On November 30, senior members of the Niti Ayog descended upon Kolkata to impress upon the West Bengal government the need for agricultural reforms in the state. The discussion centered around the Union government’s policy directives regarding land lease laws as well as agricultural reform, a term by which the Union government means the revision of state Agricultural Produce Market Committee laws as per its vision.

The premise is quite astounding.

In the Constitution of India, agriculture, land and intra-state markets are state subjects where the Union government and its bodies like the Niti Ayog cannot interfere, inform or persuade unless they have specifically been asked to do so by a state government. Similarly, state governments do not have the constitutional mandate to interfere in matters on the Union list.

Coercive federalism

It is time for the Niti Ayog, which is not a constitutionally mandated body, to take a look at the state list and keep out of matters that may be their brief according to the Union government, but not Union business according to the Constitution.

West Bengal Agriculture Minister Purnendu Basu informed the members of the Niti Ayog that his government opposed the Union government’s imposition of land lease laws in the state. The fact that Basu had explain that West Bengal was doing fine in agriculture to Niti Ayog members is extraordinary as states bears no responsibility to explain state list policy and performance matters to the Union government.

Why was a state forced to entertain this Union government-appointed band of technocrats?

The answer lies in the model of coercive federalism that is being practiced by the Union government, which refers to it as “cooperative federalism”, possibly for public relations purposes.

Let us understand this coercion model. The Agricultural Produce Market Committee laws of various states were developed to minimise the exploitation of farmers by middlemen and moneylenders. State control of sales at these centres ensured a modicum of fairness for the farmer.

Post market-globalisation, there is pressure from international multilateral institutions for trade and big local corporates to “open up” the sector and create an Indian Union-wide common agricultural market where big buyers can deal directly with farmers to the extent of even dictating what crop they should sow. Various state Agricultural Produce Market Committee laws prohibit this. Many state governments contend that the opening up of this sector will threaten food security and ensure total corporate control of the agricultural market.

Here is the coercion ploy that Union government is using to arm-twist states to change their Agricultural Produce Market Committee laws.

In October, the Niti Ayog drew up a ranking of states that it has called an Agriculture Marketing and Farmer Friendly Reforms Index.

Who decided that the parameters used in this ranking are “farmer friendly”?

The Niti Ayog did, possibly assuming that the parameters used in this index that give the idea that something is “farmer friendly” are universally believed to be measures of farmer friendliness.

But there is no such consensus. Many state governments have not changed the state Agricultural Produce Market Committee laws to suit the Union’s wishes precisely because they believe that the suggested reforms are farmer unfriendly.

Unsurprisingly, in the Niti Ayog ranking of states with “farmer friendly” reform, BJP-ruled states were in the top five spots. West Bengal and other states whose idea of farmer friendly policies differs from that of the Niti Ayog performed poorly. Thus this index is essentially a ranking of the extent to which a state government is changing laws with regard to a state subject in line with the Union government’s wishes.

Blackmail by the Union

Such rankings typically have little value. However, these rankings will be used as a “benchmark for allocating different Central funds to states for successful implementation of farmer-centric polices”.

In short, a state government will be paid Central funds based on how much a state allows the Union government’s policy diktats to encroach upon state subjects. This is blackmail, which represents an assault on federalism and on representative democracy itself.

The Union government is not in charge of the country but only in charge exclusively of those functions that are in the Union list. Matters in the concurrent list comprise subjects that both the state and the Union can legislate upon, and they do so in the spirit of cooperation. Thus, the Union government is not superior to the state governments, and the Union and states do not have a parent-child relationship. Rather, they work on the principle of division of power, more like siblings with different household responsibilities, with mutual non-encroachment being the guarantee of preservation of the federal structure and part of the unchangeable basic structure of the Constitution.

The elected state government represents an autonomous expression of people’s will with regard to the issues under state jurisdiction. Thus, such blackmailing indicates that the Union government does not believe that the people’s will with regard to state subjects in states matters. The state government thus becomes a local project implementation agency of the Union government. This is as good as rendering people of a state politically speechless about policy and irrelevant in deciding crucial matters of their political future, that is, people’s sovereign power of political choice. This is a grave moment for the Indian Union’s federal structure.

Other recent instances of this blackmail based coercive federalism model includes the Union government’s Ujwal Discom Assurance Yojana, or UDAY scheme, which offers preferential financial packages for those states who agreed to it, and punitive threats like denial of coal block resources and forfeiture of grants for states that did not sign up.

Citizens or subjects?

When the financial carrot-and-funds-denial stick does not work, even this coercive federalism can give way to the Union government’s battering ram approach seen in the 2014-’15 pre-budget economic survey on the subject of Agricultural Produce Market Committees. The document has a not-so-veiled threat about disregarding states if there are continuing hold-outs:

  “If persuasion fails (and it has been tried for a long time since 2003), it may be necessary to see what the center can do, taking account of the allocation of subjects under the Constitution of India.”  

This battering-ram approach was seen in Finance Minister Arun Jaitley’s threats of passing the Goods and Services Tax as a money bill in the Lok Sabha earlier this year when the majority of state finance ministers and Union government reached a deadlock in the Goods and Services Tax council.

There is a pattern at work. The Union makes model guidelines and laws about matters on the state list, then puts pressure on states to follow it, rewarding those who do, and punishing those who do not. All this is possible due to the huge amount of revenue that the Union extracts from states – which it likes to call Central funds.

In a recent interview, Amitabh Kant, the Chief Executive Officer of the Niti Ayog said that “patience not a virtue anymore”. Bankrolled and driven by a power-centralising Union government, the rise of the Niti Ayog represents the power of unelected partisan technocrats over elected federal democrats – the victory of a partisan bureaucratic apparatus over representative, democratic politics.

Any crisis of democratic politics is a crisis for the people. It represents the moment when citizens become subjects. We may have already crossed that moment. The best-case scenario for the future of the Indian Union’s federalism and political democracy lies in a fundamental renegotiation of powers between Union and states in favour of the latter.