On the first day of the New Year Prime Minister Narendra Modi announced the replacement of the 64-year-old Planning Commission (Yojana Aayog) with the National Institution for Transforming India (NITI) Aayog. ‘Niti’ is a Hindi word for policy. The government claims the new body would be more like a think tank, providing crucial inputs that will lead to decentralisation in its plan-making and implementation process. The government’s statement also makes a very pronounced reference to ushering in cooperative federalism for greater cooperation between States and the Centre.
The now defunct Planning Commission too drew from the spirit of cooperative federalism. The 9th Plan document on centre-state relationship mentions. “Harmonious and cooperative relations between different States are as important as that between the Centre and the States for the healthy functioning of our federation,” the document stated. The new body proposes to address these fractious issues through a governing council, which would have all the chief ministers and lieutenant governors on board.
The older body too was answerable to the National Development Council (NDC), which had a similar composition as the governing council of the NITI Aayog. The NDC remained ineffective as the government’s desire (‘Niyat’ in Hindi) was to have it that way. The accountability of the Planning Commission towards the NDC was only in word and never in spirit. The challenge before the new body would also be the same, whether it would have cooperative federalism just as its Niti (Policy) or also Niyat (Desire).
The biggest concern is that the new body does not have the power to allot funds and approve schemes, which may mean the same being concentrated into the hands of the union government. Prima facie this looks to be a regressive move, as it could lead to the Prime Minister’s decision becoming binding in such matters. Under the earlier regime, the states put up a demand, which formed the basis for allocation by the Commission. The proposed change in the mechanism certainly makes it to be a case of departure from the fundamentals of cooperative federalism. Only time would tell if the government could come clean on this matter.