ABSTRACT
The pattern of development of a region in a country with multiple nationalisms is different from that in a nationally homogenous country in one critical respect: the framework of negotiated relations between the region and the centre in a country with multiple nationalisms tends to become an influential institutional factor. Federalism, as a system of inter-governmental relations between the federal centre and the regions, provinces and states, developed out of the need to reconcile the goals of regional and national development in multi-national countries. Being a system of negotiated accommodation between the two parties – the centre on one hand and the states on the other – this arrangement is bound to be a dialectical mixture of harmony and conflict, satisfaction and dissatisfaction. To the extent that regional development is facilitated by the national pattern of development, it is likely to lead to a successful and strengthened federation; and to the extent that goals of national development entail neglecting the development of a region or demand sacrifices from a region for the sake of national development, it is likely to put the federation under strain. Neglect of a region or economic sacrifice from a region may follow either because of the necessity to centralize control over the utilization of resources or because of the necessity to transfer resources from one region to another (Schoenfeld 1960, Blough 1962, Svennilson 1962, Lakdawala 1967, Grewal 1975, Grewal 1986). Transfer of resources may take place due to the relatively weak bargaining power of the region being neglected vis-à-vis the centre or for the ostensible purpose of achieving balanced regional development. A federation may, therefore, come under stress due to either region-centre conflict (a vertical conflict) or a region-region conflict (a horizontal conflict), or a mixture of the two, with varying degrees of importance of these two forms of conflict.
