The UPA, in its second term in office, has not missed an opportunity to take upon itself powers that rightfully belong to the States. Part XI of the Constitution demarcates the legislative and the administrative powers of the Union and the States.
The Union list has 97 items mentioned as its exclusive domain. Sixty six items are in List II exclusively for the States and 47 items are in the Concurrent list. The Centre is undermining the States and their authority by trying to legislate on items listed in the Concurrent List — with minimum consultation with the States.
The latest in this series is the Ports Regulatory Authority Bill. The proposed Bill shall regulate all ports in the country. While the 13 Major ports are managed by the Centre, being Entry 31 in the Concurrent List, non-major ports are in the domain of the States.
With respect to another subject in the Concurrent list, the Right to Education Bill too, the States felt the consultations were inadequate. The States' preparedness to implement the programme, noble as its intention and purpose may be, was not taken into consideration.
Many States did not have the resources to raise the required manpower and infrastructure in the envisaged time scale.
The National Commission for the Review on the Working of the Constitution observes, “The problems that have attracted attention in the field of Union-State relations have less to do with the structure or the rationale of the Concurrent List than with the manner in which the Union has exercised its powers.” It further went on to add: “In particular, the Concurrent List, List III in the Seventh Schedule under Article 246 (2), has to be regarded as a valuable instrument for consolidating and furthering the principle of cooperative and creative federalism that has made a major contribution to nation-building.
The Commission is convinced that it is essential to institutionalise the process of consultations between the Union and the States on legislation under the Concurrent List.” (http://lawmin.nic.in/ncrwc
/finalreport/v1ch8.htm)
Governance failure
Undermining cooperative federalism is a serious issue in itself. Between the Centre and the States, the Constitution envisages a relationship among equals rather than that of a ‘big brother' Centre for the States to look up to. In the matter of the ports, together with the absence of cooperative federalism, there is this critical issue of governance failure.
The recent Maritime State Development Council's meet held in Hyderabad saw several State governments standing up to retain their authority. In doing so, they have exposed issues of governance – lack of foresight, poor revenue generation, inefficient utilisation of immovable assets etc.
A quick brush with statistics will explain it all.
The growth in the major ports (total 13) has been only 1.6 per cent. Non-major ports, which are 185 in number and which are spread mainly in the nine coastal States, have grown by 8.7 per cent.
In Gujarat alone, non-major ports (total 42) grew by 12.3 per cent. Gujarat also handles nearly 73 per cent of non major ports' cargo.
Furthermore, several State governments have gone ahead with plans to develop their ports along the lines of the PPP model.
As observed earlier, private ports, as also the non-major ports, fix their own tariffs.
The proposed Bill, in intending to replace the present regulatory body the Tariff Authority for Major Ports (TAMP), it is feared, empowers the proposed regulatory Authority to fix tariffs for even the private ports, in the guise of bringing in a level playing field.
In these circumstances, Gujarat's Finance Minister, Mr Saurabh Patel, felt that States will also get into a lot of legal tussles with private operators with whom port developmental projects have been signed.
Revenue generation
The management of the water front is critical for revenue generation. States have bettered themselves each year and this is paying rich dividends. Mr Shailesh Garg of Drewry Shipping Consultants Plc felt, “Major ports have not been able to set up adequate capacity to cater to additional cargo, so shippers are looking for alternative gateways.”
Mr Karan Deep Singh, of Akal Logistics India Pvt Ltd, observed, “Because of several disputes and funds spent on settling such disputes, private investors have chosen minor ports over the major ones to conduct their maritime business. There have also been several cases when a private player operating a terminal each at a major and a minor port has shifted traffic to the latter.”
State governments are often under pressure to find newer avenues for revenue generation. They are also learning from one another on replicating best practices.
They are compelled to find their own resources. Ironically, sometimes the Central Government expects the States to forego their tax revenues for the decisions it imposes on them. The recent cooking gas and diesel price hike is a case in point.
Are States being punished for being efficient? Ports are a great hub of economic activity which can lubricate growth of their hinterland.
The rapid development of non-major ports is a good augury for the goodies of growth to reach far-flung areas.
The UPA government, even though mono-focused on growth, has lost the plot. Unabated inflation with spiralling fuel cost will have a “cascade effect”, adversely affecting the entire economy. We want buoyant, and not dependent, States.
By punishing efficiency and creating economic backwardness, the UPA seems more than willing to draw up another flagship dole programme.
Forget the fiscal deficit! By eating into the autonomy of the States, the UPA government at the Centre is threatening the spirit of federalism.
(The author is a spokesperson of the Bharatiya Janata Party. The views expressed are personal).