With the ascension of Columbia economist and a noted free market apologist Arvind Panagariya as the vice-chairman of NITI Aayog, the body that has replaced the now defunct Planning Commission, the larger picture of Modinomics is emerging from a thick smokescreen. And, it seems to be almost entirely in the service of capital in a country as labour-intensive as India.
While the NITI Aayog has been conceived as a strong alternative to the centrist structure of the erstwhile Planning Commission, alongside a grand vision of rebooting the centre-state equation with greater autonomy on the part of the states to shape their economic destinies, the choice of the vice-chairman lays bare the hidden blueprint. As it emerges, it is basically to usurp the vestiges of rickety labour laws under the garb of ‘reforms’ and bring in a regime that gives a free hand to agenda-setters in service of private capital. So ‘cooperative federalism’ and ‘bottoms-up approach’, it appears, are catchwords that the present dispensation has thrown around to create just enough buzz to bring in ultra-right neoliberal policies in the name of innovation and entrepreneurial support system.
Hence, even though the newly-appointed full time member of NITI Aayog, Bibek Debroy, another free market economist, raises pertinent questions on the nature of centrally sponsored schemes under the new body, and whether the technical differentiation between Plan and non-Plan expenditure, that the erstwhile commission had maintained for decades, would continue as it is dictating different streams of capital outflow, there is little evidence that fresh formulae to suitably address concerns related to economically weaker sections or state needs will be brought forth.
In short, without power to allocate funds, NITI Aayog will be a front to steer the wobbly ship of Indian economy full steam to the right. It is evident from the string of paeans that Panagariya has so far sung to Modinomics, hailing his ‘Make in India’ and ‘Swachh Bharat’ as brilliant and successful (a questionable claim in itself) strategies to reinject life into a fledgling economy, that the stage was being set to usher in more rapid and drastic change on the economic front.
Especially relevant are Paragariya’s absolute derision towards labour laws in India and how he blames the ‘Nehruvian hangover’ of ‘labour laws relating to industrial disputes, trade unions, apprenticeship, pensions, provident fund, and insurance’ for creating ‘major obstacles to entry of large formal sector firms into low-skilled labour-intensive industries.’ In addition, his take on bankruptcy laws is completely in favour of bailing out errant firms, a trend that has been pivotal in sabotaging our aviation sector as well as the public sector banking, weighing them down under a monumental burden of bad loans and non-performing assets. In Arvind Panagariya, Modi, therefore, has picked just the right candidate, pun intended.