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Speeches / Statements
Address by Shri T. K. A. Nair, Principal Secretary to PM at Colombo
26/03/2009
March 26, 2009
1. To be here in Sri Lanka, a country with which we in India share deep civilizational bonds is indeed a great privilege for me. We are both pluralistic societies, which are multi-regional, multi-cultural, multi-religious and nourished by the inherent spirituality of our religions and cultures. Our epic Ramayana refers to Lanka as Swarnamayi Lanka or the Golden Lanka. These deep bonds of a shared heritage have only strengthened over time. In our contemporary history as two post-colonial nations seeking to realize the potential of our people through accelerated development, India has watched with admiration the strides made by Sri Lanka in human development, somewhat similar to some of our provinces in South India. Both our people share the common aspiration of seeking our destiny through a deepening process of political democracy.
2. As I meet with you today to share some of my thoughts on governance in India, it is to this political democracy that provides our framework of governance, that I would like to allude to first. India is currently going through another round of national elections, perhaps the world’s largest festival of democracy where 700 million people differentiated by region, religion, language, caste, class and gender come together to choose who should rule them. Thanks to our diversity, democracy has emerged as the platform to reconcile differences and forge unity. India’s diversity and its reconciliation through democracy was on display as the world watched a minority community “Sikh Prime Minister chosen by a political party headed by a leader of Roman Catholic persuasion being sworn in by a Muslim President in a country that was predominantly Hindu”. Our conviction that our diversity can be responded only through a democratic framework of governance has only been strengthened over the years. It is through this democratic framework of governance that we have sought to lift large numbers of our people from “poverty, illiteracy, disease and the inequality of opportunity” in which we found ourselves at the turn of our independence.
3. Over the years, India’s governance model has been widely criticized for its inability to meet the aspirations of its now over a billion people. Even as India has made dramatic strides in reducing poverty, illiteracy and ill-health, in terms of absolute numbers it is still home to a large number of the world’s and South Asia’s poor, non-literate and under nourished population. Quite often impatient observers of development processes have suggested that perhaps a more authoritarian governance dispensation would have accelerated India’s pace of development. Often it was compared with certain other countries which they saw achieving a much faster growth rate on account of their capacity to take decisions quickly, enabled by a more authoritarian framework of governance. In contrast, India’s adversarial multi-party democracy was seen to be muddling through time-consuming processes to reconcile contradictions born out of both ideological differences and identity-based politics. All this was supposed to have reduced the headroom in India for radical policies essential for effective governance. It was at best, seen to be choosing a path of gradualist reform. However as I speak here today, we are again in a different world, which is fast revising its prescriptions of governance. A world overtaken by a spreading gloom of economic instability is perceiving India as a country, which though considerably affected by the global economic meltdown, is seen as being able to manage a reasonable rate of growth. Its financial sector has largely been insulated from global volatility. I would give the credit for this to our deliberative democracy, which ensured that we take a cautious, and in retrospect more prudent, path of economic liberalization. The basic point I would like to make is that Indian governance is both defined and shaped by the nature of its political democracy which itself has been evolving. It is this interplay between political democracy and administrative governance that I would explore in this lecture. I would present this in two parts: the first part, a rendering of our development narrative as I have experienced up to the turn of the century and the challenges before Indian governance today.
The Road Traversed
4. Governance and public policy are best understood as taking place on a contested terrain. Competing demands are reconciled, often through second-best solutions. The case I am advancing for the understanding of India’s governance framework is one of continuous learning in negotiating contradictions. Here a historical perspective of the evolution of governance in post-independence India may be in order. Colonial rule only deepened the several pre-existing fault lines of region, class, caste, and language in India. It restructured class relations as it usually does and left uneven development as inheritance at the time of independence. The first challenge in governance in independent India therefore was to forge a shared understanding of what “development” meant. People with widely differing aspirations had to be persuaded to adopt a common vision and through that vision, a new nation was to be forged. The two defining trends of Indian governance--that of “regulation” and “development” originate here. The unshackled aspirations of a newly independent people for development were to be responded to by a “development State”. The fragile and evolving concept of nationhood was to be promoted and fissiparous tendencies created by multiple identities checked through a “regulatory State”. The communal carnage following the partition only reinforced the need to have a strong centralized State. The burden of our fledgling democracy was to address these twin tasks together—the onus of accelerating development and the onus of keeping India united. It is in this duality inherent in our context that the history of many of our governance institutions needs to be located. We created a model of centralized planning for development through the setting up of a National Planning Commission and structured Five Year Plans to orchestrate development. Independent mechanisms like the Finance Commission were created to allocate resources between the Centre and the States to account for devolution. To assist the political executive in discharging its twin responsibilities of regulation and development, the Indian Civil Service rechristened as the Indian Administrative Service was to be the handmaiden and it was seen as essential to forging unity and catalyzing development. It is interesting to see that this “mandarin” service for which there are few global parallels, was uniquely cast in what could be called a “schizophrenic” role-an agent of the State for regulation which included magisterial functions as well as the vanguard of development. Members of the administrative service can be seen to be inducted into this inherently contradictory role expectations who were first expected to make their internal reconciliation to be effective in discharging their duties. Political democracy had inserted “citizen” in place of subject” in its normative framework, and the officers of the Indian Administrative Service had to negotiate the ambivalence in their mixed-up role definition and role expectation of treating the citizen often as subject in their regulatory role and as citizen in their development role. My objective judgment of this first phase of our governance in post-independent India is that its governance framework and its civil service did manage to cope with the complexity and adjust to these contradictory expectations, even if falteringly at times.
5. The external environment in which India found itself in a bi-polar world forced it to adopt a model focusing on domestic capacity creation or what economists call an import-substitution model. The internationally non-aligned position meant that India had to depend largely on its own domestic resources to build its economy. At the same time, it is also a historical fact that India’s leaders of the time were inspired by the building of the Soviet Union as a powerful countervailing global force. Its model of centralized planning held considerable attraction to India’s post-independence leadership and the first decade of our governance was focused largely on building major infrastructure like steel plants and cement plants seen as the muscles of a new nation. The public sector was placed at the commanding heights of the economy. In retrospect, this phase of our governance again had to reconcile contradictions. In ideological terms this approach meant a departure from what many perceived as a Gandhian vision focusing on the individual, her basic needs and the permission of a self-reliant local economy. The Nehruvian vision focused on technological competence and a vision of modernity driven by technology. The soul of Indian governance was being contended for by these two diverging visions. Consequently, Indian governance attempted to combine a belief in the modern State driven by technology and building an industrial base and simultaneously accommodating local aspirations and providing space for village crafts and ecologically prudent agriculture. The first generation of civil service in India had to negotiate this paradox of walking in Nehru’s footsteps building a modern State while attempting to keep elements of the Gandhian vision alive through focus on community development blocks and Khadi and Village Industries to create village self-reliance. There was a tacit acceptance of the Nehruvian vision as mainstream and the Gandhian vision as complementary, most evident in India’s agriculture modernization through inputs of science and technology. Despite all these contradictions, it is a tribute to the governance system that it was able to create a sense of unity of purpose and collective nation building became the most important marker for the first two decades of independence. In doing so, the governance framework consolidated on its regulatory role expectation of a united India.
6. India had learnt to reconcile multiple objectives and consciously chose a model of a mixed economy and an overarching framework of growth with equity. Private entrepreneurial energy was to complement the public sector and encouraged to be able to contribute to growth even as the overarching goal was to share the wealth created through redistributive public policy. Any objective recording of the first two decades of India’s governance is likely to point out a signal failure –that of not carrying out land reforms essential for redistribution of resources in rural India. Though zamindari systems were abolished and tenancy reforms initiated, these remained largely on paper as the political will for land reforms was missing in many Indian states. The coalition of interests that were in power in India included both the industrial bourgeoisie and the kulak or land owning peasantry. The technology interventions in agriculture and investments in irrigation could not deliver rural prosperity in the absence of effective efforts for structural changes in land ownership. This became the genesis of a dominant contradiction Indian governance had to confront ever since - that of “rural neglect” or the claims of “Bharat”, vis-à-vis “India”. This became the most important contradiction that Indian public policy and its administrative apparatus was called upon to confront in subsequent decades.
7. As it usually happens in India, political democracy and economic necessity refocused action on rural India. Excessive dependence on food imports which in turn depressed prices for agricultural commodities had led to a stagnation of Indian agriculture. The next phase of our governance was one that focused on extending our technology capacity to building self-sufficiency in food. The “green revolution” which India attempted in the 1960’s was as much an assertion of the economic independence it wanted to achieve so that it could continue with the independent path it was following in its foreign policy. India’s political leadership realized that the country dependent on something as basic as food can never become truly independent as was becoming evident with the strings attached to aid. The green revolution is also a case study on one of the high points of governance where a political leadership with vision, a policy leadership with sensitivity to inter-regional differences and a technocracy with competence and global connections was able to create a revolution in our farms to raise India’s productivity to a level which gave it national level food security. Shri C. Subramaniam who was the Agriculture Minister, Shri B.Shivaraman who was the Secretary of Agriculture Ministry and chief policy planner and Dr. M.S. Swaminathan a plant genetist who headed our agriculture technocracy worked together with a mission leading India to self-reliance in food. The newly developed Mexican varieties of wheat were used for a productivity breakthrough. The technology was both water and chemical-fertilizer intensive. This meant that India had to consciously choose to develop certain parts of the country at the expense of others. Punjab and Western Uttar Pradesh were chosen for focus in wheat cultivation and the Southern plains of Cauvery for rice. The major irrigation systems in these areas could support the new agricultural strategy. The Government of India was conscious of the trade-off and that it would increase inter-regional disparities. Therefore, it put in place the Public Distribution System and a Food Corporation of India that would move grains from surplus areas to deficit areas. At the same time a string of agricultural universities were established in order to develop our own technology options to avoid a crisis in the future. This was a comprehensive policy response which paid off. I have talked on this at length to establish one simple point – that the governance framework of the political leadership, the bureaucracy and technocracy had acquired a certain sophistication by the late 60’s to be able to meet major national challenges.
8. The 70’s was a period when democratic aspirations began to threaten the legitimacy of the Indian State. Political democracy had advanced people’s aspirations and they demanded a change in the governmental system to respond to their basic needs. The trickle-down development model was seen to be not delivering. South Asian economists like Mahbub ul Haq presented the case that there was no escape from beginning a direct attack on poverty and investment in basic needs. Interestingly in the same period that development efforts were seen to be deficient in India, political unrest was also on the increase straining the regulatory capacity of the State to contain them. This led to a revising of development governance and creation of several schemes that sought to directly attack poverty. Targeted programmes were crafted for different segments of the poor. The nationalization of banks enabled the Government to expand the reach of the banking system to rural areas and also develop programmes of directed credit. A combination of development and welfare programmes, some complemented with institutional finance became a critical component of the governance framework in the 70’s and the 80’s and was carried on since then with alterations from time to time. These efforts included improving agricultural productivity of small and marginal farmers through credit support, assistance to artisanal groups through extension, credit and marketing, training of rural youth for self-employment and wage employment programmes to provide incomes to the ultra poor along with the social security measures for vulnerable sections. It was a menu of developmental inputs by what could be seen as a highly “interventionist developmental State”.
9. The nineties was the decade of redefining governance in India. The economic reforms initiated in 1991 freed the economy from controls and the infamous license-permit raj. The economy began to accelerate in terms of growth rate, in fact doubling it. The Economist called it the uncaging of the Indian Tiger. The freeing of entrepreneurial spirit led to unprecedented growth in sectors like information technology. Indian private sector forced to compete globally was able to quickly adapt and rise to global standards. The paradigm of governance shifted from seeing the bureaucracy as the agency of delivery to creative collaborations between government and the private sector through public-private partnerships and disinvestments in non-strategic sectors. The State sector enterprises also facing competition rose to the challenge and many increased their profitability. This reduction of the State’s economic role gave it an opportunity to refocus on the social sector which had lagged behind both in terms of allocation of funds and effective delivery.
10. It is in India’s performance in the social sector-- in areas like education, health and human development in general that India began to get unfavorably compared with countries like Sri Lanka and China. India was seen as not creating avenues of opportunity for all its people because of its failure to universalize access to education. If we compare the development trajectory of India with that of many other countries, India’s focus on industrialization in the first two decades of its independence could be seen as happening at the cost of its investments in the social sector especially education and health. India’s record in education delivery was mixed. It did not wait to mass-base education before investing in institutions of higher learning and excellence. While this had negative equity impact, it had some positive output in terms of building a reservoir of excellence especially in its Institutes of Technology and Management. This investment made in higher education was able to create for India the third largest professionally qualified human resource pool in the world and when the knowledge economy began to dominate from the 90’s, its technical manpower was able to leverage global opportunities.
11. Indian governance was now able to make its growth impulses and its equity impulses much more complementary than before as revenue buoyancy increased. The governance structure was also forced to become more participatory. The economic policy reflex in terms of liberalization was carried over into the political arena through an amendment of the Constitution to provide for local bodies as the third tier of governance. It was evident that the Indian bureaucratic system had become obese, somewhat dysfunctional and tired. The Gandhian vision was rekindled with decentralization emerging as the political agenda in the 90s. Indian governance began to see people as the solution to many of its challenges and sought to organise them for direct action for development mediated by Panchayats. The vibrancy of non-Government organizations which saw tremendous growth in numbers and quality presented once again the hitherto unused potential of social energy for development. India’s development strategies began to get positively influenced by these new actors, the private sector in economic development, and panchayats and Non-Government Organizations in both economic and social development. India’s governance framework has been deepened through Panchayat Raj and broadened through Non-Governmental Organizations and civil society action. There has been, I believe, a perceptible move from an infrastructure building phase corresponding roughly to the first 20 years, to an excessively interventionist phase in the next 20 years to a participative phase in these last twenty years. It is this last stream of participatory governance that is now consolidating in India.
Road Ahead: Challenges of Governance
12. In a rapidly globalising and integrating world, the governance framework has to continually evolve and get modified. Many development challenges that India started with continue to engage its attention as unfinished agenda. The two major “ show-stoppers” that limit India from realizing its potential are, according to many observers, “infrastructure” in the economic sector and “female literacy” in the social sector. Needless to say, both have maximum multipliers for both economic development and social opportunity. All these get into sharper focus as we assess the opportunities that globalisation presents.
While India has been able to accelerate its pace of growth through the reforms initiated in 1991, the debate on it as skewing the benefits towards certain sections of society has only increased. While its defenders present growth as a“ tide that lifts all boats” its critics see the present growth as a “tide that is lifting only the yachts”. “What has the common man got’ was the poser in the elections of 2004 by a leading political party signifying an implicit critique of globalisation as not benefiting the masses. Objective recording of benefits from liberalization shows an improvement in the lives of ordinary people. It has been able to raise both the growth rate of India as well as the per-capita income of Indians substantially. It was able to create a middle class population of over 250 million people, larger than most countries of the world, with global aspirations and near global purchasing power parity. It was able to lift a large number of people above the poverty line. It has also, however, increased rather than decreased inequalities. The divides have became much more sharper between different sections of the people. Not surprisingly it has created initial “winners” and “losers” among Indian States and accentuated existing fault lines or created new ones. The South-West of India is seen as benefitting from liberalization much more than the North-East of India as the South-West had invested in knowledge institutions and had a better industrial base and therefore better initial conditions. The increasing of disparities between States, which in some cases are also leading to extremist movements, is a major challenge that the Indian State faces at present.
13. Global opportunities created through liberalization have excited the youth in a young India. As you are aware, India has a huge demographic dividend with half of its population below 25 years of age. A spirit of optimism and a can-do attitude define this generation This young India is a very optimistic India. Again the governance framework is addressing multiple challenges in this context too. The most important policy opportunity is to focus on education and skill development to make this young population productive. India has the capacity to claim a fourth of the global work force if it invests in skill-building for this young generation.
14. India is also today in a far better position to address the historical backlogs in development by way of financial resources. It is interesting to see that political democracy has been forced to respond to this with urgency and to redefine its overarching development philosophy as one of “inclusive growth”. The Government that I have been associated with for the last five years has been working on an agenda of inclusive growth, which believes in redistributing the benefits of accelerated growth. An agenda of inclusive growth focusing on employment, education and health through flagship programmes like the Sarva Shiksha Abhiyan for universal elementary education, a National Rural Health Mission to build rural public health infrastructure, a National Rural Employment Guarantee Programme that provides guaranteed employment of 100 days to every rural household that seeks work is in place and making a difference. To address deprivation of minorities a refocused 15 point programme for minorities is under implementation. To address problems of left wing extremism, Scheduled Tribes and Traditional Forest Dwellers were given rights over their land. A major programme of Bharat Nirman is quickly closing gaps in rural infrastructure and providing connectivity through roads, electricity and telephones to all villages. The revitalization of rural economy is now seen to be creating resilience to the economic downturn through sustaining domestic demand. The civil society demands for accountability to citizens was responded to through the Right to Information Act. All these are collectively consolidating the building blocks of the current new framework of inclusive governance. Delivery of public services has a better chance of improving through decentralization.
India’s foreign policy has demonstrated a new vision and has been effective in ending India’s nuclear apartheid through the civil nuclear energy programme. Along with information technology, India’s space programme is also attracting global attention as an opportunity for commerce.
15. Governance reform continues to be a major challenge and we could learn lessons from each other in this area. Some of the major trends in governance at the turn of the century in India could be identified as follows:
(a) Shift to a rights-based governance in key areas like rural employment, education and information
(b) Greater shift of governance responsibility to communities, local bodies and state governments
(c) Institutional innovations for delivery of public services
(d) Promotion of private investment through creation of a conducive investment regime for national and global capital and public-private partnerships
(e) An emerging competitive environment between States for attracting private investment and delivering on basic services and other governance indicators
(f) Focus on investment in knowledge and skill development supported substantially by the national plan to benefit from the demographic dividend.
16. During this period other major institutions of our democracy are also witnessing change and transformation. Our judiciary and free media have contributed to an effective watchdog function in our democratic frame of governance. Independent India sought to ensure that these institutions retain autonomy and independence though their relationship with the State have not been entirely without strain. But these have been creative tensions, which have only amplified the common goal of better governance.
17. Let me conclude with something, which may have a resonance for Sri Lanka. An evaluation of the Indian governance framework would reveal a consistent effort to keep pace with the demands made on the State through expansion of democratic space. Governance has sought to accommodate new concerns, new actors and new energies. India has always had to manage its diversity and heterogeneity. Its democratic governance has been continually learning to reconcile competing demands and has been enriched by this process of negotiation. Quite often decentralization has become the perfect tool to both accommodate diversity and enhance democracy. India and Sri Lanka share common challenges. You are attempting to advance your developmental goals within a democratic framework taking into account the interests of all segments of society. We are ourselves learning to negotiate the complex terrain of ethnic diversity and regional divides which might offer lessons. Our common vision for shared prosperity for our people will continue to motivate us to resolve differences democratically. When the world is talking in terms of a power-shift to Asia, it is important that we collectively engage in learning from our shared heritage, our common concerns of the present, and our shared beliefs about our common future.
18. Ladies and gentlemen, I thank you for the opportunity and for your attention.
Shri T.K.A. Nair is Principal Secretary to the Prime Minister of India. The views and perceptions expressed in this talk are entirely personal.