Upping the ante

The Prime Minister's speech at the 52nd meeting of the National Development Council (NDC), which met a few days ago to finalise the approach to the Eleventh Five Year Plan, grabbed attention for its reference to disadvantaged minorities and the priority of their claims on national resources. But the main theme of the speech, one that ought to guide the actions of government during the Plan period, was the setting of the ambitious goal of 9 per cent annual GDP growth during the Plan period (2007-12). It may be recalled that the draft Approach Paper to the Plan, which the Planning Commission had circulated a few months ago, provided three growth scenarios, of which 9 per cent was the most ambitious. Dr Singh's acceptance of this scenario at the Council meeting was both reassuring and worrisome at the same time.

It is reassuring because it assuages concerns about the UPA government's commitment to a growth-accelerating economic policy regime, in its emphasis on other developmental objectives, as legitimate as they may be. The re-appearance of the "growth vs. equity" debate in policy discourse and several initiatives taken by the government suggest an acceptance of the inevitability of the trade-off and its implications for policy. While the Prime Minister may not have diluted his commitment to the reform agenda and its underlying belief that rapid growth and equity go hand in hand, the collective decisions of the Cabinet clearly reflect the fact that his views are not unanimously shared within the coalition, and for that matter within his own party. Stalemate is the inevitable consequence; the current buoyancy of the economy should not divert attention from the relatively weak reform record of a government whose key figures came in with such strong reputations and high expectations. Against this backdrop, the re-affirmation of the Prime Minister's commitment to faster growth as the priority of economic policy at the NDC meeting indicates that the reform agenda has not been given up altogether.

On the other hand, what causes concern is precisely the roadmap that the Prime Minister laid out in his speech, highlighting the many recommendations of the Approach Paper with respect to agricultural rejuvenation, public-private partnerships in infrastructure and so on. It is on all of these fronts that the government has struggled during its two years and more in office. Not that good things have not been accomplished; however, these have generally been incremental in nature. When it comes to major breakthroughs in the areas that Dr Singh listed in his speech, there are few signs of moving from aspiration to accomplishment. The critical issue of how the government intends to make these plans work is not being given enough attention. Making political bargains, strengthening some public institutions while extinguishing others, enhancing the capacity of the bureaucracy to take on new challenges""all of these things are central to the Plan. They cannot be simply assumed to fall into place as the need arises. In short, achieving an average growth rate of 9 per cent over five years will require far more than a good plan or an appropriate mix of public and private investments. It will depend on a fundamental re-alignment of governance systems, in both their political and administrative dimensions. When and how will this happen?