CRITICAL ANALYSIS

ON

COOPERATIVE FEDERALISM

Semeema Subba

1st Semester

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 ABSTRACT
Cooperative federalism as a system of governance is a key feature in various federal democracies
worldwide. This critical analysis explores the complex balance between centralization and
decentralization in cooperative federalism emphasizing its significance in maintaining functional
and harmonious federal arrangement. The study evaluates the historical evolution of cooperative
federalism in India, constitutional provision related to cooperative federalism and its benefits and
challenges.

The paper begins by an introduction to the term federalism and the nature of Indian federalism.
Further this paper dives into a brief history of Cooperative federalism in India. The analysis lays
down the constitutional provision promoting Cooperative Federalism and steps taken by the
government to promote cooperative federalism.

Subsequently, the analysis examines the contemporary challenges faced in this federal system
along with the benefits of Cooperative Federalism. The critical analysis concludes by
underscoring the importance of cooperative federalism.

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 CONTENTS

ABSTRACT………………………………………………………………………………. …2

1. Introduction …………………………………………………………………………..4
2. Cooperative federalism in India……………………………………………………..5-6
3. Constitutional Provision……………………………………………………………..7-9
4. Benefits of Cooperative Federalism………………………………………………...9-10
5. Challenges………………………………………………………………………….10-11
6. Conclusion ……………………………………………………………………………11

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 INTRODUCTION

The word ‘federalism’ has been derived from a Latin word ‘foedus’ meaning alliance, treaty or
covenant. It is a concept of government where the power of the central government is
incorporated with the power of the non-centralized units. In this system the power is distributed
among the state and the central government and it follows the principle of ‘separation of power’
and check and balance. Federalism refers to a system where power is shared between the central
government and the constituent units having authoritative autonomy in matters such as
governance, law making, policy making etc. Federalism can either be cooperative, competitive,
collaborative or executive.

India is a federal nation with 28 states and 8 Union Territories. The power is divided between the
State and the Central Government with a transparent separation of power. However, there are
certain provision in the Constitution that gives notable power to the central government inclining
India towards an unitary nation. India is usually portrayed as a Quasi Federal nation since the
Centre has greater power in many circumstances. 1The Supreme Court in State of Bengal v.
Union of India, 1963 describes India as ‘a federal structure with a strong bias towards the
Centre’. Thus we can say that the Indian Constitution is both federal and unitary in nature.

Cooperative Federalism is a system of government where various states cooperate with each
other along with the Central Government and work hand in hand for the larger public interest. In
this federal system of government local , state and the central government share responsibility
for policy making and their implementation while holding liberal realms designated by the
Constitution. Different levels of the government work collectively under the same sovereignty
emphasizing on collaboration and shared decision making. This approach promotes cooperation,
mutual respect and understanding between different levels of government. Cooperative
federalism aims at balancing the need of national unity along with the regional autonomy. Under
this framework the government at different levels work together while remaining independent of
each other. This notion of federalism embodies a horizontal relationship between the state and
the central government.

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State of West Bengal vs Union of India,1963 AIR 1241, 1964 SCR(1)371

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 COOPERATIVE FEDERALISM IN INDIA

Cooperative Federalism in India refers to a firm relationship between the centre and the non
centralized unit. It administers the centre and other constituent units to take initiative and work
together to solve shared issues such as social, political, financial and provide the public with
products and services. The existence of Cooperative federalism in India can be traced back to the
Regulating Act of 1773. In this the East India Company was regulated by the Crown of England
thus embodying the idea of giving governing authority to a local government by the centre.
Additionally the Government of India Act of 1919 envisaged a concept of dual form of
government known as ‘dyarchy’ where the governing authority was divided between the British
and the locals. Furthermore the report of the Indian Statutory Commission of 1929 implied on
introducing dyarchy at the centre further advancing to a fully responsible government in the
provinces. Accordingly Cooperative Federalism in India held the Constitutional objective of
democracy, unity and social justice.

India being the seventh largest nation with 28 States and 8 Union Territories with a diverse
culture, there is a need for the adoption of Cooperative Federalism. 2The current trends
emphasize cooperation and coordination rather than demarcation of powers between different
levels of government. Cooperative Federalism improves the cooperation and ties between
various states and the centre. It helps in maintaining the balance between the central government
and the state government. It plays an important role in enabling a state. Cooperative federalism
aims at fulfilling the goals of growth and development of state and nation by formulating and
implementing various state and national policies.

The Constitution of India has laid down certain provision that establishes Cooperative
Federalism in India. For instance, Article 263 which deals with the establishment of Inter State
Council by the President. There are various other measures adopted by the Indian Government to
promote Cooperative Federalism in India such as NITI Aayog, Inter-State Council, Goods and
Services Tax, All India Services etc. There is a gradual growth in the involvement of States in
the national policy making such as the National Development Council. However Cooperative

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Development of Cooperative Federalism in India available at https://www.legalserviceindia.com/article/l441-
Cooperative-Federalsim-In-India.html (visited at 4th September 2024, 12.10 am)

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Federalism presents several challenges as well such as conflicting interest among the different
levels of governing authorities, regional disparities, implementation complexities etc.

CONSTITUIONAL PROVISION THAT FACILITATE COOPERATIVE

FEDERALSIM

Following are the constitutional provision that enshrines Cooperative Federalism in India

Article 252 - Power of the Parliament to legislate for two or more States by consent and
adoption of such legislation by any other State

This article lays down a procedure by which the parliament can assume legislative authority over
a subject in the State List as well on the goods and service tax under Article 246-A without
formal amendment on the request of 2 or more states if it is appropriate in the national interest.

Article 256 – Obligation of States and the Union

Article 256 deals with the administrative relation between the States and the Union. This article
obliges the States to comply with the laws made by the Parliament and existing laws applicable
in the state. Further the central government can give direction to the state regarding the
obligation of the state to fulfill its duty imposed by this article. This provision aims at balancing
the cooperative federalism with the need for national unity.

Article 258 - Power of the Union to confer powers, etc, on States in certain cases

This article empowers the President to delegate certain functions to the state government relating
to any matter falling within the executive power of the union. This article promotes cooperation
between the union and the state. This function can be conditional or unconditional.

Article 261 – Public acts, records and judicial proceedings

Article 261(1) and (2) is collectively known as ‘full faith and credit’ clause. This provision
declares that full faith and credit shall be given to the public acts, records and judicial

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proceedings of the Union and State thus promoting cooperation and faith between the State and
the Union.

Article 262 – Adjudication of disputes relating to waters of inter-state rivers or river

valleys

This article lays down that the Parliament is empowered to make laws with regard to the
adjudication of inter-state river or river valley dispute. Parliament adjudicates the complaint
with respect to the use, distribution or control of water of any inter-state river or river valleys.
This article encourages inter-state cooperation in managing shared water resources.

Article 263- Provision with respect to an inter-state Council

This Article deals with the “Inter-State Council” and is a key provision related to cooperative
federalism where the President shall constitute an Inter- State Council to investigate and discuss
subjects of common interest and make recommendations for better coordination of policy and
action.

This Article 263 promotes cooperative federalism by facilitating dialogue between States and the
Union, encourages cooperation on matter of common interest and fosters national integration.
Thus providing a platform where the states can voice their concerns and work together to address
common challenge.

Article 279-A Goods and Service Tax Council

This article deals with the Goods and Services Tax Council. It is a joint forum of the state and
the central government. This council shall make recommendation to the state and the union on
the GST rates, cesses , special provision for certain states. This provision enables joint decision
making between the state and the union ensuring harmonization of tax policies.

Article 280- Finance Commission

This constitutional provision empowers the President to set up a Finance Commission every 5
years for the distribution of the net proceeds of taxes between the union and the states. Further

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the commission shall recommend grant in aids to the states. This article facilitates fiscal
cooperation between the union and the states and ensures equitable distribution of resources.

Article 312- All-India Services

This article empowers Parliament to create new All- Indian Services. It is common to both the
union and the state. All Indian services ensure a coordinated administrative set up across the
nation. This service fosters cooperation and unity in both union and the state. All Indian services
have a common administration framework thus contributing to national integration and
solidarity.

7th Schedule

The 7th schedule of Indian Constitution divides power between the State and the Union. It has
laid down three lists namely Union List, State List and Concurrent List. The Union and the State
list distinctly lays down the power of the state and the union simultaneously. The third list gives
residuary power to the centre. The subjects in the Concurrent list calls for collaboration and
cooperation between the state and the union thereby allowing both the government to legislate on
the same matter.

These lists help to outline the areas of governance and ensure a clear division of powers between
the Central and State Governments, promoting cooperation and preventing conflicts.

73rd and 74th amendment

The 73rd and 74th Amendments to the Indian Constitution had been passed in 1992. The
amendment aimed to strengthen local self-governance and decentralize power.

73rd Amendment: The 73rd Amendment, introduced the concept of Panchayati Raj in the village
and the district levels. It is a three- tier system of governance at the village block, and district
levels. Gram Panchayats were established at the village level, Mandal Panchayats at the block
level, and Zilla Panchayats at the district level.

74th Amendment: The 74th amendment focused on urban local self-governance. It is a three-tier
Municipal system, comprising of Nagar Panchayats at the town level, Municipal Councils at the
city level, and Municipal Corporations at the metropolitan level. The amendment empowered

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Municipalities to collect taxes, prepare budgets, and implement development schemes, allowing
them to address local needs and priorities.

Both the amendment notably promoted cooperative federalism in India through transferring
power and responsibilities from the union and state government to the local self government. It
empowered the local government to make decision on local issues. These amendment cultivated
cooperation among the union, state and the local government, encouraged them to work together
and develop projects and share resources.

The National Institution for Transforming India (NITI)

NITI Aayog was established by the Union Government of India in 2015 to promote cooperative
federalism in India replacing Planning Commission. The objectives of the Aayog includes
bringing states together, structural support, shared vision of national development priorities,
sectors, and strategies, village plans, indices, national security etc .

NITI Aayog has been founded to execute the important goal of cooperative federalism and to
enable good governance in India. It plays an important role in promoting cooperative federalism
by fostering collaboration between the state and the union and encouraging joint planning and
implementation of development projects.

BENEFITS OF COOPERATIVE FEDERLAISM

To achieve effective governance objectives: Cooperative Federalism aims to create a nation

where both the central and state work together and address the issues that effects the entire
country. This system encourages collaboration between different levels of government with
transparency and accountability. It is important in areas such as infrastructure development,
economic policies and disaster management. The application of the cooperative federalism leads
to more effective policy implementation, improves service delivery and inclusive decision
making.

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To promote unity in diversity: India being a diverse nation with extensive languages, customs,
and traditions, Cooperative federalism allows each state to have a say in national decision
making thus allowing for the integration of these diverse elements into a integrated unit

To protect the rights of states: Cooperative federalism ensures equal distribution of power
among different levels of government so that state governments have a degree of autonomy and
preventing the union from dominating the state affairs. It allows the state to participate in the
decision making process. Cooperative federalism protects the rights of states by preventing the
central government from becoming too powerful.

To better allocation of resources: Cooperative federalism allows for a better allotment of

resources among the states. It ensures that financial resources are allocated justly among states
and share funding responsibility. Cooperative federalism helps to reduce regional imbalance,
promote development in all parts of the country and support regional development

CHALLENGES

There are several challenges faced by the Indian government with regard to cooperative
federalism in various aspects such as the centralization of power, financial dependence, regional
disparities etc. The 7th Schedule of the Indian Constitution portrays the distribution of power
based on the three lists namely the Union List, State List and the Concurrent list. The Union and
the State list distinctly lays down the power of the state and the union simultaneously. However,
matters under the Concurrent list requires centre and the state involvement such as criminal laws
and procedure, environment, health etc and if there is any conflict between the state and the
centre with regard to List III, law made by the Central government prevails. If any laws made by
the state government is inconsistent with the laws made by the central government then the laws
made by former will be held repugnant. Article 200 of the Constitution empowers the Governor
to assent to a bill, withhold his assent, return the bill to the houses and may reserve for the
consideration of the President. This acts as a hurdle for the state to function in its full capacity
and creates a barrier to the federalism since both the governments have different ruling parties
making it difficult for the state legislature to make laws because the Governor is appointed by the
President and can be considered benefit for the centre and less beneficial for the state. Further,
Proclamation of Emergency under Article 352 gives exclusive power to the Union for deciding

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the Emergency. There is no representation or involvement of the state government when
deciding on this matter. Thus there can be a situation of conflict between the state and the centre
when Emergency is imposed.

Article 153 and Article 155 of the Constitution provides that there shall be a Governor for each
state and shall be appointed by the President and shall hold office during the Pleasure of the
President. Appointment by the President has become the nexus for the centre to have a control
over the States. Article 356 enables the President to impose Presidential Rule in the State taking
over the state’s power. This provision concentrates powers in the hands of the centre and
weakening the powers of the state government thus challenging the cooperative federalism.
Under Article 356 the President is entitled to impose President rule in any state and the role of
the Governor is very important. In the case of S.R Bommai v. Union of India the Supreme Court
had laid down guidelines for the imposition of state emergency however the centre has always
tried to cast its firm hand upon the state under the context of ‘ breakdown of constitutional
machinery’.

Additionally Cooperative Federalism in India faces several financial challenges. This includes
vertical fiscal imbalance where the centre has more revenue sources than the state government.
There is an unequal distribution of resources, resources are not allocated based on need
performance and the states are heavily dependent upon the centre for funds. There is a huge
regional disparity between the states under this federalism. The states are not similar in terms of
per capita income, agricultural, employment etc.

CONCLUSION

Cooperative federalism is an essential component of Indian Constitutional framework. This

system of federalism enhances collaborative relationship between the states and the union. The
SC in State of Rajasthan v. Union of India laid down that the Indian model of Federalism is
predominantly ‘cooperative’. The concept of Cooperative federalism encourages national
integration while respecting regional autonomy and joint decision making, mutual understanding
and coordination among the union and the states. Further it balances power between the union
and states.

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