More articles by

Vijaya Pushkarna
Vijaya Pushkarna

WEEKEND READS

The NITI gritties: Will Panagariya's exit impact the think-tank?

PTI8_1_2017_000082B
  • From the quality of health care to its delivery system, from the standard of educations to the physical state of the classrooms and labs, there is nothing—be it environment, transport, digital connectivity, governance or taxation—that is beyond the scope of the institute. NITI Aayog's first vice chairman Dr Arvind Panagariya enjoyed the status of a cabinet rank minister

John Maynard Keynes, whose economic theory influenced the founding principles of many nations, famously said, “In the long run, we are all dead”. It was part of his book, Tract on Monetary Reform. It is widely accepted that Keynes meant if we waited for the world to come around, we may not be there when it happens. He clearly favoured the short term over the medium and the long term.

The Planning Commission in India focused on no more than five years at a time. It came out with plans for the economic development within that time period. It allocated specific amounts, for specific areas of economic development.

In the long run, we may all pass on, but the country will still be alive and kicking. There are future generations to think about. Prime Minister Narendra Modi liked the idea of the long term. More so, he fancied the idea of being the chosen one, the man who would transform India.

The cabinet resolution approving the setting up of NITI Aayog mentions the aspirations, "In the context of governance structures, the changed requirements of our country point to a need to set up an institution that serves as a think-tank of the government—a directional and policy dynamo." It mandates the proposed institution, NITI Aayog, “to provide governments at the Central and state levels with relevant strategic and technical advice across the spectrum of key elements of policy. This includes matters of national and international import on the economic front, dissemination of best practices from within the country as well as from other nations, the infusion of new policy ideas and specific issue-based support. This institution has to be able to respond to the changing and ever-more integrated world that India is a part of."

Half a world away, Professor Arvind Panagariya, employed at the Columbia University in the US, believed that plans and allocations should be left to the states, and that the Centre should provide direction and ideas. A celebrated economist, Panagariya was awarded the Padma Bhushan by the UPA government in 2012. Modi brought him back to India, appointed him the vice chairman of the National Institution for Transforming India (NITI) and bundled out the Planning Commission. Yojana Bhawan, at Sansad Marg in the National Capital Region, became the NITI Aayog a few months after the BJP-led NDA government assumed office. The prime minister is the chairperson of NITI Aayog. (Panagariya resigned from his post on Tuesday).

From the quality of health care to its delivery system, from the standard of educations to the physical state of the classrooms and labs, there is nothing—be it environment, transport, digital connectivity, governance or taxation—that is beyond the scope of the institute. NITI Aayog's first vice chairman Dr Arvind Panagariya enjoyed the status of a cabinet rank minister.

NITI Aayog was directed to prepare a 15-year vision, seven-year strategy and a three-year action agenda documents. Panagariya, who announced his exit from the post with effect from August 31, launched the three-year (2017-2020) action agenda, and was working on the seven-year strategy document when he decided to return to Columbia University.

There was no friction between Modi and Panagariya, as the latter had the prime minister's ears. In fact, this proximity is said to have helped Panagariya in his dealings with the notoriously sluggish Indian bureaucracy. NITI Aayog was about dispensing ideas, helping set up pilot projects, monitoring and evaluating them, both in the Centre and at the states.

Recently, NITI Aayog mooted the idea of letting children play around in the school labs, in the hope of that freedom and creativity may give birth to innovators. Called the Atal Innovation Labs, the NITI Aayog handpicked schools, provided a small funding, and encouraged them to let kids tinker. Amitabh Kant, the CEO of NITI Aayog, said it was part of their efforts to disrupt the education system. But, they apparently did little to get the human resources development ministry to ensure that the schools lightened the classroom burden.

Panagariya was not personally involved with all the ideas. But the proposal to create massive coastal employment zones, modelled after a similar scheme in China, was his baby. As was the idea of setting up world class universities in India.

He is also credited with pushing for reforms in medical education, improving the quality of doctors, and encouraging private investment in agriculture by coming up with a modern land-leasing law. He was impatient with the pace of disinvestment and privatisation of public sector undertakings, pushed for a national energy policy, and favoured abolition of all kinds of subsidies.

There are whispers that he was unhappy with the pace of reforms and the policy overhauls. Panagariya wrote in the preface of the three-year action agenda that he presented, "There will be ambitious proposals for policy changes within a relatively short period.

While some may be fully implemented within three years, he says the implementation of others would continue in the subsequent years. “The proposed agenda is wide ranging... outlining a tentative medium-term fiscal framework. It includes different growth scenarios for the economy and forecasts the available resources under each of them. Drawing on the baseline forecast, it then provides indicative expenditure allocations across broad sectors” he says.

NITI Aayog under Panagariya has pointed at infrastructure, digital connectivity, public private partnerships, energy, science and technology, and creation of an effective innovation ecosystem as growth enablers.

Invoking Modi's development philosophy of Sabka Saath, Sabka Vikas, the NITI Aayog has cited, among a host of issues, gender-responsive budgeting.

The plan states that there are nine health goals to be achieved in three years. One of them is to reduce total fertility rate to 2.1, from the 2013 estimate of 2.3.The draft action plan points out areas of concern—rising tax disputes, higher recapitalisation requirement for banks with NPAs, revenue expenditure at the expense of capital expenditure, focus on subsidies rather than spendings on social sectors including health and education.

The RSS and the Swadeshi Jagran Manch have generally opposed scholars from abroad. Panagariya, too, has felt the heat. At a meeting held in January, the SJM rubbished NITI recommendations and opposed the perceived support to GM crops and corporate houses.

What was Panagariya's contribution? What will NITI Aayog lose if he goes back? There is no unfinished agenda, for NITI Aayog's is a constant endeavour to transform India. But whether his successor will flow Panagariya's track remains to be seen. As of now, no one has been shortlisted or named.

This browser settings will not support to add bookmarks programmatically. Please press Ctrl+D or change settings to bookmark this page.