2023-06-02 23:15:00
The Narendra Modi administration at the center claims that India will transform into a developed economy in the next 25 years. Accelerating the process of decentralization is essential to achieve this goal. What is relevant here is the transfer of the financial powers held by the central government to the local self-governing institutions at the lower levels of the administrative system. This is the approach taken by the governments of countries that have achieved economic progress globally. The state of Kerala had also started an effort for a similar reform several years ago through a process called ‘Janakiyasutranam’. The slogan ‘Power to the people’ raised at that time is still relevant today. Primary education, health care, rule of law, clean water supply etc. are the areas that any democratic government is obligated to implement along with the infrastructural development projects. It would also be better if these areas were handed over to the local governments for their effective functioning. For the political and administrative powers to be effective, the necessary economic powers must also be ensured. The Constitution of India envisages nothing else. Dr. The guiding principles that were emphasized by the architects of the Constitution including BR Ambedkar are included in the corresponding provisions. As a part of this, a system called Finance Commission was formed to undergo a comprehensive study and evaluation of the central and state financial relations every five years. As a constitutional body, the central and state governments are bound to implement the recommendations of this expert committee. The existing Centre-State financial relations and powers are as per the decisions of the 15th Finance Commission.
Also read; Center’s approach to enemy country
As far as the Indian economy is concerned, a total of 60 percent is spent on development needs at the national and state levels. This is very high compared to other countries. The 14th Finance Commission had raised the central share towards states’ expenditure by 10 per cent of total revenue to 42 per cent. The 15th Finance Commission has slightly changed these share amounts. Because by then Jammu and Kashmir had been elevated to the status of a Union Territory. As a result, the state share was reduced by one percent to 41 percent. Kashmir, which had reached the new status, was entitled to one percent share. It is once morest such a backdrop that the share of central tax revenue to be transferred to states and local bodies increased from 50 per cent to nearly 60 per cent in 2013-14. Moreover, the allocation to the Indian states has reached the highest level as compared to other countries where the federal system exists. Brazil’s is 50 percent, Germany’s 46 percent, the US 40 percent and Indonesia’s share just 35 percent. Only Canada and China have higher share transfers to states than India, with 70 percent. Just because the 14th Finance Commission raised the central share to the states to 42 percent is not significant. States like UP and Bihar, which are lagging behind in economic growth, and states like Maharashtra, which have reached a relatively fair level of economic development, may not benefit from increased central allocation. If the increase is to be positive, its benefits must trickle down to the lower levels—gram panchayat, municipal and corporation levels. Experience has shown that this process does not happen often. At the same time, it is not possible to go back from the recommendations of the 14th Finance Commission. The 15th Finance Commission has reiterated it as a principle. The only way to overcome the crisis is to get more resources from the center to the states through some other means. If this transfer of power does not take place, the new education policy, the Swachh Bharat Abhiyan or the Smart City project announced by the Modi administration to raise its image will remain mere paper projects. It will be impossible for state governments to come to the aid of local bodies within their own limitations.
Also read; From Ambedkar to Savarkar
Take the case of the education sector. To improve the quality of education, not only appoint more teachers and ensure their service, but mechanisms should be put in place to monitor whether the reforms are reaching the students and to ensure that teachers attend properly. The question is which agency will be able to bear the huge cost involved. Similar crises will be faced in the primary health sector and in the administration sector. While accepting all this, there is a reality that we must recognize. The central allocation for regional development is only four per cent of the total government expenditure. This is less than developed countries and neighboring China. In developed capitalist countries and China, allocations to local governments account for up to 50 percent of total central expenditure. The 28 countries of the European Union spend 23.2 percent, Canada 21 percent, the US 29 percent, and Latin American countries an average of 12.7 percent. With repeated claims of transforming into a developed economy by 2047 and the completion of the Modi government’s tenure within a year, there is an urgent need for more resource transfer and devolution from the Center to the states. Otherwise, there is no doubt that the Modi government and the NDA will face a heavy setback in the upcoming general elections and the local self-governing bodies should be given opportunities to collect additional resources on their own.
Revenue streams like property tax and user fees should be opened up. Property tax is 0.5 percent of total revenue in our country. That is 0.1 percent of GDP. OECD countries collect an average of 5.6 percent of total tax revenue and 1.9 percent of GDP in property taxes. Korea is in first place – 15.1 percent. China, a member of the BRICS bloc of nations, collects 10 percent of the total revenue revenue, while the US, UK and Canada each contribute 11 to 12 percent. In Russia and South Africa, the tax is around 4–5 percent. According to the 15th Finance Commission recommendation, property tax should be considered as the main criterion for determining financial assistance from the Center to the states. On the basis of the same criteria, the 16th Finance Commission can also recommend to the central government that more resources be transferred to the local self-government bodies. Such a process does not happen overnight. Both the Central Government and the State Governments may face the limitation of the federal structure envisaged by the Constitution of India. Legal issues cannot be ruled out either. In addition to completing the devolution, it is also necessary to ensure that the local governments are able to discharge their new responsibilities with precision. State governments have to prepare training systems for this. The outline for this should be prepared without delay. The 16th Finance Commission itself should take the appropriate initiative to initiate such a change.
1685752677
#Governance #brought #people #Janayugom #Online
