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Table of Contents
Accountable & adventurous
• Indians are exasperated with corruption and exhausted by poverty.
• Ending poverty needs a more adventurous state
• Ending corruption needs a more accountable one
• India has been stuck in a low-level equilibrium of low productivity
• There is huge public appetite for blood — accountability — for large frauds in telecom, coal, land, and banks. • Prevention of Corruption Act will protect honest risk-takers but these changes are not enough.
• For accountability and risk-taking to co-exist – Rationalisation, Institutionalisation and Specialisation
1. Rationalisation means that the Indian state must do less, so it can do more. We Don’t Need A Big Team Of Ministers &
2. Institutionalisation :-
• Nobel Laureate Douglas North insightfully suggested that the difference between poor and rich countries is institutions.
• The key is how institutions work in practice rather than theory.
• The rule of law — demonetisation, GST, RERA, shell company evisceration, Bankruptcy Code, Fugitive Bill etc
3. Specialisation –
• Debate in leadership between generalists and specialists that will never be resolved because any healthy organisation needs both. • Politicians need assistance by technocrats not bureaucrats
• This also applies to investigating agencies with 3 per cent conviction rates • Questionable arrests like bankers by Maharashtra state police recently.
We Also applying this framework to banking :-
• The case for rationalisation is clear – banks give loans, some will always go bad, and stupidity is not illegal.
• Governance even in private sector banks – Process has started due to shareholder action, board churn and regulatory action.
• The current nationalised bank ecosystem is inadequate for creating the right governance, culture and consequences.
• The RBI is atoning for decades of bad policy for fixing bad loan handling.
Conclusion
• Bureaucrats either look up at technocrats or down on them; never straight across
• Government bank ownership must shift to a special body
• Political parties stuck in the rhetoric of left and right are exhausted and no longer have answers
• Corruption knocks off 2 per cent of our GDP and poverty stunts the lives of 300 million Indians
• Solving both problems needs an accountable and adventurous state A Quote By Great Philosopher J Saul “our citizens deserve a massive restructuring of the state because they are not customers of bureaucrats but their employers.”
The right thing
• The government’s decision to clear the Supreme Court Collegium’s move to elevate Uttarakhand High Court Chief Justice KM Joseph to the apex court.
• Justice Joseph’s name was first proposed In January
• Stand-offs between the judiciary and the executive
• Government’s unusual delay in responding to the Collegium’s recommendation Was Justice Joseph being punished for his ruling, in 2016, to quash the imposition of President’s Rule in Uttarakhand, and to restore Congress rule in the state? Chief Justice of India Dipak Misra’s unwillingness or inability to stand up and put his foot down on a matter that involved the independence of the judiciary. By clearing Justice Joseph’s name the government has sent a signal that the tensions can be lowered It will require more outreach by the government to ass
The Fake news on GST
▪ Average 3 month GST collection of 95 thousand crore for the first three months of this fiscal year — April through June.
▪ It is way below the Union Budget target of 112 th cr a month??
▪ 28% bracket – reduction in items and services
▪ Common assumption – SGST is equal to CGST – 112 Th crores.
▪ FY19: Total CGST*2 + IGST + cess = Rs 1348 thcr.
▪ 13 months estimate
▪ Average estimate of Rs 94.8 or Rs 95 thcr a month.
▪ Average per month collection April-June 2018 is Rs 95.4 thcr.
Delhi and Canberra, a lost chance
• ‘An India Economic Strategy to 2035 :Navigating from potential to Delivery’ – report by Australian expert PETER VARGESE tells about the strategic ties to be build with India.
• Its recommendations could transform bilateral relations between two countries. The long term economic strategy towards India should rest on two critic points: A)people to people ties B)geopolitical congruence Issues –
i) Hegemonic tendencies of china
ii) India and Australia favor rule based international order
Iii) Inclusive regional institutions Quiet burial of the report – the current political and bureaucratic leadership in Canberra is back to articulating a China policy reminiscent more of Chamberlain rather than Churchill.
• India – amongst top three of Australian markets by 2035.
• Third largest recipients of Australian outward investments.
• Natural resources, mining, agriculture, infra, health, defense, security and education
• Relationship in education sector – ability to attract the ‘best and brightest ‘from India.
• PM Modi’s visit to Canberra in 2014
• It is time for political leadership to take charge once again to resurrect the lost opportunities.
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