In a similar manner, getting well-known agriculture economist Ashok Gulati to head the Commission for Agricultural Costs and Prices (CACP) seems to have paid rich dividends. Gulatis initial hikes in minimum support prices (MSPs) have attracted a lot of criticism, including from this newspaper, for their inflationary impact (Gulati insists, though, inflation is the lowest in precisely those products that have MSPs), but he has other tricks up his sleeve. And even on the question of hiking MSPs, Gulati may have a point if production of coarse grains for which MSPs have been raised start rising. Of late, Gulati has been in the news for a variety of other reasons. For one, hes been taking on the government for how it is killing both the private grain trade and the fisc by its open-ended procurement policyaccording to Gulati, the government has food stocks around thrice what it needs and that, in turn, is adding R1 lakh crore to annual budget costs. Hes had some success in convincing state governments to start thinking about giving per acre subsidies as opposed to, for instance, large subsidies on wheat in Madhya Pradesh, which end up distorting crop patterns. Most important is the attempt to get Punjab to once again think of moving away from wheat, which has depleted the water table beyond acceptable levels, through an infrastructure-style viability gap funding. Gulati claims hes been working on getting the government to accept the idea of not banning exportsthe huge wheat glut is a result of a four-year banand going in for export taxes instead.
While well get to know if thats worked when the next export policy comes out, the experience of both Nilekani and Gulati reiterates the fact that inducting good professionals, and empowering them, is always a good idea.