Inter-State Council

Story hook

It is 18 July 2017. The fifth meeting of the GST Council is about to break for lunch when Kerala Finance Minister Thomas Isaac raises a question: should the 18% slab on sanitary napkins be revised? The room is divided. The Centre's representative argues revenue. The Tamil Nadu finance minister mentions the ₹220-crore-a-year Khadi exemption already in place. The Council's 3/4ths weighted-voting rule kicks in — the Centre alone holds 1/3 of votes, the 31 states/UTs share 2/3. After two more meetings, on 21 July 2018, the 28th GST Council decides: 0% on sanitary napkins. It is the first major reversal won by states acting together since GST began.

The GST Council, which most Indians cannot name, is now arguably the most powerful federal body in India. It is one of just four major federal coordination institutions: the Inter-State Council (advisory, Article 263), the Zonal Councils (advisory, States Reorganisation Act 1956), the National Integration Council (purely consultative, born of the Jabalpur riots of 1961), and the GST Council (constitutional, 101st Amendment 2016) — the only one with binding fiscal powers.

Indian federalism is no longer a Centre-State binary. It is a network of councils, some constitutional, some statutory, some non-statutory; some toothy, most advisory. Knowing which is which — and when each was created and why — is the spine of every Mains answer on cooperative federalism.

Why this matters for UPSC

These four councils show up in Prelims every year as factual MCQs (membership of ISC, GST Council voting weights, NIC year, Zonal Council headquarters). Mains GS-II uses them as case studies for cooperative federalism, competitive federalism, and centre-state coordination. Interview boards love asking "Is the GST Council a fiscal federation in itself?" and "What can the ISC do that the NITI Aayog cannot?"