Apart from statements on stronger policies by the PM and deputy chairman of the Planning Commission, useful in themselves, there are two indications of improvements in growth prospects this year. The first one is by Pranab Sen, India’s chief statistician, that larger production of crude and gas will push growth. This will be a once-and-for-all occurrence. The second is higher FDI, which needs to be watched before building it into the decision-making process.

The constraints on building rural infrastructure — largely the inability of regional and local governments to mobilise resources to take advantage of the big initiatives in the Eleventh Plan — need to be removed quickly. Examples of things that need much better Central, state and local coordination and more leeway at the local level: conditions on formulation of an agro-climatic plan to access Central money; project formulation for the National Rainfed Area Authority plan; the distressed districts ground water programmes. In no district that I have been to have these really got going, and all the district collectors I talk to say that while the NREGA and the Sarva Shiksha Abhiyan are on full-steam ahead no one has heard of these as operating projects.

The panchayats have also lost Mani Shanker Aiyar, at least as a minister, although he may become more effective now. Relatedly, field action required for the policies supporting market access, value-added processing and institutional reform — which the FAO and the World Bank have called rural-urban continuum policies — are just not seen on the ground. The problem is an unwillingness to recognise that we are not a plain rural economy, and are now rural-urban everywhere.

... contd.