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If policy could be more real

If policy could be more real

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RAJIV KUMAR

INDIA FIRST

India’s economy and society are marked by a deep and extensive dualism. There are examples galore — backward agriculture versus global firms; rural versus urban world views; dehumanising slums cheek by jowl with swanky highrises; wretched urban squalor five miles away from the New Delhi Municipal Corporation’s carefully tended Bungalow Zone in Lutyens’ Delhi; the bullock cart versus plush air travel; and vast areas of darkness just outside major cities.

Add to that moneylending in rural areas and for informal trade, finance at three per cent per month or 40 per cent per annum versus a repo rate of 7.25 per cent.

Also, merely eight per cent of workers are employed in the formal sector with the remaining 92 per cent in occupations where they have no statutory minimum wages, zero social security and absence of minimal working conditions. Illiteracy amongst middle-aged women is at 40 per cent. In contrast, India has 980 million mobile phones and 30 per cent Internet penetration.

These examples can be multiplied many times over. Suffice to say that the catchy phrase, “Whatever you say about any aspect of India, the opposite is also true”, conveys the essence of this dualism that marks almost every sector of our economy and every aspect of our lives. And we, especially the younger generation, accept this dualism — often without noticing. 

But dualism has a direct and significant implication for public policymaking — it becomes Janus-faced. Policymaking is justified by the rhetoric that it is for the poor, marginalised and those on the wrong side of the dualistic divide. Yet, it is designed and implemented ostensibly for the tiny minority.

No better example of this schizophrenia exists than in the fertiliser subsidy policy. The rhetoric is that it helps the poor, small and medium farmers. But the design and implementation of the policy almost solely benefits fertiliser producers, especially the most inefficient ones. This hypocrisy is aptly reflected in the age-old remark about economic policy during India’s socialistic era. It was then said that ‘policy always signalled left but turned right’. Subterfuge was thought necessary to retain votes.

This policy schizophrenia makes for heavy-handed and over-defined regulatory structures which ultimately lend themselves to rent-seeking and             widespread corruption. Ironically, they also result in a travesty of equity and fairness.

An example would suffice. The rhetoric justification for the Drugs and Pharmaceutical Control Order (DPCO) is to ensure cheap medicines for all, especially the poor. However, the great majority of the poor, residing in rural areas or working in the informal sector, cannot afford even the drugs whose prices are controlled. They continue to rely on home remedies or the informal system of healthcare where spurious drugs are rampant and unethical behaviour abounds. The DPCO also generates huge rents in the pharmaceutical industry as manufacturers try and get their drugs taken out of the DPCO framework or ensure a hefty mark-up on costs while prices are officially determined.

Instead, we could have a simpler, more transparent policy regime. All drugs could be sold at market-determined prices. The government, using the public health delivery system focused exclusively on the poor and marginalised segments, could subsidise them directly rather than control prices, which discourages producers and generates rents. The health insurance system could ensure that the middle class receives proper healthcare and medicines at reasonable cost. The affluent, as they do already, would be free to choose their healthcare options within India or abroad at market-determined prices.

One would have imagined that in a thriving democracy like ours, such a double-faced and inept policy regime would be nudged in the right direction through public discourse and civil society initiatives. However, this is largely not the case and successful exceptions highlight the overall absence of civil society’s influence on public policy both at the centre and in the states.

Could the reason be that civil society in India also suffers from deep and extensive dualism and is badly fragmented? Does it represent a homogenous entity that could hold public authorities to account? As Mahendra Lama put it pithily in the context of India’s foreign policy, “Track One and Track Two go on forever in parallel without any convergence.” Most often, policymakers do not take the so-called civil society seriously.

One hypothesis could be that the way civil society is constituted it represents only the English-speaking urban elite. Civil society is often derisively referred to, by journalists pretending to be serious policy wonks and in touch with those who matter, as the chatterati. The insinuation is that this class of people can go on forever without an iota of influence on policy. The reason put forward is that the elected policymaker has his/her ear close to the ‘real civil society’ that is made up of those who have time only to come out and vote once in five years, that is the subaltern, working class and the marginalised, who are not members of urban civil society.

The reverse charge, often made by ‘leftists’, is that a tiny minority of more articulate, well-heeled and ‘in season’ members of elite civil society have captured policymaking in the country.

If at all true, this charge applies only to the influence exercised by crony capitalists who have a strong nexus with the ruling establishment in multiple ways. The government gets away by effectively questioning the credentials of urban civil society to represent the common man. On the other hand, it pretends to listen to the marginalised and excluded but effectively designs policies that do not bring any succour to the poor but end up only generating rents. The government effectively enjoys autonomy in our system that is antithetical to a well-functioning democracy.

The way forward is not easy to discern. Perhaps civil society should first repair itself by becoming less fragmented and less elitist. We should spawn more civil society journals in local languages. The English-speaking urban elite will do well to create platforms where pan-Indian issues could be discussed and debated without reference to provincial, regional, ethnic and caste biases. We could increasingly articulate challenges faced by the marginalised and make them the centre of public discourse. 

The biggest challenge being faced today by civil society, cutting across all dimensions, is the generation of employment opportunities in the country. The Indian economy must absorb one million fresh entrants to the workforce each month for the next 20 years. In addition, there are millions waiting to shift from backward, low-paying jobs to higher productivity occupations. Debate, dialogue and discussion within civil society must focus on this massive challenge, which is being faced by all segments of our population. It is time we in civil society are prepared to be held accountable for our contribution to this challenge. That will sharply enhance our credentials to hold others to account.  

 

Rajiv Kumar is Senior Fellow,  Centre for Policy Research,  and Founder-Director of Pahle India Foundation