Millennium Post

Level playing field between Centre and states

T the Panchavati hall, within the precincts of the prime minister’s residence at 7 RCR, held the most powerful gathering of top political executives on 7 December. All the chief ministers, except West Bengal’s Mamata Banerjee, had reached the hall well before schedule. However, Prime Minister Narendra Modi, accompanied by Home Minister Rajnath Singh and Finance Minister Arun Jaitley, reached 10 minutes before the scheduled start of the meeting at 10.30 am. This was a consultation meeting between various chief ministers and the prime minister, along with his team, to exchange views on economic planning. The meeting was essentially a forum to suggest ways to plan for the country’s future.

Exactly at 10.30 am, Planning Commission Secretary Sindhushree Khullar and her team of officials began their presentation. Since the agenda brief was already circulated among the stakeholders, the exercise singularly focused and touched upon issues related to the abrogation of the Planning Commission and its growing irrelevance in the post-liberalisation era. The presentation also referred to the 2,900-odd suggestions made by people from various walks of life on the web portal about the proposed objectives, functions and structure of the new institution that will replace the Planning Commission. 

The presentation and the agenda brief neatly brought out the government’s view that the manner in which the economy was steered in the country was not only out of sync with global realities but also arbitrary at times. Hence, the consultation agenda concisely mentioned four issues: (1) cooperative federalism; platform for interface between the centre and states, (2) strategic and perspective planning, (3) innovation and knowledge hub, and (4) flow of funds. Perhaps, none of the chief ministers would have agreed more with the PM on these four issues. All these issues have been routinely flagged by articulate chief ministers over the years in many meetings of the National Development Council (NDC) and the Inter-State Council (ISC). Both the above bodies are interfaces between the PM and chief ministers. But the meeting at Panchavati was not only different in content but also in style.

Right at the beginning, Modi bowled over the State leaders by saying that he was one among them till recently. And he requested them to treat him as one among them only. In the presentation, the officials pointed out that between the 8th and the 12th plans, the policies which were out of tune with liberalisation were formulated without redefining the central purpose of development planning. The union government’s presentation, however, reiterated its commitment to development planning and also pointed out that “the restructured body, therefore, needs to embody the principal goals of national development, and ensure that development outcomes reach the poor”. ‘Sabka Saath, Sabka Vikas’ is the cornerstone of the new body for planning and development in India. The agenda ran smoothly till it met with hiccups when the chief ministers of the Congress-ruled states began to speak.

The chief ministers of Uttarakhand, Karnataka, Kerala and Himachal Pradesh presented a same line about the importance of the planning commission. They cautioned that the abrogation of the body would lead to an economic confusion. Even Shivraj Patil, who attended the meeting in his capacity as the administrator of the union territory of Chandigarh, lauded the role of the planning commission and expressed his disapproval of the attempt to run it down. The tone and tenor of these speeches clearly polarised the gathering on the lines of NDA and non-NDA states. At this moment, Modi took it upon himself to clarify the position. He said that he needed to intervene, as the agenda was drifting away from the main theme. Like a consummate statesman, he referred to his speech on 15 August, in which he had said, “In recent years, the Planning Commission has contributed to the growth of the country in its own way. I respect that, I am proud of that, but the prevalent situation in the country is different. Global scenarios have changed, governments are no longer the centre of economic activities, the scope of such activities has broadened. State governments have been at the centre of development and I consider this a good indication.”

Looking at the Congress chief ministers, Modi politely let it be known that the sentiments expressed in his speech about the Planning Commission reflected the views of a great and respected economist, who had a long association with the plan panel. After a pause for effect, he added, “He happened to be our prime minister as well ... Dr Manmohan Singh.” He urged participants to take up the issues in a bipartisan spirit and discuss them to arrive at a broader consensus. Modi’s intervention changed the mood significantly. Various chief ministers had expressed their disapproval for the allocation of a large share of assistance through centrally sponsored schemes, which are often one-size-fits-all solutions. They argued for a greater share for states in devolution of funds and for autonomy, to charter their own development plans. The relevance of the five-year plan was also discussed.
 In particular, it was observed that all five-year plans kick in after a gap of over a year. In effect, they become three-and-a-half-year plans. The concept of cooperative federalism was emphasised to ensure speedier development.

A nebulous outline of the body that seeks to replace the planning commission seemed to be gradually emerging from the discussion. “The unique position of the new institution as the aggregator and integrator of all developmental initiatives of the government of India and the states will enable it to be an oversight body of various development schemes,” noted the agenda circulated at the meeting. This is in consonance with Modi’s long-standing demand to make states equal partners in economic development. At Panchavati, Modi managed to create an altogether new platform between him and CMs, which may radically change the economic planning in the country.
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