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Friday, October 2, 2026
YourTurnSubscriberWrites: When Delhi starts deciding for the states: Is Indian federalism losing...

SubscriberWrites: When Delhi starts deciding for the states: Is Indian federalism losing its essence?

This is not an isolated development. Similar questions can be seen in finance, law, administration and policymaking.

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In recent years, India’s federal structure appears to be moving towards greater centralisation. The recent controversy over the appointment of Justice Ashwani Kumar Mishra as Chief Justice of the Punjab and Haryana High Court is one such example. The Punjab Cabinet objected to the appointment, arguing that the state government’s views were not given adequate importance. The dispute may be about a particular appointment, but the larger issue is how much space states have in decisions that directly affect them.

This is not an isolated development. Similar questions can be seen in finance, law, administration and policymaking.

The Question of Mineral Resources

The Mines and Minerals (Development and Regulation) Amendment passed in August 2026 has raised another Centre-state issue. It puts conditions on taxes, cesses and other levies imposed by states on mineral rights and mineral-bearing land.

The Centre says the move is meant to create a stable and predictable mining regime. But the bigger question is whether Parliament, while regulating mineral development, can also limit the financial powers of states. The Supreme Court recognised the states’ power to tax mineral rights in 2024. The debate, therefore, is about how far central regulation should go without affecting state financial autonomy.

When the Money Is With the Centre

Federalism is not only about who makes laws. It is also about whether states have enough financial freedom to decide their own priorities.

GST is an important example. It created a more integrated tax system, but also reduced the states’ independent power to levy several indirect taxes. At the same time, the growing importance of cesses and surcharges has raised another concern.

According to the 16th Finance Commission, non-shareable revenue increased from 1.1% of GDP in 2011-12 to 2.2% in 2023-24. Cesses and surcharges are not part of the divisible pool and therefore are not required to be shared with states.

From Law to Investigation

Another area of tension is the growing role of central agencies. The Supreme Court has upheld key PMLA provisions, giving the Enforcement Directorate wide powers in money-laundering cases. Opposition-ruled states have questioned their selective use, raising concerns about the constitutional space of states.

A similar debate emerged in 2021 when the Centre expanded the Border Security Force’s jurisdiction from 15 km to 50 km in Punjab, West Bengal and Assam, drawing objections from the state governments.

National security is a central responsibility, but such decisions also raise the question of how to balance national requirements with the administrative space of states.

When the Money and Priorities Both Come From Delhi

The same issue can be seen in centrally sponsored schemes. These schemes provide financial support to states, but the Centre also plays a major role in deciding their design, funding pattern and implementation conditions.

Ayushman Bharat is one example. Delhi, West Bengal and Odisha initially chose not to implement the scheme, partly because they already had their own health programmes and policy priorities.

The issue is not whether a central scheme is good or bad. The question is whether states have enough room to design policies according to their own social and administrative realities.

One Policy for a Diverse Country?

The push towards greater policy uniformity raises a similar question. Initiatives such as ‘One Nation, One Ration Card’, ‘One Nation, One Election’ and national-level frameworks in education are intended to improve efficiency, portability and national integration.

But India is too diverse for one common approach to always be the best answer. States have different economic conditions, social structures and administrative challenges. Some flexibility for states to experiment with their own policies is therefore important.

What Do These Developments Tell Us?

Taken individually, none of these developments can simply be described as an attack on federalism. India needs a strong Centre for national security, economic stability and issues that require common national standards.

The concern arises when central strength begins to leave less room for consultation with states or for their financial and administrative autonomy.

This is where federalism becomes a question of constitutional morality. Dr B. R. Ambedkar had observed in the Constituent Assembly that constitutional morality is not a natural sentiment; it has to be cultivated. Federalism also depends on a culture of consultation, restraint and mutual respect.

India does not need to choose between a strong Centre and strong states. What it needs is strong federalism. States must have enough financial space to pursue their priorities, administrative freedom to respond to local conditions, and a meaningful voice in decisions that directly affect them.

Ultimately, the real test of federalism is not how powerful Delhi becomes. It is whether, while exercising that power, there is still enough room for the states to decide for themselves.

Abhinav Shashank Mishra is a Research Scholar (Public Administration)

These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint.

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