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What Modi has done, or not done, so far

Source : BUSINESS_STANDARD
Last Updated: Sat, Aug 02, 2014 08:45 hrs
Narendra Modi launches MyGov online platform for citizen empowerment

One of the most pronounced features of people who shrilly demand change is that unless it comes in precisely the way they want it, they either say there has been no change, or that it is the wrong change. The Modi government, which is being accused of both things, provides an excellent and latest example of this.

For instance, Narendra Modi has restored the primacy of the Prime Minister's Office, or the PMO, in the government. But now the very people who had decried its emasculation under Manmohan Singh are saying that he has emasculated his ministers and their ministries.



Then there are those who say that Mr Modi has no vision, no grand policy, no broad canvas on which he will paint his masterpieces, and I must confess I am one of them. But we all forget that we accused the United Progressive Alliance, or the UPA, of having only grand visions - the whole rights-and-entitlements-based approach - but no idea of how to get it done.

Likewise, people used to say that the UPA ministers were prone to shooting off their mouths. I know of one finance secretary who told his minister not to be a motormouth and was firmly overruled. These people forget that, from late 2011 onwards, the UPA government was following a deliberate policy of someone or the other, from the government or the party, saying something atrocious everyday so that the attention of TV news would be diverted from the scams.

On foreign policy, to take just one example, the critics say that India should not have voted against Israel over the Gaza fighting. But they forget that Israel has no oil, and that India gains more by negotiating cheaper oil from the Muslim countries of West Asia.

Calm down, folks

On economic reform, the critics say that the government has done next to nothing so far. They are right in that he has done nothing dramatic like reducing subsidies to zero or thereabouts.

But they forget that Mr Modi has two important elections to win in the next 10 months in Maharashtra and Bihar. If he wins those, he will control the Rajya Sabha and then economic reforms that require new laws can (perhaps) proceed apace.

Economists outside the government also forget that hard reforms - when they are not forced down the country's throat as they were in 1991 - have a massive political component because they can hurt a lot of voters. No politician will attempt them before important elections. (By the way, I have never understood the case being made against subsidies. Are economists against them per se or only against their misdirection and misuse? But if it is the latter, will not better targeting increase, not reduce, subsidies?)

Then there is trade policy. India, say the critics, is making a mistake by insisting that the World Trade Organization resolve the food security issue before it signs on the trade facilitation agreement. Quite apart from the technical aspects about the benchmark price, which I daresay could be renegotiated to something more contemporary, how else would the government deal with Sonia Gandhi's legacy of the food security Act that requires the government to stock food for over 800 million Indians and sell much of it to them at absurdly low prices? Under the circumstances, buying time to adjust for what could eventually become a hard budget constraint is not a bad strategy, is it?

That said, Mr Modi's reluctance to privatise is a mystery that only he can explain. Shun thayoon, prime minister, why your mind is closed?

Mr Modi's biggest mistake

Does this mean he is getting everything right, albeit in varying degrees? It is too early to tell - but it would seem so. Except for his non-stop sulking over the way the media treated him when he was the chief minister of Gujarat, he certainly has not made any missteps so far.

But in the absence of contact with the ministers, some disgruntled bureaucrats are now spreading stories with three crucial elements. One, that the government is in disarray; two, there is over-centralisation in the PMO; and three, there is lack of an intellectual framework on which government policies hang.

Mr Modi will, in all likelihood, ignore all this saying he has been hurt enough in the past not to get hurt any more now. But life, especially for prime ministers, can be full of surprises.

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