Lutyens zone works to derail PM Modi’s currency move

Lutyens zone works to derail PM Modi’s currency move

By MADHAV NALAPAT | New Delhi | 13 November, 2016
Narendra Modi, PM Manmohan Singh, Madhav Nalapat, CBI, UPA, Lutyens Zone, Ministry of Human Resources Development
Narendra Modi
The public and economic dislocation caused in the aftermath of the currency-based surgical strike has shown to those officials close to the PM the importance of ensuring administrative reform at an early date.
Associates of Narendra Modi say that from the start of his innings as Prime Minister of India, it was clear from his approach how far he actually was from the characterisation of Modi as vindictive. PM Manmohan Singh sent one of his own Cabinet colleagues to jail and was well on the way to a second meeting the same fate, even while others were made to resign after allegations of gross impropriety. On the contrary, Prime Minister Modi ensured that an official clean chit was given to the then Minister for Coal (Manmohan Singh) during the precise period when numerous allocations were made on the verbal and “unsigned chit” recommendations of key UPA members. No other UPA-era minister has been the subject of even an FIR, much less a CBI prosecution. Indeed, the UPA-chosen director of the CBI, Ranjit Sinha and many other officials were allowed to serve out their terms with dignity and retire with traditional honour. Many key positions within the Modi-led NDA government remain filled by officials who were active in the service of UPA ministers, including some who have been reported as having facilitated illegal transactions, including through the stock, commodity and currency markets. Indeed, several at the top of the present government’s civilian bureaucracy have long had close and open contact with the Lutyens Zone, including with Congress president Sonia Gandhi, who has long been the uncrowned empress of this pool of resourceful and influential policymakers.

However, the fact remains that Narendra Modi is an outsider to the Lutyens Zone, and is known for his patriotism, integrity and refusal to act as a facilitator of vested interests nourished over decades by the Lutyens Zone. Hence, from the start of his term, the Lutyens Zone and its component groups have been silently working to undermine the Prime Minister and sabotage or at the least slow down the transformational measures that he has regularly been introducing since the past two years. Along with this, an entire “samizdat” industry has been developed that is designed to discredit the Prime Minister, and this despite his expansive and accepting approach towards those who were all powerful in past administrations. Senior officials in sync with the desire of Modi for transformation of the economy and the governance system warn that the currency measures announced by the Prime Minister on 8 November are being sought to be sabotaged such that public anger will swell to the detriment of the NDA. They are doing this in the context of the reality that the withdrawal of Rs 500 and Rs 1,000 currency notes amounting to 85% of the total money supply (as against less than 1% of the money supply in the 1978 measure targeting Rs 1,000 notes) affect practically all the 1. 26 billion people of the country. Should the measure go sour, the BJP as a party will pay a heavy price at the hustings.

The public and economic dislocation caused in the aftermath of the currency-based surgical strike announced by Prime Minister N.D. Modi on 8 November has shown to those officials close to him the importance of ensuring administrative reform at an early date. “Without an efficiently functioning government machinery, the historic plans of Prime Minister Modi will not succeed”, a key official warned, adding that “this needs to be a priority for the coming year, so that from 2018 onwards, people will feel the positive difference” caused by Modi coming to power at the national level.

Modi took office on 26 May 2014 with four key governance objectives: (a) making quality education widely accessible at all levels, including technology and vocations; (b) creating a framework for affordable healthcare that would place stress on prevention through measures such as vaccination and providing disincentives to toxic consumables such as tobacco; (c) ensuring that infrastructure reaches a scale and standard as would ensure that citizens be given a smooth interface to live and to work; and (d) work towards an enabling environment for the Knowledge Era that would place emphasis on high internet speeds and universal availability, as well as such essentials as freedom of speech. Thus far, the record has been less filled with spectacular outcomes than expected when Modi took office, and for this, those in government who are committed to his goals are pointing to the administrative machinery, and in particular its still colonial-minded and ossified higher echelons, where procedures and customs from the British-era past have not only been preserved but expanded upon so as to harass the citizen and deny him the rights and freedoms present in other major democracies.

There has been a continuous campaign designed to portray Narendra Modi as an over-centraliser, whereas his close associates point out that he is known by those working with him as a decentraliser. As an example of the Modi approach to national governance, senior officials point to the Ministry of Human Resources Development. They say that a single agency and its satellite bodies have not and cannot ensure world-class educational standards. In such a context, a suggestion is to recruit global talent to fill some of the posts within major centres of learning, rather than confining the choice to those resident in India. In a similar way, a fresh approach has been suggested towards key posts in the Central government and its agencies. This is to ensure lateral entry of domain knowledge experts and those from the private sector with a proven record of practical achievement to at least 30% of middle and top jobs. “If the ratio is less, the change will be too small to be effective”, a senior official pointed out, adding that “the present system of reserving almost all the highest jobs to those from a single service (the IAS) needs to be replaced so as to ensure that those from all services are given the opportunity to serve in key posts”. Another pointed out that “it makes little sense to have someone with a History and not a Mathematics background as Head of Statistics, or to place a doctor who has joined the IAS in Sports rather than in Health or a Chartered Accountant in Animal Husbandry”. Senior officials committed to the transformational plans of Prime Minister Modi say that in the 21st century, domain expertise is crucial to good decision-making, and “this is conspicuous by its absence within the higher bureaucracy”.

It may be mentioned that the IAS as a service is not First Among Equals but a Superior Service, the way the Imperial Civil Service was in the past. Almost all IAS officers reach the highest pay scales in the bureaucracy or in PSUs during the course of their career, and enjoy a two-year advantage over other services when promotions are being decided. Since the start, they have had the benefit of the same One Rank One Pension scheme that has been so difficult for Defence Minister Manohar Parrikar to navigate through the civilian bureaucracy. Although in theory those IAS officers who are incompetent or dishonest are weeded out, in practice this almost never happens. Instead, obviously incompetent or corrupt officers are frequently protected until they retire with pensions intact. “Any closed group without competition or effective accountability cannot deliver results”, an official pointed out, adding that in general, “senior officers abhor change and regard procedures as crucial while outcomes do not matter”.

Those watching with dismay the efforts of the Lutyens Zone to slow down or sabotage key Modi initiatives say that apart from 30% lateral entry from outside officialdom, key posts should be open to all services and not simply to a single group. Among ministries where outside experts are needed, including at the top, such officers in sync with Modi’s goals pointed to Electronics, Telecom, Health, HRD, Defence and Civil Administration. Based on their experience, they say that “more than 40% of officers are deadwood incapable of achieving results” and of the balance 60%, “more than a quarter are corrupt”, some obviously so and yet escaping scrutiny and censure. Many of these officers said that the Administrative Reforms Commission headed by M. Veerappa Moily needed to be retrieved from the dustbin “as several of its conclusions and suggestions are relevant to present needs”. They say that the manner in which the currency initiative of Prime Minister Modi is being implemented, the glitches and procedural lapses in the details of Modi’s bold scheme, show the need to make administrative reform a key priority during the next six months “so that the crucial (to the 2019 polls) 15 months after that can ensure smooth and complete implementation” of Prime Minister Modi’s governance and policy initiatives.

Meanwhile, it is becoming obvious that the present government’s light hand on those at the top of previous administrations who were guilty of past misfeasance on a gargantuan scale needs to get replaced with greater accountability and punishment, if the Lutyens Zone is to be scared off from further acts of sabotage in the remaining period of Prime Minister Modi’s term in office.

 

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