Disequilibrium: Prisoner of the voter

Driven by her European sensibilities, UPA chairperson Sonia Gandhi created a welfare economics model which while fiscally flawed cannot be begrudged for it tried an all inclusive approach to target the last man standing. Dole economics was predicated on serving the poor and the underprivileged and the centrifuge driving it was MGNREGA, an employment guarantee scheme for the destitute and downtrodden in distant parts of this great land. A string of pearls stratagem was built around this flagship scheme to alleviate the woes of the poor. Many other mechanism and instrumentalities were created for transparent governance.

An assessment of expenditure priorities and resource mobilisation efforts done by the Centre for Budget and Governance Accountability (CBGA) in 2009 after the completion of the first five-year term was most revealing. Remember that in 2002 a massive drought hobbled India. The India Meteorological Department (IMD) officially acknowledged that year as “the first-ever all-India drought year” since 1987, while noting that the behaviour of the 2002 monsoon was “intriguing.” In its end-of-the-season report, IMD had noted that the aggregate rainfall received by the country as a whole during this year’s monsoon season from June 1 to September, at 735.9 mm, was 19.35 per cent below the historical long period average (LPA) of 912.5 mm for this period. Further, 29 per cent of the area in the country recorded drought conditions, with rainfall deficiency (relative to LPA) exceeding 25 per cent.

According to IMD, the country is said to experience a drought year when the overall rainfall deficiency is more than 10 per cent of the LPA and more than 20 per cent of its area is affected by drought conditions. By this definition, it said that “2002 becomes an all-India drought year,” with rainfall deficiency for the country as a whole amounting to 19 per cent and drought conditions impacting 29 per cent of its geographical area. Validating this: The Indian drought of 2002—a sub-seasonal phenomenon? GS Bhat of Indian Institute of Science, Bangalore, arguedd that a major drought occurred over India in the year 2002 with a seasonal rainfall deficit of 21.5 per cent, a result of 56 per cent below normal rainfall in the month of July. The largest anomalies occurred in the western parts of India, when an Indian monsoon field experiment was in progress there. The present study is based primarily on data collected from a research ship that was deployed 100–250 km off the west coast of India for the experiment. Surface and upper air observations made over the eastern Arabian Sea during July 2002 are presented.

This resulted in the economy virtually falling off the cliff. The Indian economy recorded a growth in gross domestic product (GDP) of 4.3 per cent 2002-03, suffering a sharp decline from 5.7 per cent in the previous year (2001-02), it is not just the NDA which lost the national hustings due to to its contradictory and what turned out to be frivolous and facetious India Shining campaign. State governments of Andhra Pradesh and Karnataka were also blitzed in the polls for aggressively marketing their economic reforms. India was in shock and it needed a soothing salve. The Congress led UPA was born out of this dichotomy. Left leaning economists and Congressmen steeped in socialist moorings and dogmas ushered in a new action plan to bear, answering to Sonia Gandhi’s call for inclusiveness in her echo chamber. A series of transformational intiatives for the poor and backwards were rolled out, here is the assessment by CBGA: 

*The notification of the Right to Information Act, which had tremendous potential for improving governance in the country, was one of the most significant developments during the UPA regime at the Centre.

*A landmark achievement of the UPA regime was the enactment of National Rural Employment Guarantee Act in 2005 and the subsequent implementation of National Rural Employment Guarantee Scheme (NREGS), making 100 days of wage employment for unskilled work a right for people in the rural areas.

*Bharat Nirman, a programme for augmenting key infrastructure sectors across the rural India, was another a significant policy measure taken by this government.

*The National Rural Health Mission (NRHM), introduced in 2005-06, added the important component of a ‘Flexible Resource Pool for States’ to the various schemes being implemented by the erstwhile Department of Family Welfare (which was merged with Department of Health under the Ministry of Health & Family Welfare at the Centre). There were several serious concerns pertaining to the long term implications of the NRHM framework for public sector healthcare in our country; nonetheless, there is evidence from a number of backward States that it has helped in reviving the public sector healthcare infrastructure in the rural areas. Also, the UPA Government launched a National Urban Health Mission (NUHM) in 2009.

*Likewise, Sarva Shiksha Abhiyan (SSA), which was accorded a lot of importance as one of the flagship schemes of the UPA, indeed led to a revival of school infrastructure at the elementary level in the backward States; although, educationists and child rights activists have raised serious concerns with regard to the long term implications of some of the ad hoc measures (such as large scale recruitment of contract or para teachers) which have been institutionalised through SSA.

*Starting from 2007-08, i.e. the first year of the Eleventh Five Year Plan, the Union Budget allocations for secondary education and higher education were stepped up significantly. This government also needs to be commended for paying attention to the acute need for expansion of technical education and skill development across the country.

*The UPA Government stepped up the Union Budget allocations for a number of schemes in the social sector, such as, SSA, Mid Day Meal, NRHM, Integrated Child Development Services, Total Sanitation Campaign and Accelerated Rural Water Supply Programme. As a result, the total Union Budget allocation for social sector registered a sharp increase starting from 2005-06.

*In the last two years of its tenure, the government introduced the Debt Waiver Scheme for farmers and enacted a Social Security Legislation for Unorganised Workers, both of which were commendable steps. 

Completing its assessment, CBGA stated - 

However, there are many concerns pertaining to policy priorities and budgetary provisions for critical sectors which have remained unaddressed at the end of UPA’s five-year tenure. Moreover, this regime has also given rise to a number of new concerns with regard to the development of the poor and marginalised sections of our population. The deficiencies in budgetary policies of the outgoing government which need to be rectified by the next government include the following:

*Fiscal conservatism of the UPA government resulted in the magnitude of Total Public Expenditure in India being stagnant at around 27 per cent of the GDP during the years from 2004-05 to 2007-08. In order to expand the overall fiscal policy space available to government for making public investments towards socio-economic development, the magnitude of Total Public Expenditure from the Union Budget and State Budgets needed to be stepped up significantly, which would have required the policymakers to adopt a liberal fiscal policy much before the onset of the economic recession in 2008-09.

*The UPA Government did not take any concrete measure towards providing greater fiscal policy space to the state governments. Despite strong demands from the states, the Eleventh Five Year Plan has not shifted any significant number of Central schemes to the states. On the other hand, the imposition of Fiscal Responsibility and Budget Management (FRBM) legislation on the States through recommendations of the Twelfth Finance Commission (relating to the Debt Relief Scheme for states) has constrained significantly the fiscal policy space available to the state governments for public investments. Thus, the UPA government continued the trend of growing centralisation of the federal fiscal architecture in the country which has been witnessed over the last one and half decades.

In their second essay, the Congress got so bogged down with corruption scandals and resultant policy paralysis that nothing seemed to be moving. Despite that, at the very kernel of UPA’s economic policy remained the poor. What did PM Modi do after being pole axed by the suit boot ki sarkar jibe, he took a dramatic left turn and revived and repackaged UPA plans and schemes giving them more financial heft and substantive allocations. In terms of administrative reform, he widened and deepened it to ensure that the common man or garib’s life was made easier, but beyond that he refrained from articulating the BJP’s economic vision or agenda. Agreed delivery bottlenecks have been taken out of the equation. India has been waiting for this for the last four years, but there is nothing forthcoming. Instead the BJP has usurped 23 legacy UPA schemes and rebranded them as its own, in the process what Modi has done effectively is run a copycat government in terms of economic policy. Disappointing a vast array of people who expected much more. There is more to India than just the rural economy, which in any case is undergoing a period of uninterrupted distress. The burgeoning middle class has got nothing, just as other sections have got zilch.

Mohitkumar Daga and Parag Mohanty have been engaged by the Bharatiya Janata Party to consult on election campaigns. Their take on this copycat government is worth reading: In addition to improvements of the ecosystem, each of these 23 schemes (see box) have undergone major changes in at least one of their key elements — goal, design and delivery. Changes in some of these schemes have signalled a major shift in the policy priorities of the government. The launch of the Jan Dhan Yojana signalled a shift to household-level financial inclusion from the earlier habitation-level financial access policy. Similarly, Sagarmala was conceptualised to drive economic infrastructure around ports as opposed to the erstwhile National Maritime Development Programme, which focused merely on ports development. To end the diversion of subsidised urea, the government mandated 100 per cent production of neem-coated urea instead of imposing an arbitrary 35 per cent cap on production as under UPA. Similarly, the Modi government introduced the Paramparagat Krishi Vikas Yojana to improve farmer incomes by leveraging the premium on organic farm products. With the launch of the Atal Mission for Rejuvenation and Urban Transformation and a host of complementary schemes like Smart Cities, Heritage City Development and Augmentation Yojana, Pradhan Mantri Awas Yojana (PMAY) for holistic urban development, the Modi government is set to revive the stagnating

urban sector which had floundered under the Jawaharlal Nehru National Urban Renewal Mission of the UPA. Many schemes have been expanded to cover a broader base of beneficiaries. The soil health card scheme was envisaged to provide soil health cards for all 11.8 crore landholdings to improve the inconsistent issue of cards under state programmes. Similarly, the Pratyaksh Hanstantrit Labh (PAHAL) scheme doubled the coverage of direct transfer of LPG subsidies from 9.22 crore consumers in 291 districts to 18.22 crore in all districts. Similarly, the Pradhan Mantri Matru Vandana Yojana expanded maternity benefits coverage to all districts compared to the Indira Gandhi Matritva Sahyog Yojana, which covered only 53 districts in the country.

The intellectual bankruptcy is such that both the political parties and their leaders are busy attacking one another. Not one has stood up to communicate in a cogent and coherent manner what his economic vision for India in the next five years is. Modi came to power on a growth, development and employment plank. All this has been forgotten in the cheap rhetoric of winning elections. The visceral hatred that the two sides have for one another is all consuming and pervasive. India and its people have fallen between two stools. By veering left of centre, BJP has consciously taken a hard left with its economic policies, and become captive of lurching from one set of elections to another. Now it stands embattled and fatigued, ensconced deep in the arms of Morpheus. Even as the electorate waits to vote.

(sandeep.bamzai@mydigitalfc.com)

Columnist: 
Sandeep Bamzai