The HINDU Notes – 25th Febuary 2021 - VISION

Material For Exam

Recent Update

Thursday, February 25, 2021

The HINDU Notes – 25th Febuary 2021

 


📰 Cabinet approves PLI scheme for pharmaceuticals, IT hardware

Move entails outlays of ₹15,000 crore and ₹7,350 crore, respectively.

•The Union Cabinet on Wednesday approved the Production Linked Incentive (PLI) Scheme for the pharmaceuticals and IT hardware sectors, entailing an outlay of ₹15,000 crore and ₹7,350 crore, respectively.

•The PLI scheme for pharmaceuticals, whose duration will be for nine years from 2020-21 till 2028-29, will benefit domestic manufacturers, help create employment and is expected to contribute to the availability of a wider range of affordable medicines for consumers, the government said.

•The scheme is expected to bring in investment of ₹15,000 crore in the pharmaceutical sector.

•“The scheme is expected to promote the production of high-value products in the country and increase the value addition in exports. Total incremental sales of ₹2,94,000 crore and total incremental exports of ₹1,96,000 crore are estimated during six years from 2022-23 to 2027-28,” it said, adding that the growth in the sector is expected to add 20,000 direct and 80,000 indirect jobs for both skilled and unskilled personnel.

•The scheme also aims to create global champions from India that have the potential to grow in size and scale using cutting edge technology and thereby penetrate global value chains.

•Further it is expected to promote innovation for development of complex and high-tech products including products for emerging therapies and in-vitro diagnostic devices as also self-reliance in important drugs, while improving accessibility and affordability of medical products, including orphan drugs, to the Indian population.

•Separately, the cabinet, chaired by Prime Minister Narendra Modi, also approved the PLI Scheme for IT hardware such as laptops, tablets, all-in-one PCs and servers. The scheme, under which an incentive will be given on net incremental sales of goods manufactured in India for a period of four years, will benefit five major global players and ten domestic champions in the field of IT hardware, the government said.

•“This is an important segment to promote manufacturing under AtmaNirbhar Bharat as there is huge import reliance for these items at present...It will enhance the development of the electronics ecosystem in the country,” it added.

•As per government estimates, the scheme has the potential to generate employment for more than 1,80,000 (direct and indirect jobs) over four years. “The scheme will provide impetus to domestic value addition for IT hardware which is expected to rise to 20-25% by 2025,” it said.

📰 Winter pollution shows rise in most Indian cities, says CSE

Smaller and upcoming cities emerging as pollution hotspots, says report.

•The levels of PM 2.5, the most threatening of particulate matter, worsened in 43 out of 99 cities whose winter air in two years, 2020 and 2019, was compared by the Centre for Science and Environment (CSE). Only 19 registered “substantial improvement” — and one of these was Chennai. The restof the cities did not experience significant change.

•In the aftermath of the lockdown, several cities reported improved pollution levels but by winter, when lockdowns were significantly eased, pollution levels had clawed back to pre-COVID-19 levels, the CSE notes, underlining the significant contribution of local and regional factors to a city’s pollution levels.

•The cities with the worst pollution spikes in 2020 over 2019 include Gurugram, Lucknow, Jaipur, Visakhapatnam, Agra, Navi Mumbai, and Jodhpur. Kolkata is the only mega city in this group.

•In 37 cities that are otherwise showing stable or declining seasonal averages, their peak pollution levels have risen significantly during winter. These include Aurangabad, Indore, Nashik, Jabalpur, Rupnagar, Bhopal, Dewas, Kochi, and Kozhikode. On the other hand, in north India, other cities, including Delhi, have experienced the reverse, that is, an increase in the seasonal average but decline in the seasonal peak.

•During winter, cool and calm weather traps and spikes daily pollution, particularly in north Indian cities located in the Indo Gangetic Plain. This year, the average level of PM2.5 during the summer and monsoon months was considerably lower than the previous year due to the summer lockdown. However, the winter PM2.5 concentration has risen compared to the 2019 winter in many cities across regions.

•“This bouncing back of pollution post-lockdown unmasks the high impacts of local and regional pollution. This demands quicker regional reforms to curb pollution from vehicles, industry, power plants and waste burning to curb the winter pollution and also sustain annual improvement at a regional scale with speed,” says Anumita Roychowdhury, CSE’s executive director in charge of research and advocacy, said in a statement.

•The analysis is part of the air pollution tracker initiative of CSE. It’s based on publicly available granular real time data (15-minute averages) from the Central Pollution Control Board (CPCB). The data is captured from 248 official stations under the Continuous Ambient Air Quality Monitoring System (CAAQMS) spread across 115 cities in 22 States and Union Territories. The CSE analysts only considered cities that had readings for both years in at least 75% of the winter days (from October 1 to January 31).

•When ranked from the most to the least polluted cities, 23 of the most polluted cities are from north India. While Mysuru is the least polluted, followed by Satna in Madhya Pradesh and Kochi in Kerala, Ghaziabad is the most polluted city in the northern belt. There are only four cities (Satna, Mysuru, Vijaypura and Chikkamagaluru) that have met the national 24-hour standard (60 μg/m3) during the winter season. Satna and Maihar in Madhya Pradesh, and Mysuru in Karnataka, are the cleanest cities in the country, according to the report.

•The authors of the study also emphasise that rather than mega cities, it was the smaller and upcoming cities that were emerging as pollution hotspots. “ This report makes it amply clear that this winter pollution challenge is not limited to mega cities or one specific region; it is an omnipresent problem and requires urgent and deliberate action everywhere. This requires quicker reforms and action in key sectors of pollution — vehicles, industry, power plants and waste management to control winter pollution and bend the annual air pollution curve.”

📰 Bail as right: On bail to Varavara Rao

Laws, however stringent, cannot be allowed to trump basic rights

•In granting bail for six months to poet Varavara Rao in the Bhima Koregaon case on medical grounds, the Bombay High Court has affirmed the principle that even the stringent provisions of an anti-terrorism law are not invincible before a prisoner’s constitutional rights. Jailed under the draconian Unlawful Activities (Prevention) Act, Mr. Rao, 82, suffered from a host of ailments, and his condition was deteriorating until he was treated at the Nanavati Hospital on the intervention of the National Human Rights Commission. The court overruled the National Investigation Agency’s objection that bail should not be granted on medical grounds once an undertrial prisoner’s bail application was rejected on merits under UAPA, as long as access to treatment in a government hospital was available. The NIA had argued that in view of the statutory bar on granting bail under Section 43D(5) of the UAPA if the accusation against a person is prima facie true, any bail given on health grounds would open up the floodgates to similar petitions. The court looked at Mr. Rao’s plight from the perspective of his right to life under Article 21. It ruled that “a Constitutional Court cannot be a mute spectator to the undertrial being sent to prison and then to government hospitals, where his health deteriorates further, to be ultimately shifted to the Private Superspeciality Hospitals, upon intervention of courts...”. This could not continue back and forth only because his bail application has been turned down on merits, it said.

•Bail is routinely denied in most cases under UAPA. It became a watertight embargo since the Supreme Court in 2019 gave a ruling that made it nearly impossible for anyone arrested under UAPA to be released on bail, unless the accused could demonstrate that the charges against them were prima facie untrue. However, a few recent judicial decisions have sought to carve out exceptions. The Supreme Court laid down recently that prolonged incarceration without any possibility of an early completion of trial could be a ground for granting bail. In Mr. Rao’s case too, the High Court has noted that charges are yet to be framed, and 200 witnesses have to be examined once the trial begins. The temporary release of the octogenarian poet ought to turn public attention on the others incarcerated for a long time in the Bhima Koregaon case, in which lawyers and activists have been accused of plotting with Maoists to overthrow the government. Recent revelations that some of the electronic evidence in the case may have been planted remotely by a piece of malware have dented the prosecution’s claims about the existence of a plot. It is unfortunate that there is no sign of either an expeditious trial or any possibility of release of those arrested after a case of alleged provocative speeches made during a Dalit commemoration event held on December 31, 2017 in Pune, was transformed by the police into a sinister Maoist plot.

📰 Scientific disinterest: On Health Minister’s presence at Coronil promotion event

Ministers and public figures must not be seen as endorsing drugs whose efficacy is in doubt

•The presence of Union Health Minister Harsh Vardhan at a press conference to promote Coronil, an Ayurvedic pill promoted by Baba Ramdev’s Patanjali Ayurved, is objectionable on more than one count. Coronil is a concoction of common herbs known to Ayurveda. Since June, there have been attempts to deploy it into India’s COVID-19 management protocol. Dr Vardhan, alongside Cabinet colleague Nitin Gadkari, was at a press conference with Baba Ramdev and other promoters of Patanjali to announce a scientific publication describing the efficacy of Coronil in ridding volunteers, part of a clinical trial, of coronavirus. For one, Coronil is a product manufactured by a private company. Doctors — Harsh Vardhan is an ENT surgeon — are explicitly barred from promoting drugs of any sort. Though Dr Vardhan didn’t explicitly mention Coronil in his address at the function, what public functionaries are seen to be doing speaks louder than what they say. Baba Ramdev first claimed that his product was endorsed by the WHO. Following media reports, WHO South-East Asia tweeted that it hadn’t reviewed or certified the effectiveness of any traditional medicine for the treatment of COVID-19. What transpired was that India’s apex drug regulator had certified Coronil as a pharmaceutical product in “supporting COVID treatment and an immunity booster” and cleared it for export. It hasn’t recommended it as treatment for COVID-19.

•The publication of a double-blinded, randomised clinical trial in a research journal isn’t an endorsement of a product, but an essential requirement of reporting the drug’s action to subject experts. The report reveals that the medicine was only tested on 95 of those asymptomatic and “mildly symptomatic” but confirmed as RT-PCR positive. The 45 patients who got the actual treatment (and not a dummy pill) tested COVID-19 negative significantly quicker. However, these numbers are small. A large proportion of those with mild or no symptoms are expected to clear out the infection without any external intervention. There was no information in the study on the number of days that elapsed before the patients tested positive, making the role of the drug in clearing out the virus unclear. True, allopathic medicine too has cut corners: an ICMR-led trial ultimately couldn’t justify the administration of hydroxychloroquine; the Drugs Controller General of India approved itolizumab by Biocon that was tested only in a sample of 30 but was advertised as a “breakthrough drug”; and Covaxin was approved before its efficacy was known. Processes are imperfect, but the government must demonstrate its scientific disinterest when evidence is wanting.

📰 Adultery as ‘misconduct’

The SC must delineate some critical definitions

•Every civil servant, whether a member of the All India Services (AIS), State Service or Central Service, is governed by a moral code of conduct. Similarly, the conduct of army officers and jawans is administered under the Army Act. While the AIS conduct rules require its members to “maintain absolute integrity and devotion to duty” and do “nothing which is unbecoming of a member of the service”, the Army Act contains penal provisions for displaying “unbecoming conduct” or “disgraceful conduct”. The Central and State Civil Services conduct rules also demand similar integrity from its members. Surprisingly, what exactly constitutes an “unbecoming conduct” or “unbecoming of a member of a service” is nowhere defined. It, therefore, leaves ample scope for the employer or disciplinary authority to use this leverage and set up parameters of misconduct for its subordinates.

•One such conduct, which has been a subject of debate for long, is whether illicit or adulterous relations with another woman or man amounts to misconduct under service rules, particularly after the Supreme Court’s verdict in Joseph Shine vs Union of India (2018). This contention assumes significance in light of the Centre’s application for clarification that the SC’s aforesaid decision on decriminalising adultery under IPC should not apply to the armed forces. Though the matter has been referred to a Constitution Bench, Justice Rohinton Nariman while issuing notice made an observation that “something which is not adultery because the section [497 IPC] has been struck down will still be ‘unbecoming conduct’”. This observation, in fact, is in contrast to the judgments made by various High Courts in the past.

•In 1985, the Calcutta High Court in Rabindra Nath Ghosh (In re) held that a head constable who was living with another woman ignoring his married wife was not guilty of any misconduct in the performance of his duties as a policeman. In State of U.P. vs BN Singh (1989), the Allahabad High Court ruled that in order to bring a case of a government servant within the definition of ‘personal immorality’ on the habit of sex, it must be shown “that this habit of the government servant has reduced his utility as a public servant so as to damage the government or official generally in public esteem”. Justice M. Katju, in Pravina Solanki vs State of U.P. (2001) held that “unless an employee does some act which interferes with his/her official function then ordinarily whatever he/she does in his/her private life cannot be regarded as misconduct”.

•More importantly, after the Joseph Shine case, the Rajasthan High Court in Mahesh Chand Sharma vs State of Rajasthan (2019) held that “no employer can be allowed to do moral policing on its employees which go beyond the domain of his public life”. The court said that though adultery is an immoral act and is not to be appreciated, “the same would, however, not be a ground for initiating departmental proceedings by the employer and it be left best for the person who may be affected to take remedy...”.

Ambiguous expressions

•When various High Courts have held that the act of adultery is not a sufficient ground to initiate departmental proceeding unless it interferes with an employee’s official functions, the observations of Justice Nariman that the Army Act is “on a different footing” because the expression used is “unbecoming conduct” have, once again, raised the contention between “misconduct” and “immoral act”. Hence, the SC must address expressions such as “unbecoming of a civil servant” or “unbecoming” or “disgraceful” conduct.

•It is understood that “misconduct” is nothing but unlawful behaviour, misfeasance, may involve moral turpitude and must be improper or wrong behaviour, wilful in character. Any government or public authority would want its employees to maintain integrity not only during the discharge of their official duties, but also in the public domain. With such a public policy in place, whether adulterous conduct is sufficient to initiate departmental action is a million-dollar question that the Supreme Court must answer.

📰 The structural fragility of Union Territories

Union Territories having legislatures with ultimate control vested in the central administrator are not workable

•The sudden and inexplicable resignations of Congress MLAs from the Puducherry Assembly have turned out to be an ingenious move to topple the Congress government led by V. Narayanasamy. This was done in 2019 with devastating effect in Karnataka. In both cases, the governments lost majority and went out of office. Resigning from the membership of the House is every member’s right. But according to Article 190 of the Constitution, the resignation should be voluntary or genuine. If the Speaker has information to the contrary, he or she is not obliged to accept the resignation.

An innovative method

•But there is by now a familiar pattern to the resignations of Members of the Legislative Assembly. Such resignations invariably lead to the fall of the government and resignations take place only from the ruling parties in the States which are opposed to the ruling party at the Centre. These parties are, in fact, in a precarious condition because in most cases, the resignations are quite unanticipated and reduce the party’s majority in the House abruptly. Even the most seasoned Chief Ministers who have weathered many storms look flummoxed in the face of this blow. Resignations are done with such precision that the exact number of MLAs required to reduce the majority resign, not more. This mode of toppling a government has an odd attractiveness about it because of its sheer novelty. The beauty of this scheme is that no MLA has to defect and face disqualification and get a bad name. It is a wonderful way to end defection and save the honour of the legislators.

•The Puducherry development has tremendous political significance. But the purpose of this article is to unravel the structural fragility of Union Territories (UTs) as units of the Indian federation which perhaps makes it easier for powerful operators in the political system to destabilise them.

Composition of the legislature

•The first question that arises in the context of these UTs is why the Constitution-makers/ Parliament thought it fit to provide a legislature and Council of Ministers to some of the UTs. The ostensible reason is to fulfil the democratic aspirations of the people of these territories. In other words, there was a realisation that the administration of these territories directly by the President through the administrators under Article 239 does not meet the democratic aspirations of the people. Therefore, the creation of a legislature and a Council of Ministers is logical and in consonance with the policy of the state to promote democracy.

•But a closer look at the relevant provisions in the Constitution reveals that this professed aim has often been sought to be defeated by the Union. Article 239A was originally brought in, in 1962, to enable Parliament to create legislatures for the UTs. Look at the composition of the legislature as provided in the Constitution. It is a body that is elected, or partly elected and partly nominated. There can be a Council of Ministers without a legislature, or there can be a legislature as well as a Council of Ministers. A legislature without a Council of Ministers or a Council of Ministers without a legislature is a conceptual absurdity. In our constitutional scheme, a legislature is the law-making body and a legislative proposal is initiated by the government, which is responsible to the legislature. Neither can the legislature exist without a Council of Ministers nor can the Council of Ministers exist without a legislature. Similarly, a legislature that is partly elected and partly nominated is another absurdity. In fact, a simple amendment in the Government of Union Territories Act, 1963 can create a legislature with more than 50% nominated members. How can a predominantly nominated House promote representative democracy?

Issue of nomination

•The issue of nomination of members to the Puducherry Assembly had raised a huge controversy. The Government of Union Territories Act provides for a 33-member House for Puducherry of whom three are to be nominated by the Central government. So, when the Union government nominated three BJP members to the Assembly without consulting the government, it was challenged in the court. Finally, the Supreme Court (K. Lakshminarayanan v. Union of India, 2019) held that the Union government is not required to consult the State government for nominating members to the Assembly and the nominated members have the same right to vote as the elected members.

•Nomination as such is not new to the Indian legislature. There is provision for nomination of members to the Rajya Sabha [Article 80 (i)(a)]. But clause (3) of the Article specifies the fields from which they will be nominated. The purpose of this nomination is to enable the House to draw on the expertise of those eminent members who are nominated and thus enrich the debate in the House. But in the case of nomination to the Puducherry Assembly, no such qualification is laid down either in Article 239A or the Government of Union Territories Act. This leaves the field open for the Union government to nominate anyone irrespective of whether he or she is suitable. The Supreme Court took too technical a view on the matter of nomination and did not go into the need to specify the fields from which those persons could be nominated and also lay down a fair procedure to be followed for nomination of members. As things stand, the law invites arbitrariness in dealing with the nomination of members to the UT legislature. If a different party runs the government in the UT, this provision will be used by the Union government with a vengeance, which is what happened in Puducherry.

Administrator’s power

•As a matter of fact, the UTs were never given a fully democratic set-up with necessary autonomy. The power vested in the administrator, who is known as the Lieutenant Governor in the UTs having a legislature, bear this out. The administrator has the right to disagree with the decisions of the Council of Ministers and then refer them to the President for a final decision. The President decides on the advice of the Union government. So, in effect, it is the Union government which finally determines the disputed issue. The administrator can, in fact, disagree with all crucial decisions taken by the State government when the territory is ruled by a different political party. Section 44 of the Government of Union Territories Act and Article 239 AA(4) (proviso) of the Constitution vests the power in the administrator to express his or her disagreement and refer the matter to the President and then take all actions he or she deems fit in the matter in total disregard of the elected government. Although in NCT of Delhi v. Union of India (2019), the Constitution Bench of the Supreme Court had said that the administrator should not misuse this power to frustrate the functioning of the elected government in the territory and use it after all methods have failed to reconcile the differences between him/her and the Council of Ministers, experience tells us a different story. In Puducherry, the conflicts between the Lt. Governor and the Chief Minister were perennial. A frustrated Chief Minister at last had to knock on the door of Rashtrapati Bhavan seeking the removal of the Lt. Governor.

•Similarly, in the National Capital Territory of Delhi, one often hears of complaints against the Lt. Governor from the ministers about the non-cooperative federalism being practised by him. As a matter of fact, such conflicts between the administrator, who is the nominee of the President, and the elected government is inherent in the constitutional arrangement created for the UTs. No Union government really likes the idea of a free and autonomous government in the UTs and therefore tries to control it through the administrator. The weaponisation of the constitutional provision is done in full measure when the UT is ruled by a different political party.

•Experience shows that the UTs having legislatures with ultimate control vested in the central administrator are not workable. The redemption for the harried governments of these territories lies in the removal of the legal and constitutional provisions which enable the administrator to breathe down the neck of the elected government.

•So far as the conspiratorial resignation by legislators to bring down their own government is concerned, the political class will have to rack its brains on how to get the better of the predatory instincts of political parties through constitutional or other means.

📰 Federalism and India’s human capital

A decentralised approach and strong local governments can enhance developmental outcomes

•Investing in human capital through interventions in nutrition, health, and education is critical for sustainable growth. But India’s human capital indicators remain low. In the World Bank’s Human Capital Index, the country ranked 116th. The National Family Health Survey-5 for 2019-20 shows that malnutrition indicators stagnated or declined in most States. The National Achievement Survey 2017 and the Annual Status of Education Report 2018 show poor learning outcomes. In addition, there is little convergence across States. This is a cause of concern as these statistics could worsen due to the COVID-19 pandemic.

•Several government initiatives have been launched to address these issues. The National Health Policy of 2017 highlighted the need for interventions to address malnutrition. On the basis of NITI Aayog’s National Nutrition Strategy, the Poshan Abhiyaan was launched, as part of the Umbrella Integrated Child Development Scheme. The latest Union Budget has announced a ‘Mission Poshan 2.0’ and the Samagra Shiksha Abhiyan has been the Centre’s flagship education scheme since 2018. However, India spends just 4% of its GDP as public expenditure on human capital (around 1% and 3% on health and education respectively) — one of the lowest among its peers.

•International experience suggests that one reason why these interventions are not leading to better outcomes may be India’s record with decentralisation. Globally, there has been a gradual shift in the distribution of expenditures and revenue towards sub-national governments. These trends are backed by studies demonstrating a positive correlation between decentralisation and human capital.

•In recent years, India has taken some steps towards decentralisation. The Fourteenth Finance Commission increased the States’ share in tax devolution from 32% to 42%, which was effectively retained by the Fifteenth Finance Commission.

•In India, three tiers of government are envisaged, with the Constitution dividing powers between the first two tiers — the Centre and the States, as per the three lists under the Seventh Schedule. While public health is in the State List, the broader subject of economic and social planning is in the Concurrent List. In 1976, education was shifted from the State List to the Concurrent List through the 42nd Amendment. The placement of a subject in the Concurrent List, in effect, indicates the presence of overarching considerations that warrant the Centre’s involvement.

•Fiscally, while the Constitution assigns the bulk of expenditure responsibilities to States, the Centre has major revenue sources. To address this vertical imbalance, the Constitution provides for fiscal transfers through tax devolution and grants-in-aid. In addition, the Centre can make ‘grants for any public purpose’ under Article 282 of the Constitution. While fiscal transfers that are part of tax devolution are unconditional, transfers under grants-in-aid or Centrally Sponsored Schemes (CSSs) can be conditional. Therefore, the increase in the States’ share of tax devolution represents more meaningful decentralisation.

Several imbalances

•The 73rd and 74th Amendments bolstered decentralisation by constitutionally recognising panchayats and municipalities as the third tier and listing their functions in the Eleventh and Twelfth schedules, respectively. These include education, health and sanitation, and social welfare for panchayats, and public health and socio-economic development planning for municipalities. However, the Constitution lets States determine how they are empowered, resulting in vast disparities in the roles played by third-tier governments.

•Despite some shifts towards greater State autonomy in many spheres, the centralised nature of India’s fiscal architecture has persisted. Centrally Sponsored Schemes have formed a sizeable chunk of intergovernmental fiscal transfers over the years, comprising almost 23% of transfers to States in 2021-22. But its outsized role strays from the intentions of the Constitution. Article 282 of the Constitution is listed as a ‘Miscellaneous Financial Provision’, unlike Articles 270 and 275, which fall under ‘Distribution of Revenues between the Union and the States’. Constitutional expert Nani Palkhivala had characterised it as more of a residuary power, opining that grants-in-aid under Article 275 as per Finance Commission recommendations are the more appropriate, regular route. The Supreme Court in Bhim Singh vs Union of India had observed that “Article 282 is normally meant for special, temporary or ad hoc schemes”.

•There are issues in the design of CSSs as well, with the conditions being overly prescriptive and, typically, input-based. Against this, international experience reveals that schemes with output-based conditions are more effective. Moreover, CSSs typically have a cost-sharing model, thereby pre-empting the States’ fiscal space. This is incongruous, given that many CSSs cover subjects in the State and Concurrent Lists, such as health and education.

•A functionally and fiscally empowered third tier would not only be more in keeping with the constitutional spirit, but also lead to better outcomes. But ironically, States, too, have been responsible for centralisation. Many States do not clearly demarcate or devolve functions for panchayats and municipalities.

•Further, third-tier governments are not fiscally empowered either. The collection of property tax, a major source of revenue for third-tier governments, is very low in India (under 0.2% of GDP, compared to 3% of GDP in some other nations). The Constitution envisages State Finance Commissions (SFCs) to make recommendations for matters such as tax devolution and grants-in-aid to the third tier. However, many States have not constituted or completed these commissions on time, and hence, the Fifteenth Finance Commission has recommended no grants after March 2024 to any State that does not comply with the constitutional provisions pertaining to SFCs.

Towards a solution

•To begin with, the Centre needs to rethink the nature of its actions. It should play an enabling role, for instance, encouraging knowledge-sharing between States. For States to play a bigger role in human capital interventions, they need adequate fiscal resources. To this end, States should rationalise their priorities to focus on human capital development. The Centre should refrain from offsetting tax devolution by altering cost-sharing ratios of CSSs and increasing cesses. The unconditional nature of these vertical transfers should be effectuated in spirit. Concomitantly, the heavy reliance on CSSs should be reduced, and tax devolution and grants-in-aid should be the primary sources of vertical fiscal transfers. Panchayats and municipalities need to be vested with the functions listed in the Eleventh and Twelfth Schedules.

•Leveraging the true potential of our multi-level federal system represents the best way forward towards developing human capital.