monopoly capitalist classes and in this grand project Modi’s asking all the states to follow the ‘one model of political economy’ as laid down by the central government and open its markets to private capital, both Indian and foreign. Modi’s politics of economies is to facilitate the establishment of capitalist economic system for the ‘whole country’ in which all chief ministers will be in his language the ‘Team India’. The Modi government’s real game then is to make all chief ministers fall in line and follow the path of development as decided by the oligarchic class of India and abroad so that capitalism takes deep roots in Indian society. It is not without reason that the Modi government is going out of the way to persuade and bribe all the chief ministers to accept Goods and Services Tax system for the whole country and make India one national market of capitalist system. Is it diversity or uniformity in the garb of cooperative and competitive federalism? Second, the Modi government has appointed all governors for the states who belong to the Rashtriya SwayamSevak Sangh to keep firm control over chief ministers especially non-BJP state governments like that of Uttar Pradesh, or Bihar, or Karnataka. All these RSS loyalist governors are eyes and ears of the central government to keep surveillance over the state governments so that they do not deviate from the path shown by the centre. Third, the real Hindu Rashtravadi, Modi and the real controller of the Modi-led government, Mohan Bhagwat, believe in establishing ideological hegemony over the whole of India and in this hegemonic project there is no space for dissent, difference or devolution of ideas and power. M S Golwakar, the real consolidator of RSS, had clearly stated that India was ‘attacked’ by foreigners because it was a ‘divided country’ and hence he pleaded for a highly “centralised system of government to maintain unity of Hindu India and the creation of 50 administrative units for the governance of the whole of Bharat Mata”. How can state governments be autonomous in any manner under a regime of centralised ideology of Hindutva for the whole country? It is not only that Modi himself believes and practices the system of centralised governance and concentration of power in his own hands; he is also a faithful messenger of centralised hegemonic ideology of Hindutva. It is a deadly combination where a prime minister primarily believes in controlling all the levers of power in his own hands and his prime minister’s office and he also practices centralised Hindutva ideology which he has learnt in the workshop or school of Rashtriya SwayamSevak Sangh

Hence Modi’s cooperative federalism is another name for centralisation and control over the whole country. Fiscal federalism is only pretence to facilitate the emergence of capitalist market system for the whole country, without any exception, and the real face of Modi is reflected in the mirror as of a full-fledged and full blooded centraliser who cannot deviate from the ideology of Hindutva. Modi’s preference for a decentralised federalism is a myth because the reality is that he is guiding the whole county in one direction of capitalism and Hindu Rashtra. This is the political economy of Modi’s federalism project. Otherwise there is no explanation for the ruthless aggressive policy of the RSS to expand in eastern India especially the North East. If Modi believes in federal diversity, he should not be presiding over the expansion of the forces of Hindutva in the tribal belt of the North East. This is the crux of the issue.