Wednesday, October 18, 2023

Policy paralysis – UPA vs NDA-2

 Continuing from yesterday…(see here)

In the enterprise world, new ideas or innovations are usually valued much higher than the ability to execute such ideas. I believe for a successful enterprise both ideation as well as execution are equally important. The question of execution would not arise if there is no idea to execute. Similarly, an idea, howsoever innovative and brilliant it is, would remain just a thought or piece of paper unless it is executed well. Nonetheless, since the idea is the starting point of any enterprise, the innovator deserves to get a relatively higher valuation.

Taking this further, in the realm of politics and governance, the two key components of good governance are:

(i)    Conceiving, formulating, and instituting policies that would ensure inequitable, sustainable, and accelerated socio-economic development and growth.

(ii)   Execution of instituted policies through a set of structured programs, efficient delivery modules, and effective & prompt review and corrective mechanisms.

I believe that the performance of any government must be evaluated on these two parameters.

As I mentioned yesterday (see here), I find that the previous UPA government under the leadership of Dr. Manmohan Singh scored excellently on the issue of conceiving, formulating, and instituting policies that would aid in achieving accelerated, sustainable, and equitable growth. A high rate of GDP growth, especially in light of the global financial crisis, and the challenges of running a government with the support of a large coalition comprising parties with divergent ideologies and agenda underlines the efficiency of execution. The policies not only helped the Indian economy navigate safely through the global financial crisis and a subsequent current account crisis; but also helped bring a record number of people out of poverty.

Now, if we were to assess the performance of the incumbent government under the leadership of Prime Minister Narendra Modi on these two parameters, I strongly believe that the current government has performed very well on the execution front. This government has definitely—

(i)    Executed policies instituted by the preceding government like MNREGA, UIDAI, RTE, Food Security, DBT, financial inclusion, FDI in retail trade, infrastructure development etc. rather efficiently;

(ii)   Devised good programs and delivery modules for the policies formulated during the last years of the UPA government like digitization payments, GST, Direct Tax Code, implementation of 14th finance commission recommendations, etc.

(iii)  Augmented many policies like Unique identity and digital payments brilliantly to exploit maximum benefits out of these policies.

This strong execution helped the Indian economy navigate through the Covid-19 pandemic and subsequent global slowdown very well. Despite all challenges, India remains the fastest-growing major economy in the world. The programs like Unified Payment Interface (UPI) have become extremely popular globally. Road network development is happening at an accelerated pace. Many large infrastructure projects that were stuck due to a variety of reasons are getting completed.

However, insofar as conceiving new ideas and policies is concerned the performance of the incumbent government is ordinary. In the past nine years hardly any new idea has been conceived and/or converted into policy and programs.

NITI Aayog – the Think Tank

One of the earliest policy decisions taken by Prime Minister Narendra Modi led government at the center was to disband the planning commission and constitute a new Commission to provide directional and policy inputs to the government.

The commission, named NITI Aayog, was formed through a resolution of the Union Cabinet on 1 January 2015. NITI Aayog is “the premier policy think tank of the Government of India, providing directional and policy inputs. Apart from designing long-term policies and programmes for the Government of India, NITI Aayog also provides relevant strategic and technical advice to the Centre, States, and Union Territories. NITI Aayog acts as the quintessential platform for the Government of India to bring States to act together in national interest and thereby foster cooperative federalism.”

A careful reading of the latest Annual Report (2022-23v) of the NITI Aayog suggests that the Aayog has focused more on the review and assessment function and less on thinking and policymaking function.

As per the report, the government has implemented only one noteworthy development policy namely Aspirational District Program (including Aspirational Block Program).

In the first five years of this program (2017-2022) “the programme has acted as a successful template of good and effective governance, Under this programme India’s 112 backward districts have shown remarkable progress across key sectors that matter to the people. The core strength of the programme is its focus on data driven governance that drives evidence-based policy interventions at the district-level. NITI Aayog monitors the 112 Aspirational districts on Key Performance Indicators (KPI) on a monthly basis. The KPIs are designed in a way that the input and process indicators are being evaluated so as to achieve desirable outputs and outcomes across major socio-economic themes such as health & nutrition, education, agriculture & water resources, financial inclusion & skill development, and basic infrastructure. The robust monitoring strategy has enabled the district administration to engage in cross-departmental reviews and thus drive convergence. The competition through the monthly release of delta ranks keeps the districts constantly motivated to improve the KPIs.”

The achievements under the National Monetization Pipeline programs and Production Linked Initiatives (which are restructured models of old policy initiatives) are below par.

Besides this, New Education Policy is under implementation and Integrated Health Policy is under consideration.

Mission LiFE – Lifestyle for Environment is mostly at the conception stage.

In my assessment, the incumbent government has in fact performed less than ordinary on the policymaking front, while scoring well on execution.

I shall be happy to receive views of the readers on this aspect. 

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