View: Reform the reform process first

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It is perplexing when some economists describe the farmers’ agitation for a better deal for farmers as an ‘anti-reform’ movement. For decades, farmers have said that their incomes are too low in many states and subject to uncertainties in all. They want reforms to enable them to earn more, and sustainably. GoI acknowledged their needs and declared bold visions for doubling farmers’ incomes.

The stand-off between farmers and GoI arose because many farmers felt the reforms announced were not in their interests. Moreover, they were angered by the undemocratic way in which the reforms were sought to be made – rammed through by an ordinance and then in Parliament by a voice vote without deliberations. The self-styled ‘pro-reformists’ say GoI’s retreat from the reforms Narendra Modi had announced, which they supported, is an enormous setback to India‘s reforms process. It could actually be a great advance.

India’s economy is not growing fast enough, and growth is neither inclusive nor environmentally sustainable. Infrastructure must be built, public services must be vastly improved, institutions of justice must be strengthened. The reform agenda is complex. Bold intentions to reform have been announced by many governments, Modi’s is not the first. However, the intentions rarely translate fast into actual outcomes.

The Indian State does not seem to have sufficient ability to manage complex reforms. In 2009, when UPA began its second innings, many citizens recommended that, rather than making any more five-year plans for faster, inclusive and sustainable growth, GoI should learn to make reforms and get things done. ‘No more policy announcements and no more foundation stones, please. Let’s have more finishing stones and outcomes,’ was their demand.

A root cause analysis revealed that implementation of infrastructure projects and public policies is poor in India because there is poor coordination among agencies, and there are unresolved contentions among stakeholders. Therefore, India’s reformers must focus much more on improving the process of reforms rather than debating the contents of policies.

Reformers’ intentions will be converted to outcomes much faster when methods of governance are improved, to convert confusion to coordination, and contention to cooperation. India is not the only country that must manage complexity in its policies. A look around the world reveals better ways to make complex reforms. These are compiled into a set of principles and methods, which all states and cities – GoI included – could use to produce outcomes faster, and at less cost too.

The farmers’ agitation is a reminder that we must first get the process of reform right, to get the right policies and support for their implementation too. All stakeholders must be involved to define the desired outcomes of reforms as well as their contents.

There is both an ideological requirement for this and a scientific reason. Liberal democrats insist that all citizens must have the right to participate in the governance of their own affairs. Citizens have a right to be listened to, whether they are considered as experts or not. The examination of policymaking processes during UPA 2 revealed that lip service is given to consultation by GoI. Representatives of stakeholders are invited to meetings. They are lectured to, their comments noted with promises that they will be considered, then plans are made – often in technical language stakeholders do not understand – they are given a few days to comment on government websites, and, with all boxes ticked saying that many ‘consultations’ were held, the policy or plan is rolled out.

Similarly, the government says it has consulted farmers extensively. The farmers say they were not listened to – they have complained about the shallowness, and even insincerity, of the consultations.

Economic reforms do not involve only economics. They have social, environmental and political ramifications, too. Experts in economics often complain that politicians make a mess of good economics, and that vested interests derail experts’ solutions for economic growth. They would rather shut out the views of ‘non-experts’ in economics, even when the people who want to be heard are the principal stakeholders in the process – as all farmers are in agriculture reforms.

The exclusion of stakeholders – simply because they don’t talk sense from the experts’ perspectives, or because they may oppose the experts’ solutions – makes the experts blind to the forces within complex systems. Therefore, whether the experts are political liberals or not, they must listen well to all stakeholders to design the right solutions.

It is time to go back to the drawing board, to get India’s agriculture, environment, land, labour and investment policies right to accelerate more inclusive and more sustainable growth. In fact, it is time to change the drawing board, and reform the process of reforms.



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