BIMAL JALAN

                                     

India   Priorities for the Future by Bimal Jalan ; Published by Penguin / Viking ; Pages 184 ; Price Rs 499/-

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The country is presently embroiled in a political “star war” of a virulent type. Yashwant Sinha, who presented seven budgets as Finance Minister, asserts that India is teetering on the precipice of a collapse. Pitted against him is his son Jayant Sinha ,who was a M o S in the Ministry. He claims critics are not aware of full facts. Arun Jaitley ,the Finance Minister stoutly defends and points out that these are regular movements in the economy which is inherently strong. In all this cosmic confusion one welcomes sane assessment by independent thinkers like Bimal Jalan who has brought out a new book.

Dr.Bimal Jalan was the Governor of the Reserve Bank of India from 1997 to 2003. He has held exalted positions in the Government having served as Finance Secretary and Chairman of the Economic Advisory Council to the Prime Minister. For six years he was a member of the Rajya Sabha. He was Chairman of the Expenditure Management Commission. He served with distinction on the Boards of the I M F and the I B R D.

His academic attainments are impressive. He was Chairman of the World renowned “ Centre for Development Studies” in Thiruvananthapuram. He has close links with NCAER, Delhi and the ISI, Kolkata.

In the over three decades till 2014 there were twelve different governments. Of these four were multi-party coalitions and survived their five year terms. The remaining eight governments lasted less than two years. This resulted in the inevitable  absence of feasibility for any Government to initiate political reforms that would result in reduction of discretionary powers of ministers or reduce the role of the Central Government in the allocation of financial resources across the States.

There has been a dramatic change since the installation of the Modi government. It has become completely feasible  now for the Government to launch reforms to reduce the discretionary powers of independent ministers hailing from different parties  and introduce political changes that can surely reduce corruption and banish administrative bottlenecks in the delivery of services.

Jalan identifies some priorities for the future that can be implemented in a short-term of 2-3 years till the Modi government completes its first term in 2019.

While looking at the economic side, the book also consistently looks at the political side as well, taking pains to analyse the impact of the political situation and the political aspect of economic decisions.

The Congress party was at the helm of the affairs for about thirty years after Independence till 1980.The First Section of the book entitled “India Then (1980—2)" highlights certain economic developments during this period. Rajiv Gandhi as Prime Minister initiated a process of loosening the direct controls and regulatory framework for industries by the private sector as well as enabling the freer movement of foreign direct investment in the country. However, no change was noticed in the role of the Government or the public sector in the economy. In the 1980s the country suffered a persistent balance of payments problem and the foreign exchange reserves touched rock-bottom. Our capacity to meet import requirement became grossly inadequate. There arose an imperative and crying need for evolving a new development strategy and for revision of financial reforms that would lead to higher growth.

Section Two is  entitled “India Now—(2000-15)" and considers the economic and political situation pervading since the commencement of the 21^st century. It highlights the important priorities for the future that will lead to India’s realisation of its full potential as one of the fastest growing emerging economies of the world. 

This Section also analyses issues relating to the separation of powers among the three wings of the State—the legislature, the executive and the judiciary. This discussion will be of special interest to those fighting for ensuring that no schism mars the unity of the three wings of the government.

Seventy years of Free India has proved that a democratic system has survived and India is regarded as  a role model for the peaceful transition of power from one Government to another after periodical well-conducted elections. However, the process of governance, the distribution of power among the different agencies of the state, the functioning of political parties and the work of Parliament must be periodically reviewed.

In the light of India’s highly disappointing record of organising the economy before 1990 Jalan outlines a  programme of action which is valid even today and will lay the foundation of sustainable growth and can be implemented quickly. Some of these are given below.

1.Early action to remove revenue deficit altogether; 2.Reorganisation of public sector enterprises; 3.Replacement of direct physical controls by fiscal,                         credit and financial regulations;                             4.Decentralised planning ;                                             5.Higher priority for full literacy ;                           6.Reduction of administrative costs;               7.Administrative system to be made accountable.

Jalan analyses the slow progress of reducing the role of the State. He outlines the priorities needed to sustain growth with stability. He also tackles the problem of finance and development. There is a need to take early preventive action and build firewalls and keep safety nets.

 The book  is a very thought provoking and deep analysis of this intersection of  Politics and Economics of our nation, concerning itself with the Economy of the country, its performance through the years in numbers as well as Macro Factors; and the political aspects of this, that is – the decisions, involved decision makers, systemic weaknesses and plus points as they exist and what needs to be done.

 The  chapter on – “Politics and Governance “ is the most crucial one in  the book. It is an in-depth study of  the system of governance--- analysing  the Judiciary and its link with the Executive, and Legislature; the gross deterioration of  the political class, accountability of the Cabinet – the myth versus the reality, noting with candid clarity that the Parliament and the Legislatures generally do what the Government wants them to do. 

Jalan analyses thoroughly  the myth of the separation of powers. He studies  Centre-Judiciary Relations, Collective Responsibility,  Lack of Accountability, Problems in Parliament and its functioning, and the Politicisation of Administration.This book is compulsory reading for all students of economics,banking, polity and laymen interested in the progress of India.

P.P.Ramachandran.

1 / 10 / 2017