Coercive Federalism and Conditional Welfare
Institutions of basic welfare cannot become instruments for political conformity.
EYEING withheld funds from the union government to the tune of Rs. 1,158 crore, the Kerala government decided to sign the Pradhan Mantri Schools for Rising India (PM SHRI) scheme earlier last month, in what was a surprise U-turn of the left’s consistent opposition to the scheme. The Communist Party of India (Marxist)-led government’s decision also sparked a political controversy in the state, with coalition partner, Communist Party of India, accusing the government of having signed the memorandum of understanding (MoU) without cabinet approval. The emergent political fault lines have forced the government to freeze the implementation of the scheme until a cabinet subcommittee examines the MoU and tables its recommendation.
The Kerala government’s decision exposes the ideological tightrope that states are forced to navigate in the face of eroding fiscal and federal autonomy. By unjustly withholding funds that accrue to states under the Samagra Shiksha scheme, the union government has weaponised fiscal control to ensure the coercive adoption of the National Education Policy (NEP). The PM SHRI is the union’s flagship initiative to promote model schools that will showcase the NEP and serve as exemplars of its principles. The opposition to the scheme in Kerala stems from its potential to then serve as vehicles of ideological import through rewritten textbooks, saffronised curricular frameworks, privatisation, and commercialisation. The state’s education ministry details that nearly 40 lakh students from marginalised communities have been affected by the freeze of funds, which will be released only in lieu of signing the PM SHRI. Therapies and assistive devices for 1.8 lakh differently abled students, free uniform and textbook distributions, and teacher training have also been derailed. It is appalling that the fundamental tenets of human welfare become scapegoats in the coercive ideological project of the ruling regime at the union.
Earlier this year, the Tamil Nadu government went to the Supreme Court to seek the release of pending funds of Rs. 2,200 crore under the Samagra Shiksha, withheld for its refusal to sign the PM SHRI. The state’s contentions primarily stem from anxieties over the implementation of the three-language formula. West Bengal is the other state, which has refused to comply with the branding directions of the scheme, mandating that model schools have PM SHRI prefixed to their name, even when states have to bear 40% of the cost and take over the schools after five years.
This is, however, not the first time that states have locked horns with the union over branding requirements for welfare schemes. Funds under the National Health Mission (NHM) were withheld until states complied with the rebranding of public and family health centres as Ayushman Arogya Mandirs, with prescribed colour codes, logos, and illustrations on the walls of healthcare facilities. Kerala received none of its rightful funds under the NHM in 2023–24 over its non-compliance with branding, disrupting several health schemes and facilities in the state. The cultural incongruence of the mandated proposals and the sheer oddity of painstaking repainting and rebranding prompted many states to sound opposition. However, most states starved of funds, including Kerala, eventually yielded to the demands.
The Pradhan Mantri Awas Yojana (PMAY) was also embroiled in similar conflicts in the state, with the union government demanding that the logo of the scheme be displayed in front of houses, in return for funds. Kerala, which sought to integrate the PMAY with the state’s own successful flagship housing project, the LIFE Mission, criticised the proposals as an insult to the dignity and self-respect of the beneficiaries, and an attempt to usurp state credit. In 2024, the union government froze Rs. 7,000 crore under the National Food Security Act (NFSA) to West Bengal, allegedly over the state’s refusal to display the Prime Minister’s photograph and the NFSA logo at ration shops.
Three alarming concerns emerge from this recurring pattern of holding welfare funds at knifepoint over ideological rebranding. First, the coercion that now comes to define union–state relationships hints at a larger constitutional crisis of federalism. Welfare expenditure that accrues to citizens as a matter of right is now conditional on the state government’s compliance and acquiescence to the national ruling party’s agenda, in what can only be termed dependent federalism. With the union imposing additional fiscal constraints and borrowing limits on states over concerns of “poor fiscal management,” shrinking their fiscal space, mandated funds under basic welfare schemes become bargaining leverage for political and policy manipulations. This is a troubling encroachment on state autonomy.
Second, that universal basic welfare, like education and healthcare, is allowed to be disrupted over naming and branding is shameful for any democratic nation. This signals a worrying shift where the continuity of essential services is held hostage to political compliance, amounting to a wilful sabotage of people’s rights.
Third, the ideological politics of such branding and scheme adoption is in itself deeply insidious. For one, as with stamping PMAY logos on houses or displaying the Prime Minister’s photos on ration shops, it shifts the perception of welfare delivery from a basic right to be assertively demanded, to a gift from a benevolent government or its one leader. The insistence on uniform logos, colour schemes, and Sanskritic names also points to an ideological desire for homogenisation, in line with the Bharatiya Janata Party’s “one nation, one narrative” politics. The more pervasive goals of institutional indoctrination and symbolic capture by the ruling regime’s political machinery—furthering the ideological project of Hindutva through the steady subsumption of public institutions—are advanced through such administrative rebranding. It is important that the threats posed by such political manipulation to democratic functioning and people’s rights be recognised. Institutions of basic welfare cannot become coercive instruments for political conformity.
(An Editorial of the Economic and Political Weekly, Vol 60, Issue No. 45, Nov 08, 2025)
