TERRITORY, POLITICS, GOVERNANCE
https://doi.org/10.1080/21622671.2021.1972830
EDITORIAL
Understanding multilevel dynamics in India:
constituent power and multilevel governance
Wilfried Swenden
a
, Rekha Saxena
b
and Chanchal Kumar Sharma
c
ABSTRACT
This introduction to the special issue introduces readers to the specificities of Indian federalism and places
the various contributions within a broader conceptual and comparative framework. It argues for an
approach that understands centre–state relations in India by ‘blending’ elements of a ‘constituent’ and
multilevel governance framework. Such an approach acknowledges that constituent power matters
alongside an understanding of the resource strength of national and subnational governments linked to
political leadership, policy communities and networks. Overall, we argue that constituent and informal
subnational power reinforce each other and have contributed to India’s resilience as a multilevel polity,
even under conditions of one-party dominance at the centre.
KEYWORDS
federalism; centre–state; India; multilevel governance; constituent power; intergovernmental relations
HISTORY Received 14 September 2020; in revised form 14 July 2021
INTRODUCTION
The Covid-19 pandemic has shown the difficulties and opportunities that multilevel political
systems have encountered in fighting an unprecedented health crisis. At its inception, the effect
of the pandemic was often localized, with outbreaks in specific areas, thus necessitating locally
tailored approaches to testing, tracing and containment. At the same time, in the event of widespread community transmission, a more nationalized and coordinated response is necessary to
halt cross-national and cross-regional transmission, to coordinate the provision of personal protective equipment (PPE), or indeed to deal with the massive economic fallout of widescale lockdowns and their effect on the livelihoods of citizens, workers and the vulnerable sections of
society. Although multilevel systems, by virtue of making lower tier governments responsible
for certain tasks, may be well placed to offer localized responses, they also often lack the fluidity
required to shift to more coordinated or national approaches to crisis management (Schnabel &
Hegele, 2021). There are two reasons for this: one constitutional, the second political.
Constitutionally speaking, different authorities may be responsible for handling different
aspects of a health crisis such as a pandemic (Dodds et al., 2020). As Saxena (2021) and
CONTACT
a
(Corresponding author)
w.swenden@ed.ac.uk
School of Social and Political Science, University of Edinburgh, Edinburgh, UK.
b
rekhasaxenadu@gmail.com
Department of Political Science, Faculty of Social Sciences, University of Delhi, Delhi, India.
c
Chanchalsharma1@gmail.com
Department of Political Science, Central University of Haryana, Jant-Pali Mahendergarh, Haryana, India.
© 2021 Regional Studies Association
TERRITORY, POLITICS, GOVERNANCE
https://doi.org/10.1080/21622671.2021.1931423
Concessionary federalism in a dominant party
system? Indirect tax reforms and subnational
acquiescence in India
Chanchal Kumar Sharma
a,b
ABSTRACT
What accounts for subnational assent to policies that seek to reduce their fiscal autonomy and increase
fiscal centralization? Since subnational actors with access to veto capabilities can block such reforms, the
key to this theoretical puzzle lies in the identification of those conditions that create weak veto
possibilities. This article seeks to solve this puzzle by analysing the case of India which has amended the
constitution to introduce a ‘dual GST’ system. The combined logic of a market economy paradigm –
within which the realization of a common economic market was an important policy goal – and the
logic of a ‘dominant party equilibrium’ – which reduced the number and impact of veto players –
created the right conditions for intergovernmental coordination. However, even under these conditions,
the coordination dilemma, which had plagued the indirect tax reform process since 1991, could not
have been resolved without making compromises as midpoints of competing claims. Thus, even under a
dominant party system, the institutional condition of federalism cannot be ignored entirely. Overall,
India’s transition to a goods and services tax (GST) regime is a classic case of the centre and the states
pooling sovereignty over the taxes assigned to them. This has strengthened the ‘shared rule’ dimension
of Indian fiscal federalism.
KEYWORDS
India; goods and services tax (GST); federalism; indirect tax reforms; party system
HISTORY Received 15 October 2020; in revised form 10 May 2021
INTRODUCTION
Designing and implementing goods and services tax (GST) reforms in countries with federal
constitutional structures is extremely challenging (Due, 1990; Tait, 1988). While the best practice is to implement a general consumption tax assessed on a broad base at a low uniform rate
(Musgrave, 1987), this format does not suit federal countries because complete tax harmonization violates the federal principle. Therefore, Richard Musgrave recommends levying retail sales
taxes instead of GST in federal countries. In practice, however, several federal countries have
imposed national value-added tax (VAT) or GST,1 the Australian and German systems being
the best models. Both of these federations levy national GST, the bases and rates of which are
determined jointly by the central and local governments and use a formula to share the GST
CONTACT
a
(Corresponding author)
chanchalsharma1@gmail.com
Department of Political Science, Central University of Haryana, Mahendragarh, Haryana, India.
b
Institute of Asian Studies, German Institute of Global and Area Studies, Hamburg, Germany.
© 2021 Regional Studies Association
866845
IPS0010.1177/0192512119866845International Political Science ReviewSharma and Swenden
research-article2019
Article
Economic governance: Does it
make or break a dominant party
equilibrium? The case of India
International Political Science Review
2020, Vol. 41(3) 451–465
© The Author(s) 2019
Article reuse guidelines:
sagepub.com/journals-permissions
https://doi.org/10.1177/0192512119866845
DOI: 10.1177/0192512119866845
journals.sagepub.com/home/ips
Chanchal Kumar Sharma
Central University of Haryana, India
Wilfried Swenden
University of Edinburgh, UK
Abstract
Why do voters re-elect the same party for prolonged periods of time even when there are reasonable
alternatives available? When and why do they stop doing so? Based on a quantitative analysis of elections
between 1972 and 2014, we test the significance of ‘economic governance’ for the continuance and fall of
one-party dominance. With data from India we show that, under a command economy paradigm, a national
incumbent party sustains its dominance by playing politics of patronage, but in a marketized economy, state
governments gain considerable scope in managing their economic affairs. This enables different state parties
to create a stable pattern of support in states. As state-level effects cease to aggregate at the national level,
the party system fragments. However, such an aggregation can re-emerge if a single party consistently
delivers in the states which it governs.
Keywords
Party system, India, Indian politics, economic governance, patronage politics, federalism
Introduction
The dominance of a single political party in a federal democracy is often attributed to one or a combination of the following six factors: the party’s ability to perform as an internally factionalized
catch-all party; the influence of charismatic leadership (political agency) in popularizing a party
across multiple levels of the state; the failure of opposition parties to coordinate their actions; the
effect of institutional rules, especially a majoritarian electoral system and economic centralization
on prolonging single party dominance; the successful framing of ideology and social identity; or the
ability to engage in vote-buying and clientelistic machine politics.
Corresponding author:
Chanchal Kumar Sharma, Central University of Haryana, Pali, Flat no. 203, Type IV Quarters, Mahendergarh,
Haryana 123029, India.
Email: chanchalsharma@cuh.ac.in
Publius:The Journal of Federalism
Oxford University Press
Partisan Federalism and Subnational
Governments’ International Engagements:
Insights from India
,* Sandra Destradi,† and Johannes Plagemann‡
*Central University of Haryana, India and German Institute for Global and Area Studies (GIGA);
chanchalsharma@cuh.ac.in
†
University of Freiburg; sandra.destradi@politik.uni-freiburg.de
‡
Goethe-Universit€at Frankfurt am Main and German Institute for Global and Area Studies (GIGA);
johannes.plagemann@giga-hamburg.de
This article situates the international activities of subnational governments in India within the
broader political economy of federalism. It argues that the nature and the extent of subnational
states’engagements in international affairs are a function of the partisan political relationship the
state incumbents have with the national incumbents.The article takes a mixed methods approach.
An analysis of 1,153 episodes of international engagements of India’s states from 1996 to 2017
reveals that shifts in foreign policy engagement of selected state governments primarily reflect
alterations in the subnational incumbents’ political affiliation with the Union government. Several
qualitative case studies shed light on how the central government’s inclusion of subnational
governments’ perspectives and representatives in foreign affairs is highly partisan and profoundly
political. Therefore, the Indian case reveals how subnational diplomatic interactions merge
domestic and international politics.
Since the 1980s, subnational governments (SNGs) across the globe have intensified
their international engagements. Yet, within single nation states, the intensity of
SNGs’ international engagements—termed paradiplomacy—varies considerably. In
the United States, for instance, California with its two internationally active
cities—San Francisco and Los Angeles—is an explicit case of paradiplomacy going
its own way (Poulos 2017). In Brazil, S~ao Paulo state stands out in terms of both
the institutionalization of its paradiplomacy and sheer activism. In Russia, the
North-Western regions are known to exhibit much greater international activity
(Kaliningrad being the most vigorous actor of international cooperation) than the
North Caucasian or the Far Eastern regions. Guangdong Province in China tends
to exercise relatively high levels of foreign policy activism. Similarly, Flanders
Publius:The Journal of Federalism volume 50 number 4, pp. 566^592
doi:10.1093/publius/pjaa017
Advance Access publication June18, 2020
ß The Author(s) 2020. Published by Oxford University Press on behalf of CSF Associates: Publius, Inc.
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/
licenses/by/4.0/), which permits unrestricted reuse, distribution, and reproduction in any medium, provided the original work is properly
cited.
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Chanchal Kumar Sharma
Fiscal Federalism
Chanchal Kumar Sharma, Alice Valdesalici
Content type: Encyclopedia entries
Product: Max Planck Encyclopedia of Comparative
Constitutional Law [MPECCoL]
Article last updated: April 2020
Subject(s):
Duty to pay taxes — Federal reserve system — Public finance — Taxes — Fiscal federalism — Political
philosophy of federalism
Published under the direction of the Max Planck Foundation for International Peace and the Rule of Law.
General Editors: Rainer Grote, Frauke Lachenmann, Rüdiger Wolfrum.
From: Oxford Constitutions (http://oxcon.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved. Subscriber:
Chanchal Kumar Sharma; date: 07 September 2020
Regional & Federal Studies
ISSN: 1359-7566 (Print) 1743-9434 (Online) Journal homepage: https://www.tandfonline.com/loi/frfs20
India after the 2014 general elections: BJP
dominance and the crisis of the third party system
Arjan H. Schakel, Chanchal Kumar Sharma & Wilfried Swenden
To cite this article: Arjan H. Schakel, Chanchal Kumar Sharma & Wilfried Swenden (2019) India
after the 2014 general elections: BJP dominance and the crisis of the third party system, Regional
& Federal Studies, 29:3, 329-354, DOI: 10.1080/13597566.2019.1614921
To link to this article: https://doi.org/10.1080/13597566.2019.1614921
© 2019 The Author(s). Published by Informa
UK Limited, trading as Taylor & Francis
Group
Published online: 14 May 2019.
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Understanding Contemporary Indian
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Competing Perspectives, New Challenges and Future
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Edited By Chanchal Kumar Sharma, Wilfried Swenden
Copyright Year 2018
ISBN 9780815366171
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India Review
ISSN: 1473-6489 (Print) 1557-3036 (Online) Journal homepage: https://www.tandfonline.com/loi/find20
Continuity and change in contemporary Indian
federalism
Chanchal Kumar Sharma & Wilfried Swenden
To cite this article: Chanchal Kumar Sharma & Wilfried Swenden (2017) Continuity and change in
contemporary Indian federalism, India Review, 16:1, 1-13, DOI: 10.1080/14736489.2017.1279921
To link to this article: https://doi.org/10.1080/14736489.2017.1279921
Published online: 10 Mar 2017.
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Edinburgh Research Explorer
Modi-fying Indian federalism?
Citation for published version:
Kumar Sharma, C & Swenden, W 2018, 'Modi-fying Indian federalism?: Centre-State Relations under
Modi’s tenure as Prime Minister' Indian Politics and Policy, vol 1, no. 1, pp. 51-81. DOI: 10.18278/inpp.1.1.4
Digital Object Identifier (DOI):
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INDIA REVIEW
2017, VOL. 16, NO. 1, 14–41
http://dx.doi.org/10.1080/14736489.2017.1279922
A situational theory of pork-barrel politics: The shifting
logic of discretionary allocations in India
Chanchal Kumar Sharma
ABSTRACT
Despite the extensive literature on distributive politics, there is
still a lack of a theory of how political and fiscal institutions
interact to shape the pork barreling ability of national leaders in
a federal parliamentary democracy. This article examines how
the party system types (dominant party versus coalition system)
and particular attributes of discretionary grants (providing
credit claiming opportunity or facilitating side payments) influence opportunities for pork-barrel politics. This article proposes
a situational theory of distributive politics that states that incentives for exclusive targeting of affiliated states in one-party
dominant systems drive national ruling parties toward particularism while the shrinking opportunity to indulge in such a
policy in multiparty coalition systems creates a universalization
effect. The disaggregated analysis of discretionary grants using
Indian data for 14 states for the one-party dominant period
(1972–89) and the coalition era (1996–2012) confirms the theoretical expectations. Additionally, the exercise brings to the fore
the fact that the shift from particularism to universalism occurs
for schematic grants that provide credit claiming opportunity.
The ad hoc grants that are like side payments remain subject to
particularism.
Introduction
The term “pork-barrel politics” refers to instances in which ruling parties
channel public money to particular constituencies based on political considerations, at the expense of broader public interests. The pork-barrel disbursements
are chosen unilaterally by the central incumbent party and are not subject to any
universal equalization formula. Although normative theories of fiscal
federalism1 envision a valuable role for federal grants-in-aid to correct the equity
and efficiency distortions, a plethora of empirical literature reveals that the party
in power allocates grants not to optimize welfare gains but rather to promote
partisan gains and to maximize the prospect of re-election.2
Despite the extensive literature on distributive politics, there is no theory of
how party system types and grant types interact to shape the ability of national
leaders to play pork barrel politics in a federal parliamentary democracy.
Chanchal Kumar Sharma is affiliated with the Central University of Haryana, India and the German Institute of
Global and Area Studies (GIGA), Hamburg, Germany.
Color versions of one or more of the figures in the article can be found online at www.tandfonline.com/FIND.
© 2017 Taylor & Francis
India Review, vol. 10, no. 2, April–June, 2011, pp. 126–184
Copyright © Taylor & Francis Group, LLC
ISSN 1473-6489 print; 1557-3036 online
DOI: 10.1080/14736489.2011.574550
A Discursive Dominance Theory of
Economic Reform Sustainability: The Case
of India
CHANCHAL KUMAR SHARMA
Introduction
This article attempts to reveal the precise mechanism that has controlled the transition of the economic system in India from a command
economy to a free market economy. Researchers have tried to explain
this phenomenon with little success thus far.
In the words of Jagdish Bhagwati:
The full story of why the reforms finally began to happen in
1991 under the minority government of Prime Minister Rao awaits
research.1
To quote M. P. Singh:
Even more than its modest success in India, what has often puzzled analysts, is the political sustainability of economic reforms.
Beyond the initial condition of a balance of payments crisis and
conditionalities from multilateral monetary and financial agencies,
the reforms have been maintained by a string of minority and/or
coalition governments with parties with divergent policies since
1996.2
Scholars have attempted to explain the conditions under which liberalizing reforms are initiated and terminated. Many studies credit crisis
and subsequent World Bank- International Monetary Fund (WB-IMF)
aid for encouraging reforms, because the aid tends to be accompanied
by pressure to undertake policy changes.3 Correspondingly, factors
Chanchal Kumar Sharma is an Assistant Professor of political science, Maharaja
Agrasen College, Kurukshetra University, and Associate Fellow, Centre for
Multilevel Federalism, New Delhi.
doi: 10.1111/j.1467-9299.2011.01947.x
BEYOND GAPS AND IMBALANCES: RE-STRUCTURING
THE DEBATE ON INTERGOVERNMENTAL FISCAL
RELATIONS
CHANCHAL KUMAR SHARMA
How do we know whether a country suffers from vertical fiscal imbalance (VFI)? What should
be done about it? Academic appreciation of these issues in general, and the nature of political
behaviour in particular, both have major implications for the way federations are fiscally structured.
While the latter clearly is a problem of political negotiations, our focus is on the former, that is,
conceptual clarity, which precedes meaningful negotiations. Thus, the paper aims to clarify the
multiple usages of the symbolically loaded terms VFI and VFG (vertical fiscal gap) by critically
engaging the fundamental assumptions and premises underlying these ostensibly similar notions.
It proposes an alternative conceptual framework and introduces the concepts of vertical fiscal
asymmetry (VFA) and vertical fiscal difference (VFD) that have the potential to better structure
public debate on issues of vertical fiscal relations and stimulate a sensible appreciation of the
problem and possible remedies.
INTRODUCTION
This article examines the concept of vertical fiscal imbalance (VFI), which remains under
debate because there is neither a universally accepted definition of VFI in the fiscal
federalism literature (table 1) nor a commonly accepted approach to measuring it (see
table 2). Estimates of VFI are derived, much like accounting or deficit measurements, by
comparing the revenues and expenditures of two levels of government. VFI is, however,
too nuanced an issue to be described by this kind of national accounting procedure.
The problem we address is substantive, but also has an important terminological
dimension. Terms such as VFI and VFG (vertical fiscal gap) are often used to structure
political debate in federations, but different authors use them with different meanings
and thus cause ambiguity in the policy solutions to the assumed problems. The imprecise
usage of VFI (table 1) and VFG (table 3) for different ideas in different contexts not only
makes it difficult to combine the results of papers, which might employ the same concept
for different ideas or different concepts for the same idea; it can also cause the fiscal
policy debate to deteriorate into a tug-of-war between federal and regional interests (for
example, the Canadian example in the section that follows). Thus, this paper attempts to
resolve the terminological ambiguity that obscures these substantive issues in policy.
One of the substantive issues in the debate on vertical fiscal relations is the question of the
existence or absence of fiscal gaps and imbalances. Another issue is the rhetorical emphasis
on either of two remedies, that is, federal transfers and subnational tax autonomy. This
paper presents a conceptual framework that goes beyond the ‘rhetoric’ on either side of
intergovernmental debates about vertical fiscal relations and promotes a more nuanced
understanding of the problems of fiscal gaps and imbalances and their potential solutions.
In the section that follows, we begin by defining the problem and subsequently place it in
an international context. To establish the need to re-evaluate VFI, we then critically examine the conventional approach to VFI and show why it is not useful for evaluating fiscal
Chanchal Kumar Sharma is in the Department of Political Science, Maharaja Agrasen College, Kurukshetra University
and at the Centre for Multilevel Federalism, New Delhi.
Public Administration Vol. 90, No. 1, 2012 (99–128)
 2011 The Author. Public Administration  2011 Blackwell Publishing Ltd, 9600 Garsington Road, Oxford OX4 2DQ,
UK and 350 Main Street, Malden, MA 02148, USA.