The most notable of opportunity cost of a washed out Monsoon Session is the failure to have the Constitutional amendment to introduce a uniform goods and services tax (GST) across Indian states. A draft legislation that has a rare bipartisan backing in many respects in a fractious political environment, the GST law has been worked on by political leaders across party lines for years now, under multiple governments at the Centre and states. The rising tide of public opinion is making political parties squeamish. The Lok Sabha finally witnessed a debate over an adjournment motion with one day remaining for the session to end - an adjournment motion is a proposal to adjourn all business in view of the issues raised by those moving it - and the Bharatiya Janata Party and Congress staged a pitched personalised reality TV battle. Debate over an adjournment motion with 48 hours left in the session, is merely an eyewash to give the impression that our lawmakers indeed debate and discuss issues with an open mind.
The Rajya Sabha, on the other hand, has been in shambles through this session. The Congress issued an advance notice that it would blow up an entire session unless one BJP Union Cabinet Minister and two BJP State Chief Ministers resigned. The BJP too, remained obstinate and did not even order an official probe into allegations to buy peace, thereby refusing to cede any political ground as a compromise. Now what does this mean for the acche din promise on which this government was voted to power with a complete majority in the Lok Sabha? First, the legislative capacity of the government has shown chinks in the armour. The government, which prided itself in not having some grand vision statement or plan design in what to do over five years, and has been happy to focus on small steps that would resonate with the common man, would now be repenting not moving faster in the initial weeks and months of assuming power. In the initial months the government took the easy way out, promulgating ordinances to address its reform agenda, but has faltered in getting the ordinances actually passed by Parliament.
The opposition's power had been underestimated to such an extent that the weapon of convening joint sessions of Parliament (in a joint session, the government's drawback of being in minority in the Rajya Sabha would be wiped out by its majority in the Lok Sabha) was not used at all. The trick of converting draft legislation into money bills has not been effectively utilised either. All it takes is one controversy to hold up the capacity to perform in Parliament. Shouting that the opposition is disruptive of India's economic progress does not sound strong, when, just a few years ago the same voices had said disruption is a legitimate democratic tool. Second, the fundamental rule it followed so well in the election campaign - using shock and awe - has been followed in the breach when it comes to legislation. Instead, the defensive approach of reform by stealth, which was the hallmark of the past decade under the United Progressive Alliance government, is back in vogue.
One abject example is the loss of more than a year in reforming the law governing public sector banks. Even the legislative changes that could be brought in, using subordinate law drafted by the government under the authority already granted by Parliament in existing legislation, have not been effected. State-owned banks are governed by antiquated 'schemes' drafted by the government, using powers under legislation passed by the Parliament, while the governance of all other companies under normal company law has marched light years ahead. Writing a new scheme and scrapping some really silly provisions in existing schemes (for example, a ban on payment of performance bonus to bank management) is low-hanging fruit, but not even a single measure has been achieved here. Third, the sheer inability to realise that no matter what happens in Parliament and the number of MPs in each House of Parliament, there is enormous cleansing required to be effected at the level of regulatory oversight for doing business in India to become easy. Complicated regulatory issues, imprecisely drafted provisions, disproportionate enforcement actions, excessive bias towards punishment from one regulator and excessive bias towards prudential measures ignoring the need for effective punishment by others, are all examples of what ails the over-regulated Indian business sectors. The absence of political will and intellectual stature to mould public perception about the need to clean up unregulated activities of regulators ensure fear of being perceived as interfering with autonomous regulators.
The Prime Minister has alluded to an 'Emergency' situation arising out of the behaviour of the Opposition.
If he were to call in the armed forces and follow Indira Gandhi's footsteps, without throwing people into jail and without enforcing silly policies like Sanjay Gandhi's forced nasbandi, there may even emerge mass support for benign dictatorship. Private capital always prefers predictable dictatorial regimes to chaotic democratic systems. That such an eventuality even sounds plausible is a signal of alarm and of grave concern to India's future and clouds the prospects of acche din.
(The author is a partner of JSA, Advocates & Solicitors. The views expressed herein are his own.)
somasekhar@jsalaw.com
The Rajya Sabha, on the other hand, has been in shambles through this session. The Congress issued an advance notice that it would blow up an entire session unless one BJP Union Cabinet Minister and two BJP State Chief Ministers resigned. The BJP too, remained obstinate and did not even order an official probe into allegations to buy peace, thereby refusing to cede any political ground as a compromise. Now what does this mean for the acche din promise on which this government was voted to power with a complete majority in the Lok Sabha? First, the legislative capacity of the government has shown chinks in the armour. The government, which prided itself in not having some grand vision statement or plan design in what to do over five years, and has been happy to focus on small steps that would resonate with the common man, would now be repenting not moving faster in the initial weeks and months of assuming power. In the initial months the government took the easy way out, promulgating ordinances to address its reform agenda, but has faltered in getting the ordinances actually passed by Parliament.
The opposition's power had been underestimated to such an extent that the weapon of convening joint sessions of Parliament (in a joint session, the government's drawback of being in minority in the Rajya Sabha would be wiped out by its majority in the Lok Sabha) was not used at all. The trick of converting draft legislation into money bills has not been effectively utilised either. All it takes is one controversy to hold up the capacity to perform in Parliament. Shouting that the opposition is disruptive of India's economic progress does not sound strong, when, just a few years ago the same voices had said disruption is a legitimate democratic tool. Second, the fundamental rule it followed so well in the election campaign - using shock and awe - has been followed in the breach when it comes to legislation. Instead, the defensive approach of reform by stealth, which was the hallmark of the past decade under the United Progressive Alliance government, is back in vogue.
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Even in areas where the absence of a majority in the Rajya Sabha does not matter since one does not have to go to Parliament, there has been little achievement. In the absence of shock and awe moves, vested interests opposed to reform have a lot more time to regroup and plan better to stymie reforms.
One abject example is the loss of more than a year in reforming the law governing public sector banks. Even the legislative changes that could be brought in, using subordinate law drafted by the government under the authority already granted by Parliament in existing legislation, have not been effected. State-owned banks are governed by antiquated 'schemes' drafted by the government, using powers under legislation passed by the Parliament, while the governance of all other companies under normal company law has marched light years ahead. Writing a new scheme and scrapping some really silly provisions in existing schemes (for example, a ban on payment of performance bonus to bank management) is low-hanging fruit, but not even a single measure has been achieved here. Third, the sheer inability to realise that no matter what happens in Parliament and the number of MPs in each House of Parliament, there is enormous cleansing required to be effected at the level of regulatory oversight for doing business in India to become easy. Complicated regulatory issues, imprecisely drafted provisions, disproportionate enforcement actions, excessive bias towards punishment from one regulator and excessive bias towards prudential measures ignoring the need for effective punishment by others, are all examples of what ails the over-regulated Indian business sectors. The absence of political will and intellectual stature to mould public perception about the need to clean up unregulated activities of regulators ensure fear of being perceived as interfering with autonomous regulators.
The Prime Minister has alluded to an 'Emergency' situation arising out of the behaviour of the Opposition.
If he were to call in the armed forces and follow Indira Gandhi's footsteps, without throwing people into jail and without enforcing silly policies like Sanjay Gandhi's forced nasbandi, there may even emerge mass support for benign dictatorship. Private capital always prefers predictable dictatorial regimes to chaotic democratic systems. That such an eventuality even sounds plausible is a signal of alarm and of grave concern to India's future and clouds the prospects of acche din.
(The author is a partner of JSA, Advocates & Solicitors. The views expressed herein are his own.)
somasekhar@jsalaw.com