With its age-old fascination for education, southern states have done better than the North.
Start-ups, IT hubs, and industry majors setting up shop have changed the face of the South.
Nearly 79% of global offices set up by international conglomerates in India are in the South.
Almost 46% of tech unicorns are from the South.
The GDP per person in the South is 4.2 times higher than the North.
None of these indicators can be ignored by any central government, whatever the political compulsions, notes Ramesh Menon.
A simmering anger is building up among those in the southern states about what they call the Centre's distorted fiscal regime, where they are getting a lesser share of tax revenue than the northern states.
The latest controversy is over Narendra Modi's BJP-led government, withholding the Samagra Shikha funds of Rs 2,152 crore (Rs 21.52 billion) to Tamil Nadu as the state has refused to implement a three language formula in schools where Hindi is one of the languages.
Without these funds, Tamil Nadu will not be able to pay salaries of teachers, reimbursements for under privileged students, finance self-defence training for girls, ensure transport for students in remote areas and upgrade schools.
For decades, Tamil Nadu has followed a two-language policy in schools that have Tamil and English.
The three-language policy is part of the Union government's National Education Policy.
It has been accepted by states like Uttar Pradesh but one cannot see any student studying Marathi, Punjabi, Kannada, Telugu or Malayalam.
Why then are Tamilians forced to learn Hindi, is the argument that the state's leaders put forward.
Chief Minister M K Stalin is clear that he will not allow the imposition of Hindi even if the Centre gives a grant of Rs 10,000 crore (Rs 10 billion) saying that states should decide their education policy.
The DMK has said that the Modi government was using financial pressure to force compliance of Hindi.
It said that the Centre was setting a dangerous precedent for Indian federalism and was undermining the rights of states to shape its education policy.
India has 19 non-Hindi speaking states. Only nine states speak Hindi.
All Dravidian parties in the state have framed the Centre's stand as an 'existential battle over language and identity'.
The Dravidian movement was built on the principle of linguistic self determination.
For many months now, progressive southern states like Karnataka, Telangana, Andhra Pradesh, Tamil Nadu, and Kerala have been pointing out how over the years, they have been getting lesser and lesser shares in the taxes they generate and pay to the Centre.
Ironically, states like Uttar Pradesh and Bihar, which fall behind many development parameters, get a larger share.
So, the feeling has been growing, especially in the southern states, that they are being punished for good performance.
As they do not get the money, they argue that they cannot follow the kind of development they want as the funds they deserve get diverted to mainly BJP-run states like Uttar Pradesh and Bihar.
Let us look at what states get for every rupee they contribute: Bihar gets Rs 7.06, Uttar Pradesh gets Rs 2.73, Rajasthan 1.33, Kerala gets 57 paise, Andhra - 49 paise, Telangana - 43 paise, Tamil Nadu - 29 paise and Karnataka - 15 paise.
The devolution formula works on different parameters like population, area, forest and ecology, equity, tax and fiscal efforts and demographic performance.
Political leaders from the South maintain that as Opposition parties in power, the Centre is depriving them of their rightful share in central taxes.
In the last 20 years, the share of the southern states in the divisible tax pool has considerably fallen.
It declined from 21.1 per cent during the 11th Finance Commission period of 2000-2005 to 15.8 per cent during 2021-2026, which is the the tenure of the 15th Finance Commission.
Karnataka itself pays around Rs 4 lakh crore in taxes to the Centre every year.
In February last year, Siddaramaiah, the chief minister of Karnataka, along with his entire cabinet and Congress MLAs, protested on the streets of Delhi against injustice to the state in the devolution of central funds.
Ministers from Kerala followed to protest the discriminatory policies of the central government. They were protesting against the devolution of taxes and grants-in-aid from the Centre to the states.
Grants-in-aid to the states have plummeted from Rs 195,000 crore in 2015-2016 to just Rs 165,000 crore in 2023-2024 when it should have been the other way around.
Karnataka says it has lost around Rs 187,867 crore in the last seven years because of unfair fiscal devolution by the Centre.
Though the 15th Finance Commission recommended a special grant of Rs 5,495 crore to offset the impact of the state's share in tax devolution from 4.71 per cent to 3.64 per cent, it did not get the money as the Centre chose to reject this recommendation.
Again, the Commission had recommended a grant of Rs 6,000 crore for a Ring Road in Bengaluru and to improve water bodies in and around the city as the water crisis looms.
But it has not been released. Instead, it asked the state to manage these projects with their own funds.
The protests by state leaders in Delhi embarrassed the central government as they showed that federalism was not working as it ideally should.
BJP leaders tried to play it down, with some even alleging that the leaders from the South were indulging in separatism.
That carried it too far, as none of the southern states have mouthed anything as drastic as this. All they did was to ask for a fair share.
The West Bengal government of Mamta Banerjee claimed that the Centre was holding back around Rs 1.16 lakh crore that had to come in to implement various welfare schemes.
She claimed that the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) wages to the tune of Rs 6,911 crores had yet to be paid as the Centre had defaulted on it.
Her government claimed it had yet to receive MGNREGA funds since December 26, 2021.
The Centre hit back, saying that the funds were withheld as it suspected irregularities in the scheme and had invoked Section 27 of the MGNREGA, which gave it the power to stop releasing funds if improperly utilised.
The Left Democratic Front government in Kerala says that the Modi government has pushed the state to its worst financial crisis.
The government says the state suffered a loss of Rs 57,000 crore because of the central government's discriminatory policies.
The Centre has substantially lowered the state's borrowing limits.
In a suit filed in the Supreme Court against the Centre, Kerala said that the Centre's policies had led to considerable arrears in the payment of social sec city pensions to the poor, allowances to pensioners, state employees and dues to state-run enterprises.
The court has asked the Centre to consider Kerala's plea and bail it out of its financial mess.
Kerala has the best development indices in India, and it is well-known.
Over 60 lakh people from vulnerable sections benefit from various state-run schemes.
Of late, many have not received any payments because of the crunch caused by the Centre not releasing funds.
Among the affected are healthcare schemes, which are now collapsing.
As the state refused to brand central schemes with the logo of the prime minister's photo, the Centre has reportedly withheld more than Rs 5,000 crores.
The Centre had directed the state to put up posters of the Antyodaya Anna Yojana with Modi's picture to be put up at 14,000 ration shops and also set up selfie points at around 550 such outlets.
Due to the cap on borrowings, as many as a thousand infrastructure projects in Kerala with an outlay of around Rs 74,000 crore lie stalled.
This should worry Chief Minister Pinarayi Vijayan as it might affect the prospects of his government returning to power in the next assembly election.
Finance Minister Nirmala Sitaraman says that the Centre has withheld money as Kerala had mismanaged funds.
However, the state government has refuted that, saying that the state's revenue actually grew by 23.4 percent in the last year.
Earlier, the Planning Commission allowed the states to use their discretion to spend funds on what they felt was necessary.
However, with the Planning Commission abolished by Modi, discretion was taken away.
Various central governments have in the past tried to keep a significant share of the revenues from taxes without reasonably passing it on to the states.
Instead of addressing their concerns, Prime Minister Modi said these chief ministers from non-BJP ruled states were divisive as they wanted to divide India into the North and the South.
There is reason for these chief ministers to be wary.
Opposition leaders have been selectively targeted by central investigative agencies, charges filed against them, and an aggressive Centre has tried to rob them of a development narrative by controlling numerous schemes for which the state should be executing and taking credit.
Looking at the larger picture, the messaging is straightforward: To get funds, get a BJP government elected.
The GST regime that Modi introduced after opposing it when the Congress was in power affected the fiscal situation in the states.
Modi forced them to give up their right to impose taxes of their own, which was the case earlier.
When state governments in Delhi and Rajasthan offered welfare schemes to women, unemployed youth and people with low incomes, Modi said they were blowing up state resources just to win elections.
But when the Centre had a bevvy of schemes clearly designed to win the electorate before elections, it was termed as welfarist.
This has made Opposition-run states feel that federalism is being diluted and even challenged as they find the grip of the Centre suffocating.
C P Chandrasekhar, a senior research fellow at the Political Economy Research Institute, University of Massachusetts in the United States, says that it is now an open declaration in India to the citizens of the states that they will be privileged in central spending if they elected a BJP government.
Time and again, Modi and other BJP leaders have stressed the importance of having a 'double engine sarkar' so that it works in tandem and benefits.
Finance Minister Nirmala Sitaraman's Budget in February allocated to the five southern states only 88 per cent of the allocation that was made to Uttar Pradesh!
It is a fact that the southern states cannot wish away.
All the leaders who have spoken about the South getting the wrong end of the stick say that it is their right to get a rightful share.
Others argue that poorer states need to be helped by the richer ones. But that also is not happening.
With its age-old fascination for education, it is a fact that southern states had done better than the North. The start-ups, IT hubs, and industry majors setting up shop have changed the face of the South.
Nearly 79 per cent of the various global offices set up by international conglomerates in India to serve as backend offices were in the South.
Almost 46 per cent of tech unicorns are from the South. Eleven of the 14 Apple suppliers are based in the South.
Bengaluru, Hyderabad and Chennai have emerged as major business hubs for both Indian and foreign companies.
All this has contributed to a better standard of life. Also, better standards of health lead to less infant mortality and longer life spans.
The GDP per person in the South is 4.2 times higher than the North. None of these indicators can be ignored by any central government, whatever the political compulsions.
As India's political culture plummets creating divisive and discriminatory policies, there is reason to worry.
Ramesh Menon, award-winning journalist, educator, documentary filmmaker and corporate trainer, is the author of Modi Demystified: The Making Of A Prime Minister.
Feature Presentation: Aslam Hunani/Rediff.com
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