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  • Context (TH): The government has promoted cooperative and competitive federalism via NITI Aayog.
  • Withholding of GST compensation funds is seen as confrontational federalism by state govts.

Federalism and its Types

  • Federalism is a system of government in which the power is shared between a central authority and various constituent units of the country.
Type of Federalism Description
Holding Together Federation
  • Powers are shared among various constituent parts to accommodate a country’s diversity. The central authority often holds the upper hand.
  • E.g. India, Spain, Belgium
  • Article 1 of the Constitution refers to India as a “Union of States,” implying that no state can secede and that the federation is not formed by an agreement among states.
Coming Together Federation
  • Separate states combine to create a more unified entity. States enjoy greater autonomy compared to a holding federation.
  • E.g. United States, Australia, Switzerland
Asymmetrical Federation
  • Components that make up a nation have uneven powers and relationships in the domains of politics, administration, and finance.
  • Asymmetry can be seen from both a vertical (between the states and the centre) and a horizontal (among the states) perspective.
  • Russia (Chechnya), Ethiopia (Tigray), Canada (Quebec), India (Jammu and Kashmir until 2019, and various clauses in Article 371, which accord special powers to India’s north-eastern states).

Evolution of Federalism in India

Phase Characteristics
Inner-party Federalism (1950-68)
  • Disputes resolved in Congress party forums (“Congress System“)
  • Consensus-based form of “inner-party federalism
  • The Union government dismissed Kerala’s state government in 1959.
  • The Congress Party lost autonomy after the 1969 split.
Multi-Party Federalism (1990s)
  • National parties unable to win a majority, coalitions with regional powers.
  • Decline in Centre-state confrontations and arbitrary use of Article 356.
  • SR Bommai case 1994, SC questioned the Centre’s arbitrary use of Article 356.
Co-operative Federalism
  • Liberalisation gave state governments autonomy to attract investment.
  • 73rd & 74th Constitutional Amendments empowered local self-government.
  • Discussions between the Union and states made true federalism possible.
Competitive Federalism
  • The federal govt. advocated cooperative federalism (GST and NITI Aayog).
  • NITI Aayog supports states’ performance through open rankings & assistance.
Confrontational Federalism
  • NDA’s rise in 2014 reintroduced “dominant party” federalism.
  • Significant federal disputes between opposition-led states and the centre.
Bargaining Federalism
  • State governments’ bargaining strength increased in the 1990s due to regionalisation and an open economy.
  • Used to resolve interstate disagreements (e.g., territorial or water disputes)

For more details, visit – Asymmetric Federalism

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