Centre-state relations against the backdrop of GST

The defence of federalism has almost become an act of treason; Delhi-based mediawallahs, think tanks, academics and corporate mandarins would have you believe. Meagre powers that constitutionally exist in the state government's hands are continually encroached upon by New Delhi, by issuing directives, framing 'guidelines', attaching riders and conditions to different schemes and by constitutional amendments. This action is perpetrated in the name of threatened security or a fledgling economy.

Till recently, Gujarat stood against the Union government's centralising tendencies. It opposed the National Counter-Terrorism Centre proposal and the Goods and Services Tax (GST). BJP was a prominent part of the opposition conclave of the early 1980s that made a strong case for redefining Centre-state relations and distribution of power in favour of the states. But those were 2-MP times. Some principles disappear when you are 272-plus.

In a system where the Centre has unilaterally decided that major ports, mines and mineral development, oil fields, taxes on non-agricultural income, duties of customs and much more belong to itself, it is the revenue autonomy of the states that matters. Without that, BJP manifesto's 'fiscal autonomy' call for states will be a half-hearted pseudo-federalist posturing that perpetuates New Delhi's almsgiving role and the state's corresponding begging-bowl role.

A federalism champion as a Chief Minister and a long-time opposer of GST during the UPA regime, Narendra Modi's Prime Ministerial avatar seems to love the GST. The GST proposal would further destroy the few methods left to the states to generate revenue, independent of the Centre. Apex corporate bodies are united in opposing all kinds of state government taxes. The revenue loss that the states will incur due to GST needs to be compensated. But the Union government does not want to give this compensation mechanism any permanent constitutional validity. The long-range design is clear — to homogenise the whole subcontinent for the benefit of big money's mood swings. Stupendous public investments in that fountainhead of 'aspiration' called NCR and dedicated corridors that will rip across people, their livelihood and cultures — the stage is set. 'Liberation' forces stand against states' rights, linguistic rights, human rights, environmental rights but upholds the 'right' to choose from a larger array of consumer goods points. This force loves individuals and hates families, loves bands of shoppers, from FMCG to imported items, and hates small traders, loves eco-tourism and hates environmental clearances. In the end, this era belongs to those who can smoothen the transfer and investment of big capital — wherever, whenever — and destroy all impediments on the way. These impediments, known as jal-jangal-jameen, human rights, family ties, community homelands, rights of states, and federalism are holding back GDP numbers. Remove them and New Delhi will shoot to the stratosphere and will pull up the rest to the clouds. But many want to hold their ground — people whose lives, dreams and economies evolve on the land of their ancestors. Surrender by the states on the question of GST is tantamount to the betrayal of the 'idea of India' as a federal union of diverse people with diverse aspirations, identities and markets. Markets are for the people and not the other way round. The illusion of free movement of goods is a cover for the free and unhindered extraction of profit from places with weak manufacturing bases. In this GST game, the states will be pushed to the wall.

The author is a Bengal-based commentator on politics and culture @gargac