Thought for the day
"Any man who can drive safely while kissing a pretty girl is
simply not giving the kiss the attention it deserves."
-
Albert Einstein (German 1879-1955)
Word for the day
Augur (v)
To conjecture from signs or omens; predict.
(Source: Dictionary.com)
Teaser for the day
Regular vipasana, meditation, yoga, only home cooked
vegetarian food, blood sugar level 300mg/dl.
Find the odd man out?
Different things, or just done differently
Continuing from yesterday, to analyze if the incumbent NDA
government is following materially different socio-economic policies from those
followed by the previous UPA government, we need to distinguish between the
policy framework and administrative framework for implementation of policies.
We need to find whether the government is doing different things, or doing the
same things differently, or doing the same things in the same manner.
Let's analyze the issue by examining some popular performance claims
of the incumbent NDA government.
(1) Coal block
auctions - The process started after CAG reported irregularities in the
allocation of 2G spectrum and coal blocks. Supreme court cancelled the spectrum
allocation and licenses of 22 telecom operators and 208 coal blocks allocated
in past two decades in arbitrary manner. UPA government started the process of
selling spectrum through competitive bidding in a transparent auction. It was
inevitable that in future coal and other important national resources could
only be sold at market price through a transparent process. The current
government has not made any material policy deviation here.
(2) Federalism
- The process of devolution of greater financial powers on the federal states
started with rise of regional parties and decline of Congress party during late
1980s. Successive union governments have been devolving powers on the states.
Transferring some social schemes to states and accordingly increasing their
share in allocation of tax revenue is not a different policy measure. Neither
is opening IIT, IIM and AIIMS in each state of the union. UPA appointed the
14th Finance Commission and NDA accepted its recommendations. No big deal.
(3) Globalization
of the policy formulation and presentation - The process was perhaps
started by Rajiv Gandhi who appointed Sam Pitroda to head telecom revolution in
the country. Dr. Manmohan Singh, Montek Singh Ahluwalia and Raghuram Rajan were
three other notable imports from IMF by various Congress led governments. The
jargon had started changing from summer of 2013 when Rajan took charge at RBI.
It is now distinctly global. A nuanced policy change here is that now right
leaning market economists dominate the consultative teams as against the left
leaning development economists.
(4) Lower
inflation - In my view, there is nothing structural or policy
driven in the current low rate of inflation. Lower global commodity prices; the
demand suppression due to poor rural income growth; lower job & income
growth, financial suppression due to negative real consumer rates and a high
base effect have led the statistical inflation down. No major improvement has
yet been seen on the supply side. The inflation targetting started with Rajan
assuming charge at RBI. The policy has now been reduced in writing. Again a
nuanced change.
(5) Financial inclusion - The
process started a decade back. No doubt the execution took a big leap in past
six months. Again no policy issue here..............to continue
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