ABSTRACT
This chapter analyses the first phase of the Narendra Modi (Bharatiya Janata Party/National Democratic Front) government in India elected in 2014, the first de facto single-party majority in Lok Sabha, albeit a coalitional dispensation, after three decades since 1984, when a majority Indian National Congress government was last voted to power. Preceded by two phases of Indian federal politics of highly centralised one-party dominance of the Indian National Congress for the first four decades since the commencement of the Constitution (1950–1989) on one hand, and two and a half decades of highly peripheralised federal coalition governments (1989–2014), on the other. The Modi government may have hoped to offer India an opportunity to strike a balance between the two extremes sketched above. However, Modi’s and BJP’s promised ‘cooperative federalism’ and ‘Team India’ during the electoral campaign shows a mixed record. Cooperative Federalism in the domain of political institutional complex has been more a rhetoric than a reality. Fiscal federalism has also shown somewhat similar patterns, though with some more concrete positive cooperative federal steps, e.g. prompt acceptance of the recommendations of the constitutional Fourteenth Finance Commission Report, including the raising of the share of State governments in the divisible national revenue to 42 per cent from 32 per cent previously. Introduction of Goods and Services Tax and the institution of the GST Federal Council under the Constitution is also rated as the most significant indirect taxation reform since India’s Independence. Replacement of the Nehru era Planning Commission by the NITI Aayog is debatable whether it is as positive as the government makes it out to be. The adventurous policy of Demonetisation of 86 per cent of currency in November 2016, pressures on the Reserve Bank of India and on Institutions dealing with national economic statistics have done more harm than good. No significant breakthroughs in the realm of asymmetrical federalism and insurgencies in the North-East and North-West can be recorded, by and large.
