Centralised Planning:

1. Centrally sponsored schemes are devised by the centre but implemented by the state machinery.

2. Planning commission has encroached upon the autonomy of the states as it can accept, modify or reject the states’ proposals for development programmes, for which central assistance is sought and which can be granted only on the acceptance of PC.

3. Although states are represented in the NDC but it is a body of non-experts which have no match with a specialised body like the Planning Commission. States

surrendered the sales tax on sugar, tobacco and textiles etc to the centre in a single meeting of the NDC, without proper debate in the states.

4. Centralised planning had led to the creation of parallel organisations in centre as well as the states. For example, community development programme is not mentioned in any list but it covers the areas of state list. Through the parallel machinery for its implementation, the centre is virtually encroaching the state list.

5. With the beginning of direct cash transfer a significant proportion of revenue earlier given to states for passing on to autonomous agencies (including Panchayats) for implementing various Central schemes is now directly given to the latter, bypassing the states. Constitutional experts and scholars of federalism find this intrusion an affront to the states' autonomy and unhealthy for the future of Indian federalism.