Budget 2014-15: A stronger case of cooperative federalism?

Honestly, this does not deserve a separate post-at best a comment on the Firstpost page where this article was published. But if you are a regular visitor on the website (does it say something about me that I am?), you would know how the regular commenters there are...how do I say it politely...moronic.

Anyway, the facts stated in the article are accurate enough. That is, as Jagannathan notes, there has been a  "...massive transfer of fiscal implementation power to states in just one year. In P Chidambaram’s last fiscal year (2013-14), states got Rs 1,19,039 crore out of the Rs 4,75,532 crore plan outlays; this year (2014-15), they get a huge Rs 3,38,408 crore from the total plan kitty of Rs 5,75,000 crore."

Essentially, there are two ways in which states can receive funds- Centrally sponsored schemes (CSS) and Central Assistance to State and UT plans. CSS schemes come with certain strings attached. Namely, states have to make proportionate expenditure contribution to the scheme if they are to access CSS funds. On the other hand, Central Assistance comes in two forms-Normal Assistance and Additional Assistance. Additional assistance funds are scheme-based. However, Normal Central Assistance are not tied to any specific schemes. Transfers to states depend on the Gadgil-Mukherjee formula which uses criteria like population, per capita income, fiscal discipline and special problems of the state to determine how funds are to be transferred. Once received, states can work with these funds in the manner that suits the state, on schemes that are tailored to the states’ specific needs.

However, the writer is being disingenuous when he says that,

"The one-cap-fits-all approach of the UPA years, dictated by dynastic and centralising feudal considerations, is now being whittled down by a former state chief minister who is now prime minister."

In fact, the almost three-fold jump seen in Central Assistance to State and UT plans (and a corresponding decline in allocations under CSS as reflected by the Gross Budgetary Support to States) under Jaitley's 2014-15 budget, mirrors the allocations made by Chidambaram's interim budget of 2014-15. He, of the party "dictated by dynastic and centralising feudal considerations". To be fair, the budget document itself does not claim to reversing any trend of "de-federalising a federalising trend that had begun earlier in the last decade". Rather, it maintains that it is continuing with the restructuring of CSS, as suggested by the B K Chaturvedi committee report.

Just goes to show that media coverage needs to be taken with a heavy dosage of salt.

Book Review: the Accidental Prime Minister (Sanjaya Baru)

In 2004, after the Financial Express speculated that the Prime Minister would retain the Finance Ministry, Sanjaya Baru, the editor of the newspaper (and the author of the Accidental Prime Minister) got a call from Chidambaram, asking if this was true. When Baru confirmed he had received the news from reliable sources, Chidambaram went into a mini-rant, wondering what portfolio he would get, and that anything less fashionable than home, defence and finance would be ill-suited to his stature. It is this kind of gossip that punctuates most of the Accidental Prime Minister, making it the most fun piece of non-fiction I have read (which doesn’t say much given how I avoid the genre like plague, but still).

The other important aspect of the book is the picture it reveals about political machinations. Baru reveals how after the NREGA was extended to 500 districts, Congress leaders fell over themselves trying to give the credit for it to the Gandhi family, when the person responsible was Raghuvansh Prasad of the RJD. In another instance, during the negotiations for the nuclear deal, when the Left withdrew its support due to its anti-US stand, Baru got a call from Amar Singh, then a part of the Samajwadi Party (SP). He was unwell, he said, undergoing treatment in an American hospital, where the American doctors and staff were paying close attention to him.  The SP finally openly supported the deal after APJ Abdul Kalam (the then President, former scientist and Muslim) endorsed the same. This helped them gain a foothold in Delhi, without antagonising their Muslim vote-banks in UP. Amar Singh was to later claim that the authors of the nuclear deal were not Manmohan Singh and Bush but Amar Singh and Bush. Even academia it turns out is not isolated from politicking- you might be a well-respected economist alright but the journey to the Planning Commission is smoother if you have some recalcitrant (Leftist) friends in the coalition ruling at the Centre.

Of course these are side-shows to what the book aims to be-an insight into the life of the ‘neyk Sardardji’, who helmed the Indian government for the last 10 years. It mostly succeeds in giving a balanced account of the PM’s achievements and failings-though the latter only confirm what media accounts have been telling for a number of years. These include a deference to the Congress President (sometimes as a survival mechanism) and his almost-willingness to turn a blind-eye to the misdemeanours of his political colleagues. The book is far more interesting however, when it details the PM’s strengths-his doggedness in pursuing the Nuclear Deal with the US, the deft handling of some of his coalition partners, his pluralistic economic and political world-view as well as a healthy sense of humour. In 2007, when Baru reported to his PM that L K Advani was conducting havans to propitiate the Gods into ousting the Congress government, Singh joked that Advani lacked the basic data to ensure that-the PM’s accurate date of birth. 

While Baru writes an engaging account of his experiences as media advisor to the PM in UPA-1, he is guilty at times of over-explaining, at others of writing the same thing more than once-nothing that some editing won’t correct. Lastly, some lines in the book come off as sexist, though not more than our political classes. In 2004, Yashwant Sinha, likened Manmohan Singh to Shikhandi, the character from Mahabharata who was a woman in a past life and a man in the present-and hence an incapable leader. The problematic part in the book is when Baru writes, that “..there was a double entendre in that metaphor, implying that the Prime Minister was controlled by Sonia Gandhi, and it was a damaging allusion. Clearly, my biggest challenge as media advisor was to firmly establish in the minds of ordinary people the credentials and credibility of Dr. Singh as PM”. Later in the epilogue, he wonders what Yashwant Sinha really meant by that jibe.., “was he (Sinha) disingenuously suggesting that he (Singh) was not a real man and a real leader?