Frontier Nagaland Territory’s Legal Case for Direct Central Funding: Implications of Proposed Reforms

“Empowering the proposed Frontier Nagaland Territory with direct financial control embodies a crucial step towards constitutional integrity and effective governance. This approach aligns with the constitutional principles of autonomy and self-governance, ensuring that resources are managed with greater efficiency and responsiveness to local needs. By facilitating direct funding, we affirm the commitment to equitable development and the legal obligations under the Constitution, paving the way for a more just and progressive framework for the proposed Frontier Nagaland Territory.”

The Constitution (125th Amendment) Bill, introduced in the Rajya Sabha on February 6, 2019, seeks to enhance the financial and administrative autonomy of tribal autonomous councils in India’s tribal areas. The Bill proposes amendments to Articles 244(2) and 275(1) of the Constitution, facilitating direct funding from the central government to these councils, bypassing state governments. This provision aligns with the demand of the Eastern Nagaland Peoples’ Organisation (ENPO) for direct funding of the proposed Frontier Nagaland Territory (FNT), underscoring the need for streamlined financial processes to improve governance in the region. Such measures are critical in addressing the long-standing grievances of underrepresented tribal communities, who have often been left out of the mainstream development narrative. The introduction of direct funding mechanisms is, therefore, not merely a legislative amendment but a step towards correcting historical injustices.

Currently, tribal autonomous councils rely on state governments for funding, a system that often results in delays and resource mismanagement. The Constitution (125th Amendment) Bill addresses these inefficiencies by enabling direct funding from the central government, thereby empowering these councils to execute development projects more effectively. This approach reflects the intention behind Article 243M of the Constitution, which exempts tribal areas from the application of Panchayati Raj provisions (Part IX of the Constitution of India). The exemption recognises the unique governance needs of tribal regions and the importance of granting them greater self-governance. In essence, this bill is an acknowledgment of the distinct cultural and administrative fabric of India’s tribal populations, who require tailored governance structures. Ensuring timely and direct financial assistance is crucial for these regions to achieve self-sustained growth and socio-economic development.

The demand for direct funding is further emphasised by the failure of the Department of Underdeveloped Areas (DUDA) to significantly improve the lives of people in Eastern Nagaland. Established in 2003 vide Notification No. AR-6/4/78 dated 23.06.2003 by the Government of Nagaland to address the unique developmental challenges of underdeveloped areas, DUDA has been criticised for its inability to deliver tangible outcomes. Reports from the Rising People’s Party (RPP) highlighted several inefficiencies in DUDA’s operations, including a lack of strategic planning, bureaucratic delays, and misuse of funds. Instead of prioritising essential sectors like healthcare, education and infrastructure, funds have been diverted to less impactful projects, such as constructing retaining walls, culverts, and helipads. These misdirected efforts have done little to alleviate the deep-rooted poverty and lack of basic services and necessary infrastructure that plague the region. The continuing neglect in addressing fundamental needs reflects a broader systemic failure that direct funding aims to rectify. Please refer following web-link for more details (https://risingpeoplesparty.org/duda-is-the-pocket-money-department-of-nagaland-government/)

Allegations of corruption and nepotism have plagued DUDA, with contracts often awarded to the same firms without transparent processes. The department’s total failure to produce substantial results from initiatives like promoting ginger and cardamom farming further demonstrates its inefficacy. Critics argue that DUDA has become a “pocket-money department” for some officials, with development funds being diverted for personal gain rather than addressing the region’s actual needs. The persistent lack of accountability within DUDA is a glaring example of how corruption can undermine the very purpose of developmental schemes. The shift towards direct funding aims to eliminate such malpractices, ensuring that resources are channeled directly to those in need. These inadequacies in DUDA’s performance highlight the need for a more direct and accountable financial model for governance in eastern Nagaland, one that aligns with the spirit of Article 21 that guarantees to life and personal liberty and Article 19(1), which guarantees the right to practice any profession or carry on any occupation, trade, or business, as this right is intrinsically linked to the broader economic development of the region. Please refer following web-link for more details (https://risingpeoplesparty.org/duda-is-the-pocket-money-department-of-nagaland-government/)

Given DUDA’s shortcomings, the ENPO’s demand for direct funding for the proposed Frontier Nagaland Territory appears increasingly justified. Under the current financial arrangements, funds are routed through the Nagaland state government, often resulting in delays, mismanagement, and insufficient resource allocation. Direct financial transfers would bypass state-level intermediaries, ensuring that resources are closely aligned with local needs and more effectively addressing the development gaps that have plagued eastern Nagaland. This restructuring of the financial model is a move towards greater transparency, enabling local authorities in the proposed Frontier Nagaland Territory to take ownership of their development. Moreover, it empowers the people of eastern Nagaland to break free from the cycle of dependency on state-level bureaucracies. The ability to receive funds directly would also align with Article 280, which mandates the Finance Commission to recommend grants-in-aid to states from the Consolidated Fund of India, including for areas requiring special consideration, such as those inhabited by Scheduled Tribes. This is further bolstered by Article 271(1), which allows the imposition of surcharge for specific purposes, providing a constitutional framework for direct funding mechanisms in regions requiring special financial interventions.

A prominent leader from eastern Nagaland on the condition of anonymity pointed out that “the current system does not reflect our aspirations; our people continue to face neglect and underdevelopment due to the inefficacy of state-level interventions”. This sentiment reflects the broader dissatisfaction with how state government has managed funds meant for eastern Nagaland areas. His assertion underscores the need for direct central government funding to the proposed Frontier Nagaland Territory, bypassing state-level inefficiencies. His advocacy is rooted in the belief that real progress can only be achieved when governance is brought closer to the people, with decision-making powers in the hands of those directly affected. This aligns with the principles of subsidiarity, where decisions are made at the most local level possible, fostering a more responsive governance model. His perspective is consistent with the intent behind Article 39, which directs the state to ensure that the ownership and control of the material resources of the community are so distributed as to best serve the common good.

The prominent reader from eastern Nagaland further articulated the need for local control over resources, stating, “without the ability to directly manage our own resources including funds and financial grants from central government meant only for the development of eastern Nagaland, our people will remain on the margins of development”. His statement aligns with the ENPO’s demand for a funding model that allows the proposed Frontier Nagaland Territory to exercise greater autonomy over its development initiatives. Local resource control is not just a matter of administrative efficiency but of reclaiming the region’s dignity and self-reliance. Empowering local governance (in our case proposed Frontier Nagaland Territory) through direct funding also embodies the principles of participatory democracy, where deprived communities have a constructive say in their developmental priorities.

An instructive case study is provided by the approach of the United States federal government in funding Native American reservations. The U.S. government has established a transparent and robust legal framework that allows direct funding to Native American tribes, recognising their sovereign status and promoting their right to self-determination. Under the Indian Self-Determination and Education Assistance Act (ISDEAA) of 1975, tribes are empowered to manage federal funds directly, bypassing state-level intermediaries. This Act allows tribes to enter into contracts and compacts with federal agencies to administer programs that address their specific needs, such as healthcare, education, and infrastructure. The success of this model has significantly contributed to the socio-economic uplift of Native American communities, providing a blueprint for similar governance reforms in India. Adopting such a model in the Indian context would not only enhance governance but also ensure that tribal regions / backward among backward tribal regions are no longer left behind in the nation’s development trajectory. This direct funding model has led to a significant improvement in resource allocation and governance outcomes, ensuring that tribal governments have the autonomy to prioritise their developmental goals.

Moreover, the U.S. approach is bolstered by the Federal Trust Responsibility, a legally binding obligation requiring the federal government to protect tribal assets, resources, and treaty rights. Through the Bureau of Indian Affairs (BIA) and other federal agencies, Native American tribes receive grants and other financial resources directly, ensuring that funds are not diluted or misallocated by state governments. This legal provision has fostered greater transparency, accountability, and efficiency in the use of federal funds, significantly empowering tribal communities to govern themselves and manage their development more effectively. The parallels between the U.S. system and the situation in Eastern Nagaland (in our case, Tribal backwards among Tribal backwards) are evident, with both contexts demonstrating the necessity of aligning financial mechanisms with the unique governance needs of indigenous populations. Implementing a similar direct funding model in India would represent a significant step towards fulfilling the constitutional promises made to its tribal communities. The parallels between the U.S. system and the situation in Eastern Nagaland and the demand for Frontier Nagaland Territory underscore the potential benefits of adopting a similar approach in India starting with proposed Frontier Nagaland Territory as a test case, especially given the constitutional protections for Naga Tribes as well as Naga tribal areas under Article 371(A) and related provisions.

The U.S. case strengthens the argument of the ENPO for direct funding from the central government in India. By demonstrating that direct funding, coupled with appropriate legal frameworks, can improve governance and development outcomes, the U.S. model serves as a compelling example of how India could reform its approach to funding tribal regions. The American experience shows that when tribal communities are entrusted with managing their own resources, with proper oversight, strict legal framework, robust system of accountability, checks and balances and constructive support and direct intervention from the central government, they can make more effective use of funds tailored to their unique socio-economic contexts. This evidence-based approach highlights the importance of empowering local governance structures to handle their own affairs, a principle that resonates with the aspirations of the ENPO for Frontier Nagaland. Adapting such a model to the Indian context could revolutionise the way tribal regions are integrated into the national development agenda. This model could be adapted to the Indian context starting with the proposed Frontier Nagaland Territory as a test case, where constitutional provisions already exist for special treatment and autonomy for tribal areas, further reinforcing the case for direct funding.

However, critics caution that direct funding alone may not resolve the region’s complex challenges. Without robust legal frameworks, direct supervision from New Delhi and effective and transparent local implementation mechanisms, even direct funding may not yield the desired development outcomes. Past experiences in the ENPO region, where development funds often failed to translate into tangible benefits due to mismanagement and corruption, underscore the need for stringent oversight and active local agency involvement to ensure effective use of resources in the proposed Frontier Nagaland Territory. This also calls for a simultaneous strengthening of local traditional governance institutions and also various government bodies that will come under proposed FNT, ensuring that they are equipped with the necessary tools and capacities to manage funds responsibly. Transparent and accountable traditional institutions as well as government institutions are the bedrock of successful governance, making the fight against corruption an integral part of this reform process. This is further emphasised by Article 256, which mandates that the state governments comply with laws enacted by Parliament and ensure the implementation of these laws. While Article 256 requires states to follow the directions given by the central government, it does not directly address direct funding. However, effective governance, particularly in the context of direct funding, indeed necessitates a clear legal and institutional framework, which could be reinforced by compliance with central directives under this Article.

The proposed Frontier Nagaland Territory would operate under Article 371(A) of the Constitution, which grants Nagaland special autonomy to manage its internal affairs, including religious and social practices, customary law and procedure, administration of civil and criminal justice, and ownership and transfer of land and resources. This special provision allows the FNT to leverage an existing constitutional framework tailored to the region’s specific needs, ensuring an effective and culturally appropriate governance structure that reflects local customs and aspirations. This constitutional framework is pivotal in ensuring that the development initiatives are not only effective but also resonate with the socio-cultural ethos of the region. Moreover, it enables the FNT to operate with a level of constitutional autonomy that is crucial for sustainable and inclusive development, providing an effective model for other tribal regions in India. The autonomy granted to the proposed Frontier Nagaland Territory under Article 371(A) is crucial for tribal regions, where governance must be sensitive to unique cultural and social practices, ensuring that development initiatives align with the region’s specific needs and requirements.

As is widely recognised, the proposed Frontier Nagaland Territory (FNT) will not be governed under the Sixth Schedule of the Constitution of India, which typically provides for autonomous councils in tribal areas. Instead, it will operate under the unique provisions of Article 371A. This unique constitutional framework under Article 371A grants Nagaland special autonomy, particularly concerning religious and social practices, customary law, and ownership of land and resources. Given this distinct status, there are no constitutional or legal barriers to extending direct funding to the proposed FNT. This distinct constitutional positioning of the FNT offers a significant opportunity for pioneering governance reforms in tribal regions in India.

Frontier Nagaland Territory presents a unique chance to create a model of development that is both locally relevant and constitutionally sound. Unlike regions under the Sixth Schedule, which must await the passage of the Constitution (125th Amendment) Bill to secure direct central funding, the FNT can immediately benefit from such financial arrangements. This makes the FNT a potential model for financial governance in tribal areas, offering valuable insights for the Government of India as it seeks to reform and improve financial governance across other tribal regions, potentially setting a precedent for more responsive and effective resource allocation in areas with unique governance needs.

In summary, the direct funding model demanded by ENPO for the Frontier Nagaland Territory not only aligns with existing constitutional provisions but also enhances the autonomy and self-governance of tribal regions, addressing long-standing developmental disparities. This model would empower the FNT to directly manage and allocate funds according to its specific needs, without the bureaucratic delays and mismanagement that have plagued state-level interventions. The move towards direct funding is a step towards rectifying the historical neglect of these regions, empowering them to chart their own development trajectories.

Furthermore, it represents a broader shift in governance philosophy, where underrepresented, backward local communities (backward among backwards in case of eastern Nagaland tribes) are recognised as capable and responsible stakeholders in their own development. By leveraging the special status granted under Article 371(A) and the constitutional flexibility provided by Articles 275(1) and 282, there is no doubt that the FNT could serve as a model for other tribal regions across India. This initiative would not only uplift marginalised communities but also demonstrate the transformative power of our Constitution, which ensures justice and equality for all. The successful implementation of the proposed Frontier Nagaland Territory would reaffirm India’s commitment to preserving the unique identities of its tribal populations and the “backward among backwards” among them; while securing their rightful place in the nation’s progress and prosperity. Embracing this model fosters sustainable development and strengthens our national unity, ensuring that no community is left behind in our journey toward a stronger and more cohesive India.

Dr. Aniruddha Babar

Dept. of Political Science

Tetso College, Nagaland