Interstate Relations

• States in India have limited sovereignty, and the operation of the Constitution is guided by the federal spirit. However, as a result of global trends, India's federalism is becoming more pronounced. More prudent autonomy could be granted to states. To maintain harmonious relations and close cooperation between the Centre and the states. Inter-State Relations UPSC Notes are available here. In terms of inter-state relations, the Constitution provides for the following:
• Inter-state water dispute resolution
• Inter-state councils for coordination
• Mutual acceptance of public acts, records, and judicial proceedings.
• Inter-state trade, commerce, and intercourse freedom
• In addition to the above arrangements, the Parliament established zonal councils to promote inter-state cooperation and coordination.

Water Disputes Between States (Art. 262)

• Water sharing is one of the most contentious issues in the Indian federal political system, and it has repeatedly called into question the principle of cooperative federalism. Although water is on the State List, the Central Government has the authority to regulate and develop inter-state rivers and river valleys.

Reasons For Rising River Disputes

• Demographic factor- A demographic factor is a growing population in the river basin.
• Agriculture patterns are changing as farmers shift to water-intensive crops like paddy and sugarcane.
• Climate and geographical factors - A 2011 study predicted that climate change could cause a 50% reduction in the waters of the Cauvery sub-basins by 2080.
• Uneven distribution of water resources, as well as increasing rainfall variability and drought frequency.
• Disputes arising from state bifurcation - When Telangana was formed in 2014, the Godavari water and the Polavaram project became a source of contention.
• Political factors- With the growing nexus between water and politics, regional political forces have grown stronger and more assertive, transforming disputes into vote bank politics.

Article 262

• Two provisions are made in Article 262 for the resolution of inter-state water disputes:
• By law, Parliament may provide for the adjudication of any dispute or complaint relating to the use, distribution, and control of any interstate river and river valley.
• Parliament may also provide that no court, including the Supreme Court, will have jurisdiction over any such dispute or complaint.
• The River Boards Act of 1956: Establishes river boards for the regulation and development of interstate rivers and river valleys. The Central Government establishes a river board at the request of the concerned state governments to advise them.
• Inter-State Water Disputes Act (1956): Allows the Central Government to establish an ad hoc tribunal to resolve a dispute between two or more states over the waters of an inter-state river or river valley. The tribunal's decision would be final and binding. Furthermore, neither the Supreme Court nor any other court shall have jurisdiction over any water dispute referred to such a tribunal under this Act.

Note:

• The Krishna Water Disputes Tribunal, established in 1969, was the first inter-state water disputes tribunal. Karnataka, Andhra Pradesh, and Maharashtra were the states involved.

Constitutional Provisions To Solve Water Disputes

Issues In Inter-State Water Disputes

Water Dispute Resolution Issues

• Historically significant - The dispute over sharing Cauvery's water dates back more than a century. It began between the princely state of Mysore (now Karnataka) and the Madras Presidency (now Tamil Nadu).
• 262, prohibits the Supreme Court or any other court from hearing interstate water disputes. However, the Supreme Court accepts the petitions under its power of Special Leave Petition (Art. 136), resulting in pending litigation.
• The Central government's mediation for resolution becomes difficult in times of coalition politics and assertive regional political forces.
• Non-compliance by states with tribunal awards is a critical weak link in dispute resolution that can persist even when a permanent tribunal exists.

Problems with the current Interstate River Water Dispute Act of 1956:

• For each interstate river water dispute, a separate tribunal must be established.
• Delays in resolving such disputes are excessive. Tribunals such as the Cauvery and Ravi-Beas have been in operation for over 26 and 30 years, respectively, with no award. Adjudication is not time-limited. In fact, delays occur during the formation of tribunals as well.
• There is no provision for an adequate mechanism to enforce the Tribunal's decision.
• Issue of finality - If the Tribunal rules against a party, that party moves quickly to seek redress in the Supreme Court. Only three of the eight Tribunals have issued awards that have been accepted by the States.
• Control over water is regarded as a sacred right that must be jealously guarded. Compromise is viewed as a flaw that can be politically fatal.
• The Act makes no mention of the principles that the tribunal must follow when deciding on water disputes.
• The chairperson and members of the tribunals have no age limit.

Features Of The 2017 Inter-State River Water Disputes (Amendment) Bill

• Dispute Resolution Committee (DRC) - to be established by the Central Government prior to referring a dispute to the tribunal, with the goal of resolving the dispute amicably through negotiations within a year extended by six months.
• Instead of the existing multiple tribunals, a single tribunal would be established.
• It authorises the appointment of Assessors to provide technical assistance to the tribunal. They will be chosen from among experts in the Central Water Engineering Service who hold the rank of Chief Engineer or higher.
• Timetable - A dispute should be resolved by the tribunal in four and a half years.
• Finality - The Tribunal's decision is final and binding.
• Data collection and management of a national data bank for each river basin by an agency appointed and authorised by the central government.
• The Tribunal shall be composed of one chairperson, one vice-chairperson, and no more than six other members. It limits the chairperson's tenure to five years or until they reach the age of 70, whichever comes first. The term of office of the Vice Chairperson and other members of the tribunal will end with the resolution of the water dispute.

2017 Inter-State River Water Disputes (Amendment) Bill Issues

• Permanent Tribunal benches are proposed to be established as needed. As a result, it is unclear how these temporary benches will differ from the current system.
• The Supreme Court has stated that it can hear appeals against water tribunals established under the ISWDA, causing the judicial proceedings to be delayed.
• The institutional mechanism for enforcing the tribunal's decision is still riddled with ambiguities and uncertainties.

Suggestions And Way Forward

• The Inter-State Council (ISC) can be useful in facilitating dialogue and discussion towards conflict resolution.
• River Basin Organizations (RBOs) - River Basin Organizations (RBOs) can be established under the River Boards Act of 1956 to regulate and develop interstate rivers and their basins.
• Transitioning to Mediation - Mediation is a flexible and informal process that draws on the mediators' multidisciplinary perspectives.
• Supply Side Management - Many academics have argued that increasing the water supply could be one solution to such problems.
• The declaration of rivers as the national property may reduce the tendency of states to regard control of river waters as a right.
• Adding water to the concurrent list, as suggested by the Mihir Shah report, where a central water authority can be established to manage rivers. A Parliamentary Standing Committee on Water Resources also supported it.
• Inter-State Water Issues Institutional Model - Water-sharing challenges persist because the country lacks institutional models for implementing inter-state river water awards. As a result, there is a need for a permanent mechanism to resolve water disputes between states without resorting to the courts.
• River interconnection - can aid in the adequate distribution of river water in basin areas.
• Following the 4Rs - In order to achieve SDG 6 (Ensure access to water and sanitation for all), the concept of the 4Rs (Reduce, Reuse, Recycle, Recover) for water management must be practised.
• Following National Water Policy - for rational use of water and conservation of water sources.

Cauvery Water Management System (2018)

• The Centre established the Cauvery Water Management Authority (CWMA) and the Cauvery Water Regulation Committee under the scheme (CWRC).

Cwma Functions

• With the assistance of the CWRC, monitor storage, apportion shares, supervise reservoir operation, and regulate and control Cauvery water releases.
• Karnataka's water release will be regulated at the inter-state contact point at Billigundulu gauge.
• Calculate the total residual storage in the specified reservoirs at the start of the water year (June 1 each year).
• Advise states to take appropriate measures to improve water use efficiency, such as encouraging micro-irrigation (drip and sprinkler), changing cropping patterns, improving agronomic practises, correcting system deficiencies, and developing command areas.
• If any party state fails to take appropriate action, it may seek the assistance of the central government in carrying out the award.

The Importance Of Cwma

• It is a permanent body that reports to the Union Ministry of Water Resources, and its decisions are final and binding on all parties.
• The share of each state will be determined based on the assumed flows and the available carry-over storage in the reservoirs.
• An inter-state river, such as the Cauvery, is a "national asset," and no state can claim exclusive ownership of its waters or deprive other states of their equitable share.

Art. 263 Inter-State Council

• As 263 implies the establishment of an Inter-State Council to effect coordination between the states and between the Centre and the states, the Inter-State Council is a constitutional body.
• The PRESIDENT OF INDIA has the authority to create such a council if he believes that it will serve the public interest. The president can also define the nature of the duties to be performed by such a council, as well as its organisation and procedure.
• It was established for the first time in 1990 by Presidential order in response to the recommendations of the Sarkaria Commission under the Ministry of Home Affairs.
• The council serves as a consultative body on inter-state, centre-state, and centre-union territorial issues.
• The Council may convene at least three times per year. All questions are resolved through consensus. However, in 26 years, it has only met 11 times. In July 2016, the meeting was held in Delhi after a ten-year hiatus.
• The Council is the most dynamic platform for discussing policies, strengthening Centre-State relations, and acting as a bridge between the Centre and the States.
• The council's functions to investigate and advise on inter-state disputes are complementary to the Supreme Court's jurisdiction (Art. 131) to resolve a legal dispute between governments.
• Art. 131 - gives the Supreme Court original jurisdiction over any dispute between states or between the centre and a state.

Significance Of The Inter-State Council

• CONSTITUTIONAL SUPPORT - Unlike other platforms for Centre-State cooperation, the ISC has constitutional support, putting states on a more solid footing.
• Cooperative federalism - With different political parties in charge of the Centre and various states, the need for dialogue becomes even more important.
• Resolving state-state and centre-state disputes
• Decentralized decision-making - If the goal of a more decentralised polity, which necessitates interaction between various levels of government, is to be realised, Interstate Council is an essential first step.
• Makes governments more accountable - Because it serves as a forum for dialogue and discussion, it holds governments at both the national and state levels more accountable for their actions.
• A safety valve - The council contributes to bridging the trust gap between the centre and the states. If it wasn't always a problem solver, it was at least a safety valve.
• A scarcity of other options - Another constitutional route

Inter-State Council and Sarkaria Commission

• The Sarkaria Commission on Centre-State Relations (1983-88) proposed establishing a permanent Inter-State Council (under Article 263) of the Constitution.
• To distinguish itself from other bodies established under the same Art. 263, the Commission recommended that the Inter-State Council be renamed the Inter-Governmental Council.
• It proposed that the Council be charged with the duties outlined in 263 (b) and (c) (c).

Duties delegated to the Inter-State Council under Article 263

• a) Investigating and advising on disputes that may arise between states
• b) Investigating and deliberating on subjects in which the states or the Centre and the states have a common interest. c) Making recommendations on any such subject, particularly for better policy and action coordination on it. d) Deliberating on such other matters of general interest to the states as may be referred to it by the chairperson (i.e. Prime Minister)

Inter-State Council Members

• In 1990, the Janata Dal Government, led by V. P. Singh, established the Inter-State Council.
• Chairmanship of the Prime Minister
• Chief Ministers from all states
• Chief Ministers of UTs with legislative assemblies in Delhi, Puducherry, and Jammu and Kashmir
• UT administrators who do not have legislative assemblies
• Governors of states subject to the presidential rule (Art. 356)
• Six ministers from the Central Cabinet (to be nominated by the Prime Minister).
• Permanent invitees to the Council are five Ministers of Cabinet rank / Ministers of State (independent charge) nominated by the Chairman.

Inter-state Council Standing Committee

• The Council's Standing Committee was established in 1996 to provide continuous consultation and processing of matters for the Council's consideration.
• Standing committee members include
• Union Home Minister is the chairman.
• Five Cabinet Ministers from the Union
• There are nine Chief Ministers.
• Standing committee functions include:
• To monitor the implementation of decisions based on the Interstate Council's recommendations.
• To process all matters concerning Centre-State Relations before they are considered by the Inter-State Council.
• To deliberate on any other matter referred to it by the Chairman/Inter-state Council.

Inter-State Council Problems

• The council's advice is non-binding.
• Lack of regular meetings among member states - the Inter-State Council recently met after a 10-year hiatus.
• Deliberation on socioeconomically important topics such as poverty alleviation, health, education, and SDG implementation at the state level is lacking in the Council.
• There is no representation in the Council for civil society, NGOs, and experts from the corporate and academic sectors.
• The Union Home Ministry's secretariat and the chairmanship of the Union Home Minister give the impression of bias.
• It is viewed as merely armchair discussions with no substantive outcome.
• Despite having constitutional backing (unlike NITI Aayog), the ISC's potential and importance are underutilised.

Methods To Improve Isc

• It should be strengthened as a forum for both administrative and political and legislative exchanges between the centre and the states.
• ISC should allow civil society institutions, NGOs, the corporate sector, and domain experts to make more extensive representations.
• In addition to the All India Services cadre, the Council's organisational structure should include experts from the fields of law, management, finance and economics, and political science.
• The ISC is considering shifting its secretariat from the Union Home Ministry to the Rajya Sabha secretariat in order to give it a neutral federal character.
• Instead of the Union Home Minister, the Vice-President of India should chair the council.
• The ISC must meet at least three times per year on an agenda developed after extensive consultation with states. - Commission Punchhi
• According to The Punchhi Commission on the Centre-State Relationship (2007): To make the Inter-State Council a credible, powerful, and fair mechanism for managing interstate and Centre-state differences, appropriate amendments to Article 263 is required. 
• The Interstate Council should continue to play an auditing role in the management of matters involving concurrent or overlapping jurisdiction. — Punchhi commission on the relationship between the Centre and the States (2007)

Inter-State Trade And Commerce (Art. 301) 

• Spans from 301 to 307 (Part XIII) of the Constitution and deals with trade, commerce, and intercourse within India's territory.
• 301 à declares that trade, commerce, and intercourse shall be free throughout India's territory.
• 301 aimed to break down border barriers between states and create a unified unit in order to encourage the free flow of trade, commerce, and intercourse throughout the country.
• The freedom granted by Art. 301 includes intra-state trade, commerce, and intercourse.
• Imposing restrictions at any state's border or at any previous or subsequent stage is a violation of Art. 301.

Restrictions on the freedom guaranteed by Article 301

• In the public interest, Parliament may impose restrictions on the freedom of trade, commerce, and intercourse between states or within a state.
• Except in cases of the scarcity of goods in any part of India, Parliament cannot give preference to one state over another or discriminate between states.
• The Essential Commodities Act (1955), for example, allows the Central Government to control the production, supply, and distribution of certain essential commodities such as petroleum, coal, iron and steel, and so on.
• In the public interest, a state's legislature may impose reasonable restrictions on the freedom of trade, commerce, and intercourse with that state or within that state. Only with the President's prior approval can such a bill be introduced in the legislature.
• Furthermore, the state legislature has the authority to favour one state over another or to discriminate between states.
• The state legislature has the authority to levy any tax on goods imported from other states or UTs that are similar to those manufactured in that state. This provision forbids the state from levying discriminatory taxes.
• The freedom (as defined in Art.301) is subject to nationalisation laws (Laws providing for monopolies in favour of the Centre or the states).
• The Parliament or state legislatures have the authority to enact laws that allow the respective government to engage in any trade, business, industry, or service, whether to the exclusion, complete or partial, of citizens or otherwise.
• The Parliament may appoint an appropriate authority to carry out the purposes of the preceding provisions relating to trade, commerce, and intercourse freedom and restrictions.
• The Parliament can also delegate the necessary powers and duties to that authority. However, no such authority has been established thus far.
• In the United States, such a body is known as the Inter-State Commerce Commission.
• Under Art. 307, steps should be taken to establish an Inter-State Trade and Commerce Commission (Entry 42 of List-I). This Commission should be given both advisory and executive powers, as well as decision-making authority. The Commission's decisions, as a constitutional body, should be final and binding on all states as well as the Union of India. Any party who disagrees with the Commission's decision may file an appeal with the Supreme Court. — The Punchhi Commission on the Centre-State Relationship (2007)

Zonal Councils

• The statutory (extra-constitutional) bodies are the Zonal Councils, which are established under the States Reorganisation Act (1956) and the Seventh Constitutional Amendment Act (1956)
• The act divided the country into five zones: Northern, Central, Eastern, Western, and Southern, with each zone having its own zonal council.
• The zonal councils are intended to promote cooperation and coordination among states, UTs, and the Centre.
• They are merely deliberative and advisory bodies, and their recommendations are not legally binding.
• The Seventh Amendment was required to implement the recommendations of the States Reorganisation Commission (established in 1953 and led by Fazal Ali) regarding the linguistic reorganisation of the states. It paved the way for states to be classified as A, B, C, or D, and it established Union Territories. Andhra Pradesh became the first state of independent India on October 1, 1953.

Zonal Council Composition

• Union Home Minister is the common chairperson of the five zonal councils.
• Chief ministers of all states in the zone - each chief minister serves as a vice-chairman of the council by rotation, for one year at a time.
• Two other ministers from each zone state.
• Each UT in the zone's administrator.

The Zonal Council Can Work With The Following People As Advisors (Without The Right To Vote)

• The Planning Commission (now NITI Aayog) nominates a person to be the Chief Secretary of the Government of each state in the zone and the Development Commissioner of each state in the zone.

The Goals Of The Zonal Councils

• To achieve the country's emotional integration.
• To assist in slowing the spread of acute state consciousness, regionalism, linguism, and particularistic tendencies.
• In some cases, to assist in removing the aftereffects of separation so that the processes of reorganisation, integration and economic advancement can synchronise.
• To enable the Centre and states to collaborate in social and economic matters, as well as exchange ideas and experience, in order to develop uniform policies.
• To work together to ensure the successful and timely completion of major development projects.
• To maintain some level of political equilibrium among the country's various regions.
• To deliberate and make recommendations on issues such as economic and social planning, linguistic minorities, border disputes, interstate transportation, and so on.
• The Zonal Councils should meet at least twice a year, with an agenda proposed by the states concerned, to maximise coordination and promote harmonisation of inter-state policies and actions. A strengthened Inter-State Council Secretariat can also serve as the Secretariat of Zonal Councils. — Punchhi commission on the relationship between the Centre and the States (2007)
• The zonal councils should be constituted afresh and reactivated to promote the spirit of federalism. —Sarkaria commission on Centre-state relations (1983)

Zonal Councils In India

Council Of The North-East

• The North-Eastern Council is a non-constitutional institution established by a separate Parliamentary statute, the North-Eastern Council Act of 1971.
• NORTH-EASTERN COUNCIL FUNCTIONS
• To create a unified and coordinated regional plan that addresses issues of common concern.
• Conduct periodic reviews of the measures taken by member states to maintain regional security and public order.
• It serves as the focal point for economic and social development in the eight North Eastern Region states.
• Its mandate is to serve as the North Eastern Region's Regional Planning Body.
• While developing regional plans, the Council must prioritise schemes and projects that benefit two or more states, with the exception of Sikkim, for which the Council must develop specific projects and schemes.
• In 2019, the government decided to allocate 30% of the budget of the North-Eastern Council (NEC) to developing deprived areas.
• Sikkim became the eighth member of the North-Eastern Council in 2002.

Composition Of North-Eastern Council

• Ex-officio Chairperson – Union Home Minister
• Vice-Chairperson – Minister of State (Independent Charge), Ministry of DoNER
• Members – Governors and Chief Ministers of all the eight States and 3 members nominated by the President.

Should The North-Eastern Council Be Designated As A State Art Resource Centre?

• The NEC was established to serve as a platform for regional development initiatives.
• To meet the growing aspirations of the people, the NEC must reflect and assess the extent to which it has been able to achieve its goal. The NEC must be reoriented and upgraded.
• NEC should be provided with the necessary resources, knowledge, and skills.
• If the NEC becomes a resource centre, it will be able to assist states and implementing agencies in properly planning and executing projects, promoting research and innovation, and providing a strategic policy vision for the region.