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Can Manmohan be believed this time?

 | June 8, 2012

The prime minister may well adhere to Modi's mantra to attract investors: No red tape, only red carpet.

COMMENT

Indian Prime Minister Manmohan Singh’s coalition government at New Delhi has frittered away three years out of five in political squabbling, dishing out lame excuses for humungous financial scams and playing the sitar while India’s teeming masses struggled.

Economists and industrialists lambasted the state of affairs. The free fall of the Indian rupee, the decline of the GDP and the alarming decrease in industrial production, coupled with punishing inflation – which is making the millions of poor poorer and the thousands of rich richer – unmistakably indicate mis-governance and policy paralysis.

In what is seen as downright ridicule of Manmohan’s rule, Firstpost, had this to say: “In an early episode of the tele-series, Yes, Minister, a Whitehall bureaucrat uses the furniture in a minister’s office as a metaphor for the minister’s inability to get anything done.

“There are two kinds of chairs to go with two kinds of ministers,” the bureaucrat says. “One sort folds up instantly; the other sort goes round and round in circles.

In India, “Wednesday’s [crucial] meeting of key economic ministries, presided over by Prime Minister Manmohan Singh, shows an entire government that is going round and round in circles”.

At the meeting, Manmohan announced a series of steps to pump oxygen into the economy, to get it breathing again.

Manmohan’s Congress Party, which leads the coalition government, will push for long-awaited and much-needed pension reforms and foreign direct investment in aviation, which has flown into stormy turbulence and is all set to crash.

Baron king Vijay Malaya’s Kingfisher Airlines is as good as defunct now. Even the state-run Air India has run up huge losses, and has been asking the government to bail it out with funds, a suggestion that has provoked the wrath of the country’s taxpayers.

In infrastructure, the prime minister’s plan includes upgrading Tiruchi and Coimbatore airports to international status, extending highways by 9,500km and generating an additional 18,000 MW of electricity

Manmohan also told the meeting that there was a pressing need to revive private sector investments.

Red tape aplenty

Although these measures appear good on paper, they have come too late, and can also be viewed as Congress’ desperation to win the next general election to be held in less than 24 months.

The man on the street today is fairly intelligent to fall for this kind of ploy – which has been dangled in front of him so many times before.

The man may not have missed the fact that India’s Finance Minister, Pranab Mukherjee, accused of driving away private investors and foreign capital, was not present at the crucial Wednesday meeting.

Perhaps, he smugly thinks that his days in the Finance Ministry are numbered, given the fact that he is most likely to be the nation’s next President.

Now, how many are going to believe Manmohan when says that he is bent on setting right all that is wrong with country. Since his government came to power in 2009, he has given many such assurances. And they have seldom translated into hard reality.

In an interview with the Economic Times, the (opposition) Bharatiya Janata Party hotshot and Chief Minister of Gujarat, Narendra Modi, summed up the current malaise plaguing India.

“The government,” Modi quipped, “has no business to be in business. It should play the role of a facilitator.”

In Gujarat, “investors don’t have to grease the palm of politicians or bureaucrats. There are well laid-out policies. I believe that the country can progress only if we end red-tapism. No red tape, only red carpet, is my policy towards investors.”

Modi added: “Before any individual or company invests, it looks for safety of its money and profit from its investment. We can provide safety for invested money through clarity in policies, transparency in decision-making and decent implementation. Is the (federal) government able to do these? The answer is: no.”

In some ways, Gujarat under Modi has boosted the economy to sheer vibrancy. Manmohan and his team may well look at that model, and kick themselves out of the corrupt inertia they have let themselves in.

Gautaman Bhaskaran is a Chennai-India based author, columnist and film critic, and can be contacted at [email protected] He is an FMT columnist.


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