A level-playing field between centre and states

In Panchvati retreat Modi met CMs as one among them, called for bipartisan approach

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Ajay Singh | December 10, 2014




At the Panchavati hall within the precincts of the prime minister’s residence known as 7 RCR, it was the most powerful gathering of top political executives on December 7. All the chief ministers had reached the hall much before the time. The only exceptions were West Bengal’s Mamata Banerjee, who sent a personal letter to the PM and was represented by finance minister Amit Mitra, Mizoram’s Lal Thanhawla who was not well, Omar Abdullah of Jammu and Kashmir and Hemant Soren from Jharkhand – both busy with assembly elections in their states.

Home minister Rajnath Singh and finance minister Arun Jaitley were already present. They all did not have to wait for prime minister Narendra Modi for long as he reached 10 minutes before the scheduled start of the meeting at 10.30 am.

Since the quorum was complete, Madhya Pradesh CM Shivraj Singh Chouhan urged the PM to start the meeting early. Modi politely declined, saying “Let the meeting start as scheduled”. This was a consultation meeting of the CMs and the PM along with his team to exchange views on economic planning. The meeting was essentially a forum to suggest ways to plan for the country’s future.

Exactly at 10.30 am, Jaitley took the mic and started compering the proceedings. Modi made opening remarks, followed by planning commission secretary Sindhushree Khullar and her team of officials, who made a presentation. Since the agenda brief was already circulated among the stakeholders, the exercise was singularly focused and touched upon issues related to the abrogation of the planning commission and its growing irrelevance in the post-liberalisation phase. The presentation also referred to the 2,900-odd suggestions made by people from various walks of life on the mygov.in web portal about the proposed objectives, functions and structure of the new institution that will replace the planning commission.

The presentation and the agenda brief neatly brought out the government’s view that the manner in which the economy was steered in the country was not only out of sync with the global reality but also arbitrary at times. Hence, the consultation agenda concisely mentioned four issues: (1) cooperative federalism; platform for interface between the centre and states, (2) strategic and perspective planning, (3) innovation and knowledge hub, and (4) flow of funds. Perhaps, none of the CMs would have agreed more with the PM on these four issues. All these issues have been routinely flagged by articulate CMs over the years in many meetings of the national development council (NDC) and the inter-state council (ISC), which are the interface between the PM and CMs.

But the meeting at Panchavati was not only different in content but also in style. Right at the beginning, Modi bowled over the CMs by saying that he was one among them – till recently. And he requested them to treat him as one among them only. In the presentation, the officials pointed out that between the 8th and the 12th plans, the policies which were out of tune with liberalisation were formulated without redefining the central purpose of development planning. The union government’s presentation, however, reiterated its commitment to development planning and also pointed out that “the restructured body, therefore, needs to embody the principal goals of national development, and ensure that development outcomes reach the poor”. ‘Sabka Saath, Sabka Vikas’ is the cornerstone of the new body for planning and development in India.

The agenda ran smoothly till it met with hiccups when the CMs of the Congress-ruled states started speaking. The CMs of Uttarakhand, Karnataka, Kerala and Himachal Pradesh parroted the same line about the importance of the planning commission. They cautioned that the abrogation of the body would lead to an economic confusion. Even Shivraj Patil, who attended the meeting in his capacity as the administrator of the union territory of Chandigarh, lauded the role of the planning commission and expressed his disapproval of the attempt to run it down. The tone and tenor of these speeches clearly polarised the gathering on the lines of NDA and non-NDA states.

At this moment, Modi took it upon himself to clarify the position. He said that he needed to intervene as the agenda was drifting away from the main theme. Like a consummate statesman, he referred to his speech of August 15 in which he had said, “In recent years, the planning commission has contributed to the growth of the country in its own way. I respect that, I am proud of that, but the prevalent situation in the country is different, global scenario has changed, governments are no longer the centre of economic activities, the scope of such activities has broadened. State governments have been at the centre of development and I consider this a good indication.”

Looking at the Congress CMs, Modi politely let it be known that the sentiments expressed in his speech about the planning commission reflected the views of a great and respected economist who had long association with the plan panel. After a pause for effect, he added, “He happened to be our prime minister as well ... Dr Manmohan Singh.” He urged participants to take up the issues in a bipartisan spirit and discuss them to arrive at a broader consensus.

Modi’s intervention changed the mood significantly. The CMs expressed their disapproval for the allocation of a large share of assistance through centrally sponsored schemes which are often one-size-fits-all solutions. They argued for a greater share for states in devolution of funds and for autonomy, to charter their own development plans. The relevance of the five-year plan was also discussed. In particular, it was observed that all five-year plans kick in after a gap of over a year. In effect, they become three-and-a-half-year plans. The concept of cooperative federalism was reemphasised to ensure speedier development. Political objections by certain non-NDA CMs remained confined to written speeches.

It was then time for a sumputuous lunch, for which tables were laid in such a strategic manner that non-NDA CMs would be close to either Modi, Singh or Jaitley, and not bunched apart. The PM took the opportunity to interact more with them. The lunch, then, extended into an informal exchange of ideas, and it was jaitley who termed it as ‘the PM’s retreat with CMs’, to avoid giving it any formal character. Unlike the official proceeding earlier, during lunch the CMs were interacting with the PM without the accompanying officials.

Post lunch, a nebulous outline of the body that seeks to replace the planning commission seemed to be gradually emerging from the discussion. “The unique position of the new institution as the aggregator and integrator of all developmental initiatives of the government of India and the states will enable it to be an oversight body of various development schemes,” noted the agenda circulated at the meeting.

It was Chhatisgarh CM Raman Singh who remarked that it was the first time in his experience that CMs were interacting with the PM on a equal level. That was in consonance with Modi’s long-standing demand to make states equal partners in economic development. As the CM of Gujarat, he had raised serious objections over the seating arrangement at the NDC meetings where CMs were made to sit in the audience while the PM, cabinet ministers and bureaucrats used to sit on the dais. At Panchavati, Modi managed to create an altogether new platform between him and CMs, which may radically change the economic planning in the country.

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