<b>Nitin Sethi:</b> A question of oil and Rio for Modi

Uncertainty over inclusion of former-Nagaland CM Neiphiu Rio in Modi govt and question of oil exploration in the state could be a test for PM's policy on relations with states

The appointment of General (Retd) V K Singh as the minister for development of north east region, even as the future of former Nagaland chief minister Neiphiu Rio in the Narendra Modi government remains uncertain, has led to a lively debate in the region, especially in Nagaland. Talks of betrayal have singed arguments in the region where federal relations with the Centre remain built on a combination of both dependence and suspicion.

But the possible accommodation of Rio in the Union Cabinet at a later stage promises to throw up another challenge for Modi, turning the question that Rio sabre-rattled the Centre into a bigger argument - who controls the oil and gas rights in Nagaland?

Despite objections from the Centre, the Nagaland state government took out letters of interest to explore 11 oil blocks in the state and awarded the rights to companies before the Assembly elections. The awarding process itself has come under a cloud, with doubts being raised about some of the winners.

The rebel NSCN group was recently reported demanding that any company wishing to operate in the state must commit to setting up a refinery too.

Then, the community organisations where exploration could take place have also warned that work would have to be done on their land with prior permission and with due respect to their traditions and cultural practices.

"Even though the State wields de jure power to make law and regulate 'ownership and transfer of land and its resources,' the emerging political process shows that de facto power is wielded by a melange of tribal bodies and Naga civil society," wrote Professor H Kham Khan Suan in The Hindu recently, explaining the complexities the state faces internally in handling the rights over natural resources.

The Centre on its part has continued to call the move ultra vires of the Constitution, while the Nagaland state government has defended its rights under the special provision of Article 371 A(1) in the Constitution to govern its natural resources by its own regulations where the state assembly so decides.

Rio, who has won the single Nagaland Lok Sabha seat offering the support of his North East Regional Political Front to Modi, was one of the key people that led the oil debate as chief minister. He resigned as chief minister in the hope of making it to Delhi and T R Zeliang has replaced him in Dimapur.

The Bharatiya Janata Party made inroads into Assam and clocked one out of the two seats in Arunachal Pradesh. But in states such as Nagaland and Mizoram, it is bound to work through allies. Though with the brute majority this time around, it does not require these minor allies after the results.

As head of the government, Narendra Modi, has suggested that he would work and co-operate with the states and not try to impose an aggressive Centre. The case of oil exploration in Nagaland promises to test his ability to really implement a liberal federal relations policy.