Life in the heart of Indian government

Discussion in 'Defence & Strategic Issues' started by ppgj, Jan 6, 2010.

  1. ppgj

    ppgj Senior Member Senior Member

    Aug 13, 2009
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    Life in the heart of Indian government

    Page last updated at 08:22 GMT, Wednesday, 6 January 2010

    Guest columnist Kaushik Basu, who has been appointed chief economic adviser to the Indian government, bids farewell and explains why he took up his new job.

    It is less than a month since I relocated to Delhi to be chief economic adviser to the government, in the ministry of finance.

    The offer came out of the blue and I agonised over it.

    As a researcher I did economics for the love of aesthetics - not for relevance.

    In defence, I will simply say that that is the only way to do good research.

    The primary motivation that drives a researcher is a creative urge, the urge to unearth beauty and order, be it in nature, society or the chaos of the market.

    If I moved from the ivory tower to the world of policy and politics, I would not only be working in a setting totally alien to me - the daunting world of Indian bureaucracy - but I would have to reorient my objective, for one thing was clear to me: if I did make this major move, it would be to get something worthwhile done for society, to give my absolute best towards creating a better India.

    This is an intimidating objective where failure is more likely than success. The only consolation was what a colleague at Cornell laughingly told me - "if you fail, you can come back and write a sizzler on Indian politics and policy".

    I dithered for a day or two and took the plunge.

    In early December I moved to my high-ceilinged, Raj-era office in Lutyens' Delhi, the North Block. I had landed in the belly of the beast that I had studied for so long from outside through the analyst's neutral lenses.


    The first week was harrowing.

    My in-tray reached for the ceiling till someone pointed out that on my right was an out-tray.

    Questions concerning the economy came at rapid fire from parliament and from policy-makers.

    I was asked, for example, if allowing futures trading in food created inflationary pressure on the spot market price of food.

    This is the kind of question on which I would love to spend some months thinking and reading and then write a paper. Here I had 24 hours to respond.

    For all the bewilderment of the first week, there was one pleasant surprise.

    'This job is to give my absolute best towards creating a better India'

    I did not expect the level of professionalism and commitment to work that I encountered in my ministry.

    It is entirely possible that this is a recent phenomenon and special to Delhi, but the level of individual industry that I have seen in my first weeks is entirely on a par with or even higher than the best private sector firms.

    In addition, the top brass combines this professionalism with an unexpected unassuming air. This augurs well for the Indian economy.

    Let me clarify, I have not changed my mind about the slowness of our bureaucracy.

    There is enough hard data to show that we take too long to clear the permits needed to start a new business, we take too much time to close a business that has gone bankrupt and our procedures for enforcing contracts are too cumbersome.

    I believe that to streamline these and make them faster will be like starting fast trains between cities, building better ports, providing ample electricity. It can have a magical effect energising the entire economy of India.

    What my first weeks of the view from within has convinced me is that the problem lies with the system and not with the individuals who comprise it.

    It is like ace drivers caught in a traffic jam; a huge waste of a valuable resource.

    Enabler of enterprise

    We have to re-examine the structures of decision-making in our bureaucracy so that permits are given quickly for new enterprises to start and bankrupt ones to close, food grains are released promptly when prices begin to rise, justice is dispensed with quickly when somebody is wronged, and visas are given (or not given) as promptly as possible.

    'India is too big a country to provide for all'

    A part of the problem arises because of flaws in the way we see the role of the state.

    The state has to be an enabler of enterprise, not a substitute for it.

    India is far too big and complex for the government to be able to directly provide food to all, education to all and employment for all.

    The government should instead create an enabling atmosphere which allows ordinary individuals to provide these vital goods and services to one another.

    This, in turn, means that the government's default option should be to permit rather than prevent.

    If we manage to effect a restructuring along these lines, with so much talent in the government, this will give another boost to India's growth.

    As I begin in my new job and try to do my share, I will of course miss my Cornell life.

    I moved to the US in 1994 with apprehension.

    Once I discovered the American university, I could not but appreciate its openness, its fierce regard for individual freedom and voice and its multi-culturalism.

    On the latter, though, India, with its pluralism, also does very well.

    The babble of varied accents and styles that I encounter even within the hallways of the North Block is very reassuring.

    Postscript: It is time for me to bid adieu to my column.

    Let me close with a facetious story that sums up the joys and vexations of multicultural life.

    'Streamlining the bureaucracy will help boost the economy'

    A newly-arrived Indian couple, driving though La Jolla, get into an argument about how to pronounce the name of the town.

    When they stop at a restaurant for lunch, the wife asks the waiter: "My husband and I realise that neither of us knows how to pronounce the name of this place. How does one pronounce it?"

    The waiter, a new immigrant from China, says: "Don't worry. In my one year here I have heard many people mispronounce it. But it is easy. First you say buh, then guh, and then you say kingggg."

    Kaushik Basu is on leave from Cornell University, where he was until recently professor of economics.

    BBC News - Life in the heart of Indian government


    picture of mr. kaushik basu -


    source: BBC.CO.UK.
  3. Energon

    Energon DFI stars Stars and Ambassadors

    Jun 3, 2009
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    That there is a lot of skill and professionalism at the topmost level of the Indian government comes of no surprise, especially in the realm of economics. As Gurucharan Das rightly points out, for India there was never a dearth of economists, if anything it has been burdened with too many brilliant ones. The question however still remains how far well will their ideas be organized and executed by the legislative and executive branches, especially at the state and local levels.

    I am glad to see that Dr. Basu has taken up a job with the GoI. More so than his impressive academic credentials he brings with him a lot of good ideas.

    For me the most critical part of this essay is when he says...

  4. ppgj

    ppgj Senior Member Senior Member

    Aug 13, 2009
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    I sense winds of change and that's why I'm here: Kaushik Basu

    20 Jan 2010, 0647 hrs IST, Abha Bakaya, ET Now

    Kaushik Basu.

    Don’t be surprised if you see brightly painted T- shirts and sarees around North Block. It’s just a harbinger of changes to be brought in by Kaushik Basu, the Cornell economist who has taken over as the chief economic advisor to the finance ministry. Mr Basu enlists his plans to attain double-digit growth rates in an interview with ET NOW’s Abha Bakaya. Excerpts:

    Bureaucracy can frustrate best of men in India. For an academicturned-advisor , it might be difficult to push through implementation ?

    I know there will be severe restrictions compared with the theoretical world. I am a theorist, but I do have enough common sense to know that the government is bureaucratic. I’m learning the ropes and the insights I’m gaining are extremely useful. I now know exactly where restructuring is required. I’m also surprised at the high level of hard work being put in. It’s one of the best and most capable governments we’ve had in recent times. It’s the procedures that are wrangled up and need modifying. I had been warned of an insider lobby and an outsider lobby at play. Maybe I’m being naïve , but I have not sensed any such thing as yet.

    How would you define your role?

    There is a need to think out of the box and I am an outsider. I’ve worked in many different contexts. For instance, inflation control is a political import and it has people concerned. There are 3 standard solutions to the problem, but there are 5-6 new things we can try.

    And what chance do these have of being implemented?

    People are open to listening and that’s important. Hopefully some of these suggestions will translate into action.

    How soon do you think we’ll see food prices cooling off?

    The measures have been put into place. They will cool off in 1-2 months.

    What’s your GDP number?

    It’s 7.5%. We’ve got a great stimulus package. Better than many of the international ones. It’s a question of sustenance . The entire Indian growth story is not on the back of stimulus measures. From 2003 to 2007, we saw 9% growth. Recession came in last year and we needed rescuing. We’re already back to 7.5% and am sure we can end next year at 9% once again. I’m confident we’ll be breaking 10% growth in 4-5 years, unless there’s another unforeseen event like another US recession, which is unlikely.

    Your approach to reforms?

    Expect good reforms that will last 20 years. That will establish the new government . Some of the issues that need to be addressed include speeding up the bureaucracy . It should take less time to start up a business and it should also be quicker to wrap up. It should be quicker and cheaper to enforce a contract. Bureaucracy can grow, but it needs to be more effective. The US has more laws than us. The number of laws is not the problem, but it’s how you administer them.

    And on the economic agenda?

    India will be a bigger exporter. This needs strategising. We’ve done well when it comes to IT, pharma and auto. Now, we need to focus on textiles and garments. We have natural strengths which we can use to grow rapidly. An export thrust is on the cards. The government has been spending on social progress, but there are still leakages. If we plug these then we can get twice the bang for the buck. A good identification system, like the UID, can be the crux of a good anti-poverty programme . Once we have the system by 2012 we can backpack on that. That’s the third agenda.

    The government will have to take a call on the rollback of stimulus measures sooner or later? What’s your take on this issue?

    The question is when? Rollback stages need to be decided, that’s all. Stimulus measures have been put in place globally so there is a need for global coordination . China is not transparent enough. The US began the rollback process, but then realised it was too soon so has stepped back. And unemployment continues to be a huge issue in the US.

    Any rate tightening expected in the monetary policy?

    A wait and watch approach is being followed . I am confident that inflation will turn around. So hopefully we’ll get around without needing to tamper with the rates.

    How are you adapting to the new role?

    It’s the start of a good run for India. I sense winds of change and that’s why I’m here. Otherwise I love my academic life. Though I could say I’m busier than would have cared for! And yes, I hardly get time now for my various hobbies --one of which is to paint. And why paint on paper when you have something more permanent and usable like a Tshirt or a saree. That’s something I enjoy doing in my spare time.

    I sense winds of change and that's why I'm here: Kaushik Basu- Interviews-Opinion-The Economic Times

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