Pushing Modi's Agenda
Joe C. Mathew May 5, 2017
Exactly a year ago, the Prime Minister's Office (PMO) asked the National Institution for Transforming India (NITI Aayog), the apex government think tank, to prepare three sets of document that crystallise Narendra Modi government's vision for development into a concrete action plan. The papers being drafted are a 15 year vision document, a seven year strategy blueprint and a three year action plan.
In the last week of April, NITI presented the three-year agenda first.
"We have tried to reallocate the resources that are available with us and focus on priority sectors like health, education, agriculture, rural development and infrastructure" says Arvind Panagariya, Vice Chairman, NITI Aayog. Inherently, the three year action plan proposes to shift the composition of expenditure by allocating a larger proportion of additional revenues available over time to high-priority sectors. Thus, the share of non-developmental revenue expenditure - in total revenue expenditure - would decline from 47 percent in 2015/16 to 41 percent in 2019/20. As a result, the allocation for health will see a jump fromRs30,000 crore in 2015/16 toRs100,000 crore by 2019/20. Education spend will rise fromRs66,000 crore in 2015/16 toRs1,12,000 crore in the next three years. Capital expenditure in railways and roads will shoot up fromRs40,000 crore toRs1,18,000 during the same period. The change is equally striking in agriculture and rural development sector - the proposal is to exponentially hike the allocation fromRs1,03,000 crore toRs2,16,000 crore in three years. The revenue stream has also been estimated. Both GST and demonetisation are expected to power revenue generation over the next few years. The changes will not significantly dent the government's fiscal discipline roadmap either.
India had moved away from the five year planning structure that was followed since independence after the Narendra Modi government scrapped the Planning Commission and, in its place, set up NITI Aayog. The mandate of NITI was to adopt a planning process with greater perspective, instead of the erstwhile Planning Commission's prescriptive plan and non-plan allocation based approach. The 12th and the last five year plan came to an end on March 31, 2017 and there was a need to have clarity on what the government intends to prioritise in the short term. The action plan was the outcome of this thinking.
The document does not restrict itself to the solutions it offers for the priority sectors. It talks about the changes needed in the economic and social ecosystem to trigger the overall growth the country needs. It highlights the need to rebalance the government's role in favour of public services and away from manufacturing. It recommends reforms in civil services and the electoral process. It touches upon every issue that the government considers important, be it curbing black money, expansion of tax base or synchronization of elections. The action agenda also discusses the imperative of education and skill development to fully harvest India's demographic dividend. "We look forward 15 years down the lane, and say this is where we want India to be. To get to there, we have to build upwards from below. The building blocks (for this vision) are what PM has already referred to you. Sabka Saath, Sabka Vikas," says Bibek Debroy, Member, NITI.
Debroy emphasises that the idea is to ensure every citizen in the country avails a minimum level of government services. Similarly, every entrepreneur must have a more benign business environment. "In the pursuit of these goals, there are issues which we need to tackle. That is what these documents are all about. The 15 year vision distills down to a seven year strategy document, which further distills down to a three year action plan. The vision document and strategy document are work in progress. The three year plan is still not a final document, and it will soon be in the public domain", adds Debroy.
The document has been shared with the chief ministers of all states. It will be finalised after further stakeholder consultation.
After all, 95 percent of India's national income generation happens in the states. The key to the success of the action plan lies with getting states on board.
ROLE OF THE STATES
In the heyday of the erstwhile Planning Commission, one of the major complaints the chief ministers - and this includes Prime Minister Modi too during his tenure at the helm in Gujarat - had a common grouse. The perceived 'highhandedness' of the Commission. It was as if the States had to come to the Planning Commission with a 'begging bowl' to get sufficient allocations for their earmarked priority projects. It is a reversal of sorts now. With no powers to allocate funds, NITI is more of an apex advisor. "We have neither carrot, nor stick", admits Debroy. That makes it even more important to ready an 'action plan' that the states want.
Panagariya says that the states' inputs were taken during the preparation of the draft itself. However, once the draft is finalised, NITI members, including Panagariya, will visit all the states and Union Territories to help them carry out the proposed reforms.
It's also a fact that most of the suggestions - and there are at least 300 of them across sectors spread out in the 150 page document - are not entirely new. For instance, the agricultural reforms that NITI talks about are already being discussed in the country. The legal reforms it is advocating have already begun in Rajasthan under NITI supervision. There are several such programmes that are ongoing, or about to be launched in many states.
"A year ago, we had started the discussion on land leasing laws. The response from the states is huge. NITI has solid arguments. And if we are capable of persuasion, we will be able to win over several of the states, if not all of them" says Debroy emphatically.
From the Ganga Action Plan to Swachh Bharat, from the National Youth Policy to the National Health Policy, the draft three year action agenda moves along with the priority schemes and flagship programmes of the central government. While it highlights some state level programmes as models that can be adopted by other states, it also points out the possible measures that can make other initiatives more effective.
The action plan is a mix of corrective measures, new ideas and model proposals and statutes that can be tried elsewhere. If the NITI Aayog was set up to provide a holistic structure to the dozens of programmes that the government wants to implement to achieve certain lofty goals, it has made a good beginning. And if that is the case, the three year agenda is providing a clear view of the broad contours of the seven year strategy and the 15 year vision of the government.