While Prime Minister Inder Kumar Gujral deserves to be congratulated for his efforts last month to stop his cabinet colleague M. Arunachalam from preventing a sharp cut in the administratively-fixed prices of critical pharmaceuticals, he has, unfortunately for the country, failed to learn the right lessons from it. In the event, the steps he's taken are unlikely to have any long-term salutary effect.As reported in The Indian Express (February 15), Arunachalam who is the cabinet-ranked minister for chemicals and fertilisers, kept resisting the recommendations of his own department's officials to reduce the prices of the anti-ulcer ranitidine by 30 per cent and the anti-tuberculosis rifampicin by 10 per cent. So while the original price-cut recommendation was made by the Bureau of Industrial Costs and Prices (BICP) after it had studied cost-data for the industry, Arunachalam asked that the matter be studied afresh by the newly-created National Pharmaceutical Pricing Authority (NPPA).
When this body,in turn, seconded the BICP's recommendations, in one case, Arunachalam suggested a change in the methodology used for calculating costs and prices! Quite peeved, the bureaucrats in the department of pharmaceuticals saw this as yet another attempt to delay the price cuts.
In the event, they ensured that the matter reached the Prime Minister through the bureaucratic channel, both formal as well as informal. The PM, in turn, used his prerogative to have the matter referred to the Cabinet. This august body, in due course, voted against Arunachalam's rulings and in favour of what his department was recommending.
That, however, is where Gujral and his government stopped, and passed up a golden opportunity to prevent politicians from interfering with the government's decision-making process. No note of censure was passed, nor was Arunachalam asked to explain his position which the entire Cabinet thought was untenable. Certainly, no attempt was made to launch a probe into his conduct in the matter. After all, ifGujral and his Cabinet were so certain that he was in the wrong and was using all manner of excuses to prevent a decision from being taken expeditiously on cutting prices, then clearly they were levelling serious accusations at him. In which case, they should have followed it to its logical conclusion. Of course, poor Gujral couldn't be expected to take the matter to its logical end. Apart from the fact that several of his colleagues who matter wouldn't have allowed him to do this, one hallmark of the Gujral government is the complete abandon with which its ministers have felt free to interfere in even the routine running of government.
The Indian Express, for instance, has carried several news reports in the last few months detailing how various ministers have turned upside down the recommendations of the Public Enterprises Selection Board (PESB) for various public sector units. What takes the cake, of course, is the manner in which the minister for civil aviation and his deputy have publiclyattacked the secretary for, what they perceived as his attempts to undermine their authority.
In the case of the Tata Airlines and the ModiLuft proposals, for instance, both C.M. Ibrahim and Jayanti Natarajan objected to M.K. Kaw's referring these to the Foreign Investment Promotion Board (FIPB) without their explicit clearance. Had the duo, however, been familiar with business rules, they would have known that the revised Tata proposal as well as the ModiLuft one, fell within the guidelines of the existing aviation policy, and so Kaw was well within his rights to send it to the FIPB.
In any case, since the FIPB is a body of secretaries, it is not considered competent enough to judge the decisions of ministers -- in other words, the FIPB requires the judgment or decision of the ministry (the secretary) and not that of the minister. If the proposal falls within the ambit of the existing policy guidelines, the FIPB clears it -- if it doesn't, or the matter seems particularly sensitive, then it is referredto the Cabinet. That, and not earlier, is where the role of the ministers comes in.
This is also where Gujral's handling of the Arunachalam affair comes in. Had he insisted that some sort of formal probe be launched into the matter, this would have helped ensure that politicians would have thought twice before they decided to fiddle with, or delay, the recommendations of bodies such as the BICP, the NPPA, or the PESB which have been set up to assist the government in matters which require some professional expertise. If, however, they are to be second-guessed at each stage, then why even bother to have them in the first place?
In fact, much of the debate about insulating economics from politics centers around this very point. If one is able to ensure that policies are implemented irrespective of whether there is a change in government or not, then the impact of political instability of the kind we've been witnessing for the last few years will be minimised. Maybe this -- tinkering around withrecommendations, or delaying decisions -- is something various parliamentary committees should concentrate more upon. It will, of course, require a lot of hard work and will be quite unglamorous, but the impact will be quite rewarding.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
