India’s steel frame has delivered during this crisis, but still needs fundamental reforms
By Srivatsa Krishna
Everyone wants the state to step-up, bail out, yet not be intrusive. It is like saying: You want a top-notch Bharatanatyam performance without contouring the body in any way! When the government crafted the Rs 20 lakh crore stimulus (for which everyone wants the IAS), won’t it take precautions while spending this public money (for which no one wants the IAS)? Everyone wants a langar, with no oversight! Indeed, should the bureaucracy, like many leading IT honchos have suggested, simply get out of the way, become a kind of ‘reservist force’?
India’s much-maligned bureaucracy has delivered the world’s biggest lockdown fairly effectively, without any playbook to learn from, which gave India time to prepare better; our health systems have coped, not collapsed, and by and large, every single arm of the government has risen up to the occasion admirably—conceding fully that handling of the migrants could have been done much better, despite their unpredictable decision to go home in droves.
This well-implemented lockdown ensured India has one of the lowest fatality rates in the world (<3%) and good recovery rates (49% and rising). Those who are throwing stones at the IAS forget that officers in the Prime Minister’s Office down to the last constable have worked round the clock, often risking their own lives, which people seem blind to. Indeed, make bureaucracy more accountable and competitive, but don’t bash it without context or comprehension.
Professional bureaucracy bashers forget the simple fact that the permanent executive is a tool that, as per the Constitution, is expected to carry out every lawful directive of the political executive. When a particular set of CMs want extension of lockdown (or exemptions), why blame the bureaucracy which is only carrying out a lawful directive? Likewise, it doesn’t escape notice that eminent economists of Indian origin abroad often speak with a forked tongue when it comes to monetisation of the deficit.
Tomorrow, if indeed there is some inflation or ratings downgrade, the very same economists will berate India’s political and permanent leadership for having monetised too much too quickly.
Indeed, there are overenthusiastic bureaucrats who want to be more loyal than the king, and make some shocking regulations to cover their own backs! Adjusted gross revenue (AGR) is so utterly inane that it mandates spectrum charges on foreign exchange gains or losses too—but it covers backs, which can be exposed for caning even after two decades post-retirement!—after all, one can’t be fired for being overcautious, but only maybe for super-performance. Thus, behaviour is as per incentives facing the civil servants.
Let’s not forget that the nature of any rule is that it is always applied to the lowest common denominator, and the minute one tries to nuance regulation, bureaucracy is accused of becoming a ‘clarifications ministry’ or opens itself up to allegations of allowing unwanted discretion and abuse. Why can’t the clarifications be seen as a responsive bureaucracy willing to learn from rapidly shifting ground realities and nuancing rules? If the corporate sector does the same, then it is lauded as ‘agile’ development. Just assume if the bureaucracy had not responded on the fly, then it would be called callous, red-taped, unwilling to be responsive even in a crisis.
Likewise, many who haven’t set eyes on an economics textbook their entire lives sprout wisdom on how the UK has given a 15-20% fiscal stimulus and how India should do the same—whereas the UK’s fiscal stimulus is only 4.8%. Every country has done a combination of fiscal plus deferrals of taxes plus other liquidity provisions/guarantees, which is what some of the best minds in India’s civil service have also put together, but that is attacked, whereas the UK is lauded. In fact, no country in the world, other than the US, the UK, Germany and the Netherlands, has given a pure fiscal stimulus greater than 2.5% (www.bruegel.org/publications/datasets/covid-national-dataset) and yet the illiterate cacophony to criticise the government on the stimulus continues, unabated—even by top industrialists masquerading as economists and political commentators as phony economists. Everyone wants to be anything but atmanirbhar—only government-nirbhar. Shouldn’t the government retain some dry powder, if Version 2.0 of the virus comes back later?
In this current fight against an invisible enemy, contact tracing and enhanced health infrastructure are expected of every government. New York, California and Massachusetts have started new employment generation for ‘contact tracers’ spending millions of dollars, as should India.
Every major corporate worth its salt in India today has a social media command centre, with granular data of their clients. Banks and hospitals have important citizens’ records, who don’t seem to mind them having it, so why should they mind their own duly-elected government using it too, with some safeguards? How do you expect governments to identify, track and deliver food, cash, care without knowing some basic data of citizens? If, say, Facebook were to offer the same service, wouldn’t citizens happily (or unhappily) share their data? When it comes to commercial activity, bureaucracy must get out of it, become a reservist force meant for emergencies only.
Suspension of labour laws by UP, Punjab and Gujarat are a good step forward, for much of these are enablers of extortion for most in the game. The Industrial Employment (Standing Orders) Act 1946 is the Covid of both industry and labour, making it impossible for either to thrive. Simple proof of this is if labour laws had been a thumping success, West Bengal or Bihar wouldn’t be in the economic state they are in, with labour migrating in droves.
Coming to reforms in the IAS, lifetime contracts in employment are not found almost anywhere in the world, and India should after, say, 15 years allow officers to continue only through 5-year performance contracts or let go with a golden handshake.
The government must open up 15% of joint secretary and above appointments by lateral entry, but only through the UPSC to ensure proper scrutiny and professionalism in intake. Competition is always good, and a revolving door in and out of government helps all sectors understand each other better—it shouldn’t be one way only. The key questions to ask are:
1. If we abolish bureaucracy, who will design and implement policy and advise democratically-elected leaders? Imagine the counterfactual—if we had a Kalmadi or a Mallya or a Bannerjee or a Togadia as cabinet secretary, would that be Pareto-optimal?
2. Corporates, consultants, comedians and media believe that the Bell Curve doesn’t apply to them and that there shall cometh a new race of Indians from Mars perhaps, who are all honest, superefficient, effective, yet not intrusive. Don’t we all come from the same stock of people with broadly similar frailties?
3. Capacity and competence in the government is extremely spotty—some outstanding who will be in the top 10% of any collection of individuals anywhere in the world, many mediocre and some rapaciously terrible, and some come in combo packs. What kind of incentives will work in this ecosystem, when dismissing a corrupt employee takes 20 years, while one’s own tenure is two or less? For the first time ever in India’s history, this government has shown the courage of conviction and sent home numerous officers for corruption and incompetence. Why isn’t that lauded?
In summary, the best livelihood antidote for Covid-19 is a strong economy. And a control-freak bureaucracy, goaded by various masters, is more dangerous than the virus itself; however, some interventions will be intrusive—so be it in these unprecedented times. Don’t throw out the baby, the bathtub and bathwater, all together, in the quest for reforms. Why doesn’t India take a slightly more generous view of bureaucracy, and, indeed, the government, which are working in a very tough ecosystem and yet delivering—even if they fall short sometimes? Why don’t they try to understand the average officer’s experiences and constraints no matter how inchoate they appear at first sight and thereafter nudge him to explore different, nay, better methods? The fault, sometimes, is in the stars too, eh Brutus?