This is the concluding part of the article "Political parties must focus for better governance"The influence of labour unions, small-scale industry, government and public enterprise unions, is quite disproportionate to their contribution to the economy. By contrast, the agricultural lobbies are weak. It is the rich farmers (many of them among the politicians), who are able to push policies to benefit them and their class.
The urban poor are a strong lobby when it comes to clearing urban slums or making them pay for services. However, it would appear that politicians tend to exaggerate the demands of some of these vested interests. For example, farmers may in fact prefer to pay for electricity if they can have confidence in its availability. But politicians would rather give it free even when availability is uncertain. Urban slum-dwellers might prefer to have safe water, sanitation and safer electricity. But politicians might prefer to leave things as they are so as to appear as if they are helpingthese urban poor.
The lack of a coordinated and holistic approach to policies has resulted in variable progress in different sectors. If financial sector reform has made consistent progress in the 1990s, the same cannot be said, for example, of civil aviation. We abolish ULCRA but do nothing about rent control and tenancy laws. We criticise cheap or free electricity to farmers but do nothing to regulate the use of ground water or the tariffs for water.
These types of partial policies are to be seen in almost all sectors of the economy. It is clear that we need a consensus on economic policies, and the managerial ability to implement them in a cohesive way. As we end the decade, we do see much greater political consensus on economic policies than there was at its commencement. And yet there are vast areas of ignorance both in the political leadership and the public, and little attempt to build public opinion.
Another aspect of managing the Indian state is the management of the economy - the structures,systems, procedures, etc, apart from the way in which policies are developed and implemented. Do concepts well-known in the management of industry have relevance in looking at the management of the economy? They do, and can help answer questions such as:
Does India have a vision for its economic future? Who is to prepare this vision and how well coordinated is it so that the economy marches in step in all sectors? How is it to be communicated and marketed so that it is a shared vision? Is Planning Commission an effective instrument for this purpose? Are the institutional mechanisms adequate and effective to translate this vision into reality? We have recognised for at least three decades that the rate of growth of population in India must be reduced. For a long time however, despite spending substantial amounts of money, our population policies had little effect in curbing population growth. To a great extent this was due to the target orientation of governments and the lackof involvement of the people.In the last few years however, there has been a distinct change in policies and a sharp fall in fertility rates and population growth rates. The same can be said of literacy where in the last few years, coordinated programmes with involvement of local communities has led to a almost 10 per cent rise in literacy over the country within the decade. This is yet another aspect of management failure.
What is our implementation mechanism to ensure that all aspects of the plan are implemented in such a way that differential progress does not prove to be a bottleneck? Are our administrative structure and procedures of government appropriate for the speedy and effective implementation of plans? What changes do we need if we are to speed up the process? We seem to have decided without too much debate in this decade that we should reduce the role of government in the economy and increase the role of the market. Do we have a sufficiently clear understanding ofmarkets and how they work? Do we know how to use price signals so that they can influence economic behaviour in directions that are in conformity with our vision for the economy and the country? How can we involve all the people in implementing the economic vision and the plans?Management requires a framework of rules and procedures. For the state the equivalent is that of the vast mass of laws, rules, regulations, procedures, and the like, through which the Indian state implements and enforces its vision for the Indian economy. Are all these laws necessary? Do we know which are no longer relevant, where there are contradictions and inconsistencies, and which need to be changed? How can the legal system be made more responsive to a vision for India, which builds the capabilities of its people, makes the economy competitive, productive, customer-oriented and less amenable to corruption?
There is also the issue of penalties. Our system does not provide for adequate punishment. The maximumpenalties in almost all our laws, are kept very low. Those who adulterate food or medicines as a result of which many people die, even if found guilty, are subject only to minor penalties.
When recently alcohol was served in Delhi in an unlicensed establishment and far beyond normal closing hours, the owner if found guilty would be fined only Rs 50. Theft of electricity is not treated as a crime of the same genre as other thefts. Until our penalty system develops muscle, respect for law is likely to be seen more in its absence. Here again we have enough research to show that our laws are antiquated, poorly, drafted, contradictory and lacking in co-ordination.
And finally of course, there are the people who are to implement the vision and the plans. They are the ones that are pejoratively called the "bureaucracy". How is the bureaucracy organised and does that need to change? Are their skills adequate, and if not, what do we need to do about it? Do they have the orientation that is necessary? Are thereexcessive numbers and what does that do to effective functioning, motivation and incentives? So long as there is a state there will be need for administrators, and a bureaucracy. Neither the state nor the bureaucracy can wither away. We must get them to work for the good of the many and not merely for a few.
India is unique in having detailed answers to most of its problems, including the issues raised here. But we seem singularly unable to take the obvious and known actions. Only a strong public opinion and repeated articulation of issues and solutions can push our state into action.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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