Cooperative Federalism: Why India's Centre-State Compact Needs Renewal
A new essay argues that India's federal design works best when the Union and the States share responsibility as partners rather than compete for control.
A new commentary argues that India's federalism should be read less as a tug-of-war over who holds power and more as a constitutional bargain. The piece contends that the country's system was built to balance national unity with regional autonomy, and that its health now depends on whether the Union and the States can carry out their separate duties in partnership.
The argument lands at a useful moment. India's economic, environmental, technological and geopolitical challenges are growing more tangled, and few of them respect the line between central and state jurisdiction. For readers tracking policy, the framing matters: federal friction can slow infrastructure, delay tax coordination and blur accountability, while cooperation tends to make governance faster and more predictable.
The essay leans on Granville Austin's description of India's model as “cooperative federalism” in The Indian Constitution: Cornerstone of a Nation. Austin's point, as the author reads it, is that the Constitution's goal was never just to divide power on paper. It was to make that division function in a country with an unusually wide range of languages, cultures and political traders' traditions.
On the legal side, the commentary notes that the Constitution does not use the phrase “cooperative federalism” outright, yet its structure points that way. It cites the description of India as a Union of States, the division of legislative powers across the Seventh Schedule, provisions on executive coordination, the financial relations framework, the Inter-State Council under Article 263 and the Finance Commission under Article 280. Together, these create autonomy for each level of government alongside formal channels for coordination.
The essay also cites the Supreme Court's ruling in S.R. Bommai v. Union of India (1994), which it presents as a reminder that federalism is part of the constitutional core and that powers must be exercised within their limits. For investors and policy watchers, that principle has practical weight: it shapes how central and state actions are judged, and therefore how predictable the policy environment feels.
The core claim is that a strong Union and strong States are not rivals. National unity, the author argues, grows stronger when regional priorities are heard inside the constitutional framework, and the Union keeps its real responsibilities in areas such as national security and macroeconomic stability. The essay's warning is against treating the Centre's authority as a license to override state autonomy, and against states treating federal fiscal and administrative channels as obstacles rather than tools.
For a country that is still refining instruments such as the GST Council and the transfer formulas set by the Finance Commission, the message is pragmatic. Renewal of the compact means regular consultation, clearer roles and a shared sense that governance outcomes are a joint project. Whether that vision takes hold will depend less on rhetoric than on how both levels of government behave when interests collide.
Read the full commentary here: Cooperative Federalism: The Constitutional Compact India Must Renew.