The new government must focus on eradicating curable diseases, malnutrition amongst children, bringing down infant mortality, and raising levels of education.
The NDA government in the run up to the elections was vociferously attacked by the Opposition on a number of grounds. It challenged the government on the “fudged” economic data to manipulate growth figures. It alleged that there was a jobless growth and that unemployment had peaked in the last 45 years. Sadly, for the NDA, this attack seemed further magnified due to the vast unorganised labour sector and the lack of data making it impossible to defend itself. The Opposition had accused the government on having failed to boost private investment, held it responsible for the spiralling growth in rural unemployment, and most of all, it blamed the government on the carnage wrecked on the SMEs by the hastily conceived and executed demonetisation.
The Indian economy, since the economic reforms of 1991, went from a near defaulter of loans to the third largest economy on PPP terms, but has yet failed to lift its teeming millions from the shackles of poverty. What can the new NDA government that takes charge do to correct this grave injustice?
The first step would be to instil confidence amongst the citizens, academia and institutions that the economic data that the government releases every month or quarter is reliable. It should entrust finalisation of growth figures to an autonomous committee of economists and civil servants of the economic ministries after the CSO (Central Statistical Organisation) has estimated the figures.
The next step should be to tackle rural unemployment by concentrating on village development and ensuring the reduction of people employed in agriculture by 15% in the next five years. This will also reduce pressure on metros caused due to rural urban migration. Industrial houses should volunteer to take up village-clusters for this transformation and employ people after imparting skills as required. They already have income tax relief for employing people. Agro processing zones should give preference to employ people moving away from farming. There is no harm in inviting foreign investment in this sector as Indian industry has not succeeded in a big way. The government should ensure that fragmentation of agricultural holdings below one hectare is stopped by legal and other means so that farming becomes profitable. Any further immiserating of farmers must stop immediately. Farmers engaged in subsistence agriculture must be provided with alternative sources of income. As the private sector has failed, the government should take the lead in setting up viable cold storages across the country where horticulture crops are grown, for farmers to store their produce till such time they can sell it for the right price. Cold storages could advance 50% of the value of produce to farmers to be recovered when they sell their produce. Production of organic food must be encouraged as there is an ever-growing demand amongst the affluent in urban areas. Tertiary airports should be set up in strategic locations for the transport of perishable commodities. This will not only give a boost to agriculture but also a fillip to the growing aviation and logistics sector by generating employment.
SMEs account for more than 60% of the employment generated in India. Indian SMEs have to contend with some of the highest interest rates in the world, at times higher than 12% and most of them barely break even. The new government should make sure that loans are given at the same interest rate as in China at 4.5%-6.5%, but with strict enforcement of repayment rules through securitisation of sales revenue. The cost of power should also be made available at comparable rates as in China. Unless our government matches the rates, Indian industry will never be competitive against China, let alone become profitable within its own market. The holy grail of employment generation lies within the SME sector.
Most of our citizens consider defence deals to be mired in corruption. The incoming government will win hearts and minds if it is able to create a ministry for defence procurement with zero-tolerance policy towards political interference. This ministry should be manned by defence personnel selected from the armed forces. Procurement of weapons foreign or domestic should be the prerogative and responsibility of the end user. The civilian bureaucracy must have a say only at levels where it concerns inter-ministerial relations during the capital procurement of strategic weapons systems.
Also, the government under no circumstances should interfere with the autonomy of universities and regulatory bodies.
The civil services consisting of the IAS, IPS and other cadres should be reformed within six months, military training made compulsory with a mandatory posting at the border areas for six months, with independent command of patrols and anti-terrorist operations. Age recruitment must be kept at a maximum of 26 years and 28 years for the general and reserved categories, respectively. IAS and IPS officers must be posted outside of their home states irrespective of ranks. In Tamil Nadu only promoted officers from the state services are being promoted in districts as collectors for obvious political reasons. This must stop. The Supreme Court order on the minimum tenure of civil servants based on rank must be adhered to by the government in letter and spirit.
With regard to the sustainable development goals of the UN, the Central government should create a new ministry to supervise the achievement of targets by every state. This ministry should be under the Prime Minister so that there is no file pushing for orders. The Union government should form three councils of state ministers for industry and commerce, health and nutrition and education on the lines of the council of finance ministers for GST to take national level decisions to promote rapid industrialisation and to reach an export level of USD 750 billion by the end of 2024.
Eradication of all curable diseases such as cataract, leprosy, filariasis, tuberculosis and eradicate malnutrition amongst children, bringing down infant mortality below the age of 10, and raising the levels of education compared with the best in the world. The Central and the state governments should give priority to these programmes in the allocation of resources. The new Modi government must ensure that the states become partners in this major thrust to take India to the upper middle income level, with a rank in the human development index amongst the top 25 countries.