Mani-Talk: Two Little Words Missing From Modi Budget

(Mani Shankar Aiyar is a Congress MP in the Rajya Sabha)

For all the bumph in the BJP manifesto and the President's Address about Moditva intending to prioritize the poor, there is nothing - literally nothing - in Arun Jaitley's first budget to bring cheer to any rural household. The only silver lining is that Jaitley has not fiddled overmuch with the slew of pro-poor programmes initiated by the previous government. Perhaps one should thank the Lord for small mercies.

Yet, Modi has the gall to describe the budget as an "arunodaya". It's not. It's just Arun Jaitley. The Finance Minister deserves an award for being the first FM ever to talk for two-and-a-half hours without once mentioning Panchayat Raj - a feat possible only by someone so far removed from the rural poor as to leave them not even entering his reckoning of whom the budget is for. For Jaitley, the only constituency to whom the budget is addressed is the pink papers and his patrons on Dalal Street. (Yet, Dalal Street was so unimpressed, Sensex and Nifty actually fell as he droned on!) In this, he is at one with The Economic Times which has devoted all 23 pages of its main edition on the morrow to the budget without once referring to the hundreds of millions of the rural poor who are most in need. Fortunately for them, the UPA government lasted ten years before the "arunoday". Arun Jaitley was thus able to re-circulate all the UPA programmes with nary a change to claim them as the BJP's own. If one is relieved at that, that is only because during these self-same ten years, Jaitley & Co. have torn into these programmes as a waste of money, a drain on resources, schemes, as Modi claimed during his infamous campaign, that have no aim other than "filling the pockets of the Congress netas". Well, perhaps they have been left untouched the better to fill the pockets of the BJP's netas.

If there is the least little hope for the really poor it comes from two sources. One is the long list of 29 token schemes announced by Jaitley each with a token allocation of Rs. 100 crore, which is North Block- speak for saying, "Don't worry we won't actually implement any of these schemes but will work on them in the coming year to see what is feasible and how much it will cost". Other FMs have done the same - but for one or two schemes. Jaitley has topped them all with a wish-list (or deception list) of 29. My apprehension is not that these schemes will fall by the wayside but that it will all amount to tinkering with the machine without addressing the fundamental question of why compared to financial allocations, outcomes are so poor, be this is education, health, drinking water, sanitation or any of the 29 subjects illustratively listed in the Eleventh Schedule as the Constitutionally-proposed domain for Panchayat Raj Institutions (PRIs).

Moditva seems not to understand that panchayats are the forum for "Jan Shakti" and "Jan Bhagidari" - people's empowerment and people's participation that Modi has claimed for Jaitley's budget. But if the two little words "Panchayat Raj" are not even mentioned in a 150 minute oration, and no note is taken of the five-volume report on leveraging Panchayat Raj Institutions for the more effective delivery of public goods and services that was submitted over a year ago by an expert committee I chaired, then I fear that all this business of jan shakti and jan bhagidari is just empty rhetoric of the kind that befooled the electorate in the first half of this year and which the country will soon learn is what Modi means when he incessantly mouths the words "good governance".

Modinomics has never, not in Gujarat, not since, ever understood the needs of the poor. That is why Modi's Gujarat has so pathetically lagged far behind almost half the states of the Union on the Human Development Index despite being fourth on the growth rate measure (after Bihar, Maharashtra and Tamil Nadu). This is principally because Modi does not understand or empathize with Panchayat Raj.
In an investigative article in The Economic and Political Weekly of 31 May 2014, a fortnight after Modi rode to power, which got drowned in the media euphoria of Modi's election, Atulan Guha of the Institute of Rural Management Anand in Gujarat has detailed how the Gujarat government under the Samras Gram Yojana has forestalled elections to Panchayats by incentivizing panchayats with monetary grants to not hold elections. This has insulated panchayats in Gujarat from the people they are supposed to serve, reducing these panchayats to political agents of the party in power in Gandhinagar instead of letting them evolve as forums for the ventilation of people's concerns and the redressal of people's grievances.

If there is no people's involvement in the delivery of public goods and services, that is, no jan bhagidari, how can there be any jan shakti? And if in twelve years of ruling Gujarat with an iron hand, Modi has devolved precisely nothing to the panchayats, then what hope is there of his ensuring this will happen through his one innovation - central assistance programmes rather than centrally-sponsored schemes? Where local politicians and the local lower bureaucracy alone are entrusted with performance, outcomes will inevitably be sub-optimal. As Guha observes after quoting the official justification for not encouraging elections to panchayats, "power structures have remained unchanged and continue to favour traditionally powerful communities...(R)epresentatives, including the sarpanch, have to be acceptable to the dominant family group of families in the village". Moreover, "there are no district planning committees formed" - a key requirement of the Constitution - and "there is no formula for the devolution of funds from the state government to the PRIs". In a word, "Fiscal federalism within Gujarat is non-existent". State Finance Commissions in the state have been consistently crippled. No wonder "(a)ccording to the reports of the Thirteenth Finance Commission, Gujarat has scored 'zero' in the index of devolution."

For the better part of a decade I have wondered why Modi, almost alone among the Chief Ministers of India, refused to invite me as Union Minister of Panchayat Raj (2004-09) to his state to review Panchayat Raj and sign an MoU about how to improve matters like 21 other CMs had done. I suspected he did not want anyone to uncover his sins of omission and commission. I now have the definitive explanation. He knew I would rip off the mask and expose him to the public gaze as Enemy No. 1 of Panchayat Raj. That is no longer needed. He has indicted himself through this Budget.

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