Would you like your own new state?

The complicated business of India’s internal boundaries

At least two generations of Indians have grown up taking India’s internal boundaries—drawn based on linguistic logic—for granted. As a colleague pointed out in an email exchange last week, the linguistic organisation of Indian states pre-dates the States Reorganisation Commission of 1955. The Hindi-speaking province of Bihar was carved out of the Bengal presidency in March 1912 by the British colonial government. After independence it was the agitation by the Telugu-speaking people spread across three political units that galvanised the process that ultimately led to the states as we have come to know them.

The logic of language was most salient in the non-Hindi speaking regions. Unlike in linguistic states, the Hindi-speaking people were not organised into one single state, but spread across several states. Their boundaries didn’t seem to evoke much of a controversy then, nor do they do now. Chattisgarh, Jharkhand and Uttarkhand were carved out of Bihar and Uttar Pradesh without fuss, and the proposed further divisions of Uttar Pradesh and Madhya Pradesh do not arouse a lot of public emotion.

It is the demand for and the decision to create a new Telangana state out of Andhra Pradesh that challenges the logic of linguistic organisations, for both states have a majority of Telugu-speaking people. To a large extent, they share the same culture. History—Telangana being part of the Hyderabad Nizam’s dominion while Andhra was under British rule—created differences in the political economies that underpin the disgruntlement accompanying their merger into one state as well as the demand for separation. Telugu solidarity was trumped by other factors.

In contrast, Tamilians, Kannadigas, Malayalees, Marathis, Gujaratis and others do not currently have issues that divide them to an extent that they demand a division of their states. Even so, there are significant linguistic minorities in many states who could—and some have—raise a demand for their own linguistic state. So even as Telangana challenges the logic of linguistic organisation, it could spur demands based on that very principle elsewhere in India.

What should we make of India’s internal political boundaries? First, there is a degree of merit in linguistic/ethnic organisation of a highly diverse polity like India’s. This allows a diverse population to be part of a larger nation-state with a reasonable degree of security over preserving its language and cultural heritage. This does come at a cost of creating linguistic-ethnic minorities who are considered too small (or too weak) to have their own states. It also comes at the cost of ignoring other factors like governability and physical geography.

Second, while it does appear that bigger and more populous states are less likely to be better governed, the solution does not automatically lie in smaller states. Despite the setting up of governmental structures at the municipal and panchayat levels, the devolution of power is choked at the level of states. State governments have a stranglehold on financial and administrative power, which leaves us with a disempowered, emaciated local government structure. (See Shankkar Aiyar’s op-ed essay). Further decentralisation to the local government level is an alternative to smaller states, at least as far as better governance is concerned. Such decentralisation is necessary even if we create smaller states.

Third, there is a case for incorporating physical geography into the logic of state boundaries. This could, for instance, turning inter-state disputes over river water sharing into intra-state policy issues. India’s abysmal record on environment management is in part due to ecosystems straddling political boundaries. Reorganising state boundaries to better align with physical features can create the conditions for better environmental governance. While this might be a difficult proposition where linguistic and ethnic emotions are running high, it might be possible in the Hindi-speaking regions.

Finally, however states are organised, there must be greater emphasis on the representation ratio. Just how can one Member of Parliament represent over 3 million people, as the MP for Outer Delhi does? A Lok Sabha MP, on an average, represents 1.3 million voters. A legislator in Karnataka, on an average, represents around 200,000 voters. While it is impractical to raise the number of seats in parliament and legislatures in accordance to population growth, it is dangerous to let the representation ratio get out of hand. Smaller states can, but not necessarily will, address this problem.

Unfortunately, the demand for political reorganisation tends to arise only from cultural insecurity and grievance, causing the political system to respond accordingly. Respecting linguistic diversity at the sub-state level, empowering local governments, managing representation ratios and respecting ecological zones—factors that are likely to lead to better governance outcomes—just don’t arouse the same passions.

Let’s not forget that decades after Independence, India is still not a common market. It is important that the enthusiasm for smaller states should not undermine progress towards one.

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Redistribution as theft

Alleviating poverty requires economic growth alone.

It is not often that Indian public discourse seriously discusses big ideas. So it was nice to see, a few days ago, a debate in large sections of the mainstream and social media on economic growth vs redistribution. This debate received wider public attention because it was conflated with a personality clash between Jagdish Bhagwati and Amartya Sen, because it became entangled with the hottest political topic of our times and because it came at a time when the issue itself is important.

When faced with two sharply different points of view, it is common—not least in India—to insist that the truth lies somewhere in the middle. This is celebrated as being reasonable, as representing the compromise that is the hallmark of democratic practice and as being the mystic middle path. So when some economists insist that growth is the best way out of poverty while other champion redistribution of wealth, it is to be expected that there will be reasonable people who will say “we need both more growth and more redistribution”. This is a good way to end the debate amicably and drink to reasonability and democratic compromise.

Unfortunately, there’s a difference between appearing reasonable and being right. “We need more growth and more redistribution” is not a reasonable middle position. It is essentially an argument for redistribution but stated in a different form.

Without growth, redistribution is at best a transfer and at worst, theft. If a community earns the same amount of money (or produces goods of the same value) every year, then redistribution takes from Preetam to pay Palani. If Preetam consents to the arrangement, it is a transfer. If he doesn’t, it is theft. Over a period of time, it will make the community more equal, but it doesn’t necessarily make the community less poor, for even after achieving income equality, the average income can be below what is required to subsist.

Growth is the only way to increase the overall income of a community. It can raise the respective incomes of both Preetam and Palani, although Preetam’s income might rise faster than Palani’s. Inequality will rise in such a community—perhaps because Preetam was born into a better endowed family, perhaps because Preetam works harder or perhaps because Palani faces greater social hurdles—but because both Preetam’s and Palani’s incomes rise, the whole community can climb out of poverty. There is vast empirical evidence for this, and growth is the best antidote to poverty. It’s the most effective anti-poverty scheme known to humankind.

Here’s the best thing: in such a society, there is no inherent need to take from Preetam to pay Palani on the grounds of poverty alleviation. There might be other issues—for instance, progressive taxation to finance public goods based on the ability to pay, but not to help a poor Palani out of poverty.

Hey, wait a minute! Isn’t inequality rising? Isn’t that a bad thing? Aren’t Palani’s prospects not handicapped by historical social hurdles? Aren’t Preetam’s disproportionate gains coming from exploiting Palani? The reasonable people who argue that “we need both more growth and more distribution” usually raise these questions to argue for more redistribution. (There are unreasonable people who raise these questions for other reasons, but let’s stick with responding to the reasonable).

Yes, inequality will rise, especially during periods of high growth. But inequality is a social problem only if it is permanent and ossified. However, growth is the best way to ensure that it is not—with growth comes mobility, and the expectation that one can improve one’s life allows societies to thrive despite the inequalities. Ask migrants to New York or Mumbai. Many also see a moral problem with inequality, but why expect the state to solve moral problems? Let the moral conscience of society address its moral problems.

Shouldn’t we account for historical social hurdles that hobble some citizens? Yes, but these are addressed by creating equality of opportunity, not by insisting on equality of outcomes (where Preetam and Palani end up earning the same income). You can achieve equality of opportunity without redistribution—affirmative action and reservations (without subsidies) are ways to address this challenge.

Isn’t Preetam exploiting Palani? This blog post will not attempt a comprehensive critique of Marxist thought. However, the ideas of economic freedom, property rights, voluntary exchange and comparative advantage together prove that Preetam’s gain is not at Palani’s cost. Although the sort of people who argue that Preetam exploits Palani will seldom acknowledge that redistribution, by definition, means that Palani’s gains come at Preetam’s cost. Unlike redistribution, growth creates non-zero-sum or win-win situations. Only growth creates such situations.

From this alone, we should conclude that “we need growth, not redistribution”. But reasonable people will go to great extents to be reasonable. It’s about sequencing, they’ll say, and contend that some redistribution is necessary for growth. It’s unclear why this is called a reasonable argument—if we accept that both Preetam and Palani will be better off with growth, then the decision to take some from one and give it to the other is unnecessary, whimsical and entirely arbitrary. Instead, why not spend extra effort to ensure that there are no constraints to growth in areas that benefit Palani?

Ergo, what appears reasonable is not quite reasonable: we need growth, not redistribution. The state can ensure growth by getting out of the way of private enterprise, ensuring public goods are provided, acting as an impartial referee, ensuring equality of opportunity and a level playing field. Governments are not good at redistribution: it involves taking money from people who don’t want to give it up and passing it through a system where everyone wants to grab as much as they can get. That is why redistribution is attractive to politicians who are keen to listen to intellectuals who say it is necessary.

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It didn’t start in 1988

A brief review of Praveen Swami’s “India, Pakistan and the Secret Jihad: The Covert War in Kashmir, 1947-2004“, first published in the November 2008 issue of Pragati

A retired senior police officer complained to Bahukutumbi Raman, a former intelligence officer and prolific commentator, that intelligence agencies and police show a greater readiness to share their information with Praveen Swami, than with each other. And that “we all wait for his columns in The Hindu to know what information other agencies and the police of other States have.” That is as much an indictment of the internal security set-up as it is a compliment to Mr Swami. Those familiar with Mr Swami’s reportage will know that some of India’s best writings on terrorism and internal security come from his MacBook.

So it is a mystery why the publishers of India, Pakistan and the Secret Jihad: The covert war in Kashmir, 1947-2004, a book Mr Swami wrote in 2006 did not adequately market it in India at a price that ordinary readers could afford. The paperback edition is now available in bookstores, but you won’t know it until you ask for it. (Update: It’s a little more widely available now). That’s a real shame because Secret Jihad is the one book on the issue in Jammu & Kashmir that everyone should read.

If it reads like a spy thriller, it is because it is one. In just over 200 pages of engaging prose, Mr Swami demonstrates that contrary to what most people think (and India’s median age is around twenty-five) the troubles in Jammu & Kashmir didn’t start in the late 1980s, after an infamously rigged election. Rather, as the introduction to the book says “a welter of jihadist groups waged a sustained campaign against Indian rule in Jammu and Kashmir from the outset, after the Partition of India.” Mr Swami’s narrative takes the reader back to the days of the Master Cell and Al- Fatah—entities that appear quaint by today’s standards—and their subsequent evolution into and inspiration of terrorist organisations that exist in contemporary times.

Similarly, Mr Swami reveals the now-in, now-out relationship of the state’s major political parties with Islamist and Kashmiri-nationalist ideologies, and the reader arrives at the inevitable conclusion that for all the paeans celebrating Kashmiriyat, secularism has always been less than skin-deep in Kashmiri separatist politics.
To the extent Secret Jihad relies on sources from within India’s internal security establishment, it largely illuminates only one side of the war. Mr Swami admits this himself, conceding that Pakistan’s secret archives, if they exist at all, are necessary to improve the completeness of the account. But even so, Mr Swami’s book joins Chandrashekar Dasgupta’s War and Diplomacy in Kashmir, 1947-48 as an indispensable book for anyone seeking a well-researched and readable account of the Kashmir issue. Secret Jihad ends in 2004 but the secret jihad continues. An updated edition, or better still, a sequel, is in order.

Related Link: Saurabh Chandra has a brief history of events, in today’s DNA. 

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Ad hoc defence

In my Business Standard column today I argue that structural reform of the armed forces is the unfinished business of Kargil:

It may appear that the country has been lucky to have escaped without too much damage for another 14 years. But the failure to restructure our armed forces in line with contemporary needs will impose strategic costs beyond just delays and scandals. The current structure, divided as it is between the army, navy and air force (and within their constituent arms), is unable to holistically conceptualise India’s strategic environment.

Take, for instance, the Cabinet’s approval for a new mountain strike corps to handle the Chinese threat along the unresolved boundary. It involves an army formation of 45,000 soldiers and a cost of Rs 62,000 crore over 2012-17, tasked with mounting an offensive in Tibet in the event of a Chinese attack. This move was widely hailed as a robust Indian response to China’s aggressive actions along the boundary and its steadfast refusal to move towards a settlement. Few asked where the money and the soldiers are going to come from. As my colleague Rohan Joshi notes, the army is already short of 10,000 officers and 30,000 soldiers. With slower economic growth, higher social expenditure and looming deficits, how does the government plan to finance this expansion?

The bigger question, though, is not the financial cost but the opportunity cost. Is an army strike corps India’s best response to the strategic threat from China?

It is possible to argue that by choosing an army strike corps, New Delhi has played right into China’s hands. Beijing has, by inexpensively raising tensions along the Himalayan boundary, managed to induce New Delhi to invest in an expensive military asset that is unlikely to be used. Nuclear deterrence makes a direct military conflict between the two countries unlikely; and a large-scale conflict necessitating the use of corps-level formations is even more unlikely.

Meanwhile, the geostrategic contest of our times is being played out in the oceans. The only regional force that can challenge the Chinese navy’s quest to dominate the Indo-Pacific waters is the Indian navy. And guess what? India has Rs 62,000 crore less to spend on the naval expansion of the kind that would have countered China’s maritime power.

Perhaps the decision to invest in a strike corps is the better one, though this columnist disagrees. Yet, absent the long-pending restructuring of the armed forces, we can never say that the big trade-offs were adequately weighed.

Fourteen years after Kargil, the country certainly cannot afford such ad hoc functioning. [Business Standard]

Coincidentally, another op-ed in another newspaper by one of India’s foremost thinkers on strategic affairs takes up this argument in greater detail. Admiral Raja Menon packs quite a punch in the pages of The Hindu when he argues that instead of a mountain strike corps, a “a flotilla of nuclear submarines and a three carrier air group” makes more sense:

Most of all, we appear not to have assessed the Chinese weakness and strengths. Their strength is the huge logistic network that they have built up in Tibet. By creating a one axis strike corps, we have played into their strengths. The Chinese weakness lies in the Indian Ocean, a fact that even Beijing will readily concede. The clash between their political system and economic prosperity requires resources and, increasingly, the Chinese resource pool is Africa, which generates massive sea lines of communication (SLOC) through the Indian Ocean. Today, they are merely SLOCs; tomorrow they will be the Chinese Jugular. Beijing’s paranoia about the Indian Ocean is therefore understandable but the threat according to its strategic commentators comes only from the U.S. Sixty thousand crore spent on strengthening the Indian Navy’s SLOC interdiction capability would have given us a stranglehold on the Chinese routes through the Indian Ocean. The Himalayan border, the entire border, could have been held hostage by our strength in the Indian Ocean with an investment of Rs.60,000 crore. [The Hindu]

While I am not a fan of aircraft carriers, I am of the same opinion as Admiral Menon on the need to invest in naval and expeditionary assets. The absence of a higher defence structure that can look at strategy in a comprehensive manner—including the nuclear dimension—is causing India to engage in linearism, incrementalism and ad hocism.

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The use and misuse of poverty lines

The undesirable consequences of using a macroeconomic indicator as a criterion for entitlement.

Earlier this week, the UPA government’s Planning Commission announced that there has been a significant reduction in poverty in India over the last decade—essentially, during the UPA’s two terms in office—from 37.2% in 2004-05 to 21.9% in 2011-12. In other words, while there were 407.1 million poor people in India in 2004-05, the number had come down to 269.3 million by last year. The Planning Commission uses the Tendulkar method (see Rathish Balakrishnan’s explainer on the brief history of poverty lines in India) but it is quite likely that poverty will show a decline regardless of the method adopted to measure it. This is good news.

What was meant to advertise the UPA government’s achievement has actually put it in a spot. How can the UPA government now justify providing deep, open-ended food subsidies to over 822 million people? Does subsidising food for the non-poor, at tremendous cost and contingent liability to the exchequer, have the same justification as delivering essential food to those who absolutely cannot afford it? Not quite. If the Opposition parties mount a political challenge along these lines, it is unlikely that the UPA’s dubious poverty arithmetic will prevail. If.

Let’s consider a broader issue. What is a poverty line good for? Whatever the formula used, a poverty line provides a useful estimate of the level of poverty in a population. How it changes tells us whether public policies are helping or hindering poverty alleviation. The rate of change allows us to compare—albeit in hindsight—which set of policies are more effective in raising incomes. As the Planning Commission’s figures show, poverty declined at an average rate of 0.74% between 1993-94 and 2004-05, and at 2.18% between 2004-05 to 2011-12. This correlates with the higher economic growth rates achieved in the 2000s compared to the 1990s. This is consistent with the empirical observation that economic growth lifts people out of poverty.

What the poverty line is not good for is as a selection tool to identify beneficiaries for entitlements. This is because it is practically impossible to estimate whether a particular person earns more or less than the given poverty line income. This fact is lost on many policymakers and intellectuals—just how does one assess whether a person earns less or more than Rs 33 a day? There are no objective methods to test and verify incomes—no financial records, salary slips, bank accounts and so on. So we are left with self-declaration. However, if people know that those deemed below the poverty line will receive benefits from the government, they are likely to declare themselves poor. To take one example, in 2006, 91% of the families in Karnataka state declared themselves below poverty line.

The Planning Commission can set up expert groups that propose formulas involving automatic exclusion, automatic inclusion and scoring indices. Such methods only create an illusion of accuracy while creating a political economy—read corruption and political patronage—for the procurement of Below Poverty Line (BPL) cards. Note also that once a person acquires a BPL card, she is BPL for life. Such is the bluntness of poverty line-based schemes that they presume that a person, once deemed poor, will remain poor for life. This makes the BPL card even more valuable.

Moreover, for the sake of argument, even if we assume that it is possible to perfectly assess incomes, is it sensible to deny an entitlement to a person earning Rs 34, because the poverty line is set at Rs 33? What about Rs 35? Rs 36? Where do we stop? Any number you pick is arbitrary.

What this means is that while poverty lines are useful as macroeconomic performance indicators, they are useless when used as ‘entitlement lines’. If budgets were infinite, we could live with the leakages and inefficiencies in the knowledge that those who really deserve assistance are not deprived. However, budgets are not infinite, which means that public funds end up in the hands of undeserving people, while there isn’t enough money for essential public goods like education, health, security, roads, electricity and communications. Look at the state of our government schools, hospitals, police stations and roads and ask why they are in such a decrepit condition. It is politically suicidal for any government to cut back on subsidies and entitlements. It is fairly easy, in comparison, to cut down on capital expenditure on public goods.

That’s why misusing the poverty line as an entitlement line is counterproductive—it slows down the rate at which poverty declines.

Related Link: My Takshashila colleague Pavan Srinath’s critique of the poverty line, on the INI Transition State blog.

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Tagore on the welfare state

Why a welfare state will fail in India

I often argue that the fact that the Indian Republic arrogated to itself the task of social welfare has made the Indian citizen, at the margin, less inclined towards that cause. The argument goes something like this: “Why bother about doing something about the poor because it’s the government’s job. After all, most of our taxes and government revenues are allocated for social welfare, rather than providing us with public services.” Charity and philanthropy exists, but it is difficult to sustain an argument that the average citizen feels responsible for helping the poor and the less privileged.

Rabindranath Tagore had thought about this, long before India became independent and set itself up as a welfare state. Here’s an extract from Partha Chatterjee’s essay on Tagore’s views on nationalism. (Tagore, by the way, was opposed to nationalism, as he felt that it was contrived from the European historical experience and unsuited to the Indian context).


Rabindranath’s argument was this: before the English arrived in India, the samaj would carry out through its own initiative all the beneficial works necessary to meet people’s needs. It did not look to the state to perform those functions. Kings would go to war, or hunt, and some would even forsake all princely duties for pleasure and entertainment. But the samaj did not necessarily suffer on this account. The duties of the samaj were allocated among different persons by the samaj itself. The arrangement by which this was done was called dharma.

That which is callcd “the state” in English is now called, in our modern languages, the sarkar. The sarkar, has always existed in India in the form of the royal or sovereign power. But there was a difference between the power of the state in Britain with the power of the king in our country. Britain has entrusted the entire responsibility of looking after the welfare of the country to the state. In India, the state only had a partial responsibility… From giving alms to the destitute to teaching the principles of religion and morality to the common people, everything in Britain depends on the state. In our country, such activities are founded on the system of dharma among the people. Thus, the English are happy when the state is alive and well; we are relieved when when preserve our system of dharma.

But even if it is true that we never had a universally benevolent sovereign power in the past, could we not through our own efforts build such a state now? Rabindranath’s answer is clear: “No, we cannot.” He says: “We must understand this: the state in Britain is indissolubly founded on the general consent of the entire society; it emerged out of a process that is natural to that country. We cannot have it here simply by the force of argument. Even if it is inherently of outstanding quality, it will still remain beyond our reach.”

Extracted from: Tagore’s Non-Nation, “Lineages of Political Society: Studies in Postcolonial Democracy”, by Partha Chatterjee, pp99-100

This appears to be an argument for investing in social capital, rather than charging the state with the task of social welfare. Tagore was onto something. But it was Gandhi who carried the day.

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Our problem is not spiritual but social

Rabindranath Tagore’s diagnosis of India’s problem

In this letter to a New York lawyer, Tagore accurately pinpoints the big problem—parochialism based on identity—and its unhappy consequences. It comes up again, in verse, in Where the Mind is Without Fear: “Where the world has not been broken up into fragments/By narrow domestic walls”. This letter was perhaps written around the same time (Gitanjali was published in 1912) and elaborates on the argument in high prose.

Letter to Myron H. Phelps (New York)
16 December 1911

In every age the spiritual ideal has found its highest expression in a few specially gifted individuals. Such are to be found in India even today, often in the most unlikely places—among the apparently sophisticated, as well as among the unlettered and outwardly uncultured—startling us with the wonderful depth of their spiritual perception and insight. I do not feel that India has lost her spiritual heritage, for it is clear to me that her highest thought and activity is still spiritual. In the old days, however, the simpler environment—the comparative freedom from so many diverse and conflicting interests—permitted of the easy permeation of this ideal, emanate though it did from a few isolated altitudes, through and through the lower strata—with the result that Truth was recognized and realized not only intellectually but also in the details of everyday life.

A distinguishing characteristic of this spiritual civilization, as I have explained in my former letter, was its inclusiveness, its all-comprehensiveness. Aliens were assimilated into the synthesis; their widely differing modes of thought and life and worship being given their due places in the scheme by a marvellous interpretative process. But while the evolution of the spirit thus proceeded upon highly complex lines, the growth of the material body went on in a simple unorganized fashion, so that the time arrived when the mesages of the spirit could no longer find their way unimpeded throughout, resulting in differences of spiritual intensity, and consequent compromises and aberrations in the character of its manifestations. That is why high thinking and degenerate living are seen side by side; ideals are converted into superstitions: and the finest of inspirations reduced to grossness in action, wherever the vitalizing spiritual stream is deprived of its freedom of onward movement.

The problem of India therefore does not seem to be that of re-establishing its lost ideals, but rather of reforming its overgrown body so as to harmonise with and give free and fitting expression to its ever-living soul. In other words our problem is not spiritual but social—that of reviving, by organizing and adapting to its more complex environment, our fast disintegrating social system. It is our disorganized society which prevents our ideas and activities from being broad, the narrower self from being merged into or sacrificed for the sake of the greater—and our national experiences are being dissipated and wasted for want of a storing and coordinating centre. The workings of the spirit are seen as flashes but cannot be utilised as a steady flame.

In the west the situation seems to bejust the opposite. There we see a highly organized body, as it were, of which the soul is dormant, or at least, not fully conscious. While our soul is in search of an adequate body for want of which it cannot give its inspirations effective shape, and succeeds only in displaying to the outside world various incongruities clothed in phantastic forms, we find the west deploring its lack of spirituality. But surely spirituality cannot be lacking where the larger self is finding such noble expression in comfort-scorning striving, in death-defying heroism. On what can this living for ideas be based if not on spirituality? As for the want of consciousness, does not that tend more and more to be remedied by the very activities to which so efficient an organism finds itself increasingly impelled?

It is only where life is petty and scattered, and society partitioned into mutually exclusive sects that the vision of the Great is lost—it is only there that the mental horizon becomes narrow, aspirations fail to soar high, and the spirit remains steeped in a perpetual despondency. Here and there some greater soul may succeed, like a cloud-topping peak, in rising into the serene atmosphere above; but the multitudes wallowing in the slough below are as devoid of material consolations as of clarity of spiritual perception, and an unmeaning repetition of ritual is the only lifelike response of which they seem capable.

If the spiritual genius of India is not to prove futile for the purposes of humanity then it needs must seek to acquire the art of body-building. May it not be possible, in that quest, to avail ourselves of the assistance of the West without treading that slippery path of imitation which leads only to self-destruction?

Source: The English Writings of Rabindranath Tagore: a miscellany (Sahitya Akademi, 1994)

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Two laws of policy realism

A cynic’s perspective on robust policy design

The first law of policy realism
A policy that relies on the Indian citizen to act in selfless public interest will not work. In fact, a policy that expects an Indian citizen to act in anything but self-interest and relative gain will not work.

The second law of policy realism
A policy that expects Indian citizens to adhere to a process—any process—will not work as intended, because people will ignore, work around or actively undermine the process.

Implications of the above:

1. Policies must be designed to appeal to self-interest and maximise relative gains (in other words, the citizen must feel s/he will get more out of it compared to others).

2. Policy design must incorporate processes that are consistent with people’s mindsets and are resistant to being undermined.

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Why the President of India must reject the Food Security ordinance

President Pranab Mukherjee must reject the Union Cabinet’s unjustified ordinance

The UPA government’s Food Security Bill (brief) is likely to cause severe damage to the Indian economy, while saddling future generations with an open-ended spending commitment that will be hard to wind down. The government’s own Commission on Agricultural Costs and Prices and the Expert Committee (report) headed by the chairman of the Prime Minister’s Economic Advisory Council (report) have argued against it. As Ravikiran Rao argues in Pragati, the scheme will not only widen India’s gaping fiscal deficit, but severely distort the national food supply chain.

But you do not have to agree with the bill’s critics to acknowledge that a bill on which there is no consensus even among the government’s top economic experts, which imposes a burden on future generations, at a time when the Indian economy is in doldrums and the investors—domestic and foreign—are wary about investing in India, should not be implemented in a hurry.

Yet that is exactly what the UPA government is attempting to do. After emotional blackmail—for which purpose Nobel laureate Amartya Sen was recruited—failed to persuade parliament in the previous session, the Union Cabinet has now decided to sneak it through an ordinance.

Under the Constitution, an ordinance is an emergency provision, equipping the Executive to implement measures when the Parliament is not in session. The ordinance must be approved by both houses of Parliament the next time they convene and “shall cease to operate at the expiration of six weeks from the reassembly of Parliament”. What is important to note is the debates in the Constituent Assembly, the wording of the Constitution and Supreme Court judgements are clear that issuing ordinances is an emergency provision to be used at extraordinary times. Chief Justice P N Bhagwati, heading a Constitution Bench in D C Wadhwa vs State of Bihar held that

“The power to promulgate an Ordinance is essentially a power to be used to meet an extraordinary situation and it cannot be allowed to be ‘perverted to serve political ends’. It is contrary to all democratic norms that the Executive should have the power to make a law.” [1987 AIR 579, 1987 SCR (1) 798/IndiaKanoon]

The Union Cabinet’s decision to implement the food security bill—that is still in Parliament—through an ordinance flies in the face of the letter and spirit of the Constitution. Justice Bhagwati’s ruling is clear—an ordinance can only be used to meet an extraordinary situation, not perverted to serve political ends.

Where is the extraordinary situation? Where is the food emergency? Is there a famine in the country? Is a famine projected? If there is no extraordinary situation, then the Union Cabinet’s decision to wrap its political pet project in the garb of an emergency is against constitutional morality. It is perhaps unconstitutional as well.

There is no doubt that there many right-thinking Indians who believe that the food security bill is a good thing and that it will even provide food security as intended. However, it will be hard for any reasonable person to conclude that the situation in India is dire enough to bulldoze constitutional and democratic norms and present parliament with a fait accompli.

The argument that the ordinance is necessary because Opposition parties have not allowed Parliament to function does not wash. While the BJP has provided the Congress party with a seemingly plausible excuse, the Union Cabinet is bound by the Constitution. It is sworn to uphold the Constitution. It cannot refuse to perform this duty merely because the Opposition is not playing by the rules. If we are to buy the premise that two wrongs make a right, we are either in a jungle or in a banana republic.

President Pranab Mukherjee is perhaps sympathetic to Sonia Gandhi’s ideological persuasions. As a life-long Congressman, he might be inclined towards the party’s socialist leanings. Yet when the ordinance comes before him, the only question he must ask is “Is there an extraordinary situation that demands this ordinance?” Parliament convenes in a few weeks. Can this not wait until then?

The Indian Republic’s history is replete with presidents, who despite being lifelong Congressmen, have had the integrity, courage and statesmanship to question Congress-led governments. It is up to President Mukherjee to decide whether he wants to be a Fakhruddin Ali Ahmed or a Rajendra Prasad.

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Why public protests are proliferating

When networked societies clash with hierarchical states

This week’s Economist has a couple of interesting articles on the proliferation of public protests in recent times—from the United States, to Britain, to Arab North Africa, India and now Turkey and Brazil. It attempts to understand the phenomenon within the frames of democracy and dictatorship, with technology as a key enabler.

Any study of these protests must contend with a simple, central question: given that the protestors’ grievances are not new, why did the protests take place now (roughly since 2010)? Corruption, economic distress, political oppression and elite control of political power, among others, have been around for decades. What changed enough to cause people to get onto the streets to protest?

It is possible to identify a number of factors: youth bulge, urbanisation, size of the middle class, mobile phone penetration and growth of social media are the most important among them. It is highly likely that these factors—in various combinations—have a causal relationship with the eruption of protests. The “why now?” question, can be explained by the fact that social media platforms like Facebook, Twitter are of fairly recent origin. Text messaging over mobile telephone networks is older, but it was only in the last decade that mobile phone ownership increased significantly as a fraction of the overall population. So the availability of technology could explain when the public protests took place.

Technology also suggests a more profound implication. The proliferation of public protests—across democracies and authoritarian states—might be the first signs of a clash between radically networked societies and hierarchically ordered states. (See this talk on radically networked societies.) As I argued in my Business Standard column in December 2011, “the popular legitimacy of today’s hierarchically-structured governments – and the political order they rest on – is under threat in radically networked societies.”

In other words, corruption, bus fare hikes, tree parks or economic policies that the protesters are abstractions or symptoms of the underlying dissatisfaction with the way the people are governed. A networked society is flat, its demands are diverse and often inchoate, decision-making processes are amorphous, and leadership diffuse. However, such a society is governed by a government that operates in a hierarchical manner, top-down and bottom-up, in silos, bound by hard rules and distinct leadership. While a networked society moves fast, a hierarchical government moves relatively slowly on account of its structure. To members of networked societies the hierarchical government appears slow, less responsive and remote, hence lacking in credibility and legitimacy.

The structure of the modern nation-state was forged in the Industrial Age. It now confronts the demands of the Information Age and is increasingly found wanting.

In my column I wrote: “One reason the United States emerged on top of the world order is because it had the best political system for post-Enlightenment industrial age societies. It may well be that the nation that best reinvents itself for the information age will have a shot at being the next great superpower.”

This raises a number of questions. What does a networked state look like? How does a hierarchically-ordered state change itself into a networked state? What does this mean for individual liberty? We do not have the answers yet.

PS. For the record, the Business Standard article I refer to in this post contained a typo that risks changing the entire argument. The sentence in the third paragraph should read “This is not a classical class struggle.” The “not” is missing in the published piece!

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