Ms. Banerjee and her Trinamool Congress (TMC) party are believed to be happy over the massive fund the state government would receive towards settlement of people after the exchange of pieces of land under Chhit Mahal between India and Bangladesh. The bill has been passed in the last session of Parliament. TMC supported the bill. Now, Ms. Banerjee is likely to accompany Prime Minister Narendra Modi to Bangladesh soon to meet Prime Minister Sheikh Hashina and celebrate the conclusion of the deal. She was with Mr. Modi during the later’s first visit of West Bengal as the prime minister. The deal, along with Teesta water sharing agreement with Bangladesh, did not progress under the UPA regime as she refused to tow the line of former prime minister Manmohan Singh.

West Bengal also stands to gain substantially along with Orissa and other coal-bearing states under the government’s new coal block auction and royalty sharing formulae. The Supreme Court in its Order dated 24th September, 2014 cancelled the allotment of 204 coal blocks allotted earlier as they were granted in an illegal and an arbitrary manner. It further stated that there was no transparency and no objective criteria for evaluation of comparative merits. Thousands of Mega Watts of power capacity and millions of tonnes of steel and cement production was depended upon the coal from these mines. There were calls for urgent action on the part of the Government to ensure that core sectors of the economy were not impacted.

As coal mines had never been auctioned in the country, the process, procedures and specially the design of the auction were a big challenge. Internationally also there are hardly any examples of any large scale auction of mineral wealth. Despite such odds, the Government with its commitment to transparency and a desire to consult stakeholders invited suggestions on the approach to be adopted for auction by putting the draft Tender Document on the Ministry’s website. Hundreds of e-mails and thousands of suggestions and observations were received. The Government initiated the process of auction on 25th December, 2014 by inviting registration from bidders though a public notice in newspapers. An aggressive time line detailing the schedule of auction was also made public. A second round of auctions were also initiated on 7th January, 2015, which offered 23 mines for auction to power (including captive power), cement and iron and steel sectors.

The entire auction and allotment process had been conducted in a fair objective and transparent manner. The Delhi High Court has also commented “What has convinced us is the fact that the auction process has worked out well. The process by itself does not appear to us, to be arbitrary or irrational. There is, of course, no allegation that the auction process is designed to favour any particular bidder”. The level of transparency can be gauged from the fact that the entire auction process was shown live and accessible to everyone on the internet. In fact lakhs of people viewed the entire bidding on their Smart Phones.The auction of coal mines has been universally hailed to be a success, which has not only ensured that there is no disruption in the economy in the wake of the order of the Supreme Court, but have also set new benchmark for efficiency and transparency. On the one hand while the auction and allotment proceeds from 67 coal blocks (29 coal blocks through auction and 38 coal blocks through allocation) have touched ` 3.35 lakh crores over the life of the mine, which shall be devolving entirely to the coal producing states.

The union government’s policy on co-operative federalism clearly seems to have started paying back despite the holding of fort by opposition parties in their respective states. There are indications that apart from trying to engage Congress and allies, the NDA government is also in back-room negotiations with chief ministers such as Ms. Mamata Banerjee, Ms. J Jayalaithaa, Navin Patnaik and leaders such as Sharad Pawar and some so-called Janata Parivar parties to mop up support for both GST and the land bill. GST, which will require a Constitution amendment, needs to be ratified by at least half the number of states too to become a law.

Incidentally, Uttar Pradesh, West Bengal, Tamil Nadu and Odisha are among the biggest beneficiaries of the government approval of the key 14th Finance Commission recommendations under which the center will start transferring a much bigger share of central taxes to states — by almost 62 per cent of Union government tax collection, says the Chief Economic Advisor, Dr. Arvind Subramanian. 'We are moving away from rigid centralised planning, forcing a 'one-size-fits-all' approach on states,' Prime Minister Narendra Modi had said in a letter to state chief ministers in which he communicated the government's acceptance of the commission's recommendations. As per the recommendation of the commission, the total devolution to the states in FY16 will be Rs 5.26 lakh crore against Rs 3.48 lakh crore in FY15. 'This is the largest ever change in percentage of devolution. In the past, when finance commissions have recommended an increase, it has been in the range of 1-2 per cent,' Finance Minister Arun Jaitley had said. It also made additional provision for revenue deficit states.

GST will bring about the most important tax reform. It will benefit all and substantially push up the country’s economic growth. The land bill too is directed at economic growth and lead to massive growth of employment in the rural India as it is designed to intertwine the whole country with top class infrastructure, enabling dispersal of industry to from urban location to rural setups, making the idea of cooperative federalism really work to the benefit of states and the people. (IPA Service)