Which of the following best describes the rationale for the Centre's intervention in economic policy as highlighted in recent discourse on federalism?

To prevent 'beggar-thy-neighbour' policies among States competing for investments.

To reduce the financial autonomy of States to ensure fiscal discipline.

To centralize all tax collection powers within the Union government.

To replace State-level industrial policies with a single national directive.

Daily

250 words

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7 August 2026

Finance Minister on federalism and laggard states

The topic addresses core constitutional and economic issues regarding cooperative federalism, fiscal devolution, and the challenge of regional economic disparities, which are frequently examined in GS2 and GS3.

Notes

Finance Minister emphasizes the necessity of 'strong States' for national development, advocating for 'hand-holding' of laggard States to ensure balanced regional growth.
The Centre's role is defined as essential for managing national priorities including defence, export policy, and manufacturing, which require a unified national approach.
The Centre is responsible for preventing 'beggar-thy-neighbour' policies among States competing for investments.
Capacity building and resource empowerment at the State level are identified as critical prerequisites for meeting India's national aspirations.
The objective is to ensure underdeveloped regions catch up with the rest of the country to avoid economic disparities.

Questions

Cooperative federalism is essential for achieving balanced regional development in India. Discuss the role of the Centre in hand-holding laggard States while maintaining national economic coherence. 150 words

Attempt this — 150 words in 8 min

0 / 150 words 8:00
The division of powers between the Centre and States is designed to balance local aspirations with national strategic interests. Critically analyze how the Centre can facilitate industrial growth and investment without fostering unhealthy inter-state competition. 250 words

Attempt this — 250 words in 11 min

0 / 250 words 11:00

Prelims

Which of the following best describes the rationale for the Centre's intervention in economic policy as highlighted in recent discourse on federalism?

Syllabus

Topics

Sources

Laggards among States need hand-holding, says Sitharaman

250words.in · https://250words.in/daily/2026-08-07/finance-minister-on-federalism-and-laggard-states