- Cauvery row: Can't release water till December, Karnataka tells SC
- India beat New Zealand by 197 runs in Kanpur Test, take 1-0 series lead
- ISRO successfully places SCATSAT-1, seven other satellites in orbit
- Shahabuddin bail case: Supreme Court adjourns hearing for Wednesday
- SC refuses urgent hearing on PIL seeking to declare Indus Waters Treaty unconstitutional
The idea of economic reform in India has largely been seen as the reduction of restrictions imposed by the government on economic activity — it must go beyond this narrow scope. The next wave of reforms needs to focus on governance. The lack of transparency in the government's functioning at present is increasingly unacceptable.
In its recent approach paper, the Financial Sector Legislative Reform Commission (FSLRC) outlined recommendations to bring about an improvement in governance, with a focus on financial sector regulation. These proposals hold lessons for the ways in which the government functions in other sectors as well.
Many government tasks can be outsourced to external agencies. This is motivated by two considerations: political independence and functional autonomy. The Election Commission should not care about pleasing the ruling party, so it should be politically independent. Tax administration should not be used by the ruling party to harass rivals and obtain election funding. Thus, tax administration should be politically independent. In finance, functions such as regulation and supervision should be immune to political pressure, much like tax administration should be distanced from politics. In addition, monetary policy should not be influenced by or subject to election cycles, which makes a case for the political independence of the RBI.
The second kind of autonomy is functional. This is rooted in problems that arise from the outdated ways in which the Indian government operates. It is difficult to construct competent and professional structures within the government, given the weaknesses of human resource processes, cumbersome procurement policies, etc. If bodies external to the government are freed from the strictures that depress its productivity, superior outcomes can be attained. Bodies outside the government can aspire to the professionalism, specialised staff capability and efficiency of the private sector once they are free to deviate from government processes.
- Loud jingoism and war talk erode India’s credibility
- Phenomenon of the non-academic VC is part of a wider crisis of the university
- PM Modi must recognise Pakistan’s gameplan, and respond at a time and place of India’s choosing
- The government has failed to provide the right incentives to farmers
- The advent of the Fadnavis government in Maharashtra Marathas’ political hegemony
- Across the aisle: In search of a Pakistan policy