CHENNAI: The Economics Nobel laureate Prof. Amartya Sen would hardly approve of the domineering, at times despotic, functional style of Tamil Nadu’s former Chief Minister, J Jayalalithaa. Yet, had she been alive, he would likely give her thoughts on India’s federal structure an empathetic hearing.

For it was Prof. Sen, currently Lamont Professor of Economics and Philosophy at Harvard University, who last year during a visit home flagged the issue of States and Chief Ministers re-visiting the federalism debate, when he said that the Central government should have consulted the States prior to demonetisation of high value rupee currencies in 2016 that had a shattering economic impact.

Even if the “shocks” of demonetisation have “largely faded away”, as emphasised in the latest Economic Survey (2017-18), authored by the Finance Ministry team led by Chief Economic Adviser to the Government, Mr. Arvind Subramanian and tabled in Parliament prior to the Finance Minister, Mr. Arun Jaitley presenting the Union Budget 2018-19 last week, the federalism issue has returned centre-stage.
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Ms. Jayalalithaa did not live to see the second of the twin-shocks, the historic rolling out of the ‘Goods and Services Tax (GST)’ from July 1, 2017, about which she had some serious reservations. But what she had not failed to register, apart from Tamil Nadu’s then position on the GST, was about some crucial aspects of Centre-State relations at a meeting of the Inter-State Council (ISC) in New Delhi on July 18, 2016, barely two months before she collapsed. Her speech was read out by her then Finance Minister, Mr. O. Pannerselvam, but relevant even today.
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The purpose of the ISC, set up when V P Singh was the Prime Minister in 1990, was to facilitate coordination between the States and the Centre on a whole range of Constitutional and administrative issues, and could well be seen as the parent of the present super-body the GST Council, constituted under the GST Law. The ISC, reconstituted last year under the Chairmanship of the Prime Minister, has in recent years been deliberating on the recommendations of the seven-volume ‘Punchchi Commission’ on Centre-State relations and this is what makes Ms Jayalalithaa’s possibly last assertive text as Chief Minister politically significant in the larger context of the federalism debate.

“The NDA’s ‘cooperative federalism’ will degenerate into empty rhetoric if the States are not given adequate powers and fiscal resources,” she had cautioned in that ISC speech. She not only pressed for amending Article 356 of the Constitution to “incorporate the safeguards inherent in the Bommai case judgment of the Supreme court” to ensure that the proviso was not arbitrarily used to dismiss elected State governments, but also urged, “preventing adventurism” by Governors.
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Equally instructive for Centre-State fiscal relations, Ms. Jayalalithaa, while pleading for decentralisation of authority and resources, said post-liberalisation, as political and economic power has shifted away from the Centre to the States, and state-level parties and leaders being “significant players”, “these should not be seen as centrifugal or fissiparous trends that have to be curbed, but a manifestation of India’s nurturing a Nation with diversity and democracy.”   

Hopefully, the ISC would continue to have a supervening role vis-à-vis the entire gamut of Centre-State relations, but the semantic outreach of the latest Economic Survey (ES) suggests the possibility of the new ‘GST Council’ taking away much of the ISC’s elevated sheen. The document says, India has created one of the most important “institutional mechanisms for Cooperative Federalism, the GST Council.”

“At a time when International events have been marked by a retreat into economic nativism, and the attending seizing of control, the Indian States and the Centre have offered up a refreshing counter-narrative, voluntarily choosing to relinquish and then pool sovereignty for a larger collective cause.”  The ES even further envisages a larger role for the GST Council as “Cooperative Federalism Technology” – a new coinage-, to tackle a wide array of “difficult structural reforms” that involves the States.

These, according to ES, include a wide range from creating a common agricultural market, fixing the SEBs’, to even solving inter-state water disputes. This new “Technology” of ‘Cooperative Federalism’ could be a tool to “even replace untargeted subsidies (like power and fertilisers in agriculture) by direct income support,” the ES points out. It gives the impression that a fast-tracked ‘GST Council’, would come to be the mainstay in the new redrawing of Centre-State relations wherein the dice is loaded in favour of a strong national government.

While the ‘Aadhar-Jan Dhann-Mobile interface’ and the move towards more digital, cashless transactions is one facet of this new ‘monism’ in the transactional culture emerging alongside the GST regime, its implications for Centre-State relations and the federal principle, traditionally understood as not intruding into the State’s powers in a multi-lingual, multi-ethnic country, are equally large.

More and more centralised decisions, whether it be a one-off act like demonetisation or any other policy pronouncement through the ‘GST Council’, or through the budget, is thus logically bound to marginalise the role of States. 

No wonder the first cries of “our state” being ignored by the Central budget has come from the Andhra Pradesh Chief Minister, N Chandrababu Naidu and Punjab Chief Minister, Amrinder Singh. Ms Jayalalithaa, had she been around, would have expressed the same objections now, as part of revisiting the federalism debate, alluding to the spirit of Prof Amartya Sen’s call following the demonetisation step.  
 
The predicament of the States has been brilliantly summed up by Prof. Harihar Bhattacharya, professor of Political Science, University of Burdwan, West Bengal, in his “Federalism over Democracy in India- Dialectics of Diversity-claims over Equality-claims” thus: “With India’s shift to a free market economy since the early 1990s’, Indian federal democracy is confronting an evolving, but contradictory reality.” Whether economic growth at any cost should get precedence over poverty alleviation will be an alternating dialectic, depending on the pre-election moods. Mr. Jaitley’s latest budget is partly a reflection of that bigger dilemma.

THE ONGOING CONTROVERSY OVER THE FILM, REPORTEDLY GAVE THE PRODUCERS A DIFFICULT TIME.

The Vijay starrer Mersal released to packed houses on Diwali, October 18, 2017 but it was embroiled in controversy over the inclusion of certain scenes; particularly those about the GST.

While this has irked BJP leaders in Chennai as they claim that it was aimed at the BJP-led Union government, the producer of the Telugu version of Mersalseems to be the most affected.

The original plan was to release Mersal and its Telugu version Adhirindi simultaneously, but the delay in procuring the censor certificate for Adhirindi made it impossible for the film to release on time.

Producer Sharath Marrar had made all arrangements by pumping in huge amounts of money for the release in Andhra and Telangana region but the delay in obtaining the censor certificate had stalled the release.

Sources in the tinsel town say that obtaining a censor certificate for a film that has already been certified is simple, but the ongoing controversy over the inclusion of some scenes against the government, made things worse for the Tollywood producer Sharath Marrar.

The producer is keen on having the film released soon as he wants to cash in on the huge success of its Tamil version. Further, with pirated clips of some scenes spreading on social media, chances are that movie buffs may not go to the theatres.

While the release of Adhirindi looked bleak a few days ago, all hurdles have been cleared now and reports are that the film will be out on October 26.

Mersal, starring Vijay in triple roles, has Samantha Ruth Prabhu, Nithya Menen and Kajal Agarwal playing the female leads. The film has been directed by Atlee and produced by N Ramasamy, Hema Rukmani, R Mahendran and H Murali under the banner Thenandal Studio Limited.

AR Rahman has composed music for this flick with GK Vishnu cranking the camera and Ruben editing it.
With Vijay having a good fan base in Andhra and Telangana, hope the Telugu version hits the marquee soon.

Chennai: Even though the lanes of Parry's corner in Chennai are buzzing with crackers shops, traders say that there is a decline in the sales by 30 per cent.
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 'We received bulk orders in the month of March, but as GST was implemented from June, we didn't push it to customers as 28 per cent of tax means no profit for us,” said a wholesale dealer.
According to informed city police sources, temporary licenses obtained by shop owners to sell crackers have dwindled this season.

“There are no visible roadside cracker shops in Central Chennai due to stringent monitoring and in general shop keepers who last year came to the station to furnish details of cracker stocks are also missing this year,” said a police inspector. Another major reason for the dip in cracker sales is the economic slowdown. “Economic slowdown and awareness on pollution have also reduced corporate orders and Bunder street is dull this year missing the Deepavali fervour,” said an employee with Mahesh Stationeries that sells crackers during Deepavali.

The wholesale business is blunt till now and dealers are hoping for the retail business to improve by Sunday. And to attract kids interesting names for the fireworks are being marketed this season.
While the names of social networking sites including Facebook and WhatsApp made for impactful brands last year, it is the turn of the movies to occupy the space this Deepavali.

Most of the new cracker varieties are named after the upcoming projects noted directors and actors. Explaining the trend, R Mahesh of Sri Krishna fireworks, Sivakasi said, “We have named the cracker brands after Mahabharata as Bahubali director's next movie is on the epic. The same way, as there is going to be a sequel for 7am Arivu, we created brands such as 5th sense and 6th sense. The whole point is to be remembered and make some sales,” he said.

The Tamil Nadu Film Producers Council on Wednesday said no new Tamil films will release on Friday onwards until the state government removes the additional 10 per cent tax over and above the Goods and Services Tax (GST).
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In a statement, President of the Producers Council Vishal said, "We will have a meeting today (Wednesday) to discuss the next course of action. No new Tamil films will release this week as we feel the additional 10 per cent Local Body Entertainment Tax (LBET) above the GST will disable the industry."
On Tuesday, the Multiplexes Association of India (MAI) directed multiplexes such as PVR and INOX here to shut shop against double taxation. "All multiplexes operating in Chennai have announced that they are going on strike starting today (Wednesday)," read a statement from MAI.
According to the statement, the double taxation defeats the purpose of the GST model and goes against the principle of One Nation One Tax.
MAI President Deepak Asher appealed to the Tamil Nadu Chief Minister K Palaniswani and Great Chennai Corporation (GCC) Commissioner to consider their request to withdraw the LBET levied on the film exhibition industry in Chennai immediately.
Vishal said they were ready to go on indefinite strike if the government did not consider their request. "Various stakeholders have already explained their situation to the government. Unfortunately, 10 per cent tax has been levied without regulating the ticket prices. This will only increase the losses for the producers and pave way to more confusion," Vishal added.