The dominance of the CSSs as a vehicle for transferring funds to the States has increased rapidly over the last eight years. In many sectors important from the point of view of the States, the present government at the Centre has introduced CSSs which could distort the States’ priorities, diminish their role and weaken them politically.
In 2014-15, the CSS fund releases under Article 282 constituted only 7.5% of the gross fund transfers to the States in that year. In contrast, in the Budget estimates for 2022-23, the corresponding proportion is around 47%. If this trend is to continue, the day is not far off when discretionary grants from the Centre to the States will eclipse rule-based transfers, eroding the role of the FC. If this happens, very little political space will remain for the States, with the governance system becoming more unitary than federal.
by E A S Sarma
03/09/2022
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