When Data Becomes Territory: Surveillance, Federalism, and the Reconfiguration of Union–State Power in India

Authored by Misritha Arvapally, a 3rd-year law student pursuing B.B.A. LL.B. (Hons.) from Jindal Global Law School, O.P. Jindal Global University

Representational Image/AI-Enhanced

Introduction

The traditional understanding of federalism in India is a constitutional system that allocates power between the Union and the States across specified legislative, executive, and fiscal areas, as manifested in Articles 245-246 and the Seventh Schedule. This is based on the premise that law is used as a form of power, but in well-defined areas of jurisdiction.

This basic assumption is disturbed by digital governance. The data infrastructures that contain identity systems, databases, and algorithmic decision-making systems operate and extend beyond these constitutional limits. Such systems are centralised, networked, and, unlike legislation, which is territorially limited, this type of governance operates using technological architectures and not formal law. By doing so, they create a parallel channel of authority that cannot be easily integrated into the conventional system of federal power distribution. In this changing environment, data is becoming a core area of political power. The issue of federalism thus changes: not only who has the legal power, but also who has the means to control the infrastructural context in which this power is exercised.

The conceptualisation of this change is known as “surveillance federalism”, whereby the federal balance is not amended but is achieved through engineering. By centralising data collection, storage, and authentication structures, the Union gains the ability to indirectly influence and limit State action in areas constitutionally vested in the States, thereby making them functionally dependent, although formally autonomous. Such restructuring is not only a matter of institutional realignment but also a structural change that has disproportionately impacted marginalised communities in terms of class, caste, and gender, with significant implications not only for federalism but also for social justice because welfare access increasingly depends on centrally controlled digital systems, where errors in identification, authentication, or documentation are most likely to exclude poor, Dalit, Adivasi, and female beneficiaries.

Digital Infrastructure and Dependency

State power is becoming more and more defined by access to and control over digital infrastructures, namely centralised databases, identity authentication systems, and data-sharing platforms, that render the functioning of governance by exchange of information between governments and citizens possible in modern India. The Centralised Monitoring System, National Intelligence Grid, the Crime and Criminal Tracking Network and Systems and the Aadhaar-enabled ecosystem that tracks communications, links databases to provide access to security, and digitises police records are examples of how governance is mediated using interconnected data architectures. Aadhaar, originally designed as a biometric identity platform, is affecting welfare schemes, banking, telecommunications, and taxation. Although such sectors are either under State responsibility or overlap, the infrastructure that facilitates them is centrally managed.

These systems are not only serving to govern but also restructuring Union-State relations by centralising national informational control. In a Latourian socio-technical sense, they may be thought of as actor-networks, in which agency is decentred across technological systems, institutions and human actors. In this sense, digital infrastructures do not merely facilitate state action but also define how the state operates, influencing decision-making and information circulation and implicating centralisation in system design, rather than relying on legal regulations.

What is important is that this reconceptualisation is no longer a traditional conception of surveillance as a mere relationship between the state and the citizen. Rather, surveillance is carried out as a distributed mechanism in which governance is accomplished by various actors: the state plans and regulates infrastructure, corporations provide technologies, and citizens can contribute to surveillance by complying, reporting, and sometimes engaging in informal surveillance. This decentralisation of power disintegrates responsibility and makes control more ingrained in day-to-day administrative and social practices.

This structure creates a dependency structure in which the States can make and pass policies, but their implementation increasingly depends on authentication and validation by databases controlled by the Union. The Union’s regulatory control over these systems enables it to indirectly influence State functions by governing the technological infrastructure through which they are operationalised, without formally legislating on subjects within the State List. This is a kind of “infrastructural centralisation,” in which power is exercised through influence over governance mechanisms rather than through direct legal imperatives.

Importantly, this does not formally set aside State authority. Rather, the Union embeds itself in the processes in which such power is exerted. States still undertake their constitutional roles; however, in technological structures, they no longer design or control. This means that state autonomy is not directly restricted but put into functional terms.

This is echoed in the Justice B.N. Srikrishna Committee Report on Data Protection, which acknowledges that the functional division between federal and unitary power can be obscured by widespread access to personal data by a centralised or harmonised system. The result is a conflict with the Constitution, since efficient governance relies on infrastructure that cannot be managed by States. There is no change to the structural composition of the Constitution, but the operational structure is altered, making it difficult to redesign federalism through infrastructure without changing the Constitution itself.

The decentralisation of the database presents an opportunity for addressing this problem. Decentralisation will enable states to have greater control over the collection, management, and authentication of information relating to matters within their constitutional jurisdiction. It ensures that the states are less reliant on the Centre. Hence, these infrastructures are designed in line with the division of powers of the Constitution to ensure that governance cannot be concentrated through control of data infrastructures.

Infrastructural Conditionality

The practical implications of this dynamic are increasingly visible in contemporary governance. The recent technology-related funding controversies in Kerala, Delhi, Punjab, and West Bengal in 2024 demonstrate how the capacity of State implementation can be indirectly affected by access to Union-controlled resources and digital systems. This was particularly evident in the PM-SHRI (Pradhan Mantri Schools for Rising India) scheme controversy, where access to educational funding was made contingent upon compliance with centrally prescribed conditions and Union-monitored digital governance frameworks.

Outside of identity systems, surveillance federalism is most evident in sector-specific areas, including governance of public health. Despite remaining in the State List, health care is becoming more organised through centrally designed infrastructure, such as the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PMJAY), which standardises data collection and reporting formats and information flows. This standardisation is not neutral, as it dictates how data are collected and classified, and these systems influence what should be considered valid knowledge for policy formulation. Consequently, the State has official competence in the health sector, but its effective autonomy in establishing priorities or responding to local circumstances is limited to the technological frameworks within which governance is operationalised. Consequently, this technological and fiscal federalism is becoming a form of indirect pressure, with adherence to centrally determined infrastructure dictating what States can effectively do, without altering their formal constitutional powers under the Seventh Schedule.

Another implication is the reconfiguration of accountability. Since governance is mediated by the interrelated and interconnected Union and State systems, errors, omissions, or abuse become detectable and attributable. When results are influenced by centrally planned systems and delivered by State authorities, it is not clear who should be accountable, whether the designers of the infrastructure or those who use the infrastructure. This division undermines one of the fundamental characteristics of federalism, the clear distribution of power needed for democratic oversight, and makes it difficult to challenge power within the current constitutional structures.

Intersectional Implications of Surveillance Federalism

One overlooked but major aspect of surveillance federalism is that it is not evenly distributed among social groups. Despite the language of an apolitical, efficient digital governance system, it operates within existing social hierarchies, producing uneven effects across class, caste, and gender.

Economically marginalised communities increasingly rely on centralised digital identity systems to access basic services. Biometric authentication in welfare policy can lead to exclusion due to technical faults, data discrepancies, or inaccessibility. Aadhaar authentication failures in the Public Distribution System, including instances reported in Jharkhand (2017–18), have resulted in the denial of food rations due to biometric or database errors. These groups consequently face a dual burden of increased surveillance and the risk of deprivation of basic rights and services. Gendered harms are also enhanced through public health data systems. HIV-surveillance systems and programmes such as the National AIDS Control Organisation (NACO) have raised concerns regarding data protection and disclosure practices, exposing individuals' health status and leading to stigmatisation, social ostracisation, and barriers to healthcare. Such harms can aggravate structural vulnerability, particularly for women in rural settings.

Caste-based inequalities are also recreated by apparently impartial systems. Misidentifications, profiling, and administrative biases may further marginalise historically marginalised communities and bias the current exclusion trends. Surveillance federalism does not manifest equally. It mediates and intensifies pre-existing social hierarchies by integrating governance into centralised digital systems, which have varied and unequal impacts on society.

Doctrinal Blind Spots in Federalism Jurisprudence

The emergence of surveillance federalism exposes a gap in Indian constitutional doctrine. While the right to privacy recognised in K.S. Puttaswamy v. Union of India provides a framework for assessing the legality of data collection, it remains primarily individual-centric and does not address the structural consequences of centralised data control for federalism. Similarly, although federalism forms part of the Constitution's basic structure, as affirmed in Kesavananda Bharati v. State of Kerala, surveillance federalism can alter the balance of power without any formal constitutional amendment.

In S.R. Bommai v. Union of India, the Supreme Court recognised federalism as a basic feature and affirmed that State autonomy is constitutionally entrenched. However, the judgment largely assumes that constitutional imbalance arises through identifiable acts such as legislation, executive action, or explicit jurisdictional encroachment. Surveillance federalism challenges this assumption by redistributing power through underlying digital infrastructures rather than formal legal mechanisms.

This produces a form of doctrinal “visibility constraint.” Indian federalism jurisprudence is structurally calibrated to recognise power only when it appears in a legally legible form, that is, as a command that can be located within constitutional categories and subjected to judicial review. It is therefore capable of addressing violations that take the form of formal redistribution or encroachment of competence, but not forms of power that operate through infrastructural systems that structure how authority is exercised in practice without formally altering it.

Surveillance federalism takes advantage of this loophole and shifts power from the command-to-law to the location of infrastructural design. The power over digital systems does not remove constitutional subjects from the States, but rather preconditions the exercise of State power by defining how information comes into existence, is authenticated, and is operationalised. Consequently, State power is formally preserved but functionally predetermined by the system architecture. This shows the inherent weakness of current doctrine, which is not infrastructural forms of centralisation that restructure governance without provoking an apparent constitutional action.

Toward Infrastructural Constitutionalism

The article recommends that courts use an Infrastructure Conditionality Test to this end, as an approach to construing infrastructural dependence as a justiciable constitutional condition rather than a background administrative fact. The question would not be whether the Union has legislated in a domain of State power, but whether the State power is structurally related to systems under the control of the Union to exercise it. It involves the examination of the conditions of core State functions depending on access to Union-managed digital infrastructures to perform them; the imposition of interoperability standards or design constraints that indirectly condition administrative decisions; centralisation of informational flows in a manner that redefines discretion, sequencing or decision-making capacity at the State level; and whether reliance is systemic rather than incidental. In all such cases, infrastructural control needs to be subject to constitutional scrutiny, since power can be exercised through systems architecture even in the absence of any legal transfer of power.

In this regard, constitutional adjudication has to shift its focus from policing the formal separation of powers to asking questions about the infrastructural conditions under which power is exercised.