Cooperative And Competitive Federalism: The Two Towers of National Development

Abstract

In the past decades, India’s economy has taken giant strides. India is standing on the cusp of becoming the world’s largest economy. In this backdrop, and in the light of contemporary development, it is important to look at the functioning of our federalism because, we are, in character, a federal nation with a strong centre. Formulation of economic policies, allocation of funds and resources and other allied matters are matters to be discussed between the Centre and the States. Any federal nation cannot grow if there is no understanding and cooperation between the Union and federating units. India’s Constitution firmly establishes a cooperative regime between the Centre and the States. But, as times have been changing, the government has also accepted and started to promote competitive federalism as a tool of national development. Besides a scheme where Centre shares a vertical relationship with the States, a scenario where States, in a horizontal relationship, compete with each other in order to attract investment and favourable policies could ultimately lead to the development of the nation as a whole. However, both cooperative and competitive federalism are susceptible to some challenges and hurdles. Since, both cooperative and competitive federalism are efficient mechanisms for India’s development, the author, through this article, has attempted to analyse the contemporary trend relating to the same and the government’s response to the challenges posed.