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Union and State

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November 20, 2017

Resentment and separatist zeal is often fuelled by the feeling of regional grievances among residents due to poor redistribution. Analyse this in the light of recent global and national events.

Refer – Live mint

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IAS Parliament 6 years

KEY POINTS

Catalonian crisis

·         The roots of Catalonian crisis are the sense of Catalan identity rooted in language, culture and history distinct from the rest of Spain.

·         But, a growing dissatisfaction with fiscal transfers within the Spain, which many Catalonians believe hurt their region disproportionately, remains an equally important driver of the desire for independence.

·         Like most federal unions, the Spanish government also engages in fiscal redistribution, where the resources transferred from “have” regions to “have-not” regions.

·         Here, from Catalonian region to the entire Spain.

Redistribution is a major concern not only in Spain but also in

·         Canada, which has a system called “equalization” in which many Albertans and British Columbians complain that their tax dollars go to subsidize Quebec, which claims to be culturally distinct as well as having the largest claim on federal coffers.

·         Italy, where many in the wealthy north resent large fiscal transfers to the poorer south, the way many in former West Germany bristle at transfers to the poorer former East Germany within the reunified German republic.

India

·         India is not an exception, as herein there is a sizeable quantum of inter-state fiscal redistribution occurs between have and have-not states through the Centre’s taxing and spending policies.

·         The average citizen of Maharashtra receives fewer amounts than the average citizen of Bihar albeit their equal contribution to the state coffers.

·         The feeling among many residents that their hard work and thrift are paying for the alleged indolence, welfare dependency culture, and absence of entrepreneurial ethos in lagging regions, in the long run will instigate a feel of resentment and separatist zeal.

·         The voices from the developed states like Tamilnadu as, “Wilful erosion of States Rights by Centre will only incite a renewed War of Independence” stand as an example for separatist zeal. 

Way Forward

·         The need of the hour is to move away from the over-centralizing tendencies of the Centre, which have characterized all dispensations.

·         India has to prepare a model which takes fiscal and policy devolution to the states seriously.

KS Abhinav 6 years

Separatist sentiments can often be kindled due to improper fiscal redistribution among the states in a federation. Recent secessionist attempts in Catalonia underlines the importance of proper devolution of economic autonomy to each states.

Across the globe:

·        A large part of resentment of Catalonians from the Spanish government has been that their hard earned money isn’t used for the welfare of the Catalonians but it is redistributed among the other poorer provinces.

·        Similar sentiments are found in Italy and Germany where one part of the country feels that the taxes they pay contribute little to their welfare but it is splurged on the poorer states often perceived as ‘lazy’. In Canada, the relatively richer western parts too complain the same.

In India:

·        Vidarbha movement in eastern Maharashtra is motivated by the notion that the money and resources from that part of the state is being spent on the western part.

·        While the Dravida movement in Tamil Nadu is long dead, it surfaces once in a while with odd comments by Tamil politicians. The state leaders have often stressed on more economic autonomy to the states.

Way Ahead:

·        Since, its independence, India has moved towards gradual devolution of economic autonomy to states. With 14th Finance commission’s recommendations in play, the states enjoy 42% of the total revenue and thus their fiscal autonomy is far improved.

·        The insurgency affected North-East India is given various tax concessions. But, the centre needs to boost its developmental projects to make them feel an integral part of India.  

India is learning to eliminate such issues of resentment on the basis of proper fiscal redistribution as it gradually becomes a matured federation. Other factors like cultural domination and historical wrongs towards a community are also factors worth noting.

IAS Parliament 6 years

Focus more on redistribution. Regarding the political comments, tone it a bit down. Good Answer. Keep Writing.

Hermoine 6 years

Please review

IAS Parliament 6 years

Good Understanding of the issue and an excellent flow of content. Add a few more global examples before discussing Indian Policies. Keep Writing.

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