New Delhi: Cooperative federalism will be the leitmotif of Niti Aayog’s governing council meeting on Sunday chaired by Prime Minister Narendra Modi.
The third meeting of the governing council which also has chief ministers of states and union territories as members, comes in the backdrop of fundamental reordering of federal fiscal relations which includes larger transfers to states for funding of centrally sponsored schemes.
According to a government statement issued on Saturday, Niti Aayog vice chairman Arvind Panagariya, “will present a roadmap for the rapid transformation of India by outlining key aspects of the 15-year Vision document, comprising the seven-year strategy document and the three-year action plan.”
Madhya Pradesh chief minister Shivraj Singh Chouhan will present a roadmap for doubling farmer’s income. Also, there will be a presentation on goods and services tax (GST) during the day-long meeting.
The Sunday meeting holds special significance given the GST council keenness to meet the 1 July deadline for the roll-out of the historic tax reform, which economically unifies the country.
The governing council meeting will set new socio-economic goalposts for the nation, Mint reported. With the Planning Commission being replaced with Niti Aayog, the era of Nehruvian centralized planning also ended on 31 March with the end of 12th five year plan (2012-17).
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“States have carried out reforms in many areas. Tomorrow’s @NITIAayog meeting is an opportunity to learn best practices from each other,” said the prime minister, who is the chairperson of Niti Aayog in a tweet on Saturday evening.
The NDA government aims to double farm incomes by 2022. Madhya Pradesh on its part has taken the lead in farm mechanization as reported by Mint. The state also enacted a separate land leasing law based on Niti Aayog’s Model Agricultural Land Leasing Act, 2016 to protect the tenant and land owners’ interest.
In the evening, the prime minister will also meet the chief ministers of BJP-ruled states.
The National Democratic Alliance (NDA) government engineered a transformation in the country’s federal polity with chief ministers becoming governing body members of National Institution for Transforming India also called Niti Aayog---India’s apex think tank.
State governments as well as gram sabhas had a say in evolving the vision document, a person with direct knowledge of the matter said on condition of anonymity.
“The (governing council) meeting will deliberate on a host of policy initiatives and legislative reforms being piloted by Niti Aayog including the Regulatory Reforms Bill, a model Agriculture Land Leasing Act, changes to Agricultural Produce Marketing Committee Act, a national energy policy and strategic disinvestment of state owned enterprises,” said the person cited above.
Issues such as further reducing the inverted duty structure (where raw materials attract higher duty than the finished products) to make manufacturing more competitive, creation of coastal employment zones and tapping the export markets using existing free trade agreements will also feature during the discussions.
Modi is also expected to review key projects’ such as skill development and promotion of entrepreneurship which are expected to have a multiplier effect on the economy.
Experts say that a mere increase in gross domestic product (GDP) is not a good measure of overall progress and shall be matched by job creation.
“For growth to be inclusive, and for citizens to benefit from growth, more livelihoods and jobs must be generated. This should be the measure of good, inclusive growth,” said Arun Maira, former member of Planning Commission.
The governing council meeting also comes at a time when concerns about potential data breaches and privacy violations surrounding Aadhaar—the world’s largest biometric identification database, which forms the pivot of government welfare programmes has been expressed.
The first three-year action agenda, coming into effect from 2017-18 to 2019-20, aligns the country’s goals with available resources, by predicting flow of finances during the 14th Finance Commission award period (2015-20).
The 14th Finance Commission on its part triggered the radical overhaul of the existing fiscal relationship between the Centre and states by bumping up the states’ share in central tax revenues substantially to 42% from the previous level of 32%— the largest increase ever. Also, the GST council was created by pooling the sovereignty of the Centre and the states.
The N.K. Singh panel which reviewed India’s fiscal rules recommended a debt-to-GDP ratio of 38.7% for the central government, 20% for state governments together and a fiscal deficit of 2.5% of GDP by financial year 2022-23.