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Reform Wishlist for 2011

The bells ringing in peoples ears this winter are not all of the jingle variety normally associated with this time of the year. This is hardly surprising, given that as 2010 drew to an end and we reflected on the year that has been, it has been difficult to focus attention away from the many scams that have emerged over the past few months. Despite the magnitude of the 2G spectrum case, even cynics didn’t expect the winter session of the Parliament to be such a washout. The IPL controversy is still looming. There are sensitive domestic issues like Naxal violence and J&K. Coupled with all this is food inflation.

The question that keeps coming to my mind is whether all of this is part of some kind of natural cycle, a strange coincidence, or everything just catching up all at once, like bad karma! And since I don’t have an answer, I am happy accepting that whatever it was, we left it behind us in 2010. Let’s, therefore, resolve to enter the New Year with a new spirit, a fresh outlook, a lot of optimism for what the year ahead can and will be and a renewed sense of urgency to build upon India’s rise as a global power.

The good news is that projections continue to peg economic growth at about 9% annually. But it is important that the reforms also keep pace. Further, one of the areas of focus in 2011 needs to be enhanced governance.

On the reforms front, the government needs to take cognisance of the drop in FDI inflows and address this by further liberalising FDI rules and guidelines. Deserving particular attention are the retail and defence sectors, but of equal importance are the insurance and financial sectors. Entry of new private players and more licences to foreign banks will be the matters watched with keen interest. Reforms are also required to ensure further investments in the infrastructure sector. What will help the investment landscape are land acquisition reforms and the proposed implementation of GST and the simplified DTC. Finally, a legal process needs to be established to raise and fund election campaigns and this necessitates substantial electoral reforms.

Reforms need to be supported by governance, which, at a very basic level, is the conduct of public affairs and the management of public resources. Governance can only be termed good if it is effectively implemented. It is important to install processes that improve efficiency and accountability of the public sector and, at the same time, are equitable and inclusive. Given the vast rural population, it is important to empower local governments and decentralise power so people feel part of the governance process affecting their lives and livelihood. Technology can play a large role in achieving these objectives. Thus, the UID scheme is a notable endeavour through which citizens’ identity is acknowledged and the data gathered through this process can also be used to shape governance practices. Let’s remember The Directive Principles of State Policy enshrined in our Constitution, which are fundamental in India’s governance.

Finally, it is perhaps, now more than ever, important to put in place in-built systems of checks and balances that would help detect and hopefully even prevent corruption at early stages. Equally important is the necessity to restore the rule of law. Improvements to the criminal justice system must be carried out on war footing and people’s faith in the honest and independent functioning of the judiciary has to be re-established. The government should make as its primary resolution for 2011 the need to restore public confidence and change public perception. As Jagdish Bhagwati stated in his lecture at the Indian Parliament, “India is witness finally to what I have called the Revolution of Perceived Possibilities. Aroused economic aspirations for betterment have led to political demands for the politicians to deliver yet more.” Thus, for once, politics needs to take a back seat and make way for good governance. It is time we recognise that the two are not mutually exclusive. Most of this, albeit somewhat simplistic-sounding, can be achieved if the functioning of the government is made more transparent and there is greater accountability for its actions. Let’s hope that unlike most New Year resolutions that die down within the first few months, the government in 2011 will see through the promises it has repeatedly made about reforms and governance. I am optimistic—Happy New Year!

First Published in the Indian Express on January 06, 2011

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