Watch a video of the talk I gave at the IIT-BHU, Varanasi on 11th August 2016 on ‘A development vision for India’
Your Excellency Sri Vajubhai Vala, Governor of Karnataka, Sri Doreswamy Naidu, the Chancellor of PES University, Prof Jawahar, the Pro Chancellor, Dr K N B Murthy, the Vice Chancellor of the University, faculty, staff, students, parents and others present here today:
At the outset, let me congratulate the proud graduates who are here today to this first convocation of the PES university to receive their degrees. I am happy to be here amidst such a wonderful campus, among such acclaimed intellectuals, and outstanding students and scholarship and share your joy and enthusiasm.
Down through the ages, a traditional form has evolved for this type of convocation address, which is: A elderly person, his best years behind him, who, over the course of his life, has made a series of dreadful mistakes (that would be me), gives heartfelt advice to a group of shining, energetic young people, with all of their best years ahead of them (that would be you). And I intend to respect that tradition.
Each of you stand on the threshold of shaping your future and preparing for life in a world that seems to be getting increasingly challenging to comprehend, and difficult to come to terms with. As you stand waiting to explore the adventure that lies ahead of you, you will have to come to terms with the fact that University education can only take you this far… All that your teachers and professors can do is to lay a foundation for you. But you will have to do the hard work of building on it with the skills that this university has honed in you.
I’ve got three things I want to ask you to ‘learn’ as you move forward, and I think these might be kind of counterintuitive, particularly coming from an activist who is unashamedly disruptive, and concerned mainly with social and economic justice. Here are the three things I’m going to ask of you:
Learn to operate from zones of your incompetence,
Learn to be alive and
Learn to be real
‘Learn to operate from zones of your incompetence’ may sound like advice that is completely out of place in a university convocation. Universities train you with one set of competences but the danger is that they do not allow us to come to terms with what we do not know. As we gain competence in one specialized area of our study, we start becoming totally ignorant of our incompetence in other areas. Feeling incompetent is a safe and sure way to keep acquiring the competence you need to grow and thrive in this dynamic world. The world is changing and progressing at such a rapid pace that no amount of knowledge or skills that you acquire will ever by sufficient or help you face the challenges that man keeps creating for himself today. Learning to operate from zones of your incompetence will give you the humility to explore; to learn newer skills to build on your existing repository; and more importantly give you the freedom to fail.
We need to understand that intellectual arrogance can cause disabling ignorance and we need to over come this. And we can overcome this only when we embrace humility with a desire to learn. Only when we have the humility to accept what we do not know, will we embark on the journey of life-long learning. Remember that every person will have something to teach you. If your attitude is that only smarter people or formal Institutions have something to teach you, your learning opportunities will be very limited. But if you have a humble eagerness to learn something from everybody & everywhere, your learning opportunities will be unlimited.
I remember something that happened to me very early in my life. After my medical graduation, I went to an interior forest area in the Bandipur National Park in Mysore district with a desire to serve the indigenous tribals living there. On a visit to a small tribal hamlet, I joined the meeting of a women’s self help group that was taking place there. There were around 20 women and they were animatedly discussing what to do with one woman who was repeatedly defaulting on her repayments. I had to come to attend this meeting mainly to establish myself as a doctor who now lived in a tribal colony nearby and was eager to help them with their health problems. I knew that many of them had relatives living in the colony where I lived, and I had hoped that the news of my dispensary had reached them. After the welcome and the small talk, we slowly started discussing on what they did when they fell sick. Someone told me that her two-year-old child was having an acute diarrheal episode. I saw this as a good opportunity to establish my relevance as a ‘doctor’ and started telling them about Oral Rehydration Salts (ORS). I told them all about diarrhea, how to prevent it, the efficacy of boiling water and ended my talk with how ORS should be prepared and that it should taste like human tears. Little did it occur to me that drinking something tasting like tears required a lot of motivation and may not exactly be something that a two-year-old would like to have. The women were silent and did not respond as enthusiastically as I wanted them to do. I was talking to them about what the World Health Organization (WHO) called the ‘discovery of the century’ and these women just did not seem to care!! Then it occurred to me that these people had more than 10,000 years of anthropological history and must have been having diarrheas all along. They must have been doing something very effective to counter it too. I asked the women what they would do to help this baby. This kick-started a very vibrant and energetic discussion. The women told me that they would spend about a rupee on buying a banana and some flattened rice (called poha in hindi or avalakki in kannada). They would powder the flattened rice and crush the banana and mix the two well. They would then feed this to the baby. If the diarrhea persisted, they would make a decoction out of the peel of pomegranate fruit and make the baby drink it 4-5 times a day.
Here I was, stupidly telling this community to use a poorly tasting drink like ORS while they could give their baby carbohydrates, much needed sodium & potassium and fluids, in a simple yet tasty way. Banana is also a well-known bowel binder. How much traditional wisdom and knowledge exists in such indigenous communities! All that I needed to do was swallow my pride, throw away the arrogance that modern schooling had clouded me with, and come to these people with the humility to learn. One will never be disappointed nor cease to be surprised with the things that people whom we consider ordinary can teach us.
Learn to be Alive
More than a century ago, Swami Vivekananda thundered, “He alone lives who lives for others. The rest are more dead than alive”. Being alive is appreciating that our education, our success and our achievements are meaningless if it is not undertaken in the spirit of serving others. And this can happen only when we have a purpose in life that is larger than merely a career. If a career is all about us and our own attainments, living a purposeful life is all about others and our meaningful contribution in making this world a better place. Being alive is all about seeking happiness in the happiness of others.
Today’s generation has learnt to celebrate career successes to the point where we have lost focus on what truly matters. Living your life for others is not limited to only spending your life in the service of others. Your family, the community around you and your self matters too… Balancing our life’s priorities should include making the time for the people who care about you and about whom you care a lot too. Taking our family for granted is the common mistake many do. Life would be worthless if we sacrificed our family and their needs on the altar of career success. Allocation choices can make your life turn out to be very different from what you intended. People who are driven to excel have this unconscious propensity to under invest in their families and over invest in their careers. You should learn not to worry about the level of individual prominence you have achieved; but learn to worry about the individuals you have helped become better people.
Learn to be Real
To be real is to be yourself. For too long we have come to believe in the images that we and others have been creating for us from a very young age. This comfort-seeking world has convinced you about things that you cannot do and what you are not… From one’s childhood, we are constantly told ‘don’t do this’, ‘don’t do that’. We are reminded everyday of our own failures and what we cannot and should not be doing. Very few of us have lived in ecosystems that have celebrated failures and given us the courage and encouragement to believe in ourselves. The world is now calibrated to measure human endeavor by the narrow metric of financial successes and cognitive attainments. Any person who sets out to be true to his own inner self and thinks and acts differently is seen as a non-conformist and too disruptive for anyone’s comfort. Being yourself and not conforming to set patterns that society prescribes for you will allow you to go places where others dread to dare. You now need to convince yourself of the enormous power and potential within you. Learn the power of positivism…understand what you truly are…do not try and live upto the images that you give yourself and the world keeps giving you. Do not lose your authenticity…and you will surely succeed in making this world a better place.
Work with your strengths but more importantly build your strengths around what is passionate for you. And remember that acting on this knowledge of understanding yourself will ensure that you are ‘creatively disruptive’ enough to operate in today’s world of ‘dynamic disequilibrium’.
The changing metrics of success
The benchmark for being successful is rapidly changing…it will no longer be the people who have the skills, knowledge and competence to make money…It will soon be measured by the human and social capital that you enjoy and not by the economic capital that you generate. And remember that it is not people with PhDs from the best of Institutions who will succeed in the future. Success cannot be a life where at best there is an absence of failure in our chosen fields…Survival and success is not going to be driven by how much you know or how well you apply what you know. It is going to be driven by disruption…innovation…digital technology, data management and the leadership that can sustain these processes
It is people who can confidently answer ‘yes’ to the following 4 questions that will enable themselves and those around them to succeed…
– Can you be disruptive?
– Can you lead with both passion and compassion?
– Can you learn to work in a digital environment?
– Are you prepared to live and operate in a data rich eco-system?
Understanding disruption is hard. Disrupting is even harder. Disruption literally uproots and changes how we think, behave, do business, learn and go about our day-to-day lives. Harvard Business School professor and disruption guru Clayton Christensen says that a disruption displaces an existing market, industry, or technology and produces something new and more efficient and worthwhile. It is at once destructive and creatively constructive too.
Only when you learn to be alive and authentic can you generate a passion for living. Living a life for others is what compassion is all about. Passion with compassion can be the formula for the success that you seek.
Young people like you are born and are growing up in a digital world where boundaries of privacy are getting increasingly blurred. Only those who have learnt to operate in this highly interconnected digital environment will learn to thrive and prosper. We live in a knowledge based society and in times of information overload where data is getting thrown at us from multiple directions. Learning to mine, collect, collate, process and apply data in a productive way is what will discriminate the mediocre from the outstanding.
And it is the people who are life-long learners; people who have learnt to be alive and who have learnt to act with authenticity, will be the ones who will be able to make a real difference in the world today. It is these people who have learnt to not only cope but to grow and thrive in a complex world who will end up exercising the leadership to take humanity forward. Managing ourselves and others around us is creating a revolutionary paradigm…Let us all be a part of it and together work with the determined optimism that is required to make this world a truly great place to live and operate in.
Wishing you all the very best,
Dr R Balasubramaniam
The growth of non-governmental organizations (NGOs) over the last four decades in many parts of the world is phenomenal. India is known to be home to nearly 3 million NGOs working in different sectors like health, education, rural & tribal development, environment issues and social development amongst others. They vary in size and sectoral focus and many small charities have now become large, going concerns and some of them rival government departments and private sectors in their scope and ambition. Few people acknowledge the fact that NGOs are today one of India’s largest employers and have gone into areas where many would dread to enter. Many of them have done extraordinary work amongst the marginalized and have created platforms for the voiceless across the country. While the sector has its share of black sheep, one cannot be dismissive about the enormous contributions that a significant number of NGOs have done to the cause of social development in India. While the Government is well within its rights to demand accountability and transparency from this sector, one should resist the temptation to try and paint all the NGOs with the same brush. The debate around NGOs usually is one sided depending on which side of the story one likes to hear. The Government response has been based on anecdotal incidents involving a few high profile NGOs and the changes that it is foisting on the entire sector is likely to have unprecedented consequences. The debate now should be objective and one needs to address both the myths and the realities that are prevailing and likely to ensue because of the complexity of the eco-system that is getting fashioned by the Government.
The changing taxation laws, the Foreign Contribution Regulation Act (FCRA) act and the constantly changing rules, the Lok Pal act and the inclusion of all key NGO functionaries and Board members as Public servants are a but a few in this list. On one hand the Govt talks about sustainable development and community participation but is insensitive to attempts by NGOs to become sustainable organizations by themselves. Limits on the percentage of revenues to determine the ‘Charitable status’ makes the NGOs dependent on external sources of funds –whether it is from donors or Corporates or Government funding. This frequently reduces many well intentioned NGOs to become contractors delivering welfare services wherever the public systems have failed or have never reached. While the government wants to promote service agencies, it is now becoming wary of any NGO advocating change or empowering citizens in demanding change. It does seem ironical that the government is streamlining laws and making it easy for FDI and invites global business leaders to set up operations in India but goes overboard in creating barriers for NGOs from receiving foreign funds or working with global partners. The Government should understand that the ease of doing business should also apply to the development sector and it must not intentionally create barriers that inhibit social action and change.
How poverty is viewed and how it can be tackled is one of the key areas of disagreement. While the state takes the view of seeing poverty in terms of levels of income, assets, calorie intake, per capita gross national product or a combination of these; many NGOs see poverty additionally as the lack of opportunities, lack of access to Government services, geographical isolation, vulnerability, powerlessness and being ‘voice-poor’. The state response is usually driven by government programs and it finds physical weakness, isolation and income poverty more acceptable and less threatening aspects of deprivation to tackle. The government tends to neglect discussions around vulnerability and powerlessness which NGOs tend to focus on. This naturally creates tensions in the relationship and reactionary consequences ensue. While NGOs may want to see themselves as supplementing Government efforts, the State may see them as threats trying to supplant Government itself. NGOs also need to appreciate that they do not truly represent ‘civil society’ but only ‘civil interests’.
The changes in the external eco-system will necessarily drive even the best run NGOs to re-configure themselves in order to survive. NGOs will have to now learn new coping mechanisms while at the same time retain the flavour of voluntary action. They will have to learn to survive in hostile environments where politics and tradition compete for pride of place with bureaucracy and international donor agendas. They will have to fashion new strategies to deal with the risks in the environment, their own ambitions, and learn to operate with humility and transparency. They need to hold themselves accountable not merely to their Boards and donor agencies but also to the Government and the communities that they work with.
The need of the hour is to begin the process of debate and dialogue not just around managing the relationship between the Government and NGOs, but also around the very understanding of poverty and how to manage it collectively. Unless one appreciates the complexity and enormity of the problem on hand and the need for collective action, this growing tension may result in the disappearance of civil society organizations as we know it. And the loser will neither be the Government nor NGOs but the people and the nation at large.
The media for the last week is talking about two men, two very different men in India. Both are in politics and seem to always be in the limelight. One is Subramaniam Swamy and the other is our Prime Minister, Mr Narendra Modi. While Swamy seems to thrive on creating issues and controversies, the Prime Minister has to communicate to the Nation and the world not only his Vision for the country’s future but also constantly negate some of the issues associated with the past.
I have had the privilege of having met and interacted with both of them and found them so very different. I met Subramaniam Swamy when I was at Harvard. Having heard about this maverick person from India, a few South Asian colleagues suggested that we invite him to lunch and have a chat on many of the issues that he was raising back home in India.
The lunch that we had on that day in August 2009 was indeed memorable. Swamy was a walking encyclopedia and seemed to know just about everything about Indian and South Asian politics and policies. He could hold any conversation by himself and explain with facts and figures why he believed in what he believed. He left us all impressed with his intellectual brilliance, his erudition, his impish smile and his ‘never care for anyone or their feelings’ attitude. When I wanted to know where he found his courage to take on powerful people, his answer was straight and simple – “Having nothing to hide, gives me the courage and the power to expose others who have something to hide.” Beneath his apparent arrogance, I could see that he did have a lot of valid substantiation to his arguments. His conversations were built on the foundations of data and authenticity and one could not find any fault with the content of what he said. What some people have a problem with are the manner in which he says it. While he may not fit into the definition of a regular politician, I felt that in a country like India where our politicians and senior policy makers have a lot of skeletons in their cupboards, we need some one like Swamy to show the common man the filth that lays beneath the actions of the sophisticated and powerful people safely ensconced in their ivory towers. I left that afternoon thinking that Swamy was truly a master craftsman at Politics. He seemed to know which side of the bread is buttered and intentionally picked his fights and adversaries. For him, there seemed to be no distinction between politics, policy, publicity and people. All of this gave him the adrenaline that he needed and he drew his affirmation from both the hatred that his adversaries gave him and the love that his fans showered on him.
I got a call from the Prime Minister’s Office in mid October 2014 informing me that the Prime Minister desired to meet and interact with me on my ‘Development Vision for India’ and what i thought should be the new ‘policy body’ (the present NITI Aayog). I was both surprised and happy. Having just two days to prepare left with me nervous and hesitant, but I decided that I would speak from my heart and not worry about anything else. My appointment was for 20 minutes beginning that evening at 4.30 pm. I had reached Delhi in the afternoon and I got a call from the PMO asking if I could come at 4 p.m. itself. Hurriedly, I reached the PMO and was made to wait in the outer waiting area outside the room where the PM met with visitors. Sharp at 4 p.m, the Prime Minister walked in and greeted me warmly. I was stuck by the punctuality, the warmth, show of interest and the positive vibes that he generated. His entire team of senior bureaucrats had already assembled and I was nervous at the full audience that I had. As I hesitantly started my presentation, the PM stopped me. He patiently mentioned that I had not introduced myself and took it on himself to introduce me and what I did to his senior officers. I was stuck at the level of details that he seemed to know about me. As I rushed thru my presentation keeping the limits of time in mind, he politely asked me to go slow and mentioned that he was keen to listen and that he would make the time for me. What was supposed to be 20 minutes turned out to be the best two hours I have spent explaining my views on what India’s development should be. What left me floored was the level of detail that the PM wanted to dive into. He was full of questions and patiently listened as I explained my views. He mentioned to me that he was a man in a hurry and that he had no time for academic theories and wanted to know from my grass root experience what would work and what would not. His love for the country and for raising her to her rightful place in the comity of nations was very palpable. Though he constantly encouraged his team to challenge and question my views, I found them to be mostly numbed into silence in his presence. His sincerity to learn and understand, his commitment to resolve the challenges of poverty, his determination to make growth inclusive was very evident to me. I was touched by his gentlemanly gesture of walking me out to the door and asking me to call on him whenever I visited Delhi. I left that evening feeling hopeful and confident that the country had someone at the helm who could now steer her to great heights.
Looking back, reading and listening to the media description of both these persons, I feel that both seem to be more misunderstood than understood. Both of them are so very different but also so very similar. Both are difficult to comprehend, predict and understand. But surely both seem to love what they do and one cannot fault their sincerity and commitment to the cause that they believe in – that of making India greater than what she is today.
In the recent World Economic forum, the finance minister of India proudly proclaimed that India was one of the few countries whose GDP was growing and is the envy of other nations. In his budget speech to the Parliament, he reiterated this fact while maintaining that our GDP would continue to grow in the forthcoming year. Whether it is the finance minister or our Prime Minister, they do not spare any opportunity to remind the Nation of our economic growth. While economic growth is a necessity and is welcome, will this alone be enough to shape the destiny of India and its future? Will the narrative of ‘economic growth’ that our political system and government is fashioning be enough?
Announcements of schemes like ‘Make in India’, ‘Start-up India’, ‘Stand-up India’ and MUDRA will not mean much to the millions of toiling millions, especially in India’s rural areas if we do not see development from a perspective that is different from a blind pursuit of income growth alone. Development is not just about building airports and highways; it is not even about more roads, hospitals and schools. They are surely necessary and important, but should only be seen as the consequences of human development rather than the very purpose of it. Development has also become a buzzword in the past few years and has been used and abused to shape the political and economic discourse of entire nations. It is projected as a broad purpose and justification of all activities, often without answering the questions of whose development and how. Development, in my view should be a ‘constant expansion of human capabilities’ and it can be most meaningful and lasting only when ‘Human’ and ‘Social Capital’ is created and expanded.
This raises the question on whether the many Government welfare and social interventions announced in the recent budget will really bring about any change in the lives of the poor? Or will it go beyond the political rhetoric and change the face of India. And what is this change that we desire? As one thinks about it, one is left wondering if we can bring about change in our attitude, mindsets and physical environment without a change in the entire eco-system. Will mere income growth and economic progress assure us of these changes? Or do we need to usher in change at a much deeper human and social level before we begin to reap the ensuing economic consequences?
What kind of human capital are we talking about? Is it merely the capacity of human beings to acquire enough cognitive information and skills to meaningfully participate and contribute to the ‘economy’? Or is it something more than that. What about all the other human capacities that allow him to function freely, responsibly and with dignity? What about the qualities of compassion, humanism, spirit of enquiry, humor, mindful existence, positive thinking and the intent to be good and do good? Imagine a world that is led by humanity that is responsible in its consumption, respectful of all of nature’s creation, constantly striving for both internal and external peace, harmony and good will. Such a world would be wonderful indeed, where sharing and caring would be second nature to human kind and the mad rush to acquire everything for just ourselves a thing of the past. Imagine such a world where these self-evolved humans are interconnected and live with the awareness of mutual trust, interdependence and reciprocity. That is the ‘Social Capital’ that this world badly needs, if it needs to stop hurtling towards self-destruction.
India now needs a new narrative that talks about creating and expanding this human and social capital. Sustainable development will then not be a mere slogan or a fashion statement that is talked about, but a practical and realistic attempt to build this new ‘India’. In that new vision for India, development will also be seen as securities and liberties for communities and individuals. This means that people will have the political space to voice their problems and choose the solution that bests represent them. Dominant players of development – whether they are the Government or Civil Society or the corporate world will then take the time to listen to people with respect and to provide them the platform to articulate their just and legitimate aspirations. India needs to become a pioneer in translating this vision of development into concrete reality where the rule of law is the norm rather than the exception, where no Indian will go hungry, where human rights is not a mere slogan but a way of life, where democratic participation is not a fanciful aspiration but an everyday expression of citizenship, and where food, nutrition, livelihood, infrastructure, education, health care and religious freedoms are not mere political promises but entitlements of an empowered citizenry. Only when this happens can we call India a ‘Developed Nation’.
Collaborations are in the in thing nowadays. Beyond the economics of it, collaborations between partners who bring in different skill sets and domain knowledge end up benefiting more people that just each other. Though partnerships in the social space are usually seen only between Civil Society organizations (CSO) and the Government, we are now beginning to see Corporates willing to partner and work with CSOs too. One would usually see such partnerships being driven by the CSR mandate but we at SVYM recently had a different kind of a mutually enriching partnership with a Global corporate player. This partnership took sometime to plan and think thru and began when another non-profit, the VSO-India Trust (VSO) approached us nearly a year ago. VSO harnesses the energy of youth and corporate volunteers to enable change. They foster development partnerships to create lasting change and promote inclusion and equality for all. More information about VSO is at VSO India Trust. They wanted to explore if SVYM would be willing to work with IBM (whom they were representing) and host 3 of their employees. This was part of the IBM Corporate Service Corps that was launched by IBM in 2008 to help communities around the world solve critical problems while providing their employees unique leadership development opportunities. More info about this program is at IBM CSC
The idea was to see if we could use the skill sets and competences of these employees to help design solutions to some of the problems that SVYM was grappling with, but did not have the ‘talent’ bandwidth to solve. Based on some of the earlier experiences that we had with corporate interns and volunteers, I was a bit skeptical and was more of a distant observer as Prasanna from SVYM worked with VSO and IBM to draft out a Scope of work. After meeting and interacting with the 3 IBMers – Amy, Walter and Rameswari, within a day or two of their coming to SVYM, I felt my skepticism being blown away. They were indeed a different kind of a team that clearly meant business from the very first day of their coming. Though each of them came from different countries and cultures, what was impressive was their professionalism, their commitment to our cause and their serious intent to help solve our IT problems.
SVYM is a very complex and diverse organization with high aspirations as far as its IT needs go and not so high levels of IT resources. Prasanna who is taking a break from the IT sector and has been volunteering with us for the last year and more, is trying to articulate, streamline and restructure our IT resources and capabilities. After internal discussions and deliberations, we zeroed in on our immediate priority of developing an intranet that would help augment our IT capabilities of managing both our internal and external stakeholders efficiently and effectively. Though writing the SOW was an easy first step, I wondered whether these three people with no or very little social sector experience, be able to understand SVYM and come out with something meaningful and productive. What left me impressed was their ability to soak themselves into the SVYM environment completely, befriend every SVYMite that they met, gather in so much information; and finally put all of this together to come out with a product that we could immediately start using.
The IBM trio of Walter, Amy and Rameswari at their final presentation at VLEAD
I would not be exaggerating if I were to say that what they accomplished was much more than what we had bargained for. They not only kept taking in criticism and asking for user feedback, but were also scouting the external environment to explore what other solutions could exist for SVYM and how practical would it be to consider integrating them too. All in all, this was not just a pleasant experience because the IBM team ended up delivering more that what they had committed or we had asked for. What they demonstrated was the fact that people with different backgrounds and cultures can actually team up and work on a project completely outside their domain expertise. They showed what professionalism truly means and lived the humility that such work demands. They also showed us at SVYM what it is to set deadlines and meet them too. They also showed us partnerships need not be driven merely by contracts or agreements, but can also have societal change as the common undercurrent force driving it. Amy, Walter and Rameswari came in as IBMers but they left us as friends and SVYMites on whom we could count on, in the future too. From our end, Parvathi was the SPOC who despite the many demands on her, supported them with the information that they needed for undertaking this project.
And the best way to thank VSO and the IBM team would be to take this partnership forward in terms of putting what they have developed to its fullest use and building on it. And learning and imbibing some of the qualities that they lived and demonstrated while they were here would be another way to remember them every day from now on.
The IBM, VSO team along with some of our SVYM team members at VLEAD, Mysuru
Thank you Amy, Walter and Rameswari and we are sure that you also carry fond memories of SVYM and our work.
The Union budget of India arouses not only interest but passionate debate across the country. From Corporate czars to the experts on television shows to the man on the street, everyone likes to comment on the Union Budget. Each one tends to see it from their own perspective and form opinions that are driven by both objective and subjective analysis. After a week of talk, most of the excitement dies down and very few even remember either the Union Budget or the long term consequences of the same.
While Analysts called the budget of the year 2015-16 as being pro-corporate & urban-centric, they are quick to rush in with the view that this year’s budget is pro-farmer and heavily skewed in favour of rural India. There were also criticisms that last year’s budget did injustice to the much needed social sector programs and the poor of India. We must understand that the budget document reflects the core fiscal policy of the government and should not change based on political compulsions alone. While the budget is indeed prepared on a year to year basis, a reasonable policy continuance is to be expected from the Government in power. From this perspective, this year’s budget has indeed moved away from being such a policy document reflecting the thinking of the ruling BJP party and seems to be influenced by their recent electoral defeats and the upcoming elections in 4-5 major states. While this may give them electoral dividends in the short term, they should not lose sight of the long term impacts that it will leave on the nation and its citizens.
The last year saw two major policy changes that emerged. One was the fiscal decentralization from the Center to the States and the second was the transfer of social sector responsibilities to the state governments. An analysis from this perspective would be critical to appreciate whether the enhanced allocations made to the social sector in this year would result in visible and sustainable change in the year to come. Many schemes were regrouped and slashed and only a few ‘core’ ones were financially supported by the Central Government. The rationale offered was that the states had access to enhanced allocations of 42% under the fiscal decentralization plan and that they had to prioritize relevant social sector programs locally. The reality of the situation is that the transfer of responsibilities to the state governments across a range of development sectors was not matched by adequate increases in their spending capacity. Existing administrative and program implementation capacity has been permanently affected and any enhanced allocations cannot remedy the situation immediately. Moreover, the basic issues of corruption, inadequate monitoring and lack of desired levels of accountability have not been addressed so far. While welcoming the step towards fiscal federalism, we need to appreciate that social sector expenditures made by all states historically in the last fifteen years has not exceeded 40% of the total expenditure. Therefore, in order to realize the Centre’s expectations that the states shoulder major responsibilities of provisioning for the social sectors, would only be possible under massive reprioritization of spending patterns in the states as well as flow of adequate resources to fund these expenditure priorities.
It is from this hindsight that the Finance Minister and the Government should view this year’s budget. Social development is a long drawn process and is painstakingly slow. It is also driven by stable policy support that the Government in power provides. This necessitates that programs and schemes be driven not by political exigency but by the ground realities that prevail. An economy in transition with widening inequities needs a sensitive, understanding and stable government with clearly thought through long term policies. The Government also needs to understand that the poor and the socially excluded no longer need elaborate and complex safety nets in terms of sops and subsidies. They need a state that can ensure that their human and social capital is steadily and consistently expanded over periods of time long enough to get them to participate in wealth creation. This is the only way to ensure economic dividends both for them and for the nation at large. This translates as budget support to ongoing programs over long periods of time, enhanced monitoring of the implementation process, redefining performance standards for the executive, and engaging citizens in the process of their own development. It also calls for an innovative description of the concept of co-operative federalism where both the Centre and the States agree to a minimum acceptable level of social progress and to hold each other accountable in delivering on the same.
While the Prime Minster likened the budget presentation to his annual exam, one must realize that the results of this exam cannot be declared in a week or in a year, but only after many years of demonstrating disciplined excellence by his Government.