R Ravimohan: Gandhiji's India?

The darkness that surrounds the education sector is both appalling and unnerving.

Of the various virtues Gandhiji preached, self-reliance was perhaps the most vivid. While spinning the charka helped make one's own cloth, it was also a powerful icon of self-reliance. Sixty years after independence, we might actually be following those words of advice, albeit for a very different reason. In our work at CRISIL as a leading infrastructure adviser in the country, we found that most companies practise an extreme form of Gandhiji's self-reliance principle by insulating themselves from infrastructure constraints, with their own power, water, port and even hotels. Though hardly any Indian spins the charka, most Indians produce their own electricity, source their own water, dispose of their waste, find teachers to educate themselves and indeed arrange for their medical remedy.

Nearly 80% of households in Delhi survive on diesel-generating sets. Bangalore, the Silicon Valley of India, is the only city that beats Delhi in the percentage of households using diesel generators. Most dwellings in India now dig their own bore-wells to source water as the public supply covers only a small percentage of population and that intermittently at that. Even our best cities cannot supply piped water to a third of their citizens. Dwellings that don't have wells have to source water through tankers over long distances. Both diesel generators and water transportation require enormous amounts of liquid fuels, which need to be imported, bloating our import bill, spewing greenhouse gases and engendering colossal inefficiency in the system.

There is a shortage in the number of educational institutions at all levels. There is a shortage of teachers too. Skill levels of teachers vary. Thus, the quality of education deteriorates very sharply as we go down from the very few well-regarded institution at each level and in each discipline of studies. For instance, in Mumbai, nearly 90% of students of even the elite schools attend tuition classes. This is not only for the crucial school finishing years, but even for junior classes. The story is similar with regard to health care with a woeful shortage of beds, doctors, nurses or medicines.

Rather than improvement, the supply of these essential services has deteriorated since the beginning of this century. Unless improvements take place on a war footing, the situation is likely to become more difficult as the very vast population of young Indians age at the rate of over 10 million on average every year for the next 35 years!

It is not that the authorities have not tried. Big initiatives have been taken to induce the private sector to take up part of the load as it was clear that the public sector did not have the ability to deliver the full bandwidth of solutions. But the private sector has so far not been able to tackle effectively the challenges of delivering what has been for long construed as public service. The services that are being referred to here are subtly different from infrastructure development, in the sense that infrastructure services have a tangible economic viability to them. Some of these essential services may first need to be converted into infrastructure services, before the private sector becomes effective vendors of the same. But policy and public support are not yet in a state of endorsing private sector activity in essential services. However, the unseeming confusion of branding everything as infrastructure and without being sensitive to the public interest content in these services will mar the various laudable efforts to gear up supply. The challenge will be to foster sensible public-private partnership models that will strategically blend the public utility role to be played by the government with the creative, efficient operations of the private sector with a carefully structured incentive scheme for the private sector, designed to make it profitable for them to participate. Such participation will lessen the load on the public system, accelerate development and make the essential service providers more accountable to the public at large.

The second initiative that the authorities have taken is to improve the efficiency of the existing utilities both with governmental incentive schemes and by allocating funds for upgrading the services, especially backed by multi-lateral funding schemes such the Accelerated Power Development and Reform Programme and Jawaharlal Nehru National Urban Renewal Mission, two schemes for the improvement of public utilities in the electricity and the urban sectors, respectively. These schemes are making tangible progress in improving public services. However, these are but catalysts and their impact will be too little and too late. To accelerate and broaden the impact, private participation is needed even in these improvement programmes. Once there is clarity on the allocation of roles of public services and the private sector, and a paradigm of seamlessly integrating the respective roles evolves for new projects, it will easy to extend it to existing utilities and make them more productive.

At last, the introduction of an independent regulatory framework has begun in the electricity sector. Even though the sector continues to fall short on meeting the demand, the initial experience with the regulatory system has yielded a few tangible benefits, such as greater transparency in the utilities working, improvement in efficiency, progress towards a good public-private partnership paradigm and the beginning of consumer interest protection. However, much more needs to be done to improve the efficacy of the regulatory system with the success today being determined by the person at the helm rather than the system per se. By contrast, least progress is witnessed in the field of education, with the government getting more and more entrenched in its management. The myopic policies have shut out formal private enterprise. The burgeoning demand is being met by a mushrooming cottage industry backed by an unholy nexus of political and petty commercial interests. For a country that aspires to become the global leader in knowledge-related activities, the darkness that surrounds the education sector is both appalling and unnerving. Light needs to be shone on it to enlighten India. Jai Hind!

R_ravimohan@Standardandpoors.com

The views expressed in this article are personal