Friday, December 16, 2016

In search of solutions - 9&10

"We do not learn; and what we call learning is only a process of recollection."
—Plato (Greek, 427-347BC)
Word for the day
Clarion (adj)
Clear and shrill, e.g., the clarion call of a battle trumpet.
Malice towards none
Did Mahesh Shah or any of his accomplice know about impending abolition of HDNs, and just created a bucket where Rs13800cr worth of old currency could be washed, if needed?
First random thought this morning
The popular narrative these days is straight copy from the blockbuster Deewar - "भाई पहले उसका sign ले कर आओ, मैं तभी sign करूंगा."
Politicians are busy highlighting misdeeds of each other.
Tax evaders are justifying their deeds, on the pretext of corruption in administration and leakages in the public spending and delivery system.
No one is willing to admit their own failings.

In search of solutions - 9&10

—B. R. Ambedkar
In my view, the sustainable solution for India’s economic problems could be found only by looking within. Borrowing from the thoughts of Mahatma Gandhi, economics needs to follow ethics and not the vice versa. The primary consideration needs to be “man” and not “money”.
To achieve this means Gandhi advocated trusteeship, decentralization of economic activities, labor intensive technology and priority to weaker sections. Many criticize Gandhian economic ideas based on altruism, self reliance, and non-violence as an impractical alternative to free market economics. I believe this criticism is unfair and suffers from prejudice.
I believe borrowing blindly from the western economic models would not work in Indian context. The Indian model will have to be quintessentially Indian. It has to effectively tackle the problems of class conflict, unemployment and poverty while attempting to preserve the lifestyle and values of rural Indians, which are eroding fast with unmindful urbanization, industrialisation and modernisation.
A self-reliant, free, just and progressive society is integral to the idea of Swaraj. Self-reliance in no way violates the need for technological advancement in the areas like healthcare, communication, etc. It just wants the scale to tilt in favor of ethics and ecology conservation if a conflict arises. Self-reliance also does not infringe the idea of free market. It just promotes a non-violent and non-exploitive trade and commerce.
For those who find Gandhi completely irrelevant in the current context, it is pertinent to note that “the literature survey of Gandhian economic ideas gives similar conclusions. 258 thinkers, who have reviewed his economic ideas, have been taken into consideration. Among them, London group of Professionals and The Club of Rome are considered as individual thinkers. Even the opinion of 53 noble prize winners is also considered in this literature survey. 96% of these thinkers admire his economic thoughts. They consider his ideas practical, useful and relevant in the present world.
A growth model for economic development is shown on the basis of Gandhi economic thoughts. This model is applicable to developing economies and India. His ideas are helpful for backward and developing economies in the world. His ideas are also useful for solving problems in capitalist economies. This proves Gandhi as a unique and practical economist of the world”. (see here for more details)
In short, the economic model of India, in my opinion, should be based on the following three principles:
(a)   It should develop an environment of equality and mutual trust through decentralization.
(b)   It should focus on the strengths on Indian economy rather than overemphasizing the weaknesses.
(c)    It should focus on enable of population rather than merely providing for them.
As per NCAER Devolution of Power Index – only a handful of States have done meaningful devolution of power to Panchayati Raj Institutions - Maharashtra, Karnataka, Tamil Nadu and Kerala being the notable one.
A series of irregularities that have come to light in past two decades suggest that lack of transparency in government functioning and substantial discretionary powers enjoyed by elected representative in appointments, procurement, resource allocation etc. have been the primary reasons for governance deficit.
In my Utopian (though certainly not out of the realm of possibilities) view, the following should be done:
(a)   The ownership of public resources should be earnestly handed over to “the public”. Instead of few federal ministers controlling the resources in feudal manner, the trusteeship of all the natural resources should be vested in the District Council (see here). The local people should determine how these resources should be exploited, given their sustainability and development requirements. Industry based on these resources should be developed on co-operative model with equitable ownership of local people, the financier and the entrepreneur.
(b)   Urbanization (provision of adequate civic amenities and connectivity) and industrialization (employment) should be managed at town/village level instead of further promoting India-Bharat divide. 6,60,000 urbanized villages would be much more productive than 500 smart cities with inadequate infrastructure.
(c)    District councils should be empowered to decide appropriate direct taxation structure and incentive formulae to achieve the objective of social, economic and gender equalities, sustainability and development.
Each local council shall determine which are the minority communities, or socially and economically backward classes in that locality and extend reservation accordingly. Similarly, each local council shall determine the development priorities and allocate resources accordingly.
Given the diversified demographic, ecological and socio-economic profile, efficient policies for energy, education, employment, industrial development, ecology conservation etc could be worked out only at the local level.
Districts with 1% Schedule Tribe population and 89% Schedule tribe population cannot have same reservation criteria.
As per the census data, almost one fourth villages in India do not have any Schedule Caste population. In another one third villages the Scheduled caste population is less than 20%.
We have seen a large number of instances in past three decades where the so called upper caste people have protested violently against the reservation formula enshrined in the Constitution.
The litigation on the matter is also endless.
It would only be appropriate and more productive if the issue of reservation is decided at the Local Council (see here) level, in accordance with the socio-economic conditions of that region.
(d)   The role of the National Council (see here) should be restricted to managing national defence, foreign relations, Trans District Rivers, dispute resolution, and developing model rules and regulation that may be adopted by the Local and District Councils with appropriate modifications.

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