He held a meeting with senior officials and retired bureaucrats "on the preparation of a National Agenda for development and the viability of the existing methods, their good and bad aspects", a release from his office said last night.
"Though the country became independent seventy years ago, the development for the past 70 years has not been on the lines as people expected."
The Chief Minister said that though several states have water disputes among them, they have not been settled. Several reforms suggested by experts in Centre-State relations have not been complied with.
"The true federal spirit has not been reflected. Under these circumstances, there is a need for preparing an agenda for the national development," he said.
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A decision should be taken on which subject should be with whom between the states and Centre, he said.
Political leaders, experts and senior bureaucrats should give their suggestions in this regard and become stakeholders in the process, he added.
Rao's plans for an alternative at the Centre has received support from West Bengal Chief Minister Mamata Banerjee and others, official sources had said.