{"id":90297,"date":"2021-02-26T10:28:27","date_gmt":"2021-02-26T04:58:27","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=90297"},"modified":"2021-02-26T15:36:07","modified_gmt":"2021-02-26T10:06:07","slug":"strengthening-decentralisation-for-improving-human-capital","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/strengthening-decentralisation-for-improving-human-capital\/","title":{"rendered":"Strengthening decentralisation for improving human capital"},"content":{"rendered":"<p><b>Synopsis<\/b><span style=\"font-weight: 400;\">: The poor performance of India in human capital indicators can be improved. If the 3 tier decentralized structure of governance gets strengthened.\u00a0<\/span><\/p>\n<p><b>Background<\/b><span style=\"font-weight: 400;\">:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">India has secured a poor 116 rank in the World Bank\u2019s human capital index. Further, the data of the National Family Health Survey &#8211; 5 for 2019-20 highlights the poor performance in the domain of malnutrition.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Similarly, issues in learning outcomes are highlighted by the National Achievement Survey 2017 and the Annual Status of Education Report 2018.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Moreover, these statistics are expected to further worsen due to Covid-19 pandemic.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\"> Therefore, the focus should be on enhancing the investment in human capital. This would require better decentralisation among 3 tiers &#8211; Centre, states and local bodies.\u00a0\u00a0<\/span><\/p>\n<p><b>Why should there be a focus on a decentralised approach<\/b><span style=\"font-weight: 400;\">?<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>First<\/b><span style=\"font-weight: 400;\">, the government has launched various programs like Poshan Abhiyan and Samagra Shiksha Abhiyan. But they have failed to deliver optimum results.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Second<\/b><span style=\"font-weight: 400;\">, international studies show there is a positive correlation between decentralisation and human capital formation.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Third<\/b><span style=\"font-weight: 400;\">, India spends only 4% of its GDP on <a href=\"https:\/\/forumias.com\/blog\/answereda-focus-on-developing-human-capital-and-employment-generation-can-help-india-to-become-a-5-trillion-economy-comment\/\" target=\"_blank\" rel=\"noopener noreferrer\">human capital<\/a> which is very less in comparison to its peers. This means these minimum funds should be spent in the most optimum way. It is possible with decentralisation.<\/span><\/li>\n<\/ul>\n<p><b>What are the existing mechanisms for decentralization in India?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The constitution allows the centre to <\/span><b>support states in their fiscal domain<\/b><span style=\"font-weight: 400;\">. This can be done through tax devolution and grants in aid. In addition, the Centre can make \u2018grants for any public purpose\u2019 under Article 282 of the Constitution.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Education was moved from the state list to the concurrent list by the 42nd amendment in 1976. It ensured <\/span><b>better coordination between centre and states<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The enactment of the 73rd and 74th amendment gave constitutional status to <\/span><b>municipalities and panchayats as the 3rd tier of government<\/b><span style=\"font-weight: 400;\">. Further various domains like education, health and sanitation are given to them under the 11th and 12th schedule.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The 14th Finance commission (FC) called for <\/span><b>distributing 42% of centre\u2019s taxes<\/b><span style=\"font-weight: 400;\"> among states, an increase from earlier 32%. This was effectively retained by 15th FC as well.<\/span><\/li>\n<\/ul>\n<p><b>Challenges to decentralisation:<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>First<\/b><span style=\"font-weight: 400;\">, significant fiscal support by centre to states is in the form of grants-in-aid and centrally sponsored schemes (CSS). As per SC ruling in Bhim Singh vs Union of India, these routes are for special, temporary or ad hoc schemes under article 282.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Second<\/b><span style=\"font-weight: 400;\">, states have been <\/span><b>reluctant to transfer their power<\/b><span style=\"font-weight: 400;\"> to local bodies under the 11th and 12th schedule.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Third<\/b><span style=\"font-weight: 400;\">, the <\/span><b>municipalities and local bodies are not fiscally empowered<\/b><span style=\"font-weight: 400;\">. This can be seen by low property tax collection which is under 0.2% of GDP, compared to 3% of GDP in some other nations.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Fourth<\/b><span style=\"font-weight: 400;\">, even state finance commissions (SFCs) are not constituted on time by respective states for recommending tax devolution and grants-in-aid to the third tier.<\/span><\/li>\n<\/ul>\n<p><b>Way Forward:<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The centre must use the route under Article 282 in a cautious way as it is listed as a \u2018Miscellaneous Financial Provision. It should give maximum fiscal support using Articles 270 and 275, which fall under \u2018Distribution of Revenues between the Union and the State.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The centre should also encourage knowledge sharing between the states which would help them in improving their fiscal potential.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The 15th FC\u2019s recommendation should be duly implemented. It recommended giving no grants to any state after March 2024 if it doesn&#8217;t constitute SFCs.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The 3rd tier of government should be vested with all the functions mentioned under the 11th and 12th schedule.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Thus, the need is to leverage the true potential of our multi-level federal system that would help in developing human capital.<\/span><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"rgq9zjHbFV\"><p><a href=\"https:\/\/forumias.com\/blog\/answered-the-draft-national-education-policy-nep-2019-recommends-a-restructuring-of-school-years-and-the-curriculum-in-a-wide-ranging-manner-but-it-lacks-the-critical-components-of-educa\/\">[Answered] \u201cThe draft National Education Policy (NEP) 2019 recommends a restructuring of school years and the curriculum, in a wide-ranging manner but it lacks the critical components of education i.e. critical thinking and deeper understanding\u201d. Critically analyse.Give some measures to improve education system in India.<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;[Answered] \u201cThe draft National Education Policy (NEP) 2019 recommends a restructuring of school years and the curriculum, in a wide-ranging manner but it lacks the critical components of education i.e. critical thinking and deeper understanding\u201d. Critically analyse.Give some measures to improve education system in India.&#8221; &#8212; Free UPSC IAS Preparation For Aspirants\" src=\"https:\/\/forumias.com\/blog\/answered-the-draft-national-education-policy-nep-2019-recommends-a-restructuring-of-school-years-and-the-curriculum-in-a-wide-ranging-manner-but-it-lacks-the-critical-components-of-educa\/embed\/#?secret=xobJ5hI31P#?secret=rgq9zjHbFV\" data-secret=\"rgq9zjHbFV\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Synopsis: The poor performance of India in human capital indicators can be improved. If the 3 tier decentralized structure of governance gets strengthened.\u00a0 Background: India has secured a poor 116 rank in the World Bank\u2019s human capital index. Further, the data of the National Family Health Survey &#8211; 5 for 2019-20 highlights the poor performance&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/strengthening-decentralisation-for-improving-human-capital\/\">Continue reading <span class=\"screen-reader-text\">Strengthening decentralisation for improving human capital<\/span><\/a><\/p>\n","protected":false},"author":10322,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[1300],"class_list":["post-90297","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-soc_3","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/90297","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10322"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=90297"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/90297\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=90297"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=90297"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=90297"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}