India loses Rs 118k crore to climate of fear

The Planning Commission may have removed the much-debated phrase “policy paralysis” from its official document, but a ‘sick administration syndrome’ threatens to overshadow a string of economic reforms unleashed by the UPA to improve the country’s fiscal health.

Facing heat from civil activists and investigating agencies, many Union ministers seem to have lost their political will. The fear created in the bureaucracy because of the spate of arrests of babus, who approved decisions at the behest of their political masters, has brought the movement of government files to a standstill in ministries. This has caused a gigantic  Rs 1,18,000 crore cost overrun in project implementation, according to a report released in October by the Infrastructure and Projects Monitoring Division of the Ministry of Statistics and Programme Implementation.

To give an idea of size, the overrun equals the total budget of the Education and Rural Development ministries put together. Some of the projects were commissioned during UPA I. Former Cabinet Secretary TSR Subramanian said civil servants are afraid to touch a file and make recommendations to expedite work.

“They know anybody who makes a recommendation will be targeted sooner or later. The present system needs a complete reform, otherwise bureaucrats will not work. It doesn’t affect them but it affects the people. With the current policy paralysis, both politicians and bureaucrats are happy but the country is suffering,” he said.

The report says that out of total 195 government projects, 19 have been delayed by one to two years and 27 mega-projects by two to five years. It also suggests that 91 big-ticket projects are hanging fire, and at least 14 projects will be delayed by more than five years. The report is based on data collected till July 1 of all mega-projects costing over Rs 1,000 crore.

Prime Minister Manmohan Singh’s assurance to babus this April that there will be no witch-hunting — meaning they would not be penalised for bonafide errors of judgment — seems to have failed to boost bureaucratic performance.