No Alibis Mandate for Modification, Reforms and 24X7 Governance

Published: 18th May 2014 06:00 AM  |   Last Updated: 18th May 2014 12:40 AM   |  A+A-


India has moved—from ‘no government’ to ‘no opposition’. It is what management gurus define as the paradigm shift.

Such has been the decimation of inaction and ineptitude that the sum tally of the Congress across 30 states is less than the tally of the BJP in one state. On the social media, the cracker line is: the Congress tally is compact enough to form a WhatsApp group.

Indeed, the BJP could well spawn a new slogan: Abki Baar only Sarkar, no opposition.

Never before has a virtual outsider been given such a decisive mandate. But mandates are also about great responsibility.

Narendra Modi the campaigner has accomplished one major task. He has successfully reversed the sense of pessimism and created a bulge of hope. Poetry now must transit into prose. Vaclav Havel once said, “Hope is not the conviction that something will turn out well, but the certainty that something makes sense, regardless of how it turns out.” And hope is not the same as optimism.

This mandate leaves no room for alibis. It yields no space for phrases like compulsion, consensus, coalition or compromise. This is a mandate for the modification of India’s economy. This is a mandate for restructuring the model of governance that has failed India. This is a mandate for a 24x7 government. This means he has to first create a team based on competency and commitment. This government must base its intent and action on outcomes. Every ministry must declare a month before the budget what it has delivered. Control-Alt-Delete must be the formula for ensuring results. The government must reform and restructure ruthlessly to revive India.

The PM-designate has his task cut. He needs to focus on these issues to deliver on hopes.

Inflation: The first order of the day would have to be fixing the persistent problem of inflation located in the complex web of cause and consequences. It is the widening gap between income and expenditure that led to the huge anti-incumbency. Food price inflation is caused by distortions in output, supply and distribution. India needs a new Amul, a Verghese Kurien to rebalance availability and affordability. The mechanism to redress this demands partnership with state governments. A good idea would be to create an inflation index for individual states and spur them into competitive mode to accelerate reforms in agricultural yield, freeing up of farm-to-fork markets and crack down on hoarders.

Fiscal deficit: The yawning gap between what the government earns and what it spends is the principal cause of high interest rates and overall inflation. When the UPA came to power, the government was borrowing `200 crore per day. It now borrows over `70 crore an hour. Asset creation receives a pittance. This cannot be changed overnight but this demands a dramatic start—a big chunk of debt must be retired immediately in the next 12 months for impact. PM Modi must disinvest from the shibboleths of government ownership and transfer assets for public ownership. Government can run institutions owning barely 26 per cent of public enterprises. It could capitalise on the rise of the Sensex to disinvest. The idea of Modi has caught the imagination of the diaspora as much as those living in India.  There is an opportunity to make them partners by inviting them to subscribe to long-term India debt and to equity. Auction of natural resources is yet another avenue to raise revenues. Government must also review taxation—those who benefit from the opportunity must share the cost of opportunity. This means the unexplained exemptions to industry and the inexplicable low collection of wealth tax needs to be reviewed. For all we know, success on all three fronts will deliver a healthy balance sheet for growth.

Subsidies: It is the second biggest item on the expenditure sheet and is unsustainable. There is no question that the poorest of the poor must be helped to bridge the gap between circumstance and opportunity, from penury to prosperity. And the only way this can be meaningful is if we know who is poor, how many are poor and whether the subsidy is reaching the poor. The induction of technology is a must—to improve financial inclusion and expansion of direct cash transfers —to manage subsidies.

Agriculture: India’s poverty is located in the obfuscation of cause and the expansion of band-aid economics. Narendra Modi engineered a revolution of sorts when he combined volunteerism, grassroots action and effective communication to expand the footprint of an atrophied party. The template of electoral success must be replicated now for greater common good. Yield per acre must be replaced by yield per litre; cropping pattern requires to be restructured to enable efficiency, availability and core competitiveness. He needs to find a champion who will transmit knowledge, technology and resources to the innards of the dark states.

Investment: India has created a whole super structure for inaction —committees, commissions, Group of Ministers, empowered Group of Ministers and so on. Essentially these are all alibis for failure to decide. Projects with intended investments of over `12.5 lakh crore are stalled at different levels in different governments. Through the campaign, Modi has spoken about federalism, cooperation with states, and championing local development to achieve national growth. Why should a township project or power project need a clearance from Delhi? Modi must initiate the steps to decentralise the regime of clearances and de-legitimise permission raj.

Job Creation: India adds a million-plus persons every month to its working age population. One big issue has been labour laws and the way ahead here too is to create a competitive environment. Imagine a monthly-quarterly or even annual report on which states created how many jobs. The political pressure this will create among parties and states will spur even the laggards into ensuring clearances for energy, manufacturing and services.

Progress is not an abstract aspiration. It is the outcome of economic inputs and political intent. India has voted for deliverance.

Shankkar Aiyar is the author of  Accidental India: A History of the Nation’s Passage through Crisis and Change

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