Aspirant Academy

Polity, Governance and Current Affairs

Key Points at a Glance

Federalism, Centre-State Relations

Paper III · Unit 1 Section 1 of 12 0 PYQs 28 min
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Key Points at a Glance

  1. Union of States — Not a Federation

    • Article 1 describes India as "Union of States" — not "Federation of States"
    • Signals no compact between states; states cannot secede
    • Parliament can create new states or alter boundaries by simple majority (Articles 2, 3)

  2. 7th Schedule — Three Legislative Lists

    • Union List (List I): 100 subjects — exclusive Parliament
    • State List (List II): 61 subjects — exclusive State Legislatures
    • Concurrent List (List III): 52 subjects — both; Centre prevails on repugnancy
    • Residuary powers vest with Parliament (Article 248) — unlike USA/Australia where residue is with states

  3. Centre's Five Overriding Legislative Powers

    • Article 249 — RS resolution by 2/3 majority: Parliament legislates on State List (national interest)
    • Article 250 — during National Emergency
    • Article 252 — on request by two or more states
    • Article 253 — to implement international treaties
    • Article 356 — Parliament makes laws for state during President's Rule

  4. Financial Federalism — Finance Commission

    • Finance Commission (Article 280) recommends Centre–State tax division
    • 15th Finance Commission (2020–26): recommended 41% of divisible pool to states
    • Cesses and surcharges excluded from divisible pool — a persistent state grievance

  5. Sarkaria Commission (1983–87)

    • Set up by Rajiv Gandhi government to review Centre–State relations
    • Recommended against misuse of Article 356; emphasised cooperative federalism
    • Called for a more effective Inter-State Council
    • Governor should be an eminent person from outside the state

  6. Punchhi Commission (2007–10)

    • Article 356 should be a last resort; "Constitutional breakdown" defined more precisely
    • CM should be consulted before appointing Governor
    • Proposed Lokpal at state level
    • Favoured giving constitutional status to the Inter-State Council

  7. S.R. Bommai v. Union of India (1994)

    • Landmark 9-judge bench ruling restricting misuse of Article 356
    • Floor test in assembly must be done before dismissing government
    • President's Rule proclamation is subject to judicial review
    • Assembly placed under suspended animation — not dissolved — until Parliament approves

  8. GST — Landmark Cooperative Federalism

    • GST (101st Amendment 2016) subsumed 17+ central and state taxes
    • Created GST Council (Article 279A): joint Centre–State decision-making body
    • Decisions require 3/4 weighted majority — Centre: 1/3 weight; States: 2/3 collectively
    • First time Constitution directly created a joint Centre–State policy body

  9. NITI Aayog (2015) — Replacing Planning Commission

    • Operates on cooperative federalism principles — no direct fund allocation
    • All Chief Ministers on its Governing Council
    • Facilitates bottom-up planning through state-level development plans
    • Key difference: Planning Commission allocated funds; NITI Aayog only advises

  10. Inter-State Council — Article 263

    • Consultative body for disputes and matters of common interest between states
    • President may establish it; constituted in 1990, reconstituted in 2016
    • Punchhi Commission: recommended mandatory meetings and constitutional body status

  11. Governor's Role in Centre–State Relations

    • Articles 153–167: constitutional head of state + Centre's representative
    • Can reserve bills for Presidential consideration
    • Sends reports to President about constitutional breakdown (basis for Article 356)
    • Appointment by President on PM's advice — area of consistent friction

  12. Competitive Federalism — NITI Aayog Indices

    • States compete for investment and ranking through NITI Aayog performance indices
    • Key indices: Ease of Doing Business State Rankings, SDG India Index, Water Management Index
    • Performance-based incentives replace passive waiting for central allocations