Sonia populism vs state CMs’ populism!

Is the National Advisory Council functioning? Aruna Roy resigns, others also lie low? Sound economic principles are needed in rural infrastructure development schemes. A pity such sound economic sense is missing now!

The so many populist schemes where heavy subsidy or subsidies or almost freebies, like free ration rice as in TN, or doles for unemployed graduates and post-graduates as in UP or massive debt write-offs, as again in TN and the so many other ” free”s, like free power, free this or that are now making the current UPA schemes like the employment guarantee scheme almost as no news!  Yes, the much-touted NREGS seems to have been grounded when the rural realities hit hard!

It was reported that the actual number of people who reported for work under the scheme and the actual expenditure didn’t tally! Yes, as suspected there is the usual suspect route of diverting funds and creating bogus muster rolls! In any large scale populist schemes like the NREGS, it is bound to be the case. After all the vast administrative machinery is difficult to put in place and the Centre has to depend on the states and the states have to be work in an environment of highly politicised low level officials.

So, what is the point of Sonia Gandhi over-orchestrating her pro-poor image when she knows she has a star-studded array of formidable competitors! Like Mulayam Singh Yadav, Lalu Yadav and down south the most cynical of all, the fifth-time CM Mr.Karunanidhi who had outbid every politician in the country with his “all-free government”! Mulayam Singh has just now given out Rs.500 dole a month to 7,66,352 registered unemployed graduates and post graduates in UP. Just imagine such a demand now spreads to other states!

So, what do you do?

Who talks of creating jobs through” public-private” partnerships, through private sector investments, like the ones sought after by now the “converted” Communist CM, the redoubtable Buddadeb Bhattacharjee of West Bengal. We need  CMs like him in all other states, to understand the need to generate large scale employment opportunities through massive private sector investments, FDIs etc.

Indians are living with so much hypocrisy! We don’t have the guts to talk openly about more liberalised economic reforms. That is taboo! For the illiterate politicians and the most cynical Communists! Then, they are the allies of the great opportunistic UPA coalition. Yes, that is the reality, that is political opportunism, calls it by whatever name or phrase you are comfortable with!

But certain basic economic policy making is badly needed now, even with the PM not showing much nerve for it, a pity! The current scenario in the country, as far as rural development, poverty alleviation and providing a sense of social security and many other such pressing priorities are concerned, the situation seems quite depressing.

The PM is a reputed economic expert and as such he has certain moral duties to perform. Besides being the Prime Minister, however you rate his performance in this respect, his handling of the economy is far from minimum pass! Why? See the so many rural populist schemes simply playing havoc with the minimum success ratios! When you have a Central budget that is so severely dependent upon such international imponderables like the runaway petroleum prices in the international market, the interest rate rise on FDI encase the FM had rightly warned, the very entire budget exercise could go away. In such an international economic uncertainties, when you have to maintain certain sober economic prudence, you have a coalition government where the PM is not exercising some restraint on schemes that are clearly derailing the basic economic constraints.

The PM certainly hasn’t covered himself with any glory when he watched  helplessly when the TN CM in waiting announced so many blatantly unworkable poll  promises like wiping off the entire co-operative farm loans, rice at Rs.2 kg etc when everybody knows such freebies could simply wreck any Central budgets for other more all Indian populist schemes like employment guarantee. So, how much you can subsidise the rice under the various schemes, one state(TN) cant take the credit for disrupting the free rice for other ,may be much more deserving backward states.

So, now what do we see? There are so many basic, much more worthy rural infrastructure  development schemes seem to be left to die a natural, slow death, if we can so cruelly term them. Yes, it is really painful to think how we are sacrificing the much higher priority schemes like rural road and communications, rural connectivity being the top most priority when we think of rural development in the new century.

There are of course so many politically inspired rural priorities, now the Centre has come out with one more confusing scheme, that of restructuring the old 20-point programme. As many as some 112 NCMP items are to be added. FM had just said this overloading is simply “unmanageable”. Every item if we spell out here would sound very reasonable but how much you can add to a populism that is already over-strained, as the Communists and other non-Congress allies in the UPA would tell you. Social security is such a difficult scheme that one highly reputed economist is entrusted with it(Dr.Arjun Sengupta)and if you take the PM’s own number of Committees, you would go mad! Yes, such is the paper work that is going on in Delhi where a government doesn’t know the rural realities outside the city limits!

It is simply not possible to pin point  the blame on any one individual or individuals. But the country seems to be realising that the duo, Sonia Gandhi and Manmohan Singh are not sharing notes. She goes about her own ways, her own National Advisory Council seem to have become irrelevant since the office of profit issue blew the government off the track and with such dedicated members of the NAC leaving the Council one by one. Even at the best of times, the NAC was not supposed to succeed in micromanagement of the various schemes.

The point is that the Planning Commission itself can’t do its job in the context of states running their own populist schemes  without any economic calculations.  The PM at least now can think of making it a rule that the states have to obtain the prior clearance from the Planning Commission before announcing the populist schemes. Also the Election Commission must mandate that pre-poll freebies must be cleared by the EC. Otherwise, our very basic economic calculations won’t make any sense. The PM was earlier speaking about 8.5 per cent growth, now, he doesn’t even talk that! Perhaps he must have realised that people would  not take him seriously.

Yes, how they will after the government went for such massive wheat import and the wheat import as it emerges exposes the government for sheer negligence. PM’s economic expertise didn’t do anything to the basic strengths of the economy. Our economic growth, our agri sector growth, our employment growth and many such indicators mainly own to the internal dynamics of a robust market-driven economy. The government’s hand in accelerating the economic engine is more imagined than a reality.

Our governance norms at many levels are not in place. The right to information act doesn’t work in many states. There is certain resistance to eradicate corruption, from the top to the bottom levels, the Lok Ayuktas don’t work so efficiently as in Karnataka. The e-governance is not yet a reality in the country.

In AP, the Panchayat Raj elections had been stalled by the High Court. No valid electoral rolls! In Kerala and Karnataka too the panchayat raj institutions need restructuring in line with new realities. So too in TN where a highly politicised panchayat raj had rendered many development schemes only on paper. From inter-state rivers to river links on the national scale there are so many worthy schemes for which there seems to be no time with the Central or state governments. Yes, everyone, party leaders to governments are working for their own narrow immediate ends!

At least a non-political expert like Dr.Manmohan Singh can do something by sticking to some basic economic realities and bringing some economic sense to the clearly  partisan political leaders.  The PM has to re-prioritise his economic  targets. This is what we suggest. Among all the rural development goals, the two seem to be of the highest priority. One, rural roads. Two, communications. If every village is connected with the major highways that is real physical growth of the countryside. Markets would expand, farmers would move out, sell in more open markets. Rural communications, if every village has  telecommunications, Internet connectivity, then a real revolution takes place. Then are also so many other priorities. Of course safe drinking water, electricity, there are even in such advanced states like TN, there are no 100 per cent rural electrification, as per a report. TN is in the tenth ranking in the power sector performance, as per the Power Ministry report.

So are the other social sector priorities. Education and health are often much talked about. But we have to concentrate on one or two high priority items. That is why let us put our full attention on rural roads and rural telecommunications. That would trigger a real, lasting rural change.

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