Economy Oct 11, 2012
The Sultanate of Shah Alam, it was mockingly said of the 18th century Mughal ruler,stretched all the way from Delhi to Palam. But the limits of his shrunken influence were evidently lost on the Sultan who bore the somewhat grandiose name of the "Emperor of the World".
Today, the Delhi durbar is headed by just such a 'sultan' whose 'empire' is reduced to a similar shrunken state. Nominally, it is headed by a Prime Minister, who is considered the first among equals among his council of Ministers, all of whom hold office at his pleasure. But there is nothing Prime Ministerial about Manmohan Singh, the modern-day Shahi Alam, whose influence doesn't extend even to sections of his Ministry.
Heck, today the Prime Minister's authority, such as it is, is being undermined by a lowly Minister of State - Jayanthi Natarajan - who has effectively 'vetoed' a proposal, favoured by no less than the Prime Minister, to fast-track clearances for infrastructural projects that had been long held up by her Ministry of Environment and Forests.
Earlier this week, Jayanthi Natarajan wrote to Manmohan Singh and gave voice to her "very serious concern" at the proposal to establish a National Investment Board to clear the backlog of projects, in which the failure to secure appropriate approvals (including environmental clearances) under two successive "green warrior" ministers (herself and, earlier, Jairam Ramesh), had dragged down investments to a crawl and, with it, the economy as well.
In her letter, Jayanthi Natarajan said, with all the imperiousness that the 'Queen of Green' could command, that the concept was "unacceptable" to her since the NIB proposal would overturn the procedures for conduct of government business and put "corporate interests" over those of citizens.
The NIB was conceptualised as a standing committee of the Union Cabinet, chaired by the Prime Minister, to which companies whose project approvals had been caught up by red tape in any Ministry (but particularly the Environment Ministry) could go in appeal and secure speedy clearances.
The NIB proposal was to have been formalised at last week's Cabinet meeting that announced the FDI in pension and insurance sectors, but had not been taken up evidently in order to iron out differences within the Cabinet on the issue. Jayanthi Natarajan's letter, details of which were revealed subsequently (here), point to a virtual war within the UPA government on the issue.
It points to the ideological and personality-based polarisation that wracks the UPA government even weeks after it felt it had secured a second lease of life, after having seen off Paschim Banga Chief Minister Mamata Banerjee, who had repeatedly held up long-delayed economic policy measures calculated to address mounting fiscal deficits and permit foreign direct investments in select sectors.
The NIB proposal was intended to calm the frayed nerves of industry leaders who have long complained that "policy paralysis" was taking a toll on investments in the absence of time-bound clearances, particularly environment clearances, for projects. In an interview to Indian Express recently, KV Kamath had flagged the "dramatic" slowdown in the infrastructure sector as the biggest area of concern for the economy.
In the first quarter of 2012, lending to the infrastructure sector had slowed down to barely a fourth of what it was a year ago, Kamath noted. In particular, issues related to acquisition of land and environmental clearances were proving problematic to the effort to revive infrastructure projects. "This needs to be addressed if the investment has to come back," he said.
But Jayanthi Natarajan has now effectively 'vetoed' the NIB proposal.
Is Jayanthi Natarajan motivated entirely by an evangelical zeal for the protection of the environment, far in excess of the requirements of her portfolio? Or are political factors too influencing her audacity in opposing no less than the authority of the Prime Minister?
According to India Today, Jayanthi Natarajan's eco-evangelism is perceived to have the blessings of Congress president Sonia Gandhi as part of a developmental philosophy that places an emphasis on policies orientated towards the aam aadmi.
The magazine reports that both Jayanthi Natarajan and her predecessor in the Ministry, Jairam Ramesh, know that "their constituency is not the Prime Minister. Natarajan, sources say, is answerable to Sonia and is dismissive of ranks in between."
So dismissive is Jayanthi Natarajan of any authority other than Sonia Gandhi that she told the magazine last year: "I don't feel the need to tell people what I am doing." (Read the entire article here.)
The episode points yet again to muddle-headedness that characterises the economic philosophy of UPA leaders, and principally Sonia Gandhi: on the one hand, Manmohan Singh and Finance Minister P Chidambaram have been making a virtue of 'big bang reforms'. On the other hand, their collective authority has been manifestly undercutby Sonia Gandhi, by deploying her pliant foot soldiers to spike even these feeble attempt at reforms, all in the name of protecting the aam aadmi.
So pitiful is the plight of Prime Minister Manmohan Singh that he is compelled to swallow the insult inflicted by a mere Minister of State, who evidently has the backing of Sonia Gandhi. Officials in the government have been reduced to wailing to the media that files put up to Jayanthi Natarajan's Ministry have been held up for many months - and that she has actually added yet more reams of red tape to the bureaucratic procedures that Jairam Ramesh had introduced to hold up environmental approvals to big-banner mining and industrial projects.
The German sociologist and philosopher Theodor Adorno famously said that an individual in a state of complete powerlessness perceives the time he has left to live as a brief reprieve. Manmohan Singh's political plight today echoes that sentiment to a nicety.
Today, Sultan Singh presides over a dysfunctional Delhi durbar that is at war with itself, like a body ravaged by an autoimmune disorder. Perhaps he looks upon the time he has left to live (as Prime Minister) as a brief reprieve. But every single day of such misgovernance and mismanagement of the economy by this apology for a government is an intolerable affliction on the people of India.
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