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  • Recently, both Houses of Parliament voted overwhelmingly in favour of the amendments to the Government of the National Capital Territory (NCT) of Delhi Act. (GNCTD)
  • The aim of the amendments were to clear ambiguities in the roles of various stakeholders (especially the Lt. Governor of Delhi and the Legislative Assembly of Delhi) and provide a constructive rule-based framework within the Government of Delhi to work in tandem with the Union Government.


GS-II: Polity and Governance (Constitutional Provisions, System of Government, Centre-State relations, Co-operative Federalism, Inter-State relations)

Mains Questions:

What is Cooperative federalism? In the context of the Government of National Capital Territory of Delhi (GNCTD) Amendment Act, 2021, how is cooperative federalism in India affected? (10 Marks)

Dimensions of the Article:

  1. About the Government of National Capital Territory of Delhi (GNCTD) (Amendment) Act, 2021
  2. Federal vs Unitary forms of governments
  3. What is Cooperative Federalism?
  4. Challenges in keeping up Cooperative Federalism
  5. How does the GNCTD 2021 act reduce cooperative federalism (L-G’s role)?
  6. Conclusion
  7. Back to Basics:
    1. Federalism with Unitary Bias in India
    2. Asymmetric Federalism in practice in India
    3. What is Competitive Federalism?

About the Government of National Capital Territory of Delhi (GNCTD) (Amendment) Act, 2021

  • The GNCTD 2021 Amendment Act clearly defines the powers of the Lieutenant Governor of Delhi (L-G) and the Delhi government on the lines of the Supreme Court judgment of 2019 and also gives more teeth to the L-G’s office. [The 2019 Supreme Court verdict upheld the Ministry of Home Affair’s 2015 notifications authorizing the L-G to exercise powers in relation to services and directing the Anti-Corruption Branch (ACB) of police not to take cognizance of offences against Central government officials as “legal”.]
  • One of the changes made was to bring consistency in the definition of the term “Government” in the NCT of Delhi, such that the government was only formalising the definition of a term that the Delhi Assembly itself had already accepted.  – Therefore now: The expression ‘Government’ referred to in any law to be made by the Legislative Assembly of Delhi shall mean the Lieutenant Governor (LG).
  • The act gives discretionary powers to the L-G of Delhi even in matters where the Legislative Assembly of Delhi is empowered to make laws.
  • The legislation also seeks to ensure that the L-G is “necessarily granted an opportunity” to give her/his opinion before any decision taken by the Council of Ministers (or the Delhi Cabinet) is implemented.
  • It also says that the L-G will not assent any bill passed by the Delhi Assembly that “covers any of the matters which falls outside the purview of the powers conferred on the Legislative Assembly.”

Federal vs Unitary forms of governments

  • Nations are described as ‘federal’ or ‘unitary’, depending on the way in which governance is organised.
  • In a unitary set-up, the Centre has plenary powers of administration and legislation, with its constituent units having little autonomy.
  • In a federal arrangement, the constituent units are identified on the basis of region or ethnicity, and conferred varying forms of autonomy or some level of administrative and legislative powers.
  • In Federal governments such as India, powers are vividly divided between central and regional governments as enshrined in Article 246 & Schedule 7 of the Indian Constitution.
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What is Cooperative Federalism?

  • ‘Cooperative federalism’ is administrative cooperation between the Centre and the States, and a partial dependence of the States upon payments from the Centre.
  • Accordingly, Indian constitutional law expert Granville Austin remarks that despite a strong Centre, cooperative federalism doesn’t necessarily result in weaker States.
  • In Cooperative federalism the Centre and states share a horizontal relationship, where they “cooperate” in the larger public interest.
  • It is an important tool to enable states’ participation in the formulation and implementation of national policies.
  • Union and the states are constitutionally obliged to cooperate with each other on the matters specified in Schedule VII of the constitution.

Challenges in keeping up Cooperative Federalism

Several issues such as trust deficit and shrinkage of divisible pools plague Centre-State relations and make total cooperation difficult.

  1. Recent Legislations: Many States have shown their displeasure with the way the Centre has been dealing with the States and laws made by the centre. Case in point: recent surge in several States passing resolutions against Central legislations such as Farm laws and Citizenship Amendment Act.
  2. Trend in Legislative powers: While the Union and Concurrent Lists have expanded, the State List seems to have shrunk, and this has led many to question the structure of Indian federalism and to propose its remodelling. As widely recognised, India is quasi-federal, with powers and resources being highly tilted in favour of the Union. The Union list has more items than the state list that enables more taxation power to centre. This acts as a major roadblock to cooperative federalism in India. Excessive central character, reduce active participation of states.
  3. Devolution of Funds: The socio-economic parameters and development of each State in India is different and while a few have made substantial progress in terms of employment, literacy and creating a conducive environment for doing business and investments, there are a few which are lagging. Economically as well, there are deficit states or the backward regions or the states under debt. Such states which are lagging have protested against the uniform approach in funding because of their special situations in which the central government has to provide special funds to these states.
  4. Under-represented in Finance Commission: Recommendations of the Finance Commission are placed before Parliament and States have no role in the debate. There is no provision for an aggrieved State to challenge the FC report or seek its enforcement.
  5. Ineffective Inter-State Council: The Constitution provided for institutions like inter-state councils to serve as a platform for consultation between the centre and the states. The inter-state council has just turned out as a platform of talks with less progress on real issues. Inter-state council has met twice in 50 years, and has not been taken seriously as a vehicle of cooperative federalism

How does the GNCTD 2021 act reduce cooperative federalism (L-G’s role)?

  • If a Lt. Governor, for example, wants to frustrate the efforts of the government, he can declare that there is a difference of opinion on any issue decided by the elected government and refer it to the President which in reality means the Union Home Ministry, and the Lt. Governor being its representative, it is easier for him to secure a decision in his favour.
  • Example:
  • The recent appointment of prosecutors for conducting the Delhi riot cases in the High Court is a case in point.
  • As per the High Court and the Supreme Court, the appointment of prosecutors is exclusively within the purview of the State government.
  • When the government decided to appoint them, the Lt. Governor referred it under proviso to Article 239AA (4) to the President stating that there is a difference of opinion between him and the government over this matter.
  • In the meantime, the Lt. Governor appointed all the prosecutors whose names were submitted by the Delhi Police and thus the State government’s list was rejected.


  • It becomes important to ensure there is complete synchronisation between the Union Government and the Government of NCT Delhi and that there is no encroachment in legislative matters. In the case of the Government of NCT Delhi, it has no legislative competence in matters pertaining to the police, public order, and land. The risk of incremental encroachments on these subjects in the legislative proposals under consideration of the Delhi Legislative Assembly can have severe ramifications for Delhi.
  • The national capital hosts the country’s legislature, the seat of the Union Government, the judiciary, diplomatic missions, and other institutions of national importance. It deserves smooth functioning and cannot be subject to misadventures arising from the ambiguities in the roles and responsibilities of its stakeholders.

Basics: Federalism with Unitary Bias in India

  • India is a federal system with a tilt towards unitary form of government. It is sometimes considered a quasi-federal system as it has features of both a federal and a unitary system.
  • Article 1 of the Indian Constitution states, ‘India, that is Bharat, shall be a union of States’. The word federation is not mentioned in the constitution.
  • India is a ‘Union of States’ and not exactly ‘Federation of States’, because:
    1. The Indian federation is not the result of an agreement among the states
    2. The States have no right to secede from the federation.
  • The Indian Constitution provides for separate governments at the Union and in the states and also specifies and demarcates the powers, functions and jurisdictions of the two governments along with the details of legislative, administrative and financial relations between the Union and the State Governments.
  • The distribution of legislative powers has been divided into three lists: The Union List, the State List and the Concurrent List, such that the Union Legislature (Parliament) has exclusive powers to legislate on the Union List, while the State Legislature has exclusive powers to legislate on the State List and both the State and Union can legislate on the Concurrent list.
  • In case of a conflict between a State and a Central legislation on the Concurrent lest, the parliamentary legislation shall prevail.
  • The residuary powers of legislation (subjects which are not mentioned in any of the three lists) are vested in the Union.

Asymmetric Federalism in practice in India

  1. Special provisions to some states: Special provisions’ applicable to States are mainly in the form of empowering the Governors to discharge some special responsibilities. E.g., Articles 371 to 371J
  2. Union Territories: UTsare directly administered by Centre. Also, there are Union Territories with a legislature, and Union Territories without a legislature.
  3. Special provisions to Scheduled areas: Special provisions regarding the administration of Tribal areas and scheduled areas are given under 5th and 6th schedule.
  4. Economic asymmetry: The Finance Commission Grants, providing funds to local bodies, state disaster relief funds and compensates for any revenue loss to states after devolution of taxes. There is an asymmetry in the devolution of taxes in such cases of funds provided or grants provided – “One size fits all” is not always followed.

What is Competitive Federalism?

  • In Competitive federalism States need to compete among themselves and also with the Centre for benefits. States compete with each other to attract funds and investment, which facilitates efficiency in administration and enhances developmental activities.
  • In Competitive federalism the relationship between the Central and state governments is vertical and between state governments is horizontal.
  • In a free-market economy, the endowments of states, available resource base and their comparative advantages all foster a spirit of competition. Increasing globalisation, however, increased the existing inequalities and imbalances between states.
  • The investors prefer more developed states for investing their money. Union government devolves funds to the states on the basis of usage of previously allocated funds.
  • Healthy competition strives to improve physical and social infrastructure within the state.

-Source: The Hindu

April 2024