Thank you. Let me start by thanking Shri Sameer Kochhar and the SKOCH Foundation for this opportunity being given to me. As I always mention, the topics which you choose are little complicated. You talk about federalism, finances and development. So where is the intersection point? Or where is the meeting point if that is possible? I suppose the eminent speakers who have already spoken here have thrown enough light on what we need to take care of in this process of either reaching the intersection or deciding to go beyond the intersection.

I will just start with two statements. Democracy is desirable because it nurtures development and is mindful of justice. So we opted for a democratic scheme of things and that is important. And while planning for this talk today, while planning for this talk today, I was thinking we have esteemed leaders from different states also here when it is Independence Day, we always talk about celebrating independence. I think there is lot of meaning in that. Preserving that independence which we got with great struggle, that means whole lot of things. And that is something which needs to be conveyed properly to the younger generation, more so the students and more so those who are supposed to take the country forward. And there is, there is whole lot of thing which needs to be done.

When we see what is happening around us in democratic systems, in established democracies, there are indications that we have to be even more alert as far as preserving this system scheme is concerned. The second statement I would like to refer to is democracy alone provides a credible covenant for an egalitarian and inclusive social order. Now again, those words have lot of meaning. And I suppose the leaders we elect, the governance system which we establish constantly tries to address these points so that it means meaningful for the large number of people we have in our country.

When we look at the federal structure, I think one point which is clear is it involves gives, give and take. On the one hand we have the central government, on the other hand we have the state governments. There are grievances, there are achievements, there are celebrations. But at the same time it's a question of give and take on both sides which alone will strengthen this process which we have taken for ourselves.

Elections form an integral part of this process. There have been discussions about the election process. I suppose when everything is laid down as to how we participate in this process of democracy election, it's important for us to address where our contribution or our role comes. Having been part of a service, I have seen those days when electoral rolls are prepared, elections are held and the process is taken forward. And it happens because there is a whole lot of well aligned system in our entire country. And at each stage there is opportunity for people to participate in this process.

I have moved from city to city, place to place. When we go to a new place, we try to get our name enrolled in the electoral list. Ideally, if my name figures at another place in this scheme of things, a message would go to the earlier place that so and so has registered at this new place. So his or her name need to be deleted. That is one way of looking at things. There is so much talk about the electoral roll preparation. I think that is again a very well laid down system where electoral rolls are prepared. People get opportunity and those who think they are left out, they have an opportunity to represent and get their name included in the process.

These aspects which have been well laid down as far as the electoral roll or the democratic process is concerned, that needs to be understood by each one of us and those who can help us in the process. That is where probably the representatives, the political parties at the booth level come in. It is not a massive process, it is a booth level process where participation should be ensured. And if there is something missing that could be corrected and that is something which is laid down. So what we should try to do is strengthen that process so that each person's right to cast his or her vote gets listed in the electoral roll and then it is up to each one of us to exercise that franchise.

I must also mention here, since it is an opportunity given to me. I was in one of the UP districts, there was a very powerful politician. I won't take names. A politician who used to depend largely on the caste support he used to get in the area. There were complaints. So a re-poll was ordered and as Divisional Commissioner and DIG of the range the two of us had to go and camp in that area to get the re-poll done. One of the things which we did was to shuffle the polling personnel because there was a general statement that the powerful politicians succeed in getting their preferred persons as polling officers.

And I hope my political leader here won't mind it. I'm talking about a different part of the country where the poll officials are also deputed in such a way that he or they will show some consideration for that particular candidate. So a total reshuffle took place. The poll process went on. All right. And this candidate, a powerful person again I won't mention his name and I remember the time also from 7 in the evening till 7:30 in the evening he gave me a lecture on telephone that. Do you think because I am an outsider in a state like UP coming from the south, do you think you can reform the poll process of the country by taking steps like this? That was the crux of his statement.

And some of you know me well, I am, I am a good listener. So I do not argue with a person. So, and especially when a candidate wants to say something, I thought it is good to listen to the person as to what is the grievance or point he or she has to make. So these are all part of the processes in, in the democratic scheme of things, elections. But to be. To be fair, it's the system which makes this happen and the system does its best to make sure that the election process is fair and impartial.

Process of consultation with chief ministers. There was a reference to the Inter-State Council. One hopes that that process is strengthened so that there is more dialogue between the central scheme of things and the state scheme of things that becomes important. The GST Council has already been mentioned. Here is a good example where a good platform has become available. And that again happened as democracy or governance evolved in our country. This is something which was not there in the beginning. It came up subsequently and a process has been established. And as we notice the deliberations at this council they are detailed deliberations and even the latest deliberations. We noticed that what came out was a consensus approach as far as the changes are concerned.

I would also like to refer to the role of the All India Services. We must go back to the framers of the Constitution as to why they made a reference to the All India Service. And look at the beauty of the system. I mean, I always feel proud that coming from Kerala I had an opportunity to work in Uttar Pradesh. Later in Uttarakhand at the center also. So this concept of All India Service that gives certain stability to the entire process of governance as far as our system is concerned. And that needs to be strengthened. And that system has to be as fair and impartial as possible. And it is one of the mechanism which have been introduced to see to it that our democratic federal structure functions in a proper way.

There are concerns at the global level. We need to look at what these challenges are and what needs to be addressed at a particular level as far as our country is concerned. I must also make a reference to those days when relations between the Prime Minister and the Chief Minister used to make a lot of difference. And to again quote one more example. Atal Bihari Vajpayee ji was the Prime Minister. Shri Narayan Dutt Tiwari was the Chief Minister in the state. And they had a very good rapport. And when it came came to questions of development, the Chief Minister was successful in getting as much as possible from the central government for the state.

So that is there is a personality equation also as far as good democracy is concerned, good governance is concerned and strengthening the federal system is concerned. There are other examples. I do not want to take you to those ones. Moving on to the area of finances, there was a reference to the Finance Commission mechanism. There are always discussions about the terms of reference of the Finance Commission. Whether that is sufficient. And let's see what the present Finance Commission comes up with. We have an expert in the area of finance sitting here, Professor Alok.

Quite often the states feel somewhat unhappy or dissatisfied as far as the process is concerned. I think that's also something which needs to evolve better because there was a reference to the revenues being raised. There is a feeling among states that more is being kept with the center though it has gone to the 41, 42% level as well. And there are other schemes also where states can take advantage. Again, I would like to make a reference to my experience as a secretary to the government. When I once traveled to the state of West Bengal. The chief minister was so definite about the process of the central scheme that the moment I entered his room he said my state has not been capable of taking advantage of whatever benefits you are providing and we have to improve.

That's the type of approach chief ministers have as far as taking advantage of central resources is concerned. At the same time, Gujarat at that time was a well performing state which came up with large number of schemes. And when schemes are approved, projects, funds are allocated. The state would make it a point to fully utilize it as early as possible. I am only taking one or two examples and the state chief minister would look for opportunities of what more can I get from the federal sources? So that again is a concept of working in a cooperative manner.

Cooperative federalism does not mean just a theory or a statement. You look for opportunities where you can take advantage, you perform well, you naturally get the advantage of that. And since there is a method of allocating resources among states, probably that is the limit to which states can take advantage. Whether one can go beyond that or not. Finance Commissions have tried with mechanisms of incentives. I don't know whether they have really worked or they need to be improved upon. That is something which need to look into.

Borrowing limits of states. I think it is increasingly becoming a matter of concern. Again an area where lot of focus is required. I live in a state where probably they borrow to the extent possible and if possible even beyond that. So on the one hand one can say that the state is keen to do more. At the same time there is a certain fiscal responsibility which we all have to fulfill. I have often wondered when states go for debt. I mean they cannot cross limits, but when they go for debt, does this aspect of burdening the future generations come to notice relevance or not? I don't think our discussions really take note of this aspect.

As to how much is the burdening which we are passing on to the next generation. It's a difficult area. Political systems normally last for five years. So they want to do their best. But I think an ideal balance between revenue generation utilization would make a lot of difference. And I think fiscal personalities like Professor Rao would start thinking in terms of. I keep myself in that category, this steep increase in salaries, pensions, I don't know where we are going to end up with. So one has to also think in those terms as to where the line has to be because development expenditure has to come from somewhere and that comes from out of this total kitty only.

Is my time over now? There was a brief reference. When we talk about center state relations quite often what is not discussed in detail is the relation between the states and the local bodies, urban local bodies, panchayats and again I am reminded of a statement by a veteran chief minister who said at that time, many years back that he said about the state government. So that was the type of attitude the chief ministers had towards the local bodies. Now we have a Madam Minister here, the 18 items listed in the list for urban bodies to be transferred to the local bodies so that governance lies where it should be. I don't know whether there is one single state Alokji, whether there is one single state which has done all 18. I don't think there is any single state in our country which has transferred all the 18 functions to the urban or other Panchayat bodies. There is more transfer urban bodies. It does not happen Empowerment when we talk about when we have states complain to the center about we are not allowed to perform and function.

There is another category in the states where the local bodies, particularly the urban local bodies, they cannot go and borrow as they wish. It is again controlled or limited by the state system ideally so because local bodies cannot be allowed to borrow any amount. But there is a limitation there also they do not have the capacity to raise the type of resources they need because again it is all within the scheme of things of the state. So when we have expectations from cities and urban bodies, how do they perform those tasks? That is the critical question and that is something which needs to be addressed much, much more proactively if our system is to remain strong enough. Because we talk about decentralization, governance, going to those levels. So if that has to happen, there has to be enough facilitation at that level as well so that they can perform those tasks better which they are supposed to do. Now that's again I think one area which needs to be looked into in much, much more detail.

From my time onwards we have been talking about empowering the local bodies, you know, devolving more resources and things like that. Sometimes the Finance Commission gives some sort of relief and one manages to live with that. But when the Finance Commission came with points about incentives, I don't think the performance has been equally good all over the country. So that is something which needs to be looked into. And I think there are newer areas also getting added. We all live in our cities and towns. We talk about potholes on the roads, we talk about flooding in the cities. Now these are all massive tasks which need huge resource allocation. If we have to address these issues properly without looking at the resource part of it, we are all happy complaining that this is not happening. That is not happening. Either there is a problem about management of resources at the local body level or as I said, there is limitation as far as generation of resources is concerned or there is some sort of fine tuning of understanding required between the state governments and the local body governments. If these issues have to be addressed, ultimately all our living, all our activities are going to be at the city end, an ordinary person, citizen living there. Luckily the problems of water, electricity are no longer there. But he or she would look for proper mobility, easy access and decent standards of living as far as cities are concerned. Now there again, I think we need to have a relook at our scheme of things so that more can happen there and people feel comfortable at that level.

When we come to the development part of it, we all know it is a joint effort and there have been lots of efforts. Reducing poverty, bringing about improvements in health parameters, education standards, these are all critical issues. There is always a discussion about what percentage of GDP you are spending on these. I think some of these also require increased focus so that we reach the certain minimum levels which are required. And that's where probably more needs to be done. When we look at higher education in the states, what we find today is problems between the chancellor who is normally the governor and the state government or vice chancellors. Whereas our focus should be on bringing about improvements in our in our education standards, more so at the higher education level because that's the only option left for people to prosper in life, move to areas where they can do more of the work. So unfortunately some of these aspects get more highlighted, more focused on than the critical aspect which needs to be addressed. And that's a matter of concern. As I say, at the same time when we talk about various central schemes, there are states which have taken advantage of that and brought about changes. I came across a statement by a Meghalaya officer who referred to taking advantage of central schemes and follow on of central schemes. How states have benefited and I just read out the statement made by the officer. I argue that implementation of MGNREGA NREGA people call it in Meghalaya and the development of village level institutions called village employment Councils have not only enabled participatory governance but has also enhanced the institutional capability of village level development institutions. It has created an overall framework for delivering development to the village.

So there is an appreciation of the. The content of the program, the change it has brought about and how it is making a difference. It makes a difference in smaller states where issues are much, much more prominent and where these initiatives bring about changes. And that is where I think we should appreciate the relevance of these programs and take them forward as required. So I come back to the point. When we talk about lack of discussion between the federal system and the state system, it equally well applies to the state and the local body system as well. So both levels we need to bring about improvement so that we can achieve what we want to. Also I would like to stress upon the require need for having independent neutral oversight mechanisms. If there are problems issues. That is one platform we can have which could take advantage of these issues. I. I always argue this point that senior citizens who have had experience in life programs projects can equally well play a role if they are neutral as far as their approach is concerned. We need to strengthen our institutions. All the more relevant due in the context of recent discussions which are going on. Whether it is the Election Commission or the CAG mechanism or the Finance Commission. Platforms for dialogue have to be there and you have to take advantage of that. And I think probably if politics can be kept aside when these discussions take place, then it should be possible for all our leaders to do a lot as far as developing the country, taking the country and to the goals of Viksit Bharat, which was referred to here, can happen in every democracy.

Good governance does not happen automatically. And we have seen this over a period of time. We have had trials and tribulations. We have overcome and we have brought about changes. And that is what is critical. And that is where I think organizations like this foundation could play a more active role in bringing out what needs to be done. I do not know, Sameerji, whether someone has looked at it or Alokji, someone has looked at it. How each state performs as far as this entire schema of things is concerned, if that could come out not to criticize the states but to highlight where they stand with regard to these various essential parameters and where they stand with regard to their level of performance in a professional manner. I mean, some win awards for some schemes, that's fine. But overall, where is it and what can be done to bring about changes? If it is done in an independent, neutral manner, I think that would be helpful for the states. It has to be. The citizens have to play a very active role in making this happen. And I am hopeful that India will be a country free of hunger, illiteracy and poverty as early as possible.

Here the issue of inclusion becomes important. And I think the Constitution matters to each citizen because it provides the structure of governance as well as shaping the direction of our policies. So I am glad that SKOCH decided to highlight this particular topic. And I do hope today's deliberations will take us forward as far as bringing about the required corrections are concerned and we all should be able to work together as far as taking our country forward is concerned. It's a big challenge. There are issues, but I'm sure with the type of capability we have and the type of understanding we have and the mutual appreciation we have, it should be possible for all of us together to take this forward. Thank you once again for this opportunity.

Participants at the Intersection of Democracy: Federalism Finance and Development