Open Forum

New Delhi, 28 May 2014

Modi Moves

WILL IT BE ALL-INCLUSIVE?

By Dhurjati Mukherjee

The clock for providing ‘good governance’ has started ticking for Prime Minister Narendra Modi. With his team of ministers in tow, the first step towards cleansing the system has been taken. It has been decided to set up a special investigating team (SIT) to probe black money. 

A recent survey in the states of Bihar, Andhra Pradesh, Madhya Pradesh and Kerala had revealed that the predominant concern of the people was corruption.  However, one has to agree that corruption has emerged as an all-India issue and it was feared that the new Government may not truly come out with a definite plan of action except some jargons as was seen in the previous dispensation.

With the SIT in place, it is now expected that it would also have a comprehensive plan to create an ‘institutional structure’ that would facilitate the nation to fight the big battle against unaccounted money. Analysts are of the firm opinion that when there is close nexus between politicians and corporate houses, how can corruption be controlled and the flight of black money stopped? A classic case of assets of many political leaders suggests the intrigue of how they have been able to amass such huge wealth in a span of just five years! Apart from the Congress and the BJP, the Samajwadi Party, the BSP, the AIDMK and the JD(U) receive patronage from industrial houses, both directly and indirectly. Will the SIT help other agencies break this nexus and ensure a clean and transparent Modi administration?

This apart, on assuming power, Modi has to work out the nature of his government’s economic agenda and whether it would be able to lift India from the doldrums of the present paralysis. People have given his party total support as clearly all are interested in a change for the better – a change that would gear up the process of development, as promised.

This includes higher growth, ongoing infrastructure projects being executed within scheduled dates, control of inflation and, in general, upgradation of the living standards of the masses. So far unfortunately, development has been geared towards the rich and the powerful, mostly ignoring the interests of the poor and the economically weaker sections. Moreover, though there are development plans on paper for the backward districts, the improvement in lifestyle of the people there has not witnessed any perceptible change in the past two decades.

On the critical issue of a sagging economy with mounting inflation, unemployment and underemployment and real wages not increasing, Finance Minister Arun Jaitley has a tough task ahead, as high economic growth is the number one issue followed by action against corruption. He fortunately realises it, and has on day one of taking over his new responsibility asked his team of officers to propose key reforms in at least three to four issues towards that goal.  And, action for which can be initiated soon.

The Finance Minister would by now realize that high growth rate sadly does not percolate downwards and help in improving the living conditions of the general masses – the BPL groups, the EWS and even the low income groups. This is not to say that growth rate need to be slow but there is no need to unnecessarily emphasize on faster growth. Growth should follow the normal pattern, wherein no favours should be extended to the corporate houses or any other segment of the population.

Obviously faster growth should not mean encouraging mining activities, which do not cater to the rules and regulations of the land. Or infrastructure and related projects be given environmental clearance even if they do not qualify for the same. A certain section of economists and planners feel that faster growth is the end all of our development strategy even if that means grabbing land of the poor, taking away agricultural land for industrial projects designed to help a few individuals and putting the natural resources of the country in the hands of business groups.

The Government should, no doubt, speed up the process of clearance but it also has to be ensured that poor people are not displaced or affected and adequate compensation is given to them to chart out an alternative source of livelihood. Moreover, projects have to adhere to the laws of the land and there is no direct or indirect loss to the state exchequer. It needs to be mentioned here that reports of delay in clearances in our country are no doubt valid but it also has to be borne in mind the structure of land holdings, the large number of EWS population and the prevailing laws which, under no circumstances, can be subverted.

An important point that also must be kept in mind by the Modi sarkar is that high growth does not necessarily mean real development. Common people think that high growth rate would benefit them but this has not been the case in India. The beneficiaries of high growth rate are the industrial class, big traders and big farmers. Of course, some trickle-down effect reaches the middle and also the low income groups but this is very nominal.

For many, Gujarat that has been touted as a model is difficult to believe as also Modi being the messiah of good inclusive governance. Recall the pertinent observation to this effect by renowned economist, Prof. Amartya Sen, who had stated: “Gujarat’s record in education and health is pretty bad” though the State grew at over 10 per cent between 2002 and 2012. Moreover, the State’s average monthly per capita income of Rs 2472 per person was lower than the national average though Gujarat may be considered relatively developed. Thus, the industrial growth rate of a State cannot be the sole criterion of grass root development of the people. And Modi now has to look at the entire nation.

As is well known, inflation – another important issue before the polls -- mainly affects the poor and the EWS as these face erosion of real wages which makes their existence dismal. What the UPA gave to the poor with schemes like NREGS, it took away with the other hand through inefficient macro-economic management that resulted in high inflation.

In the present scenario, the next few weeks should spell out how the Modi Government proposes to chart out a balanced strategy with focus on infrastructure, on the one hand, and job creation on a massive scale in the rural sector with emphasis on micro and small industries, on the other. Productivity increase and innovation should be on its radar.  Along with all this, if corruption is weeded out and transparency ensured, only then would the economy develop and ensure the welfare of the masses. Will it be ‘All-inclusive’, Mr Modi? ----INFA   

(Copyright, India News and Feature Alliance)