3 Years Of Modi Government | NITI Aayog Should Push For More Inclusive Growth
It is becoming a good public and media practice to submit the government to an annual examination. The Narendra Modi-led NDA government is completing three years. How has it done so far?
Modi announced his government’s first major institutional reform, on 15 August 2014 in his first Independence Day address to the nation from the Red Fort. He said the Planning Commission (PC) would be shut down and a new institution would replace it. The Planning Commission had been set up in 1950, shortly after India’s independence. Many prime ministers, beginning with Rajiv Gandhi in the 1980s, had expressed their desire to reform the PC.
In 2009, Manmohan Singh asked the Commission to undertake a review of itself. Many stakeholders were consulted to re-calibrate the purpose of the Commission and to update its methods for the requirements of India in the 21st century. A special commission led by Prof. C. Rangarajan examined PC’s role in management of national budgets and finances, including the classification of expenses into plan and non-plan heads. With these inputs an agenda for the reform of the PC had emerged during Singh’s tenure.
Modi, in his characteristic, action-oriented style has implemented it. The plan/non-plan distinction is gone. PC will not have any budgetary powers. Singh had said that PC’s role must change from a budget making body to a ‘systems reform’ commission. Modi announced a new charter for the institution on 1 January 2015 and gave it a new name too: the National Institution for Transforming India (NITI) Aayog. The charter lays out the purpose of the institution. It will promote the devolution of the planning process to the states and to institutions of local governance. It will create structures for cooperation between the states, and between stakeholders, to collaboratively develop the country for the benefits of all its citizens. A unifying national vision will guide the plans of the states and local bodies who will be given greater freedom and responsibility, rather than imposition of one-size-fits-all schemes and procedural micro-management from the center which was stifling enterprise and innovation in the states.
Cooperative-cum-competitive federalism was introduced by Modi’s government with the annual ‘ease-of-doing business’ evaluations of the states. This has stirred up energies in the states for reform and speedier implementation. Cities are being driven to compete with comparisons of their cleanliness. Learning is being promoted amongst states about methods to improve health and education outcomes. The burden of dense 5-year plans described in 1,000-page documents that hardly any one read, has been lifted. Instead, a 15-year vision has been formulated for the country with 3-year action agendas.
Processes of planning have been changing in the two-and-half years since the NITI Aayog was announced. As an arm-chair observer, one can recommend that NITI Aayog, to achieve its transformational ambition of stimulating planning for the people by the people, should focus much more on building institutional capacities at local governance levels.
The states will have to be motivated to do this. States should be compared for the progress they make, and they should be supported to move faster. The participation of stakeholders in preparation of national visions and sectoral policies must be deepened too. NITI Aayog has become very active on social media as it should. But dialogue with stakeholders must go much deeper and wider. The development and application of processes, in the states and in institutions of local governance, for deep, democratic deliberation amongst stakeholders is imperative for India to realize its vision of more inclusive and sustainable growth. This is the transformational task that the Prime Minister and NITI Aayog must accomplish.
