Division of Power
It includes subjects of national importance such as defence of the country, foreign affairs, banking, communication currency, etc. The Union Government alone can make laws relating to the subjects mentioned in Union List.
It contains subjects of state and local importance such as police, trade, commerce, agriculture, irrigation etc. The State Government alone can make laws relating to the subjects mentioned in the State List.
It includes subjects of common interests to both the Union Government and the State Governments such as education, trade unions, marriage, adoption and succession, etc. Both the Union and the State governments can make laws. If their law conflict with each other, the law made by the Union Government prevails.
These are the subjects that do not fall in any of the above three Lists such as computer software. The Union Government has the power to legislate on these residuary powers.
Federalism Practice in India
One of the important aspects of polity of India was the creation of linguistic states to cater to the aspirations of different regional groups. No single language was given the status of national language. Hindi was considered as an official language. Besides Hindi, 21 other languages are recognised as scheduled languages.
A major step towards decentralisation was taken in 1992. The Constitution was amended to make the third-tier of democracy more powerful and effective. This is also called Panchayati Raj.
Structure of Panchayati Raj System in Rural and Urban Areas