Impact of Agnipath scheme on operational capacity of armed forces needs to be assessed and communicated properly before rolling it out in phased manner

The Agnipath scheme recruiting agniveers for the armed forces has been a hot topic of discussion over the past fortnight, and has even led to violent protests and demonstrations in various parts of the country. There is a legitimate room for dissent and debate in a democracy but violence and damage to public property cannot be condoned in any manner. However, the intensity of the adverse reaction from the youth does point towards certain genuine concerns which need to be addressed and, in fact, should have been anticipated by the policymakers. Public policy is a complex issue because it deals with human beings who are prone to rational as well as emotional responses. It is for this reason that the formulation and rollout of any public policy needs to be done with a lot of care and has to involve all the possible stakeholders. We find that as soon as negative responses started coming in after the declaration of the policy, the government started announcing various other measures like 10 per cent reservation for agniveers in Central police forces or non-combatant wings of the armed forces. Some state governments have also assured of giving preference to agniveers in state government jobs. These announcements have helped in reducing the tensions but are somehow appearing to be an afterthought and a case of too little and too late.

Public policy always has some objectives in mind but, inevitably, there are unintended consequences to any policy, and it is the job of the policy framers to anticipate them and provide solutions in the policy document. The civil servants and the defense bureaucracy should have been aware of the likely reactions, and after deliberating on those, they should have been able to address them in the policy. The political executive normally has a much better understanding of the pulse of the people, and they should easily have been able to sense the likely reactions and prepare accordingly. I was surprised to read in one of the newspapers the statement of a senior officer of the government who said that they did not expect this kind of intense reaction. It points towards inadequate attention paid to the process of policymaking. Policies are not to be framed in isolation but have to be in close touch with the ground realities.

The government has outlined various merits of the scheme. The first is putting a check on the huge cascading liability of pension payments for better utilisation of defense outlay. In the budget for 2022-23, the defense ministry has been allocated Rs 5,25,166 crore — of which 54 per cent i.e., Rs 2,83,130 crore has been provided for pensions and salaries. Thus, pensions and salaries take away a large portion of the defense budget, leaving less to be spent on modernisation of equipment which is a necessity in modern day warfare. Only 27 per cent of the overall defense budget is for capital expenditure. It has been pointed out by some experts that ideally the ratio of revenue to capital outlay in the defense budget should be 60:40 whereas for India this ratio is 80:20. Indeed, this is a genuine cause for taking remedial action. Further, the government has also said that they will absorb 25 per cent of the agniveers in the armed forces and, eventually, by 2030, reach a state where agniveers and regular recruits would be in the proportion of 50 per cent each. This would reduce the average age profile of the armed forces, which today stands at 32 years. India needs a much younger profile for its soldiers. Unfortunately, the scheme has not been communicated properly and it has got positioned as a pension reform scheme whereas any reform relating to the armed forces has to focus on the objective of improving national security and operational capability. People would have accepted the scheme better if it could have been explained to them that this scheme would make the nation more secure, and by spending more on modern equipment, the defense forces would become far better equipped to handle any threat to the nation.

The adverse reaction is coming because 75 per cent of the agniveers are getting a job only for four years, after which they are not entitled to any pension or medical facilities, and left on their own to seek further avenues of employment. The government has come out with the promise of reservation in certain jobs for agniveers but there are reasonable doubts in the minds of the youth about the level of implementation, as even today the ex-servicemen quota in most employment remains unfulfilled. The private sector may be making pious statements about how agniveers would be a useful and disciplined resource for them but considering that they would only have a class-12 level education, one wonders to what extent the private sector would be able to employ them and in which capacity. The issue of unemployment is a genuine one confronting the youth today and this is why they are reacting in such a negative manner to the proposed scheme. It is interesting to note that most of these protests are happening in the states of Bihar and Uttar Pradesh. This is because these states have the maximum population of young people looking for jobs. Further, in both these states, the level of industrialisation is low and there are few job opportunities outside the government sector. In UP, I am personally aware of the thousands who apply for a grade-D level post in the government and many of them hold post graduate degrees and some of them are even PhD-holders. We can look around and see that in states like Maharashtra, Gujarat or Tamil Nadu, there is hardly any protest. Looking at the problem of unemployment, even the honorable Prime Minister has recently declared that one million vacancies in government should be filled up within 18 months.

In public policy, the issue of timing of a reform is also of crucial importance. Regular recruitment to the armed forces has not taken place for four years because of Covid, and many young aspirants have cleared various stages of the selection process. All of a sudden, they are informed that all these selections in process are cancelled and Agnipath scheme is to be implemented. Naturally, a negative reaction is bound to unfold due to a sense of desperation among the youth. The ideal thing would have been to complete all the selections which were in process and introduce the agniveer scheme along with regular recruitment in a phased manner. This would have given the opportunity of evaluating the scheme and, if found beneficial, rolling it out fully within four to five years. Some government spokesman has made the astonishing statement that this is a pilot scheme. A pilot scheme is one which is introduced on a small scale and, if it gives good results, it is scaled up. Evidently, there is apparent confusion in the government on how to make the scheme palatable to the people.

The Agnipath scheme has to be evaluated on its impact on the operational capacity of the armed forces and should be rolled out in a phased manner, depending on the results of a concurrent evaluation. Major policy reforms need far greater thought and involvement of all concerned.

Click to read original article.

To implement NEP’s transformational vision of ensuring multidisciplinary education, policymakers should sincerely focus on bolstering primary schooling

We are in the midst of celebrating the 75th year of our independence and the entire country is organizing functions and programmes to commemorate this year as Azadi Ka Amrit Mahotsav. There is a lot that we should be justifiably proud of in our progress during this period but, at the same time, we should be aware where we stand with respect to various indicators of development and also consciously chalk out a roadmap to make our country a developed nation by 2047. A holistic approach of development is required but we must realize that the 21st century is one where knowledge will determine the progress of a nation. If India wants to keep pace or even go ahead of the rest of the world in the 21st century then the main area of focus has to be education. We have a vast army of young people giving us the advantage of a demographic dividend but, without providing quality education to all, this will turn into a disaster. Education is a tool of political empowerment and also the means to bring about social equality and economic progress. The SDG goal for education very succinctly puts it that we have to strive to achieve “inclusive and equitable education to all by 2030”. This is a tall order for our country where the mean years of schooling are low and the gross enrolment rate for higher education is only 26.3 per cent at the moment and the status of all education indicators are much lower for girls.

We had an education policy in 1986 under which a significant amount of work was done in the education sector but the new education policy, coming 34 years after that in 2020, has a completely new vision about what education should mean for the Indian citizen. The vision statement envisions an education system rooted in Indian ethos and seeks to transform India (Bharat) into an equitable and vibrant knowledge society by providing high-quality education to all. It seeks to inculcate pride in being an Indian but also inspires to become a truly global citizen. It is indeed a wonderful vision which aspires to blend the Indian culture and ethos with modern science and technology. The NEP decisively wants to free itself from the shackles of the colonial legacy, as pronounced in the famous Macaulay minute on education. The Indian citizen should be a self-confident person, conscious of the great culture of the country but also desire to bring in the best of science and technology.

The foundation has to be strong for any building to withstand shocks or pressures. Unfortunately, our elementary education system is of abysmal quality and this clearly means that it would be difficult to build the edifice of a developed nation on this basis. The NEP has rightly focused on foundational literacy and numeracy. The education system would now be 5+3+3+4 years instead of the current 10+2+3. There would be a national mission for foundational literacy for the first five years of a child’s education. This would be till the age of eight years and is based on the scientific premise that 85 per cent of a child’s cumulative brain development occurs up to the age of six. Today, we see the sorry spectacle, as brought out by the survey reports of the NGO Pratham that students of class five can barely read or do simple arithmetic of class two levels. This requires serious remediation if our nation has to develop. The teachers need to be specially trained in early childhood care education. In India, this work is done by Aganwadis that are not trained for this job and have a lot of additional duties to perform. They will have to be trained specifically for this job and a synergy would have to be established with the primary school teachers so that together they are able to fulfill the goal of foundational literacy. It is indeed a matter of concern that even today, there are a large number of schools where the children don’t even have chairs and desks and they sit on the floor. We cannot become leaders of the knowledge society if serious steps are not taken to completely overhaul primary education. The community has to be involved in this. I would vouch for decentralization of primary education so that the village level local bodies are able to monitor them and bring about an improvement in the quality of education.

Teachers are crucial if school education has to turn round the corner. The new education policy rightly says that efforts have to be made to restore the respect and dignity of teachers which should motivate her to feel responsible and accountable for imparting quality education. We need to create an environment where the best are willing to enter the teaching profession and are prepared to work in outlying rural areas. There should be a regular programme of training and capacity development for teachers, and to keep them motivated the governance has to ensure a fair and impartial system of career management and progression. Qualified teachers should be recruited. Vacancies need to be urgently filled up and a system evolved to protect the teachers from the menace of transfers.

The goal of having a multidisciplinary approach at the school level is laudable but difficult to implement. The school systems as well as teachers will have to be oriented and geared to take up this responsibility. Besides, it is imperative to give equal importance to vocational and extracurricular education but, once again, this requires a lot of reforms at the school management level.

The new education policy has given valuable suggestions about developing education from primary to higher level but I feel we have to begin by focusing on school education. If the quality at this level remains poor then higher education will not improve. Education must get the highest priority from all political parties and the governments otherwise the problem of unemployment will grow larger and we will have an army of frustrated youth who would be diverting their energies into deviant channels. The future of India depends upon how we manage and transform school education.

Looking through the lens of social realities, rather than just in economic terms, revival of old pension scheme appears to be a viable proposition

A recent debate has been triggered on the issue of demand of the government employees to be given pension as it was done before 2005 under the old pension scheme (OPS), and not as per the new pension scheme (NPS) — brought into existence by Central Government in 2005 and adopted by all state governments except West Bengal at different points of time. Uttar Pradesh has been witnessing a major agitation in this regard by various employee associations and, recently, in the run up to the assembly elections, the Samajwadi party had promised in their manifesto that they would revive the old pension scheme if voted to power. Soon thereafter, the Government of Rajasthan went ahead and announced the implementation of the old pension policy for their employees. Recently, I also noticed advertisements appearing in newspapers justifying this decision and pointing out its several benefits. In a similar vein, the Government of Chhattisgarh is seriously considering reviving OPS and several other states are also actively examining the issue.

Noted economists and several retired civil servants have been voicing serious reservation on the revival of the OPS. Their contention is that this would be a financial disaster for the public finances of state governments as salaries and pensions were a major drain on the state resources and were increasing every day due to increase in the number of employees. Additionally, longevity of people was causing a huge strain on the budgetary position of governments, leaving limited resources for expenditure on capital items or social areas like health and education. It is true that the logic used to replace OPS by NPS was that the pension liabilities were rising too fast and the state finances would not be able to bear their burden. To discuss the implications further, it is essential to understand the mechanics of both the schemes. In the OPS, a retiring government officer or employee was entitled to 50 per cent of his last basic pay drawn as a monthly pension till the end of his life. He would also be eligible for an increase in dearness allowances announced from time to time to counter inflation by the government. In the case of the death of the employee, his wife was entitled to get 50 per cent of the pension amount for her life. The NPS does away with this system and instead provides for a monthly contribution being made by the employee (10 per cent) and the concerned government (14 per cent) of the basic salary of an employee and this contribution has been kept in a separate fund where fund manager is expected to invest this in the market and get good returns. On the date of his retirement, a lump sum is available for the employee where he can draw 40 per cent and leave the balance 60 per cent in an annuity scheme to get monthly returns. It is true that this would have a lesser impact on the cash flow on the governments than the OPS. However, it must be examined as to why it is being universally opposed almost by all officers and employees who joined service after 2004.

The employees argue that the NPS is linked to the market. They are apprehensive that the amount contributed is being invested in the stock market and that they would get an amount at the time of retirement which is determined by the stock market. There is, thus, no certainty as to what the value of their contribution would be and nor do they have any role in deciding how the amount is to be invested. Employees have different number of years of service and with the age of entry to almost all government services having been increased significantly, many employees are retiring even after just around 20 years of service. During this period, the NPS corpus that is created by their contribution is too small to give any significant lump sum return or a viable stream of returns through annuity. The employees’ associations have been quick to point out several cases where on retirement the employee has been getting a measly sum under the NPS which is too meager to enable the employee to live his balance life with any sense of dignity or comfort. The problem has been further compounded by the fact that many state governments have not been making their contributions regularly to the corpus and also that there is no real time knowledge that an employee has about the fate of his pension fund. Significantly, they point out that if the NPS is as attractive as OPS as pointed out in justification by some governments then why is it that their senior officers who joined the service before 2004 are availing the facility of OPS and not opting for NPS. Similarly, they allege that the policymakers have themselves not made NPS applicable to them. It is also significant to point out that NPS has not been made applicable to the armed forces where the OPS is continuing. In a recent advertisement issued by Rajasthan Government, it was pointed out that the second national judicial pay commission has recommended OPS for the judicial services and the national human rights commission has also expressed its opinion that the state should examine the human rights element involved in NPS vs OPS.

Even though it would not be correct to examine this issue from a purely financial angle I would like to first examine this aspect. All that the OPS is saying is that 50 per cent of the last salary should be given as pension on a monthly basis. There is no reason why state governments cannot plan for this by continuing with the 14 per cent contribution every month and keeping it in a separate corpus and earning returns on it. The budget size of each government is increasing by almost 10 per cent every year and there is no reason why the contribution to the pension cannot be increased by the same amount every year. In this way, the government will be spending only as much every year as they are spending under the NPS. The returns on this corpus can come as an addition to the state finances and, from this, a monthly pension can quite easily be paid to the retiring employees from the government treasury. In this way, I do not foresee any extra pressure on state finances which could imply curtailment of expenditure on physical and social infrastructure. Other innovative ways of handling the situation can also be thought of.

The crucial thing is that the old pension acts as a social safety net for the retiring employees. You only have to look around to see that it is a pension or family pension which allows a pensioner to live a life of dignity and enables him to address his health issues that crop up after retirement. The society is such that children look after their parents if the parents are earning a monthly income to cater to their needs. If a lump sum amount is given then it rarely remains with the old parents, as the children lay claims on the amount to meet some immediate financial requirements of theirs. An OPS ensures that a retiring employee is not dependent on his children and lives in comfort for the remaining part of his life. Every issue should not be seen simply in economic terms and the realities of social life need to be factored in. The government should seriously consider reviving OPS to keep their employees motivated and also get the best brains to apply for government jobs. If the apprehensions around NPS were not genuine then the phenomenon of almost all employees and teachers agitating on a regular basis for revival of OPS would not be there. Policymakers must view this issue not as simply an economic problem but one concerned with providing lifelong social security which is a major objective of a welfare state.

Click to read original article.

Most people have a tendency of holding the IAS responsible for anything that goes in the country.

In recent weeks there has been a debate on whether the IAS as a service has delivered or has it failed the nation. Different viewpoints are being expressed. Indeed, there can be arguments on both sides of the balance. Indeed, there can be arguments on both sides of the balance. I personally feel that IAS has delivered despite the constraints under which it functions. Ground level realities are very different from the view from outside which many sections of the society tend to take about the performance of the IAS as a service. It is also felt that in the IAS there is complete job security and promotion is automatic on the basis of seniority and there is no objective performance appraisal system in place to determine the sustainability of officers for senior level posts. There are many who have a tendency of holding the IAS responsible for anything that goes wrong in the country.

Strangely, the general view is that the IAS as a service is very closely knit and self perpetuating and always defends itself and members of the service. This is very different from reality where IAS officers are more concerned about their individual careers rather than to think about the IAS fraternity as a whole. Far too often the IAS officers have a propensity of criticizing the service and those who are senior love to say that the ethos and values of the service are on the decline in the younger batches. I do not believe this to be true. There are the good, bad and the ugly in the IAS as there are in other professions and it is incorrect to try and give the entire service a bad name.

Some years ago in the Uttar Pradesh IAS Association some officers who became crusaders against corruption in the service organized a secret ballot to vote for three most corrupt officers in the UP cadre. This move was hailed in the media and various forums but with a negative connotation and the story went around that the IAS was a corrupt service. An act of self cleansing attempted by some officers was turned into a tool to damage the reputation of the entire service.

A colleague of mine has very rightly pointed out that many IAS officers in order to show themselves as being intellectually progressive criticize their own service. Other sections of the society then use these very utterances to condemn the IAS. Introspection and self improvement are essential but the service has enough achievements to its credit to make its members feel a sense of pride in them.

Many individual IAS officers have done outstanding work in the Districts and in policy making but, unfortunately, most of it not documented. Only recently with the advent of social media have some IAS officers begun to talk about to work done by them and the innovative way in which they have delivered good governance the service as a whole can be, justifiably, proud of itself for having played a very important role in keeping the nation together and also ensuring that the government works according to the democratic principles and the spirit of the constitution. Some IAS officers have posted on social media that no doubt the steel frame has got corroded but how do we handle the corrosive environment in which IAS officers function?

Many people, when they discuss this issue with me, are quick to point out that rules and regulations are made by the IAS and if they are hampering the working of the government then the IAS should change them. It is true to some extent and it is also a fact that the IAS officers have been responsible for modernizing many rules and procedures but they cannot change everything.

They also function under a system where the politician is the master.

One thing that has emerged from all the discussion is that there is a need for a performance based promotion system for the IAS. There is a very extensive system in existence which has been continuously improved upon over the years but it is still not very satisfactory as it does not separate the wheat from the chaff. A large proportion of officers get a very good or outstanding rating without their meriting it. The promotions are on the basis of seniority subject to unfit which means only those involved in court cases or departmental enquiries are left out. The Government of India has recently introduced a three sixty degree evaluation system for the Secretary level and other senior posts. This has resulted in almost 30% to 50% of a batch not being able to get promotion to the Secretary level.

However, the working of this system is quite opaque and has caused a lot of resentment amongst officers. My view is that there is a definite need for an objective evaluation system for the IAS which should lead to the promotion of those officers who acquire new skills and knowledge, have qualities of leadership, have good communication skills, have the capacity to motivate and inspire a team and are not scared of taking prompt decisions in public interest. Officers who deliver results and outcomes should reach the top and not those who merely push files, are risk averse and believe in maintaining the status-quo. Unfortunately, the current system encourages good file work and not delivery of results. This is a difficult exercise because in my experience I am yet to come across a truly objective performance evaluation system. There is always an element of subjectivity which can become dangerous in the current environment where the politicians are evaluating the performance of officers and there is a tendency to brand officers along lines of caste, community or perceived proximity to members of a political party merely because they have served on important posts in a particular government.

It is easy to say that an IAS officer should give free and frank advice and uphold what is correct but these days it has become hazardous to do so particularly in State Governments where the Minister or Chief Minister takes this as an indication of willful dissent and is prone to transfer you to unimportant posts or worse start an enquiry against you. Today the IAS officer has to walk the political tightrope very adroitly otherwise he could have a fall from which it would take him years to recover.

It must also be kept in mind that the basic principle of governance is to have the right man at the right place. However, rarely does an IAS officer get to work with the team of his choice. He has to give results working often with a mediocre team and facing political interference at every level.

Despite the above, several IAS officers have achieved a lot and have been shining examples of competence and integrity. There is a lot of scope for introspection, self improvement and also major reforms in the entire system of governance. However, given the ground realities it would be harsh to say that the IAS has not delivered at all or failed the nation.

Click to read original article.

Rather than imposing a mandate over officers, the Central government must assess the reasons behind their ‘unwillingness’ to be deputed for Central roles
A controversy is raging these days regarding the proposed amendments to the IAS (cadre) rules proposed by the Central Government. Several states have reacted strongly opposing these amendments as they feel that this would give the Government of India much greater control over the posting of IAS officers to the Center. This amendment is agitating the State Governments more because of certain recent orders issued by the Government of India like those relating to the Chief Secretary of West Bengal and some senior officers of the same state.

To put the matter in perspective it is important to understand the current rules regarding deputation. Central deputation in the Indian Administrative Service (IAS) is covered under rule 6(1) of the IAS cadre rule 1954 inserted in May 1969 which states that “a cadre officer may, with the concurrence of the State Governments concerned and the Central Government, be deputed for service under the Central Government or another State Government”. It further states that “provided that in the case of any disagreement, the matter shall be decided by the Central Government and the State Government concerned shall give effect to the decision of the Central Government”.

There were around 5,200 IAS officers in the country as of January 1, 2021, and 458 were on central deputation. The Central Government is concerned because the required numbers of officers are not coming forward for central deputation and the Government of India is facing a shortage of officers. Central Government wrote to the State Governments recently pointing out that States were not sponsoring an adequate number of officers for central deputation. Depending upon the strength of the IAS officers in a particular state a central deputation reserve is created which indicates the number of officers, at various levels, who are eligible for Government of India deputation. Based on this, the Central Government asks for an “offer list” of officers from which it selects the required officers. The Government of India has now proposed an additional condition in 6(1) which states “provided that each government shall make available for deputation to the Central Government such number of eligible officers of various levels to the extent of the central deputation reserve”. It goes on to add that “the actual number of officers to be deputed to the Central Government shall be decided by the Central Government in consultation with the State Government concerned”. It also says that in the event of any disagreement the State Governments shall give effect to the decision of the Central Government within a specified time. In the letter written to the State Governments, the Central Government has also said that “in specific situations where services of cadre officers are required by the Central Government in the public interest the Central Government may seek the services of such officers for posting under the Central Government”. The states realized that through these changes the Government of India is taking greater control over the IAS officers and this is the reason why they are objecting quite vociferously.

It is significant to note that the willingness of the officer concerned to go on deputation to the Government of India is essential as per rule 6(2) which states that “no cadre officer shall be deputed except with his consent”. The clause about posting the officers in the Government of India in public interest appears to override this crucial requirement of the willingness of the officer concerned. In effect, it would mean that any time the Central Government can pull out an officer from the State Government to serve in Government of India irrespective of the willingness of the State Government or the officer concerned. This has become the real bone of contention, particularly, in the light of recent examples of West Bengal and earlier Tamil Nadu.

Most states are having a central deputation reserve shortfall. Over 14 states have a CDR shortfall of over 80 per cent with the West Bengal figure being 95 per cent and it is above 90 per cent for MP, Haryana and Telangana. It is a fact that most states are not meeting their CDR obligations. This is not in consonance with the concept of an All India Service. This is happening even though the annual recruitment to the service has gone up since 2000. There is a particular shortage at the level of Joint Secretaries, Directors and Deputy Secretaries. This is a genuine problem that needs to be resolved through consultation between States and Central Government.

It is also essential to understand the concept of All India Services as well as the federal structure of the constitution. The idea behind the creation of All India Services like IAS has been to have a common perspective between the State Governments and Government of India and that States should also function towards the achievement of national goals. On selection, IAS officers are assigned to a State cadre where they serve in the district and State Secretariat and acquire knowledge about the ground-level realities. They can also opt for central deputation and generally, they spend five years in the Government of India if selected and acquire a national and international perspective. He carries his experience back to the state after his central deputation period is over. The All-India character of the service is maintained by the mechanism of giving 1/3 of the vacancies in a state in a particular year to candidates who belong to the state and the balance is given to the officers from outside the state.

I think the most important point is that there should be a willingness on the part of the officer to go to the Government of India. He should not be forced to do so. Central Government must analyse why officers are not offering themselves to the Government of India. At the Deputy Secretary/ Director level the main issue is that at the same level of seniority the officer is working either as a District Magistrate or head of a department or some other important post in the state where he has a lot of authority to make decisions and the job is immensely satisfying. Further, creature comforts like a vehicle, house, schools for children and availability of health care are ensured. At the Deputy Secretary level in the Government of India, many of these hygiene factors are absent and even the job content is such that very few decisions are taken at that level and the officer is primarily involved in pushing files. If the Government of India really wants officers to opt for them at this level of seniority, it should focus on taking steps to enrich the job content and also provide basic creature comforts. I am surprised why there are fewer officers on offer for the Joint Secretary (JS) level posts because the JS is a crucial person in the Government of India and most decisions are taken by her and she contributes in a big way to the working of the department. The reasons for the shortage at the JS level would need to be studied. I feel one reason could be that a lesser number of officers were recruited into the IAS between 1990 and 2000 as a measure to slim down the bureaucracy who was misplaced and from 2000 onwards more officers are being selected into the IAS. The states are also guilty of not sparing officers for Government of India postings because they are doing some very important work and they cannot be allowed to go. They have been instances where due to political reasons the names of officers are not forwarded to the Government of India. I feel it is the responsibility of the State Governments to have the required number of officers in the central deputation reserve. Thereafter deputation to the Government of India can take place on the basis of the willingness of the officers and consultation between the two governments. This is how the character of All India Services can be maintained and also it is in accordance with the federal nature of our union. The problem only comes when political reasons start influencing this process either from the Government of India or the State Government level.

Click to read original article.

Indian bureaucracy is in dire need of reforms to ensure its independent and harmonious functioning, as also to hold it accountable to the people

I had the opportunity of chairing a session in the annual convention of the Lucknow Management Association (LMA) on the very important topic of governance reforms for the transformation of Uttar Pradesh (UP). My session was on bureaucratic reforms and leadership development. The panel consisted of illustrious speakers like ex CAG and IAS officer Vinod Rai, Pradeep Mehta of CUTS International and Himanshu Rai, Director, IIM Indore. Though the focus was specifically on the state of UP, the webinar had a larger relevance in the context of the entire country as it is clear that good governance is essential to make India a developed economy. Various studies have established a clear correlation between good governance and pace of growth of GDP. Very often it has been argued that various political parties on coming to power come up with a large number of infrastructure projects and development schemes but have not made any substantial reforms in public governance.

Good public governance is about a system where there is accountability, transparency, impartiality, fairness and integrity. The institutions of governance have to perform their designated roles. It is important that quality public services are delivered to the citizens, which is the ultimate goal of good governance. There is no denying the fact that there is a need for greater result and outcome orientation in the government system. Bureaucratic reforms are an essential component of governance reforms.

Curiously, whenever there is a discussion on bureaucratic reforms, the talk centers on reforming the Indian administrative services (IAS). It is true that IAS is at the top of the bureaucratic structure but it accounts for much less than one per cent of the total bureaucracy. Merely reforming the IAS will not change everything as reforms have to travel down to the last level of the bureaucratic ladder. I can give a classic example of this from my experience in UP. At the top level, we went through several sessions of discussions, formulated policies and issued detailed government orders regarding ease of doing business. We were rewarded for this by attaining a high rank amongst the States in the ease of doing business rankings. However, despite our claim that all clearances should be given online, the prospective entrepreneur had to vigorously follow up at the lower level of bureaucracy to actually get his work done. For example, we found that though online clearance for power connection was given, the entrepreneur did not get the connection for a long time and had to constantly make an effort to contact the junior engineer to get the job done. Ease of doing business failed at the last stage of implementation. It is for this reason that it is important to consider changing the mindset of the entire bureaucracy and not merely the IAS.

The panelists rightly felt that there was a perception about the bureaucracy being unresponsive, insensitive and insulated from people. It is up to the officers themselves to look within and alter their working style to make it people- oriented or citizen- centric. For this they will have to look at themselves as providers of public services to the people and not as rulers. This requires an immense amount of humility, empathy and compassion. Training and orientation programmes can help in bringing about this attitudinal change. However, the real change will come if there is an inbuilt system of reward and punishment which rewards the right kind of behaviour and result orientation. It is not as easy as in the private sector to have quantifiable targets for issues relating to public policy. However, some degree of quantification is definitely possible. There are performance evaluation systems which can be designed to accurately measure the attitudinal aspects also.

For bureaucracy to perform, it has to come out of the maze of rules, processes and regulations, under the garb of which it generally shelters itself. This is possible with wide-ranging reforms in the entire system of governance where an officer is not penalized for bonafide actions done in public interest. We need these reforms to ensure a system of prompt decision-making which is the basis of good governance. Above all, the bureaucracy today needs to be innovative and always ready to take initiative in resolving problems of the people with a positive orientation.

It is not that the bureaucracy cannot perform. There are several instances of outstanding work done by the officers. Two recent examples are the vaccination drive against Coronavirus and the development of Kashi Vishwanath Temple corridor. I remember, during my tenure as Chief Secretary from 2014–16, we implemented game-changing projects like construction of Lucknow- Agra expressway, Lucknow Metro and Dial-100 in a record time with no cost overrun. The quality of execution was also exemplary. Even today, officers in the districts are doing a lot of good work which is not being recognised because of lack of documentation.

Good governance requires a relationship of mutual trust between the politicians and the bureaucrats. They are like two wheels of a vehicle which have to move in tandem otherwise the vehicle will not be able to move. Unfortunately, the instances of political interference in governance are on the rise. The mechanism of transfers is used by the political executive to control the working of the officers. Senior officers are not able to get the team they want because of this interference. It is well known that unless you have the right man on the right job it becomes difficult to deliver results. Today it is almost impossible for an officer to have a team of his choice.

It is necessary to develop leadership qualities at all levels of bureaucracy. The officers have to be trained to work in teams and be motivated and inspired to achieve the goals set for the organisation. They must develop the quality of reflective listening which means absorbing the opinions of others and also developing crucial negotiation skills. The bureaucracy has to implement laws in true spirit and provide justice to all citizens. They should wield power for the benefit of the citizens and development of the country. A system should be evolved where the officers need not reinvent the wheel every time but learn from the best practices of others.

Bureaucratic reforms are possible if there is a political will to do so. I hope that the mission Karamyogi started by the Government of India will prove to be a positive step in this direction. The bureaucracy must appreciate that the real test of their performance is in the hands of the citizens. They must deliver if they want respect. It is urgently required to reform the system of governance and make it accountable to deliver outcomes without which the bureaucracy shall never be able to justify itself.

Click to read original article.

According to the data provided by DoPT the authorized strength of IAS officers is 6,699 as on 1^st January, 2019 but the actual officers available are 5205

In a welcome move the Department of Personal and Training (DoPT) has given an in-principle approval for constituting a committee to look into the deficit of IAS officers at the center and to suggest a recruitment plan for the years 2021 to 2030. The main issue is the shortage of IAS officers in various senior positions. The estimated amount of shortage as told by DoPT to a parliamentary panel is in excess of 1,500.

According to the data provided by DoPT the authorized strength of IAS officers is 6,699 as on 1^st January, 2019 but the actual officers available are 5205. It is also a matter of concern that this gap between the sanctioned strength and actual availability is gradually increasing.

The genesis of this shortage can be traced back to the reports of the Central Pay commissions, particularly, that of 1996. This was a period of grave financial crises being faced by Government of India as well as the state governments.

I remember that the Government of UP was facing a situation where the daily cash flow management had become a challenge and we were concerned about the revenue as well as fiscal deficit. The pay commission had recommended higher pay scales for all government officers and employees but had also cautioned about the financial impact. A major part of the recommendation of the pay commission report was about how to control the expenditure on salaries.

I recall that we had arrived at a figure of 3 percent employees retiring every year and it was decided to fill up only 2 percent of the vacancies thus created and in this manner gradually reduce the government staff. This did not take into account the imbalance that such a measure would bring about.

In addition to the above the recruitment to various government posts was slashed and, in particular, the IAS was a major sufferer. The batch strength of the IAS was reduced considerably and brought down to below 100 every year. This led to serious crises and I remember that in a state like UP where we have 75 districts it became a very difficult task to find officers to man the district administration. In fact, several batches of the IAS had only about 4 to 5 people joining the UP cadre. This trend continued for quite some time and is one of the major reasons for the shortage of officers of a particular seniority which is having an adverse impact today at both Government of India and state government levels.

In particular, there is a huge shortage of officers at the Deputy Secretary and Director level in the Government of India. The realization soon dawned on the policy makers and larger batches began to be recruited going up to a level of 180 every year. It is not clear whether a proper rational assessment has been done to decide upon this figure and there are those who feel that this number should be further increased.

In the light of this I find merit in the Government of India decision to setup a committee to examine this issue. We must make an assessment of the number of posts that would be required in the IAS to meet the current and future challenges of governance. They will have to take into account the number of officers recruited directly into the IAS as well as those promoted from the state civil services.

The shortage is more manifest at the Government of India level than in the states. This is because the states can fill up vacancies by rapid promotion of the officers belonging to the state civil services. The number of years required for state civil service officers to be promoted to the IAS varies from state to state ranging from 10 to 25 years.

Again, this is not based on any scientific study but is implemented more as a rule of thumb or decided by the kind of pressure which state officers can mount on the political executive. It is also pertinent to note that the state civil service officers, but for a few exceptions, do not opt for a posting in Government of India on promotion to the IAS.

There are some obvious reasons because of which young IAS officers do not opt for Government of India at the Deputy Secretary / Director level.

The fact is that at the same level of seniority an officer gets much greater creature comforts at the state level as compared to Central government. Many officers are posted as district officers which is one of the most attractive posting for an IAS officer. Even in the state government he is either head of department or in a significant position in the state secretariat where he does not have to bother about issues like an official vehicle, house, school, independent office etc. At the same level if he comes to Government of India he finds that very often he might even have to share an office room and is not likely to get an official vehicle.

A very interesting feature is that in Government of India only Secretaries have an attached toilet to their office while the others have to use a common facility. Then it might take him months to get an official accommodation and for this period he has to fend for himself. The houses allotted, also, are nowhere near what he would get in the state government. To this are added the woes of getting your child admitted to a good school and getting adequate medical facilities.

It is, thus, no rocket science as to why a young officer prefers to stay back in the states rather than going to Centre leading to a shortage of officers at the Center. Moreover, below a Joint Secretary level officers in GOI mainly do clerical work where no decision making takes place at their level. The position is very different in the districts and state governments.

In the IAS, out of total vacancies in a state cadre a certain percentage is filled by those candidates who belong to that state while the balance goes to officers from outside. It is generally seen that the “insiders” prefers to stay back in the state while the “outsiders” have a greater propensity to opt for GOI.

Also, officers allotted to North Eastern states prefer to come to Delhi while officers from states nearer to Delhi often prefer to remain in the states.

It is good that the entire issue is finally being examined. It is clear that to attract IAS officers to GOI at a level below Joint Secretary the service conditions would have to be improved and jobs enriched. The whole issue of requirement of IAS officers at each level needs to be scientifically determined. The reality is that the intake of IAS officers each year will have to be enhanced.     

NMP is indeed a bold reform initiative but its effectiveness will depend on how the structural impediments are removed and unemployment challenge is averted

The Union Budget for 2021-22 clearly brought out that the economic policy of the government is geared towards growth which would lead to the overall prosperity of the people. Privatization policy was also clearly mentioned in the budget. In addition, the budget spoke of the need to create a national monetization pipeline of brown field projects to finance fresh investment in physical as well as social infrastructure. NITI Aayog was tasked to prepare the policy framework for this announcement and, recently, the Government of India announced its policy along with a detailed guidebook covering all aspects of the same. The government declared that it has prepared a national monetization pipeline that would unleash a latent potential of six lakh crore or USD 81 billion by 2025. The target for the current year is Rs 88,000 crore. It is indeed a very ambitious programme and also a very bold reform initiative.

The policy says that there will be no sale of assets and only brownfield assets would be leased out for a certain period of time to private sector investors or an investment trust that will operate and maintain the assets as well as make investments and, at the end of the lease period, hand over the assets back to the government. The assets identified for this purpose are roads valuing 1,60,200 crores; railways 1,52,496 crores; power transmission 45,200 crores; power generation 39,832 crores; gas pipeline 24,462 crores and mining 28,747 crores. Additionally, there are some other sectors also like telecom, sports stadiums etc.

The strategic objective of the national monetization pipeline, according to NITI Aayog, is to unlock the value of investments in public sector assets by tapping private sector capital and efficiencies which can thereafter be leveraged for the augmentation of greenfield infrastructure creation. In essence, this means that a lot of public sector assets are lying underutilized and they are not being managed and operated efficiently because of the inherent structural impediments of the public sector, and which can be transformed by the private sector to generate resources that can be utilized for the development of new infrastructure. There is no denying the fact that to achieve a high rate of growth, India needs substantial investment in infrastructure which raises the question of the availability of resources. For quite some time, economists and administrators have been grappling with this problem of financing infrastructure. The national monetization pipeline is an innovative solution in this direction and, by all means, can be called a significant structural reform in creating value in infrastructure.

However, the crucial thing is the implementation of this policy. Historically, we have seen that the ambitious targets of disinvestment have not been met year after year due to various procedural bottlenecks. In light of this, it is difficult to see how such a massive scale monetization of public assets can be executed in the given time frame. Personally, I feel that it would be difficult to achieve the 88 thousand crores target for the current year and six lakh crores till 2025. The matter of Air India privatization and that of BPCL pending for years exemplify how such matters take a long time to materialize.

The experience of public-private partnership (PPP) would be vital in implementing the NMP. Various models like upfront lump-sum payment or annuity payment were devised to implement PPP and they are as many success stories as failures. I remember one of the first PPP projects in UP was the bridge on the Noida Delhi highway. The private concessionaire was expected to collect toll for a certain number of years but there was a massive agitation by the farmers and residents of the area after some years and, finally, the toll barrier had to be shut down. There were views on both sides. Some claimed that the PPP agreement had been drafted to give extra benefit to the concessionaire while some felt that the concessionaire was entitled as per the agreement to collect toll for the stipulated number of years. In any case, the whole episode showed the kind of problems that a PPP agreement can lead to. Even in NMP, this crucial issue of valuation of the assets, amount of lump-sum payment and other terms and conditions would determine the success of the policy. The private sector has often argued that the PPP documents are prepared in a manner that private developers do not get a reasonable rate of return on their investment, making it unviable for them. There is no doubt that the civil servants who draft the agreements along with consultants are inclined to err on the side of caution. They deliberately want to put such conditions which would shield them against any inquiry in the future. Naturally, this leads to putting conditions that impact the viability of the project. NMP is a new policy and the civil servants do not have prior experience and, despite the guidelines formulated by NITI Aayog, there is a likelihood that such terms and conditions may get framed that adversely impact the rate of return to the private investors, implying that they would not evince interest in bidding for the assets. Of course, in the case of PPP, things improved over time as the civil servants got more experienced and repeated guidelines were issued by the government. Similar learning experience is possible in the case of NMP but this will take time, making it difficult to achieve the NMP targets in the prescribed time frame.

The fear of subsequent allegations of corruption is not entirely unfounded. You can look around and see the number of cases of privatization or disinvestment where inquiries are going on and there have even been court directives to investigate and lodge criminal complaints. It is, thus, important that the Government of India evolves the system to protect the civil servants from any undue harm if they faithfully, and with bona fide intentions, carry out the NMP exercise.

Apart from above, the private sector would only come forward if it gets a higher rate of return than it would get through an alternative opportunity of investment. Not all assets listed in NMP are likely to give this kind of a return. This could lead to a situation of cherry-picking where the private sector bids for assets with the greatest potential of returns and avoids the others. The implication being that not all assets listed in the NMP will get a private bidder. The more lucrative assets will get bidders while the ones with less potential will remain with the public sector. I saw an example of this when in Uttar Pradesh we wanted to bring in the private sector in power distribution in the districts. We found that the private sector was keen to take up only the city areas where it was easy to collect power dues and did not want to go into the rural areas at all. This meant that the state power corporation would lose its best accounts and remain saddled with the most problematic. We had then decided to offer a package of rural plus city consumers. Not many bids were received as per this model. This is very much possible in the NMP also. We already saw when the Railways wanted the private sector to run some trains, only the public sector corporation IRCTC came forward. This again gives weight to my argument that the entire NMP list of six lakh crores is not likely to get private bidders.

Moreover, there would be issues relating to the employees. Will the private sector retain them? Will the terms and conditions remain the same? What will happen to the crucial issue of reservation in case the private sector does recruitment of its own? There are various social objectives that these assets are fulfilling and it would need to be seen whether the private sector would continue to do so. Moreover, if the public sector has not been performing then it is due to various structural impediments which would need to be analyzed, otherwise, they would constrain the working of the private sector also. Further, a private-sector monopoly is no better than a public sector one.

It is also important to see how the regulators would respond to this kind of initiative. There would also be the need for an open and transparent dispute resolution mechanism. Finally, a special independent authority would need to be created to monitor the entire process.

NMP is a bold reform initiative that could unlock funds for further development of social and physical infrastructure but there are a lot of implementation issues that need to be handled. Also, we should be aware that the targets set are far too ambitious.

Click to read original article.

The stated objectives of NMEO-OP are reasonable but the additional cultivation of oil palm has to be done in a sustainable and responsible manner

The Government of India on August 18 announced the National Mission on Edible Oils and Oil Palm (NMEO-OP). This mission proposes additional cultivation of 6.5 lakh hectares of oil palm by 2025-26, bringing the total area under oil palm cultivation to 10 lakh hectares. A total sum of Rs 11,040 crore has been earmarked for the scheme. This decision has generated a lot of controversy because of the likely ecological fall outs in terms of massive deforestation and loss of biodiversity. It thus becomes important to evaluate the various aspects of this policy and its intended as well as unintended consequences.

India is a net importer of edible oils with palm oil being the principal import. The annual consumption of edible oils in India is 25 million tonnes while the domestic production is 10.5 million tonnes. 58 per cent of the requirement is imported. The import bill in 2019-20 was USD 9.6 billion which is a significant amount. This mission proposes to reduce our dependence on imports to 38 per cent by 2025-26, though our consumption is likely to go up to 29 million tonnes. Obviously, the intent of the mission is to reduce the import bill and make India self-sufficient in edible oils to a large extent. Nobody can argue against this objective.

Even though concerns are being raised today, this initiative is not exactly a new one. To reduce dependence on imported edible oil, India began encouraging oil palm cultivation in 1991-92 under the oil palm development programme. Incidentally, oil palm gives four times more oil than other edible oils and so appears to be a viable proposition. In 1995, a national research centre for oil palm was set up. In 2004-05, 12 states took up oil palm cultivation as part of an integrated scheme of oilseeds, pulses, oil palm and maize. During the 11th five-year plan, a committee was set up under KC Chadha to reassess the potential of palm oil cultivation. This committee identified 10 lakh hectares as a potential area for the cultivation of oil palm. In 2011-12, oil palm cultivation and expansion was included in the prestigious Rashtriya Krishi Vishisht Yojna (RKVY) of the Ministry of Agriculture, Government of India. In 2014-15, a national mission on oilseeds and oil palm was launched. In 2015, 100 per cent FDI in palm oil production was allowed. The cooperation of the State was also elicited in the programme, and oil palm was declared a plantation crop to attract private sector investment. It is thus clear that the decision taken last week is merely a continuation of the thinking that has been taking shape for almost the last three decades.

To counter the criticism regarding the adverse impact on the environment, the Government of India claims that no forest will be destroyed for oil palm cultivation which would be done mostly in the fields of the farmers and assures that the programme will be kept farmer-centric. The scheme envisages assistance to farmers for planting materials in the range of Rs 12,000 to Rs 29,000 per hectare. Special assistance of Rs 250 per plant is to be given if old gardens are replanted. Oil palm takes four years to fructify. However, in the first three years, farmers can grow other crops (except paddy) like ground nuts, soya bean etc. which would ensure that the farmer does not suffer losses on going for oil palm cultivation. The Government of India has also given the farmers a price assurance through a mechanism of viability price to counter price volatility.

Oil palm grows in tropical climate, especially near the equator. The Indian government has identified the Northeast and Andaman & Nicobar Islands as the areas where this plantation would be taken up. Incidentally, both these areas are ecologically sensitive. Northeast is recognized as a home to around 850 bird species along with citrus fruits, medicinal plants, and a host of other rare plants and herbs. Similarly, Andaman & Nicobar has rich biodiversity in flora and fauna and experts have opined that no new flora or fauna species should be introduced in these Islands. There is thus a very valid apprehension of the destruction of valuable biodiversity due to the introduction of oil palm in these areas. It is likely that primary forest will be replaced by oil palm as the greed for profits by the palm oil industry would soon create political pressure for expanding the cultivation beyond the fields of the farmers.

Historically, palm oil has led to the deforestation of three per cent in West Africa and 50 per cent in Malaysia and Borneo as well as Indonesia. In fact, the entire low land in Malaysia has been lost to oil palm. It has driven the orangutans, gibbons, tiger, Sumatran rhino and elephants to the verge of extinction. To preserve biodiversity, Indonesia and Sri Lanka have already started controlling oil palm cultivation and, as pointed out by Sudhir Suthar in an article in Indian Express, the Indonesian government put a three-year moratorium on licenses on palm oil production and Sri Lanka has even ordered the uprooting of oil palm plants.

Even in India, where oil palm plantation has been taken up, the experience shows that particularly in Arunachal the farmers have been going in for oil palm cultivation in a big way and this is leading to an adverse impact on forest land. I read a study by YR Shankar Raman and Jaidev Mandal (2017) about oil palm cultivation in Mizoram. It says that in the same area, where teak cultivation supports about 38 species of birds and rain forests sustain 58 species, oil palm supports only 10 species. Incidentally, there is no environmental impact assessment (EIA) required for conversion of land to oil palm cultivation because it is designated as a plantation. Further, oil palm cultivation gets encouraged due to the ambiguous definition of forest cover which states that all lands more than one hectare in area with a tree canopy density of 10 per cent, irrespective of ownership and legal status, are covered under the definition of forests. Such lands may not necessarily be recorded as forest areas. It also includes orchards, bamboo and palm. Thus, supporters of oil palm can argue that planting oil palm leads to enhancement of forest cover which would be a fallacy.

We cannot argue that there should be no effort towards producing palm oil within the country as we need to minimize the import bill due to palm oil imports. Also, the government and the consumers would be interested in keeping the prices of edible oil under control. However, we cannot allow the destruction of the biodiversity and degradation of the environment. The solution then lies in the sustainable and responsible production of oil palm. It should be insisted that this cultivation takes place only in the fields of the farmers, and industrial large-scale plantation by the corporates should be prohibited in ecologically sensitive areas. Also, palm oil production should only be for edible purposes and not for non-edible uses like cosmetics etc. This would keep the demand in check. Already in 12 states, oil palm plantation has begun and the ecological impact on this needs to be studied. The government should focus on increasing the area under oil palm cultivation in these 12 states where it has not led to adverse impact on ecology, rather than moving to new areas like Northeast or A & N which are highly sensitive and where it could lead to widespread rain forest destruction, wildlife loss and bring about climate change. Even in the fields of the farmers, it has been found that the growth of oil palm leads to soil erosion and air and water pollution. It is thus desirable that any extension of oil palm cultivation should not be done without an environmental impact assessment.

Companies producing palm oil should be incentivised to produce it in a sustainable manner. Illegal plantations will need to be severely dealt with. No conversion of forest land to oil palm should be permitted as this leads to poverty amongst the communities dependent upon forest for their way of life and has the potential of leading to mutually destructive man-animal conflict. These days there is a movement in the West, and in India also, to encourage those companies which invest in ESG (environment, social, governance) issues. Banks provide credit to such companies and the investors are putting in their money in these ventures. Palm oil production should be done in a manner to address these ESG concerns. In fact, there could be a system where palm oil would need to be certified as having been produced ecologically just like you have in the case of organic plants. Oil palm production does not have to be destructive to the environment. It has to be done responsibly with great concern for the ecology and biodiversity.


Click to read original article.

Development indicators need to be reshuffled to go beyond mere growth goals and incorporate wider parameters

Ever since I was a student of economics at Delhi University, the growth versus equity debate has been at the centre stage of any discussion around development economics. Recently, I read an outstanding book titled “The Growth Delusion” by David Pilling which is a critique of overemphasis on the growth of GDP as an economic welfare measure across the world. India is no exception. The current budget boldly talks about economic growth as the goal to be achieved — based on the philosophy that only if the size of the cake is large, it can be distributed amongst maximum people. We hear the talk that India has already become the fifth largest economy and is soon likely to become the third-largest. The Government of India has set up an ambitious goal to achieve a USD five trillion economy by 2025. The UP government has also set a goal of a USD one trillion economy by that period. GDP is an indicator of the size of the economy but not of the wellbeing or quality of life of the people. Pilling has been severe in his comment when he says that all countries are obsessed with the rate of growth of GDP and put all their energy in chasing this chimera.

Despite growth in GDP, economies are witnessing rising inequalities. This has been highlighted in a famous book written by Thomas Piketty. We have also read the opposing viewpoints of eminent economists like Jagdish Bhagwati and Amartya Sen; the former emphasising growth and the latter talking about state intervention in public services like health and education to bring about genuine economic welfare. In India, over the years, we have witnessed jobless growth leading to an increasing rate of unemployment. Further, despite being one of the largest economies in the world, the per capita income of citizens is abysmally low, leaving us as a developing economy, far behind the developed world. There is still a lot of poverty and the second wave of the pandemic has exposed the poor quality of public health infrastructure in the country. Education and nutrition levels are far behind the developed countries and our rank in the Human Development Index is beyond 100. This clearly shows that growth by itself is not going to solve the problems of our country and we need inclusive growth. The latter requires specific state intervention in favour of the poor and the marginalised. This clearly indicates a need to have a broader index of development that goes beyond GDP and allows us to aspire for an improved quality of life for the people.

Pilling discussed various alternatives to GDP in his book. We could have goals for increasing per capita income or net domestic product. Then, we could have the Human Development Index as an indicator or evolve a Sustainability Index which would factor in the crucial environmental needs. He developed a matrix of economic, environmental and social indicators that can best bring out the status of quality of life in a country. Recently, India lost the World Test Championship to the tiny island nation New Zealand. I read an interesting article which tried to analyse the rise of New Zealand as a cricketing power by bringing out the differences in per capita income and various other social and economic indicators between New Zealand and India. The comparison held India in a very unfavourable light.

Most countries have added parameters other than GDP in their evaluation of development. The most significant has been the concept of Gross National Happiness developed by Bhutan. The utilitarian approach of the greatest happiness of the greatest number is not the solution as it ignores the problems of the minority and tends to perpetuate inequalities. Happiness economics has evolved as a discipline in itself, and 20th March has been declared as the International Happiness Day. India has unfortunately ranked 140 out of 156 countries on happiness indicator, with Denmark, Sweden, Norway and Switzerland being amongst the top nations. Happiness index accounts for GDP per capita, social support systems and healthy life expectancy, freedom to make life choices, generosity, trust and corruption levels. One can think of including more aspects of happiness in this indicator like the government of Bhutan which calculates gross national happiness on the basis of four pillars — promotion of sustainable development, preservation of cultural values, conservation of natural environment and establishment of good governance.

Currently, a new concept known as subjective well-being (SWB) is being used at the global level to measure the quality of life and the extent of happiness. SWB links happiness with life satisfaction which is a function of in-born temperament, fulfilment of basic needs and quality of social relationships. We all know that happiness has both internal and external causes. Internal happiness, of course, is a spiritual concept where happiness depends on inner contentment and the response of an individual to life situations. This is something that is influenced by the culture of the family of an individual and the spiritual practices that he follows. However, external happiness is determined, to a large extent, by the policies of the government. It is this external happiness that can be measured through an index and governments can influence this in a big way. Happiness can be defined as a state of being where there is a high level of satisfaction, positive feelings and infrequent negative feelings. External happiness depends upon a person having sufficient material resources like money, sufficient social resources like family and friends and a desirable society that is free of hunger, injustice, corruption and war; and is full of spirit of trust and cooperation. If the citizens of a country feel that they are leading a purposeful and meaningful life, and are optimistic about their current position and outlook for the future, then they can be considered to be high on the happiness index. The difference between the SWB approach and GDP is the focus on multiple dimensions of the human lives in the former. It is also true that if there are a large number of inequalities in society, particularly in the form of opportunities, then happiness decreases.

It is thus important that we are not caught in the GDP trap and focus on the larger issues of life which lead to a better quality of life for citizens and makes for a happy society. None other than the famous economist Simon Kuznets said, “The welfare of a nation can scarcely be inferred from a measurement of national income.” Robert Kennedy of the United States famously said, “GDP measures neither our wit nor our courage; neither our wisdom nor our learning; neither our compassion nor our devotion to our country; it measures everything but that which makes life worthwhile.” Human beings have to be at the centre of development policies. We have to evolve an index where we measure the quality of life that we are giving to the people. I would like to end this article by quoting David Pilling where he says towards the end of his book, “Growth was a great invention. Now get over it”.

Click to read original article.