Opinion Payback for stealthy reform

There is so much confusion about economic reforms in the public mind that people seem not to know what they want

September 16, 2012 01:41 AM IST First published on: Sep 16, 2012 at 01:41 AM IST

Before sitting down to write this,I spent some time surfing news channels to gauge reactions to the price of diesel going up. If the Prime Minister and Sonia Gandhi had done the same,they may have concluded,as I did,that possibly the biggest mistake their government has made is to not tell people the truth about why the economy had to be reformed. Had they not brought reforms by stealth,hoping against hope that nobody would notice the Congress Partys shift away from central planning,they would have not faced today the eruption of public anger that is palpable from Kashmir to Kanyakumari.

There is so much confusion about economic reforms in the public mind that people seem not to know what they want. Reporters given the task of recording the vox populi,in the streets of Delhi and Mumbai,interviewed mostly housewives and young men. Both categories vented their anger against the government and charged it with being insensitive to the pain of the common man. But,then an interesting thing happened on the news channels I watched. If the reporter extended the interview to more than just a sound byte,the same people started demanding that the government do something to make the economy grow. In the words of one young man in Mumbai,There are no jobs left for us because the economy has slowed down so much. Why did this government allow this to happen? What will we do if the slowdown leads to fewer jobs?

Now if we had a Prime Minister who believed in speaking out instead of silence,he would have told people proudly on national television that it was his reforms in 1991 that brought growth,prosperity and jobs. He would have told them this happened only because the Indian economy stopped being stuck at an annual growth rate of 3 per cent. He would add that the current slowdown is the direct result of a return to licence raj economics.

This process began in 2010 when the Ministry of Environment turned into the Ministry of Licences. Today,there are more than 900 projects held up by this ministry blocking investments that are believed to be worth more than Rs 5 lakh crores. Why? Why can the environment ministry not come up with clear guidelines instead of dealing with every project individually? Incidentally,the minister responsible for the return of the licence raj is now trying to push through a land bill that will make it impossible for farmers to sell their land or private buyers to purchase it. Luckily,this bill has been momentarily stalled.

If economic reforms had not been brought by stealth,the mindset of politicians,political parties and ordinary Indians would have changed by now. They would have been told the truth about the incalculable losses made in our socialist decades by a public sector that almost never made a profit. They would have been told that even where natural resources,like coal and iron ore,are concerned,the real losses have been made by public sector companies.

They would have been told that the reason why India continues to have the worst roads and railway services in the world is because for ideological reasons these were areas in which private enterprise was banned. They would have been told that if India has a handful of modern airports today and a handful of excellent private airlines,it is because government controls were loosened in these areas. As they were in television and telecommunications. Had there not been private investment allowed,we would still have only Doordarshan for entertainment and news and still be waiting twenty years for a telephone.

If the Prime Minister had taken pride in his economic reforms,and taken them forward,he would have been forced to bring modern methods of governance that would have ensured transparency in government contracts. And,on Coalgate he would even have been able to say,perhaps,that the reason why privatisation was attempted was because nationalisation of coal failed as a policy. But,he is a man of silences and stealth so he says nothing even when he is personally charged with being a crook.

As for the lady who gave him his job,she needs to think very seriously about her own role in the precipitous decline of the Indian economy. A few moments of introspection is all it will take before she realises that it was the leftist economists in her National Advisory Council who first started making a racket about inclusive growth and forced the government to change direction.

So here we are at almost the end of the India story. It was made possible because of private enterprise and it will end because every political party in the country reviles private enterprise today. Perhaps a good dose of the license raj is what we deserve.

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