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Subir Roy: Outdated old men should bow out

Source : BUSINESS_STANDARD
Last Updated: Tue, Oct 23, 2012 21:12 hrs

The Union finance ministry’s proposal to set up a National Investment Board as the final arbiter of projects above Rs 1,000 crore and the Union environment ministry’s vehement opposition to the idea touches upon key issues that lie at the heart of how a Westminster-style democracy functions under the Cabinet form of government.

The overt reason given for the proposal, mooted by none other than the prime minister and then passed on to the finance ministry to see through, is the current inordinate delay in project clearance. An unstated reason may be that with the Supreme Court laying down rules for project clearance, the leadership has to ensure that it, and not an individual ministry, has the final say on working those rules.

The project clearance process certainly has to be streamlined and speeded up. But in the Westminster style of government, individual ministries have their areas of responsibilities and the decision-making process moves up a pyramid at the apex of which is the prime minister and his Cabinet. It is a collective decision-making process, in which basic responsibility and final say are both important.

The position taken by a ministry in an individual instance can be overruled by the Cabinet, whose authority is final. If that were to happen then the minister concerned should take the hint and resign. In contrast, under a presidential form of government, where its head operates more like a chief executive officer, or CEO, ministers know what to do and do it from an early stage, long before being overruled.

Thus, something more than overturning individual decisions is at stake. There is an attempt to change the rules of the game. Under the new rules envisaged, the power and position of individual ministries will be reduced and decision-making authority vested in the hands of a few key ministers who see eye to eye with each other and make up the investment board. It is not as if effective power has not been concentrated at the top in the past. Under Indira Gandhi, any minister who got in her way was shown the door. The present prime minister does not have Mrs Gandhi’s political authority and, perhaps given his civil service background, wants to codify the changes sought — put in place a swifter decision-making process by altering the rules of doing business.

Jayanthi Natarajan, the environment minister, is fighting back, seeking to oppose the rule changes that will clip the wings of her ministry. It is also no secret that the power equation in the present council of ministers is tilted against her. The vehement language of her letter to the prime minister indicates that she can do little more than protest. The underlying political reality is that the biggies in the Cabinet feel that the environment ministry has become too powerful and hence the proposed investment board.

This is the political reality, but what is the overall reality? The environment and related issues have become hugely more important in public perception in India in the last decade. So, a day should come when a powerful politician will seek out the environment berth rather than, say, the finance berth. Similarly, an upgrade in the status of ministries in the social sector like health, education and social security is long overdue in India in conformity with what has happened long ago in developed societies. The problem with today’s biggies in the Union Cabinet is that they are either too old or too outdated or both. The irony is that the Union environment ministry is not the sole culprit responsible for delaying things. As a whole lot of issues from wireless spectrum to coal block allocation have illustrated, under a weak leadership chieftains have had free sway over their fiefdoms so as to rig the system and distribute favours to their capitalist cronies. With considerable environmental clearances given in the last plan period and the large number of allocated coal blocks not being worked, it is a travesty of truth to say that environment clearance is standing in the way of raising the country’s coal output and consequently power generation.

Also, the environment ministry itself needs a lot of reforms. Clearance processes need streamlining and scope for rent seeking reduced. Individual clearances – forest, environment, wildlife, coastal – should not be given piecemeal but by looking at the total impact of a project on an area. Conditions laid down while clearing a project have to be monitored for compliance. State and Union environment set-ups have to work in tandem. As Ms Natarajan has pointed out, instead of helping her reform and improve the functioning of her ministry, the investment board proposal is out to emasculate it.


 

subirkroy@gmail.com  




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