PM strikes conciliation as the way forward with states

He spoke about the way states can make use of direct benefit transfer and rolling out of primary education in the country

Prime Minister Narendra Modi today said states should leverage 96 per cent adult enrollment in the Aadhaar programme and use that to reduce kerosene consumption. Surprisingly, he praised the prompt efforts of the government of Karnataka, run by rival Congress, for snapping up 75 per cent of the subsidy as direct grant to the state.

He urged others to follow this example. Education was the other issue he flagged in securing the cooperation of the states to roll out uniform politics, especially in primary education.The PM's speech, at the Inter State Council, however, had no mention of the restructuring of discom debts or UDAY, which is where the political support of the states is most needed, as the restructuring will have to factor in the issue of power tariff and subsidies.

Citing kerosene as an example where states can use Aadhaar to their advantage he said: "Electricity connections are increasing in villages. The Union Government will provide 5 crore new cooking gas connections over the next three years. The supply of LPG will further increase. All these efforts have a direct bearing on the consumption of kerosene. Recently, the Chandigarh administration declared the city a kerosene-free zone. Now, the Union Government has launched a scheme, under which, if there is a reduction in the consumption of kerosene by a State, the Centre will disburse 75 per cent of the resultant savings in subsidy, as grant to that State. The Government of Karnataka, while moving swiftly on this initiative, has sent its proposal to the Petroleum Ministry. This has been accepted and the grant has been disbursedto the State Government. If all states decide to reduce kerosene consumption by 25 per cent, and actually do so, they can receive about Rs 1,600 crore as grant this year".

The PM's speech had copious references to Bharatiya Janata Party icons including Deen Dayal Upadhyaya, Swami Vivekanand and former NDA Prime Minister Atal Bihari Vajpayee, but he stayed away from contentious political references or referring to ongoing feuds with states, including Delhi, Bihar and others which have consistently attacked the centre for emasculating their powers.

The agenda of the Inter State Council, which is meeting for the first time in ten years, (the last meeting was in 2006, during the United Progressive Allianceregime) had the M M Punchhi report on division of administrative and other policy formulation powers as the most important item on the agenda. The PM said that states have never been as financiallyempowered as they are today.

"With the acceptance of the 14th Finance Commission recommendations, the States' share in central taxes has increased from 32 per cent to 42 per cent. This means that States now have greater financial resources to utilise in accordance with their requirements. I am happy to share that the total amount received by States from the Centre during 2015-16 is 21 per cent higher than the amount received in 2014-15. Similarly,Panchayats and Urban Local Bodies will receive Rs 2.87 lakh crore during the period of the 14th Finance Commission, which is substantially higher than last time."

He said that the rights of states had been kept in mind even in revenue received from the auction of natural resources. "Auctions of coal blocks will yield Rs 3.35 lakh crore to States in the years to come. Auctions of other mines will yield an additional Rs 18,000 crore to states. Similarly,through amendments to CAMPA Act, we are attempting to free up about Rs 40,000 crore lying idle in banks, for disbursal to States," the PM said.

On education, the PM emphasised that both quality and quantity must be kept inmind and the centre and the state governments must work together on providing quality primary education. The PM also touched upon the sensitive issue of internal security. Law and order isa state subject, but the PM referred to more unity on subjects of internalsecurity, something that state governments have expressed their resentmentabout, as the centre's intelligence agencies tend to bypass and overrule stateagencies.

Putting the issue frankly on the table, the PM said: "We have to discuss internal security challenges confronting the country, thesolutions to these challenges, and mutual cooperation in this regard. The internal security of the country cannot be strengthened until we focus on intelligence sharing, ensure greater coordination among agencies, and equip our police with modern approach and technology."