An inside report from Planet Modi
PR Ramesh and Ullekh NP | 21 May, 2015
Whenever he is apprised of protests against a project, Prime Minister Narendra Modi offers a beatific smile and reminds his ministers and bureaucrats of the role that leadership should play in nation building. He explains to them the rationale of why leaders should get others to focus on the long term. Modi, who knows Gujarat like the back of his hand, thanks to the decades he has spent as an RSS volunteer in his home state, comes up with cautionary tales, too. Take this one. When British engineers came to build railway hubs in a western stretch of Gujarat, several villages rose in revolt. The chieftains feared that trains would upset existing social equations. Finally, the British authorities chose locations where they were welcome, like Mehsana and Bhuj, which prospered and became districts, unlike the backward villages that are still panchayats—where leaders of yore took the wrong call out of myopic, feudal instincts. Modi reels out similar stories from various other parts of the state to drive home the point that leaders who settle for short-term gains hurt not only their contemporaries, but also future generations.
It was this logic, notes a Cabinet minister, that guided Modi when he lavished praise on the ‘leadership’ of Nitin Gadkari as a minister for roads at a Cabinet meeting. Gadkari and Modi had not been the best of friends until recently. But then with most senior colleagues reconciled to who the country’s topmost leader is, and with their having ceased to complain about his overwhelming dominance, there is greater cohesion—enforced or otherwise—within the higher echelons of the NDA Government. Gadkari was pleasantly surprised—and, to an extent, even inspired. His performance has been superlative: over the past decade, Central and state agencies together could only build 5 km of new roads a month (the Centre accounting for 2 km of that), but over the past one year, ever since the new Government took charge after a resounding victory that saw the ruling coalition leader secure an absolute majority in the Lok Sabha on its own (the first time any party did so since 1984), 11 km of new roads were built in a month by Central agencies alone. “Gadkariji deserved accolades and Modiji never thought twice before congratulating him. That is the spirit in the new dispensation,” says the minister.
Several bureaucrats that Open has spoken to agree that the NDA Government, which completes a year on 26 May, has changed the rules of the game and placed fresh emphasis on efficiency. “What’s crucial is to sustain the momentum. As of now, Cabinet meetings have high attendance unlike those of the previous one, where policy matters were often passed on to a group of ministers (GoM) for lack of attendance,” says a senior bureaucrat who has worked with Modi’s predecessor Manmohan Singh. Also, Modi makes it a point to let everybody speak in meetings of the Council of Ministers or those of the Cabinet. “And then he makes an observation about each and every aspect of governance and all policies,” says another senior bureaucrat once considered close to the Congress party. “This was not how top-level meetings were held under the previous regime. Whether it is out of fear or for any other reason, ministers turn up on time for such meetings,” he notes. Often, meetings go on without a break, much to the anguish of many leaders, especially diabetics in the group who need either sugar or a toilet break.
Of course, the workaholic Prime Minister—the former Chief Minister of Gujarat has not taken a single holiday since he hit the Lok Sabha campaign trail in mid-2013—has come under sharp attack from detractors over his alleged dictatorial ways and one-upmanship. The opposition has been slamming him for being ‘anti-farmer’ and ‘corporate-friendly’, and Congress Vice-President Rahul Gandhi has been at the forefront levelling such charges. Modi has been subject to broadsides for his proximity to a few business houses. Many of them poke fun at the Government, asking questions such as ‘When will the achche din (good days) you promised come?’ and ‘Achche din for whom—the super-rich or the poor?’
BJP President Amit Shah finds these accusations farcical, coming as they do from the Congress leadership, which, he says, had zealously patronised business houses and promoted crony capitalism. He finds sound bites by opposition leaders who accuse the Modi Government of ‘fascistic tendencies’ funny; to his mind, they merely betray their desperation and out-of-date ideological posture. At the same time, Shah is proud that the Prime Minister has restored the authority of the Prime Minister’s Office (PMO), which hardly had any power under the diarchy practised by the Congress; the real reins of power were held by the Congress President, who would often undermine the authority of the then Prime Minister. “It was in the time of Congress that unilateralism was the name of the game. That was when extra-constitutional bodies and individuals overruled the decisions of Prime Minister Singh,” he says. The National Advisory Council, chaired by Congress chief Sonia Gandhi, virtually dictated the social spending policies of the former Government. Towards the end, Rahul Gandhi went to the extent of publicly tearing to pieces an ordinance brought in by Singh meant to overrule a Supreme Court order on disqualifying convicted MPs and MLAs. He called the ordinance ‘nonsense’ in an attempt to endear himself to a “young and impatient” India, but rendered a devastating a blow to the image of the UPA Government and its Prime Minister.
True, the Modi Government’s image bears no similarity to that of the quasi-functional UPA-II’s. While it is being seen as a ‘clean slate’ by insiders, it is being looked up to as an effective regime by bureaucrats—though according to sloganeering NGOs, the so-called causeratti, opposition parties and others, it is ‘anti-poor’ and represents a ‘sell-out to big business’. For their part, BJP leaders laugh off such barbs and argue that any friendship with industrialists is not a crime, but doling out favours to them is. For instance, they have often challenged rival politicians to prove how his ‘proximity’ to Modi has benefited Gautam Adani of the Adani Group. Seated at his 11 Akbar Road residence, where ministers often drop in to brief him about the goings-on in their ministries, Shah offers, “It is a ridiculous charge.” He is emphatic that the incumbent Government earned more than Rs 3 lakh crore by auctioning coal and 3G spectrum, while such resources were handed out free to corporates by the previous ruling alliance at the Centre. “Will any corporate-friendly dispensation do that? Can you challenge that?” he thunders. Shah claims that Modi’s is India’s most ‘transparent’ Government ever. “After all, no soul has been able to raise a single allegation of corruption against this Government,” he says. For Shah, one year of Modi in power has been a great period for the country. “Let’s talk by looking at the facts,” he says, reeling out a series of numbers. When the AB Vajpayee Government took over (in 1999), the country’s economy was growing at 4.4 per cent a year; when the NDA government stepped down in 2004, the figure was 8.4 per cent; and when the BJP took over in 2014, it was almost back to the 1999 level. “We have managed to put the economy back on track and control inflation which had been accelerating for the past few years. We also brought down the fiscal deficit. Foreign inflows are now the highest in 10 years. We have lived up to expectations that were very high,” he goes on.
Modi was elected amid high hopes of a remarkable change in governance and a break from the Manmohan Singh regime, which had been rocked by myriad scandals of corruption and opacity. In order to highlight the past year’s difference, Finance Minister Arun Jaitley dwells at length on how UPA-II operated. He watched it closely, he says. “It was a government for sale. Resources were allocated at throwaway prices to favourites, and investors were bullied if they posed any threat to their favourites in any of the sectors.” As Jaitley puts it, coal blocks were allocated at virtually no price; and environmental clearances, too, were up for sale. He has written in his blog: ‘The Congress Party leaders had become rent seekers and name lenders. They were partners in a large number of companies which got coal blocks allocated. The discretionary and arbitrary allotment motivated by collateral considerations led to prosecutions of many and a virtual paralysis of the coal mines sector. It had an adverse impact on user industries such as the power sector. Even the former Prime Minister Dr Manmohan Singh was not spared on account of the self-destruct policies of the UPA. The courts had to intervene and cancel the allocations.’
Meanwhile, ‘rural distress’ is a cause for anxiety within the Government. With several farmers being pushed to take their lives because they can’t pay back their lenders after a bad crop season, the Centre is worried that it is being maligned for the fault of its predecessors and their high-handed management of this issue. A few senior BJP leaders Open spoke to regret that farmers continue to suffer under high indebtedness, but they also contend that farming as an occupation in its current form is not always viable. “Because everything depends on the vagaries of nature. Most of our farmers lead precarious lives. Our effort is to help them shift to better ways of earning a living, to introduce hi-tech agriculture, and to insure them against crop losses,” says a senior BJP leader from Maharashtra, which has seen a large number of farmer suicides in its Vidarbha region. “To check unregulated loans by loan sharks, we have introduced Micro Units Development and Refinance Agency Bank (also called Mudra Bank, to be set up with a capital of Rs 20,000 crore),” says Shah. Backed by a statutory enactment, he explains, Mudra Bank will regulate and refinance all micro-finance institutions in the business of lending to micro/small business entities engaged in manufacturing, trading and services activities.
The NDA Government, says Shah, cannot afford to be bogged down by the silly criticism of vested interests and opposition parties like the Congress that he alleges suffer from amnesia—of their own poor governance.
There is, of course, a chorus gaining in decibel levels that the Modi Government plans to implement the Land Acquisition Bill to curry favour with corporate houses. Modi, in fact, has an entirely other goal, say those close to the matter: getting rid of bottlenecks posed by the Land Acquisition Act implemented by the outgoing Congress Government. According to senior bureaucrat Amitabh Kant, who had been tasked with helping build smart cities, “Land is a complex issue. It is very difficult to get land of this size and scale. States are finding it hard to get land and financial resources to get land.” He had recommended Central funding to help states get the wherewithal to buy land for big infrastructure projects such as smart cities.
Shah avers that the BJP Government is unequivocally committed to passing a new bill not because it wants to help the rich walk away with poor people’s land, but to ensure that development reaches the countryside, which is home to India’s poorest of the poor. “Their upliftment is the key. And, mind you, not a single businessman will get undue favours from the Government because the Land Bill has not been conceived to help them. Our aim is to take roads and railway networks to far-flung areas. Land acquisition has to be smoother for this purpose. We will also set up various manufacturing units in the hinterland as part of the ‘Make in India’ campaign that will help rural folk, especially the youth, get enough and more jobs,” Shah says in a lengthy interaction with Open. He adds that the BJP Government doesn’t want to see impoverished villagers coming to cities with begging bowls and thus contributing to the economic and social ills of urban centres. As more manufacturing units come up, he says, rural populations will get better opportunities to develop job skills, gain the benefits of industrialisation and migrate for gainful employment.
FRIENDS TURNED TORMENTORS
Many of the newfound friends of the BJP, which was widely expected to achieve power in the polls of 2014, have turned out to be fair-weather friends. “Throughout the history of politics, you have had such people. Nehru had such well-wishers. Indira Gandhi was shrewd enough to keep such people at bay, though some others managed to hoodwink even her; Rajiv Gandhi, too, had many such friends at his prime in politics. When Modi emerged as the BJP’s poll spearhead and its sole proprietor, many corporate honchos and political wannabes descended on Delhi to ride the Modi bandwagon,” says a senior BJP leader who had coordinated ‘war-room activities’ for Modi’s poll campaign. “Most of them were sort of wannabe political entrepreneurs who had until the other day criticised Modi over the 2002 Gujarat riots,” he adds. Then there were those who aligned with the BJP only when it suited them, sensing a chance to share the spoils of power. However, once they were overlooked for key positions in the new set-up, they became fidgety and vitriolic critics of the Modi Government.
Just a few weeks ago, one such ‘intellectual politician’ who was a member of Vajpayee’s Cabinet approached the Prime Minister for a post that he thought suited his credentials as a ‘saffron ideologue’. Finally, the Prime Minister is understood to have offered him the post of Lieutenant Governor of Pondicherry. The politician, who has written several books, thought it was an assignment too small for his stature. He went back home and waited for a few days before launching a tirade against the Government for its alleged shortfalls in governance, alleging that it was being held hostage by a few powerful people who were bent upon marginalising other party leaders.
“It is only natural for such leaders to criticise the Government. Full-time party workers never do that. They may have differences of opinion, but they air them within the party. People who want to be something in the NDA Government who are not BJP workers end up venting their woes in public,” says Petroleum Minister Dharmendra Pradhan, adding that he doesn’t want to take the names of such leaders. “There is nothing unusual about it. It doesn’t surprise the BJP leadership or the Government. Such people will always be there. They are happy if they are hired for senior positions. Otherwise, they get disappointed and badmouth the Government. We are okay with it,” he says with a smile.
Ironically, some of this ‘disappointed lot’—like former Union minister Arun Shourie and senior lawyer Ram Jethmalani—took it upon themselves to express displeasure with Modi’s style of governance after their expectations were not met. Shourie was on TV channels, lecturing people on what the new Government ought to do, as soon as last year’s General Election result was declared on 16 May. Jethmalani, who had aided Modi in his legal battle over the Gujarat riots of 2002, also expected to be rewarded once the leader came to power. But Modi had other ideas, leaving power hopefuls like Jethmalani and others fuming. “Don’t give them much attention. We all know that if they were in power, they would have said the opposite of what they are saying now. Their opinions now mirror those of the NGOs, the Left and the Congress,” says a senior minister who has worked closely with them.
The minister doesn’t want to name individuals, but notes that back in 2004, a former senior functionary of the Vajpayee Government, by then in opposition, wanted to raise in Parliament a case of alleged irregularities by a conglomerate. “He kept insisting that others also raise the issue on the floor of the House, until he was taken on a tour of the company’s plants. Not one word was uttered by this gentleman against the company following that visit. That should give you an impression of such a ‘rebel’,” he chuckles.
There were other hopefuls, too, including policy wonks, defence experts and political analysts who wanted their pound of flesh for “contributing their might” to the Modi project, says an openly disgruntled domain expert. “We all became disillusioned because Modi hired only the usual suspects,” says this expert. BJP leaders refute this claim, saying that some of the senior appointments made by the Government are university professors and renowned experts. They cite names such as Arvind Subramanian (currently Chief Economic Advisor), Arvind Panagariya (Vice-Chairman of the NITI Aayog that has replaced the Planning Commission), Bibek Debroy (a member of the NITI Aayog) and several other luminaries from various fields.
The BJP Government also broke the old pattern of naming friendly bureaucrats for major roles when it came to picking someone to head the newly created BRICS Bank, based in Shanghai and set up jointly by Brazil, Russia, India, China and South Africa. The Government chose well-known banker KV Kamath instead. “Kamath’s appointment [implies] great recognition for a professional banker,” says Mumbai-based banker Nachiket Mor. Typically, such positions go to bureaucrats close to the establishment, says a Foreign Ministry official.
The cultural shift that Jaitley speaks of is more evident in the national capital’s exclusive clubs for the super-rich, which are frequented by so-called lobbyists, a euphemism for arms dealers, middlemen and other shadowy figures who typically hang out in some of the expensive lounges of five-star hotels in New Delhi. The Government has a dossier on such elements, and, as a result, not only are these lounges largely empty now, these smart men in their Armani suits are not seen anymore in the corridors of power.
THE ART OF DOUBLE SPEAK
However, many senior executives and a few journalists have learnt to thrive, lately, by offering words of advice to potential foreign investors. They often travel overseas to deliver speeches to investors interested in India. Recently, a journalist was seen doing this with gusto—for a hefty fee, of course. One corporate leader who spoke out against the Centre was HDFC Chairman Deepak Parekh. “There is a little bit of impatience creeping in as to why no changes are happening and why this is taking such a long time to have an effect on the ground. The optimism is there, but it is not translating into revenues. Any industry you see, when there’s a lot of optimism, growth should be faster,” he had said. It is no secret that Parekh was one of those who had nursed ambitions of landing a job with the Finance Ministry and had lobbied vigorously for it. Jaitley responded by observing that the Government was being criticised for being too fast, not too slow. The context was the flak Modi had got for adopting the ordinance route on key issues such as Land Acquisition. The Government, the Finance Minister said, had taken that route to expedite legislative changes that would promote business. “At a time when competing economies are facing severe challenges, history has given us a rare opportunity where the world is looking to us for investment. The present Government is determined, having eased many processes, to go on that path,” Jaitley had said. Power Minister Piyush Goyal pointed to the soaring stocks of Parekh’s group businesses, HDFC and HDFC Bank, to contend that the economy was well and robust. “The worst part of all this double-talk by people who revel in duplicity is that they are nationalists at home who attack the Government for its alleged tax terrorism abroad,” says the first senior BJP minister. The tribe is active in Delhi, interpreting India for overseas businessmen. However, they are not to be confused with genuine analysts of repute who genuinely critique government policies through columns and statements—which, the BJP minister says, are taken due note of by the Centre. “I can assure you that we are far more receptive than anyone would imagine us to be. We are also quick at taking decisions. We even watch social media closely to draw inspiration in drafting and implementing policies.”
GOSPEL THROUGH SOCIAL MEDIA
Not long ago, Pradhan received a sealed envelope while he was leaving his office in Shastri Bhavan. On opening it, he realised it was sent by the PMO and had instructions and a few tweets by a journalist who had said that one of her complaints was not yet addressed even after repeated pleas. The PMO wanted the minister to look into the matter and have it fixed as soon as possible. Pradhan called up the journalist rightaway to address the problem.
How did the PMO get hold of such tweets? Who keeps such tabs on Twitter? Young, foreign-educated professionals have been hired to comb social media platforms to alert the PMO and party leadership of tweets germane to governance and the public delivery system. Prime Minister Modi knows only too well that if you ignore public delivery systems and services offered by utilities, you end up incurring the wrath of the public, especially in the metros. That was the undoing of the Congress. It ignored the common man’s problems, thanks to hubris and indifference. They paid the price for it. Modi has learnt from his rival party’s mistakes, too. Which is why he has people monitoring social media 24 by 7,” says a BJP functionary at the party headquarters on Delhi’s Ashoka Road.
The Prime Minister is aware of the importance of tracking views on social media, says a BJP insider. This, however, is an understatement. For someone who adopted social media for public contact after being trammelled by the mainstream media following the 2002 riots, Modi is adept at picking up new ways to deal with challenges. He embraced Facebook and Twitter because he realised that using the tools of modernity to his advantage required not just being fast and first, but also being resilient—he had chosen to ignore negative publicity in the mass media. Finally, his determination paid off. “He wouldn’t want to abandon such initiatives just because he is in power. He would continue doing that with the help of his party men and officials,” notes Pradhan.
Such high levels of alacrity were shown by the PMO in emergency situations as well, says a highly impressed senior bureaucrat. “It is unfortunate that Modi’s speed and efficiency are seen as a PR exercise by his rivals. Is being slow the alternative that would please them?” asks a bureaucrat known to be close to Modi. Sample this: after a massive earthquake struck Kathmandu on 25 April, Indian troops rushed to the landlocked neighbouring country with help. The prime minister of Nepal, who was on a tour of Thailand, learnt of the devastating event through a tweet by Narendra Modi. The PMO’s attention by then was already focused on the details of managing relief and rescue operations. At times like this, small details are often lost; in all the chaos, top authorities usually ignore complaints that ATM dispensers have no cash; but when the PMO received such a complaint from Raxaul, a town in the East Champaran district of Bihar located on the India-Nepal border, at 6:30 am, it instantly instructed senior officials to fix the problem. By 9:00 am, cash- laden trucks had already reached Raxaul, and by 9:30 am, people could withdraw money. “That is the level of efficiency the Government shows, whether you like it or not,” says a senior officer with the Finance Ministry.
PARTY AND GOVERNMENT
Shah downplays media reports of Sangh affiliates such as the Bharatiya Mazdoor Sangh, Vishva Hindu Parishad and Swadeshi Jagran Manch protesting against Modi’s ‘neo-liberal policies’. He says that the RSS, BJP and the Government are all on the same page on reforms. Amid indications that Modi will face opposition from such outfits against his reform initiatives on labour laws, easing of FDI limits and disinvestment plans, RSS Joint General Secretary Dattatreya Hosabale warned affiliate organisations not to obstruct the Modi-led Government’s reform thrust. “The first major change witnessed after the BJP Government came to power was that the nation was freed from the clutches of political middlemen,” he had said at a BMS meet. In a report in a national daily, he was quoted as saying that the Government was on the right track and its efforts must be complemented with responsive cooperation rather than selective confrontation. He also said there was no reason to be disillusioned with the Government, as it was transforming the nation for the better.
An RSS insider tells Open that even if the BMS goes ahead with its planned strike along with other trade unions on 26 May, it would have mere symbolic value. “The RSS is deeply committed to the Government’s initiatives to weed out corruption and ensure enough funds for social spending,” says the insider. What is remarkable is that an otherwise soft-spoken Hosabale praised the Government on a raft of reform moves such as the new Land Bill, ending of the Inspector Raj, and higher foreign direct investment limits in the defence, banking, retail and insurance sectors. The BMS and Bharatiya Kisan Sangh had earlier expressed displeasure over the Centre’s labour law reform proposals and economic policies.
The biggest advantage for Modi, on this count, is the blessings of RSS Sarsanghchalak Mohan Bhagwat. Unlike during the time of Vajpayee, who had to face opposition to his reform push from the likes of then RSS chief KS Sudarshan and veteran leader Dattopant Thengadi (and had to look over his shoulder before making policy statements), the RSS has Modi’s back when it comes to economic policies.
As Shah says, the party and the government are of a common perspective on these matters. Another BJP leader says that criticism by fringe Hindu groups—with the probable exception of a few who also happen to be organisations only on paper—have been within “permissible limits”. He adds that noises made by loony-fringe outfits such as the VHP will not have any adverse impact on the Modi Government. “It is clear that Modi wants to promote growth and raise funds for social spending. He wants to lead India to superpower hood,” Pradhan says.
One of the major criticisms that Modi has faced is that he is still in campaign mode even as he hops from one country to another. For a Prime Minister who has visited 18 countries in a year, Modi is unperturbed by adverse remarks in some quarters about his foreign jaunts suggesting that he is never at home to address the concerns of India’s poor. A senior BJP leader says that Modi has learnt to lead with a long-term perspective in mind. “He is not disturbed by criticism in the short term. That phase will pass. He wants to appeal to the international community at a time when India, a huge market that is growing fast, needs to attract huge funds to fast-track infrastructure development. Which explains why he rolled out a comprehensive ad campaign in Hanover in Germany to invite investors. Plus, he has managed to seal deals wherever he has travelled that will bring hundreds of billion into India and put India on the fast track of growth,” he says. He laughs away the argument that Modi is travelling the world to ‘wash off’ the Nehru-Gandhi association that many leaders make with India. “With their lowest seats ever in Congress history, the world knows who the country’s leader is,” he says.
Now, Shah wants to aid the Modi project by expanding the spread of the party across the country. His membership drive may have attracted widespread criticism with the ‘real numbers’ being questioned by rivals. However, says an official at the party headquarters, “The BJP’s aim is not merely to achieve membership numbers. It will have the data of 10.5 crore people, their Aadhar card numbers, phone numbers, addresses, etcetera. In a country where 18 crore people can decide who wins, such a database would offer the BJP a great edge,” he notes. The BJP-RSS campaign apparatus depended heavily on data provided by experts who worked for the party. This helped the combine identify various sections of voters and ‘target canvass’ votes to ensure victory, especially in states such as Uttar Pradesh. A large part of the party’s hype-generating machinery drew upon massive amounts of data it had managed to collect, sort and digitise across 800,000 polling booths in the country. What came in handy was also the data on booth-wise performance of parties over the past eight elections—including state and national polls. This data-crunching also helped BJP leaders segregate each and every constituency based on its prospects, which served the RSS well, as leaders of the organisation admit. At the end of it, both the party and the RSS got invaluable data from across the country, right down to the village level—unprecedented in India.
EVERYONE FALLS IN LINE
Notwithstanding the external criticism that NDA ministers are overworked and under-slept, several of them who Open contacted say that they enjoy being part of a great team—and that despite all their tiring work, they enjoy what they do. Railway Minister Suresh Prabhu recalls that weeks before he presented the railway budget, the Prime Minister had asked him to read speeches made by all his predecessors heading the Ministry. And he managed to read almost all of them despite a busy schedule that involved meeting MPs and experts from across the country who landed at his office at Rail Bhavan. Prabhu spent hours after work going through them. At the end, he was glad that he did it, because it helped him come up with fresher ideas instead of peddling old ones again. “I realised afterwards why he asked me to read them. It is because he wanted me to relate policy to projects and only such exhaustive reading could have helped,” Prabhu recounts.
Modi, says Prabhu, has that visionary zeal—of linking policies to projects. What additionally endears Modi to his ministers, he says, is that he acts as an arbiter between ministries to speed up projects delayed by disputes or differences between departments. He finds it heartening that Modi praises performers like Gadkari and Venkaiah Naidu (for his floor management as Parliamentary Affairs Minister), besides others, at Cabinet meetings. “Frayed relations between Modi and some of his party colleagues who had fought his candidature for PM tooth-and-nail is all history,” says a senior BJP leader, referring to the likes of Sushma Swaraj. “They know that the Prime Minister is indomitable now and he means business,” he adds.
Another senior minister says that a new work culture has meant there would be no more leisurely golf sessions during work hours, no prolonged lunches at the Delhi Gymkhana Club, and strictly no cosying up with anyone for plum postings. Modi has dismantled the 62 EGoMs and GoMs set up by UPA-II. Effectively, that puts a full stop to attempts by the bureaucracy and political leadership to use these as an excuse to delay decisions. Observers say the move has boosted the flagging morale of bureaucrats now that their inputs are being sought again for decisions. In turn, that has rejuvenated governance down the line, argue at least two ministers. The dismantling of EGoMs—once perceived as bodies set up to sanctify decisions of the Government—has removed the UPA ploys for delaying swift decision-making in key sectors even while encouraging vested interests and unofficial lobbyists. Gas pricing was one such issue that had been dragged on inordinately by an EGoM. To resolve the issue expeditiously, Modi set up a committee of secretaries (CoS) comprising stakeholders and relevant ministry representatives including Power and Fertilisers. Again, on sugarcane pricing, an EGoM has been dispensed with and the Cabinet and principal secretaries have been authorised to iron out problems should they arise after the Agriculture Ministry takes a decision. Even more complex problems in key sectors such as infrastructure, energy and power would henceforth be monitored by the National Litigation Data Grid, which is expected to speed up the resolution of legal hassles.
A few bureaucrats still regret this shake-up of the status quo, but many of them see the transition from UPA-II to NDA-II as a welcome move, especially because Modi engages them constantly. Not long ago, he asked senior bureaucrats to visit places where they were posted for the first time and report their experiences as part of an effort to turn their roles proactive. PK Mishra is the point person who coordinates such efforts with bureaucrats. Mishra, a long-time Modi associate, is additional principal secretary in the PMO.
There are hiccups galore as legacy issues still haunt bureaucracy. For instance, officials close to the NDA Government had alleged late last year that the likes of KP Krishnan, a favourite of the erstwhile Finance Minister P Chidambaram, went to the extent of denting the image of the new Government through a whisper campaign suggesting that Finance Minister Arun Jaitley and RBI Governor Raghuram Rajan did not get along. That campaign was a part success in making it seem that differences over lowering the RBI’s policy rate of interest—not unexpected between any government and central bank—had driven a wedge between Jaitley and Rajan, both of whom were upset with the concerted efforts by a group of officials to denigrate them and hurt the harmony of economic governance. The whispers were relentless all the same, and by October last year, Krishnan, additional secretary in the Department of Economic Affairs and a 1983 batch officer of the IAS’s Karnataka cadre, was transferred to the Department of Land Resources as additional secretary under the Union Ministry of Rural Development. Krishnan was replaced by Ajay Tyagi, former joint secretary in the Ministry of Environment, Forests and Climate Change. The new dispensation was also upset that a few Left-oriented scholars from think-tanks such as National Institute of Public Finance and Policy (NIPFP) continued to influence policies as they did during UPA’s time. Ajay Shah and economist Ila Patnaik are part of this think-tank. A government official close to the matter says Chief Economic Advisor Subramanian had to ‘wage a war’ against this group to keep them at bay.
During UPA-II’s tenure, bureaucrats had to tolerate the whims of various ministers and senior Congress functionaries, say some of them. It was “part of the exercise”, says one of them, to receive chits from a person close to the Congress requesting that a certain business be offered a loan or that so-and-so be placed on the board of some public-sector bank. “Ten years is a long time and the hubris was very high. Ministers and party leaders used to interfere even with the most mundane of things, like transfers of class IV employees,” says a senior Finance Ministry official.
THE WAR ON CRONY CAPITALISM
Senior BJP leaders take pride in the fact that an NDA minister who holds a crucial portfolio met a tycoon who has huge interests in the sector only at a banquet organised in honour of visiting US President Barack Obama. “The instruction we have is that ‘You can meet corporates but not entertain their requests and lobbying’. We have also been told to meet them outside office if it is possible to do so,” says a minister.
All this is a big departure from the days of the previous regime, under which the influence that megacorps like Reliance Industries wielded was tremendous. Many top corporate honchos and industrialists would land in Delhi and head straight to meet senior bureaucrats or ministers, even without appointments. Their counterparts in Delhi would re-arrange their schedules for them. “Those days are gone now. Nobody can deny it, unless you are Arvind Kejriwal who can make all sorts of allegations,” says a senior Finance Ministry official with a laugh.
“It seems that many big businesses are expecting the status quo to continue and let competition take care of things. Auctioning [of scarce natural resouces] is a process that they wouldn’t like because they are used to the Government offering them resources to play with on a platter, as was so evident from the allocation of resources made during UPA rule, behind which there was corruption in crores of rupees,” says Shah.
Corporate heavyweights of the stature of RC Bhargava, chairman of auto major Maruti Suzuki, have given a clean chit to the Modi Government as it completes a year at the Centre, saying it has been a year without any corruption scandal. The assurance of clean governance, as promised by Modi, has been impressing observers in high places. Bhargava in particular has praised the Prime Minister for rapidly ridding the economy of crony capitalism by ushering in an era of competition thanks to auctions instead of ‘discreet allocations’. “We have to view this in the context of what was inherited a year ago. At that time, there were a number of issues which had made all of us and the economy very despondent about the future. One area was corruption. Now in this last year, we have had no instance of a single scam. We have had a system of allotting natural resources like coal and spectrum for phones done by a transparent auction system. The process has worked well and there have been no issues there. So, one major area of concern—that is corruption and crony capitalism—has disappeared,” he told a TV channel in an interview. “The coal part was another major issue because the energy sector was grossly handicapped by an absence of enough coal production. And the recent auction and the fact that [earlier] allocations had been stopped by the Supreme Court also show that the bottleneck has been overcome,” he added.
For Professor Kunal Sen of Manchester University, one of the biggest milestones of the past one year is the dismantling the Inspector Raj vis-a-vis small firms, similar to what was undertaken for the benefit large firms in 1991—a year that saw India make bold moves towards Free Market economics. “Inspections of these [small] firms had to be taken away from the whims and fancies of labour inspectors, and rationalised in such a way that it was not arbitrary and highly discretionary, as it has been for all this while,” reasons Professor Sen. Without doubt, the Inspector Raj for micro and small firms had rendered them among the least productive of Asian industrialising countries. Now all that is set to change.
“I challenge opponents of our policies and Government to counter us with facts rather than misinformation,” dares Shah. For now, his confidence seems contagious.