Centre Favouring BJP-ruled States, Says Amit Mitra

Several state governments have shown their displeasure with the terms of reference of the 15thFinance Commission and the recent controversial comments by Niti Aayog CEO Amitabh Kant. West Bengal finance minister Amit Mitra, in a candid chat with Mahua Venkatesh, explains about the thorny issues that are widening the chasm between the centre and his state among others. "There is nothing called co-operative federalism. It is a sham," Mitra says.
An excerpt:
 
The NDA government has been stressing on co-operative federalism to drive growth. Why are the states unhappy?
Co-operative federalism that they (the Narendra Modi government) are talking about is nothing but mere lip service. Facts don't bare out the current (central) government's mantra of this ethos.
Let me explain why. As many as 39 schemes under central assistance in the core areas of social infrastructure were simply cut off by the centre. That apart the share of the central government in another 58 schemes were drastically reduced. And these are critical programmes that I am talking about. Now, look at Sarva Shiksha Abhiyan. From Rs 8,894 crore it was simply reduced to Rs 2000 crore in the 2015-16 budget estimate. The total allocation (from the centre's share) of the mid-day meal scheme was reduced to 66 per cent in 2015-16. Similarly, in ICDS (Integrated Child Development Services), the centre reduced its share by 50 per cent to Rs 8,000 crore.
 
The 14th FC prescribed a 10% increase in the states' share of the Centre's tax booty. So are the states not getting additional funds?
Not at all. On one hand, you give and on the other, you take away. What is the point in increasing the share if you choke funds which are meant for specific programmes. So if you do an overall arithmetic, you will realise that you actually stand to lose. Central government's share towards critical programmes like green revolution, national health mission, education, ICDS, drinking water has been drastically reduced. So what is the point in increasing the share of the Centre's divisible pool towards the states? Reduction of funds for several central assistance schemes has become a major cause for concern and this is affecting the financial health of the states.
 
Were the states consulted before taking these measures?
These decisions have been taken without any consultations with the states. The states were kept in the dark. The Planning commission has been disbanded. Now every year, these issues used to be discussed in the Planning Commission. The Inter-State Council, which is a constitutional body, has held just two meetings and these issues were never even discussed.

The truth, as borne out by data, is that in the name of co-operative federalism, the NDA government is undermining the interest of States, through systematic centralisation of power with the Government of India. And when an opportunity arises, providing support to BJP ruled States while denying the same to non-BJP ruled States. The slogan of co-operative federalism is a strategic disinformation campaign.

Is there a widening trust deficit between states and the centre?
The south Indian states have already shown their displeasure. However, my chief minister (Mamata Banerjee) is the first to have written a letter to the Prime Minister on this issue. She has taken up the issue with the centre, which by the way, has not even paid the dues for 2017-18. A sum of Rs 9,958 crore is pending and this has not been released to West Bengal. Now going by the ToR of the 15th FC, our state will lose anywhere between Rs 22,000 crore and Rs 45,000 crore during the 15th FC period. Of course, the southern states also stand to lose. But the states like Uttar Pradesh, Rajasthan and Madhya Pradesh among others-- will gain. Is this a fair game?
 
Recently Niti Aayog CEO Amitabh Kant said that the eastern states have not grown the way the southern and Western states have. Your comments.
 
I don't want to say anything. Data will speak. The nominal GDP of WB in 2011 was Rs 4.5 lakh crore. It has now more than doubled to Rs 11 lakh crore. WB today is the fourth largest economy, our tax revenue has gone up, capital expenditure has gone up by 8.5 times. Let me add here that during the UPA era, WB was getting the backward region grant fund (BRGF). Unfortunately, that has been simply stopped by the NDA. So how can you talk about co-operative federalism?

Mahua Venkatesh

BW Reporters Over 20 years of experience. Writes on finance, economic affairs, banking and insurance. Past gigs: Hindustan Times, The Financial Express, Business Standard.