Federalism involves dynamic relationship between the central and state governments, which can be characterized as cooperative, competitive, or collaborative.
| Steps taken | Federalism |
|---|---|
| Constitution of NITI Aayog | Cooperative and competitive |
| Introduction of GST | Cooperative and collaborative |
| Role of 14th and 15th FC | Cooperative |
| Cooperative federalism | Competitive federalism | Collaborative federalism |
|---|---|---|
| A system where the central and state governments work together to achieve common objectives and address national issues. | It promotes competition among states to attract investment, improve governance, and enhance economic performance. | It involves both central and state governments working together as equal partners in policy formulation and implementation, with an emphasis on mutual respect and joint decision-making. |
| Characteristics: o Shared responsibilities: Both levels of government collaborate on policies and programs, sharing resources and responsibilities. For example- GST o Intergovernmental relations: Frequent consultations and coordination through bodies like the Inter-State Council, National Development Council, and Finance Commission. o Central support: The central government often provides financial assistance to states through schemes like the Goods and Services Tax (GST) compensation and centrally sponsored schemes. | Characteristics: o Healthy Competition: States compete to implement reforms, improve ease of doing business, and provide better services to their citizens. For example: Innovation Index by NITI Aayog. o Incentives for Performance: The central government incentivize states through grants, awards, or additional funding based on performance. For example: Incentives given under UDAY scheme. o Decentralization: Greater autonomy and decision-making power for states to innovate and tailor policies to their specific needs. For example: Smart cities mission | Characteristics: • Joint policy formulation: Policies and programs are designed with inputs from both levels of government, ensuring that local needs and perspectives are incorporated. For example- GST Council. • Mutual respect and trust: Acknowledging the strengths and capabilities of both central and state governments, fostering a spirit of partnership. For example- More share to Northeast states in centrally sponsored schemes. • Shared governance: Joint implementation and monitoring of policies, leveraging the strengths of both governments. For example- Programs like Sarva Shiksha Abhiyan and Mid-Day Meal Scheme. |
