Civil society systematically triggered an uprising aimed at installing a super-powerful body to check corruption. Economic reforms stalled, and foreign direct investment (FDI) in retail was aborted by opposition within the coalition and across the aisle. In the institutional balance of power, a paralysed Parliament lost ground to the judiciary. Markets tanked as a euro-zone-induced global economic downturn was matched by an inflation-led slowdown in India.
Rather than see these crises as signals heralding India Sinking, I would argue that they represent the resilience of Indias institutions and checks and balances. The multiple crises of 2011 clearly point to the key areas where the system needs fixing: First, India needs to correct the flaws in the electoral process that have spawned corruption and rotted the body politic. Second, the government needs adept political management and must ensure that Parliament and the bureaucracy perform. Third, the country is crying out for visionary leadership that can reconnect Indians to the story of an economically vibrant, inclusive India.
The fight over different versions of the Lokpal Bill is really like arguing over whether one needs a surgeon or a physician. The challenge is to address the causes of the disease of corruption. Corruption is triggered by the costs involved in running political parties and fighting elections. Indians and civil society are in denial about these costs of keeping a democracy functioning. This has led to corruption afflicting every political formation, to crony capitalism, loot of national resources and predatory government. But Prime Minister Manmohan Singh and Congress president Sonia Gandhi still have the credibility to push for far-reaching electoral reforms and state funding that can push India out of its corrupt equilibrium.
To push through changes that are good for all parties and the democratic system, UPA-II urgently needs to improve its political management. Dialogue within the coalition and discussion and debate in Parliament are crucial steps to consensual reforms that are good for all parties. This requires the government to be open to criticism and to take the lead in changing the way Parliament functions. A Parliament that brawls and stalls loses its legitimacy and its functions will be usurped by other institutions. As indeed they have. During the dying days of December, addressing party MPs, Congress president Sonia Gandhi launched an attack on opponents of the governments Lokpal Bill, vowed to fight to fix corruption and to usher in reservations for women. The country has been missing such leadership from the front for most of 2011. These are issues that can enable cross-party divides to be bridged and pan-India support can be built. Indians are crying out for our leaders to tell us what their vision is and to include us in co-creating goals that would strengthen us and inspire us to empowered action.
To get India moving again, UPA-IIs leaders have to retake the initiative by reclaiming the narrative. The PM has to spell out why we need further economic reforms and clearly enunciate how we will address the concerns of those who lose out. If one of the fathers of Indias economic-reform-led growth cannot convince us on the next steps towards prosperity, who can We desperately need to see the Manmohan Singh that we saw during the nuclear deal. He now needs to remind us that the economy is safe in his hands and to demonstrate that by getting the engines of growth revved up again. That means reaching out and preempting and preventing the thousand cuts from friends and foes in politics and industry. That means that when reforms like FDI in retail stall, he still needs to initiate investments in the agricultural supply chain that will transform the farm-to-fork equation. Foreigners dont have a monopoly on ideas on what needs to be done. UPA-II must drive investment in such infrastructure anyway, and transform the prospects of farmers and consumers.
In the UPAs division of labour, Manmohan Singh is the head and Sonia Gandhi the heart. The Prime Ministers task is to ensure economic growth. The mission of Sonia Gandhi and the National Advisory Council is to ensure that the fruits of economic growth are shared with Indias voluminous have-nots. With regard to poverty alleviation, the UPA leadership has enormous credibility.
The Nrega has created a social safety net and pumped purchasing power into the palms of the poor. Now, the food security initiative has the potential to address another fundamental problem gnawing at our conscience and self-respect that large numbers starve or are crippled by undernourishment. But tremendous attention needs to be paid to fix potential flaws in these programmes, to ensure that a culture of dependency is not fostered, that other externalities are not created and that the delivery mechanisms are leakproof.
The fight for inclusion will continue: Political empowerment by levelling and opening up a cleaner electoral playing field, gender empowerment through womens reservations, economic empowerment for backward minorities, educational empowerment for our hundreds of millions of youngsters. There is no shortage of agendas or action items on UPA-IIs list of New Year resolutions. If UPA-IIs leadership steps forward and reclaims the narrative, India can cast aside the annus horribilis that 2011 was and usher in an annus mirabilis in 2012 and beyond.
* The author is chairperson, Centre for Public Policy, Indian Institute of Management, Bangalore