Co-operative federalism needs to go down deeper below the state level for the betterment of Indian cities. Examine (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
K. V. A 6 years
Pls review
IAS Parliament 6 years
Good answer. Keep Writing.
IAS Parliament 6 years
KEY POINTS
· The United Nations projections suggest that India’s urban population will increase from 461 million in 2018 to 877 million in 2050, with India contributing the largest share of global urban population growth from 2018 to 2050.
· For this, we not only need more and better urban infrastructure but also significantly better institutions, which can manage the infrastructure and deliver public services of high quality.
· State governments have the principal responsibility for urban development. But in order to deliver, they can and should ensure that city governments are sufficiently empowered to get the job done.
· The 74th Constitutional Amendment of 1992 gives the state governments the power to transfer a set of 18 legitimate municipal functions to the municipal governments and also devolve finances to them to enable them to perform these functions and organise the delivery of the public services.
· Action on devolution of funds to urban local governments has been unpredictable and hopelessly inadequate.
· A major opportunity to improve municipal finances was lost at the time of the GST-related Constitutional amendments in 2016.
· Ideally, they should have agreed that GST revenue should be shared among all the three levels of government, but the third tier was kept out of the deal.
· In fiscal devolution, the talk of cooperative federalism stops at the level of the state government.
· The Fourteenth Finance Commission increased the share of states in the revenue pool from 32 %to 42%.
· By contrast, municipal revenues/expenditures in India have been stagnating at around 1% of GDP for over a decade.
· The Jawaharlal Nehru National Renewal Mission (JNNURM) and Rajiv Awas Yojana as Centrally Sponsored Schemes, Swacch Bharat, AMRUT, Smart Cities Mission, and Housing for All ,these national initiatives have provided some finance and also nudged the state governments to take up the challenges of urban development, and all this made some difference.
· A major failing of the national missions has been that they have not addressed the issues of empowerment and devolution to the third tier.
· A simple solution would be for the Government of India to introduce an incentive grant system whereby states that devolve funds to some desired degree get a top-up financial grant from the Centre.
· This should be limited to second tier cities, which are crucial in a new urbanisation thrust. Metropolitan cities need such grants much less, since states can help them to raise resources by empowering them to unlock land value. They are also better placed to develop PPPs with viable revenue models to attract private funds.
