Putting the cart before the horse
Jugaad is a colloquial word of Urdu-Hindi origin that can mean an innovative fix or a simple workaround, used for solutions that bend rules. It is used as much to describe enterprising street mechanics as for political fixers. The problem with Jugaad-which incidentally is a uniquely Indian <g data-gr-id="36">phenomenon-is</g> that it’s penny wise pound foolish. One can’t help but point out that Narendra <g data-gr-id="37">Modi-led</g> government’s policy solutions strike one as penny wise pound foolish policy innovations too. By trying to save on federal social and subsidy expenditure, which goes towards improving critical social indices and instead foolishly channelling it into an infrastructure ‘stimulus’, Modi’s policy makers have committed the cardinal sin in public policy: i.e. putting the cart before the horse.
The progress of living standards for common people, as opposed to a favoured minority living in the lush green bungalows of Lutyens Delhi, has been dreadfully slow—so slow that India’s social indicators are still abysmal. According to Social Progress Index, out of 133 countries rated on indicators of well-being such as health, water and sanitation, personal safety, access to opportunity, tolerance, inclusion, personal freedom and choice India has secured the 101st place. The Index defines social progress as the capacity of a society to meet the basic human needs of its citizens, establish the building blocks that allow citizens and communities to enhance and sustain the quality of their lives, and create the conditions for all individuals to reach their full potential. This is lower than India’s rank, of 93, for GDP per capita income. Even Nepal and Bangladesh rank higher than India on the Social Progress Index (SPI) ratings.
The government says lower welfare spending will be compensated for by giving state governments a larger allocation of tax revenues to spend as they choose. The keyword here is ‘say’. The government has made a lot of noises about pushing through key reforms through ‘minimum government and maximum governance’. Be that as it may, to cut spending directed towards protecting the demographically most vulnerable communities in India (women and children) may seem like an ingenious quick fix to deep-rooted problems, but it is anything but that. Currently, there is a shortfall of 109 billion rupees ($1.7 billion) for India’s flagship nutrition scheme ICDS, which provides free food and supplements to more than 100 million poor women and children.
Then there is also the point that if the central government share becomes much less than that of the State government, States would probably prefer to re-design schemes on their own, essentially rendering the federal cuts pointless. The policy decisions made by Niti <g data-gr-id="28">Ayog</g> recently in consultation with some <g data-gr-id="29">Delhi based</g> strategic think tanks have seemed <g data-gr-id="23">positively</g> perplexing from an economic point of view. Growth has to be a means to an end, not the end itself. Winning the battle and losing the war is pointless. Someone as politically astute as Narendra Modi has perhaps failed to recognise this strategic maxim.