governance, political economy, institutional development and economic regulation

Posts tagged ‘Nitish’

Make your vote count


In the 2009 Lok Sabha elections, only 60% of the 714 million voters bothered to vote. We don’t know how many, who did vote, were aware that the direct and indirect cost of each vote was at least around Rs 7500. Had voters been aware of the value of their vote, they might have given more thought to their vote. After all this is equal to the monthly salary of an aam admi.

This back-of-the-envelope valuation is based on the Rs 150 billion directly spent on the election plus 1% of the GDP over five years which is the conservatively assumed economic leeway available to a government. This means we assume that good governments can enhance GDP and bad governments can reduce GDP, by at least around 1% per year over five years.

This time around, more than ever before, we need to think before we vote. We cannot afford a rerun of the previous five years of lost opportunities and drift.

Unfortunately, bad news comes in triplicate. It seems our luck has run out.

Our new warships and submarines are sinking into the sea; our air-force falling out of the sky and our generals focusing on electoral politics.

Our government is so desperate for revenues that it will raise a tax demand retrospectively or inflate the demand unreasonably on hapless corporates and citizens, thereby enhancing regulatory uncertainty. The ongoing salary review of public officials (7th Pay Commission set up suspiciously close to the elections) will add to the existing fiscal burden of a fat and unaccountable public sector by at least 1% of GDP. More money for them means less money for us.

Pink slips in industry are on the rise. Spending on consumer durables is down. Housing stock lies unsold. The rupee see-saws between an artificial strengthening on the back of returning Indian hot money stashed abroad, partly to finance the estimated Rs 300 billion (US$ 5 billion) election expenses and the counter pull of a likely body blow as the US treasury reverses its easy money policy over the next six months.

At home, elections and the prospects of a Khichdi Sarkar (coalition government) raise the specter of continued executive indecisiveness and policy paralysis.

With two weeks to go for the first votes to be cast, the prospects of a clear winner are dwindling. Modi, the long-time favorite, faces incredible odds with lukewarm support from the BJP/RSS brass and in the face of a growing coalition of political parties with a single objective: block Modi from winning. His meteoric rise within the BJP; his charisma; his flair for independent rather than “group think” and finally his executive effectiveness make him a perfect target for the crabs to pull him down…and they are pulling mighty hard. Of course, it does not help that Modi has been unable to dissipate the ghosts of Godhra and reach out to the Muslim voter. For all the smiles, Modi is running now on only a single leg and it is likely to show.

Meanwhile, the ray of hope for the aam admi, on which Kejriwal rode to power in Delhi, has dimmed. The mechanics of electoral politics has polluted the freshness of Kejriwal’s appeal. Party infighting will mar his prospects. The speed with which his government started working in Delhi was breath taking. But like an inexperienced marathon runner, he spurted too early and lost speed in the first lap itself. His voluntary capitulation from governing Delhi has diluted his credibility and commitment to stay the course; deliver on his mandate and solve governance problems. Voters expect solutions for their every-day problems from a government, not more legislation and protests.

It is a sorry political spectacle out there. But are there things the politically aware voter can do to help pull India out of this morass? Yes there are.

First, in a parliamentary democracy like ours, please vote for a party not a particular candidate for MP. Nandan Nilikeni is a spectacularly good MP candidate and would make a great Minister for IT but vote for him only if you want to return the Congress to power. You may find Modi iffy on inclusion and social conscience, but vote for the BJP if you think the party works best for you. Nitish performed well in a Bihar, systematically degraded by Lallu, but does he have a party to support him? In our system individual candidates matter less than the party. A lone, brilliant individual in the Lok Sabha cannot achieve substantive change.

Second, India is deeply concerned about the criminalization of politics. The Mumbai based, Association for Democratic Reforms ( is doing signal service by sharing information on the declared assets and pending criminal cases for each candidate in a KYN (know-your-neta) format. Many voters may find themselves faced with a conundrum if their favorite party has put up a candidate in their constituency with pending criminal cases. Apparently around 15% of candidates, in the first phase of polling, are in this category. What should one do? If you have personal knowledge of the crime the answer is self-evident. Shun such netas. If your favorite party makes a habit of fielding criminally disposed netas, you need to think again about your party affiliations.

But remember often pending criminal charges are not an adequate indicator of criminality. Conversely, a clean record does not confirm probity. Consider that lodging an First Information Report (FIR) can be extremely easy or horrendously difficult depending on who you are. Ditto for getting the police to investigate your FIR and lodge an appropriate charge sheet in court. Lastly, getting the court to frame charges and start proceedings can be an uphill battle for the poor and poorly connected, but easy for a more forceful litigant, especially if the accused is a marginalized person.

Third, please remember MPs are not responsible for cleaning drains. That is the job of your Municipal corporator. Please do not vote on the basis of who built your neighborhood road best. MPs are meant to approve national policies and enact supporting legislation. Vote for the party whose track record in your State government, or in the National Government, has served your interests best.

The national government actually has a fairly narrow role. Be aware of the limitations of the national government. Consider that if the national government was so critical for outcomes at the local level, there should not be that much difference in the growth and development indicators of different states. After nearly seven decades of independence, inequality across states has grown, not decreased. In our system, despite the hoopla, it is the state government which matters most for your well-being.

National policies are crucial for determining (1) the rate of economic growth; (2) the cost of loans; (3) the availability of banking services; (4) the price of food and basic commodities; (5) the availability of jobs; (6) the quality of inter-state infrastructure (highways, ports, airports, railways, electricity, petro products and irrigation); (7) national defence and (8) promotion of our trade and investment interests overseas.

National policy is also key for ensuring the integrity of India and the right of every Indian citizen to travel, migrate or live securely in any place in India and access public services at their choice of residence. Around 25% of Indians do not live in the place of their birth and there can be no better indicator of nation building than the choice to migrate within India.

Assess the record of your favorite party against this simple metric because this is all that the National government can reasonably do for you. The rest is all done by your State Government, including implementing the rule of law, ensuring your personal security, protecting your property, educating your children, curing the sick, providing clean water and sanitation and developing markets, workplaces and habitats.

Make your vote count. Just think how much market research and soul searching you do before buying a microwave, planning your week-end or buying a present for your khas-am-khas friend. Your vote is at least as important.

Please don’t waste your vote by not voting or by adopting the NOTA route. Life is a forced choice exam. Do well and make sure the ink doesn’t run.


Politics and theater

Parliament disgraced it self yet again. The statement of the PM on the economic situation was a welcome window into the minds of the policracy. Perhaps it is the Shatrughan or Babbar effect, but may of the honorable members believe that they magnify their own self image by copying a fiery, rightious Bachan, a braggart Sanjay Dutt or a stylishly, thughish Pran, If we wantd to see imitation actors we would watch movies instead. Pity none of them can dance though. It would have been good to see Manmohan deliver his economic sermon break dancing to a Hritesh number. The nearest any member comes to this is the redoubtable Rajiv Shukla who vitrually goes into an attarctive “wave” dance the minute the opposition shouts at the PM.

It was not clear what the government wanted to achieve yesterday. Statements made in the house are assurances of delivery (promises) which are monitored. No new promises were announced by the PM. He merely repeated what Chidambaram had already assured the house. Worse the manner in which he read the speech out had less credibility than the assured delivery style of the practised lawyer, Chidamram. The opposition oddly thought it necessary to shout down a “maun” PM. Possibly they have become so used to not hearing him at all, that that the merest squeak out of him is tantamount to an aggressive barrage.

Yes unbridled corruption is a mjor failing of the present government but that is the election plank of the Aam Admi party which is invisible in Parliament. Only those in power can be corrupt. The UPA is in. The BJP is out, so we can’t compare apples and oranges. Corrupt sons and sons in law are not a chink of the Congress alone.

I wish the opposition had cornered the PM on the three key constraints to unlocking growth and good governance. One is the recent sense of “entitlement” of the “policracy” to massive corruption. The potential and many would say the impunity, to be corrupt, erodes the possibility of shrinking Delhi in economic decision making and the transfer functions and finance to the States. On corruption it is only the record of the left parties which is relatively clean but unfortunately, unlike their brethern in China, they join the populist bandwagon here and shed crocodile tears for the poor, with little regard for the disastrous economic outcomes of populism. In fact the left is very much like our PM….honest but ineffective and the new India does not endorse that.

 Second, we need to correct  the extravagant spending on defence of around 20% of the budget. This is a major drag which comparative developing countries in East Asia (excluding China), Latin America and Africa do not face. Since the defence sector is notoriously non transparent, little is know of how much public finance leaks…..but the growing political clout of arms dealers makes it apparent that it is they, who are king makers and not the other way around.
 Third, the dynamic economic record of some state level leaders (Modi, Nitish, Patnaik etc) has a major medium term constraint. ALL of them follow the centralised Delhi model of not devolving functions and finance downwards,  to where the real action is, at the local level. That is the third quiet revolution still to happen in India but is completely ignored by all parties.
India does not lack economic or technical expertise in the public sector, skilled labour or private entrpreneurship. What we lack is a honest, formally endorsed leader at the national level. The best cooperatives, like Amul, grow because of honest, pragmatic and enigmatic leaders, like Kurien. If INFOSYS today needs to recall Murhty, to rescue it, shouldn’t India also reach back in time and get an oldie (albeit preferably, one without a child-in-waiting), who has the experience, the rectitude and the fire in the belly to lead? India is a young country but sometimes, it is only the exprienced who can deliver what the young want.

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