New Delhi, November 16
Mr Atal Behari Vajpayee today warned the state governments that they could no longer look up to the Centre to solve their financial problems all the time and asked them to take measures on fiscal self-reliance.

"I can hardly overemphasise the need for the states to develop and implement their own programmes of fiscal self-reliance," Mr Vajpayee said inaugurating the seventh meeting of the Inter-State Council here at the Vigyan Bhavan.

Going a step further, the Prime Minister said: "The traditional belief that the solution to the financial problems of the states lies in higher allocation of funds by the Centre no longer holds good for two reasons. One, it is not a sign of responsible management of the state finances and second, the capacity of the Centre to provide additional funds is becoming severely strained", Mr Vajpayee said.

The other developmental issue that the Prime Minister raised at the council, which was constituted in 1990 by a presidential order to discuss recommendations of the Sarkaria Commission on Centre-State relations, was decentralisation of financial and administrative powers right upto the grassroots level.

Asking the states to objectively assess the experience in the last decade as to "whether the purpose of ushering in true Panchayati Raj" had been achieved, Mr Vajpayee said the task before them was to speedily ensure that the process of true decentralisation upto the grassroots level acquired substance and strength.

He said the country could be prosperous, progressive and stay united only with a strong Centre and strong states and added that the 59 recommendations from different chapters of the Commission’s report should evoke a lively and constructive debate.

Later, briefing newspersons, Union Law Minister Arun Jaitley said the meeting deliberated on 59 recommendations of the Sarkaria Commission covering various subjects like legislative relations, role of Governor, all-India services, inter-governmental council, mines and minerals, mass media and language.

On the qualification and role of Governor, the Inter-State Council had recommended that in the selection of a person to be appointed as Governor, consultation by the Union Government with the state Chief Minister should be made "obligatory" (and not as a matter of convention) and for this purpose, a Constitutional amendment will be necessary, Mr Jaitley said.

The council also recommended that the Governor would be eligible for a second term, but will not be expected to return to active politics. However, he will be eligible for election to the offices of Vice-President or President of India.

Consensus on this recommendation is significant as the Standing Committee of the council had earlier suggested no second term for Governor.

The council also insisted that a person to be appointed as Governor should be an eminent personality, not connected with the local politics of the state. Persons belonging to a minority community should also be given a chance.

However, Mr Jaitley refused to be drawn into the controversy whether imposition of such a recommendation would not infringe on the Fundamental Right to contest elections of the person who relinquishes the gubernatorial post.

In the field of legislative relations between the Centre and the states, the council has accepted the Sarkaria Commission recommendation that for legislation in respect of subjects of Concurrent List and sphere, there should be active consultation with the state governments except in "emergent cases".

The council also accepted the demands of state governments that in view of the need for mobilising more resources, the taxation powers should also be transferred from the Union to the Concurrent List.

Another important matter was regarding setting up of Commission of Inquiry against any minister of a state government. The council recommended that appropriate safeguards should be built in the Commission of Inquiry Act itself to prevent its misuse by the Central Government.

A comprehensive Central legislation should be brought about with regard to the imposition of taxes by the local bodies on the properties of the Union Government which are of industrial and commercial nature.

The recommendations made by the Sarkaria Commission in respect of issues concerning all-India services, mass media, language, etc as endorsed by the Standing Committee in its meeting held on September 1, 2000, were approved by the council.

Some states, including Himachal Pradesh, West Bengal, Tamil Nadu and Andhra Pradesh, had demanded that with the advent of several private channels, some arrangements should be made to publicise the developmental and social activities of state governments through public broadcasters, Mr Jaitley said, adding that it was decided that this issue would be discussed further in the meeting of the council itself.

Out of 247 recommendations contained in the Sarkaria Commission Report, the council has already taken decisions in respect of 171. Another 59 have been covered and decision taken in today’s meeting. This leaves only 17 recommendations yet to be considered by the council. Of the 171 recommendations cleared by the Inter-State Council, which is a recommendatory body, 16 have not been accepted by the council/administrative ministries.