An NAC insider speaks up
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The biggest frauds are those who claim to be working to save the environment and alleviate rural poverty but sadly nobody told Sonia Gandhi these things and so she allowed NGOs to make up her kitchen cabinet. And, believe me when I tell you that Sonia's kitchen cabinet has been more powerful than the Prime Minister's cabinet in recent years. It is my considered opinion that the National Advisory Council is the reason why the Indian economy has seen such a sharp downturn since 2009.
Major economic decisions have been taken by NGOs who have no more than a small idea of governance. No prime minister in his right mind would normally allow NGOs to overrun policy making but Dr Manmohan Singh had no choice in the matter. He could not possibly go against the wishes of Sonia Gandhi. When she gave him his job in 2004, she put him automatically in a subservient position and herself in an exalted one. In retrospect, it has to be said that her 'inner voice' gave her some really clever advice because what she ended up 'renouncing' was not power but accountability.
This renunciation of accountability is why economic experts who lament daily the collapse of a booming economy rarely have the courage to blame her directly. There have been many thoughtful pieces of analysis in the Indian newspapers recently on what has gone wrong. They point out that we have spent thousands of crore rupees on huge welfare schemes while other policy decisions vitiated the investment climate. The analysis is accurate but we need to go further and admit that this has happened mostly because of the interference of Sonia's National Advisory Council (NAC) in making economic policies.
Allow me some examples. It was because of direct NAC interference that we endangered what is left of our forests by giving adivasis rights to cultivate forestland. It was because of direct NAC interference that we were bequeathed MNREGA that leaks vast amounts of employment guarantee money into the pockets of corrupt officials. It was because of direct NAC interference that we have a new land bill that will ensure that acquiring land for roads, power plants and other public utilities will become impossible. And, if the NAC has its way, we may soon have a food security bill that will totally bankrupt the economy without, and I say this carefully, making the smallest difference to the shameful rates of malnutrition in our children. If big welfare programmes of this kind had worked, we would not have 45 per cent of Indian children counted as malnourished. The Integrated Child Development Scheme (ICDS), which boasts of being the biggest in the world, has been around since 1975.
The truth is that the NGOs who became Sonia's main advisors are mostly people who have their hearts in the right place (on the left) but their economic ideas in a muddle. So in the name of removing poverty, they are given to devising massive welfare schemes without noticing that these rarely work because their size and centralised nature make them an administrative nightmare.
Nobody had the courage to tell India's de facto prime minister this till last week when a member of the NAC, Shri N C Saxena, wrote an article in this newspaper admitting that the Right to Education Act would end up closing excellent private schools and that the new land acquisition bill would make land impossible to acquire. He said of NGOs that 'they pick up facts selectively, or distort them.' This from the man who closed down the Vedanta project in the Niyamgiri hills and thereby started the rot in the investment climate. When investors realised that major projects could be closed after huge investments had been made, they started to flee especially because the Environment Ministry became a handmaiden of the NAC.
So we begin 2013 with the lowest economic growth rates we have seen in more than a decade and a pall of gloom hanging in the air. The Prime Minister now appears to be trying to take charge again and the NAC appears to be more cowed down than it has ever been but is it already too late? Those who know more about these things than your humble columnist have lately taken to admitting that the economy is unlikely to see an upturn till 2014. Happy New Year!
Follow Tavleen Singh on Twitter @ tavleen_singh