Nations progress by learning to do what they could not do before. In the nineteenth century, industrialization enabled Western countries to grow their economies at a much faster rate than others. In the twentieth century, industrialization propelled growth in Japan, Taiwan, and Korea. In the twenty-first century, China has lifted millions out of poverty by rapid industrialization. Industrialization is a process of countries learning to do more complex things than they could before.
At the same time, human development indicators improve when countries learn to provide health and education more effectively than they could before. Economies grow, incomes grow, and human development indicators improve when countries learn more. They succeed in international competition when they learn and implement faster than others.
Political and social analysts say that India has become an aspirational society. Young Indians aspire for more. They want an even better life. They are not satisfied with what they have though it is much more than what people their age had twenty years ago. Dil maange more. Dissatisfaction with the present and aspiration for more are the defining themes for the next general election. For the country to meet its young citizens’ aspirations, institutions in India, particularly institutions of government, will have to learn much faster and implement much faster than they have so far.
No doubt India has progressed in the last 20 years. Its economy has grown. Human development indicators are improving. But the pace of progress is too slow for its citizens’ aspirations. And it is slower than other countries. China has industrialized and grown its economy much faster. Even poorer, neighbouring countries are improving health and other human development indicators faster than India has. The Indian state must learn how to learn faster, change faster, and implement faster.
The World Bank organized a revealing seminar in Washington in October this year to examine the development and growth of countries through the lens of their capacity to learn. A paper by Luke Jordan of the World Bank, and Sebastien Turban and Laurence Wilse-Samson of Columbia University, presented a new framework for the study of “State Learning”. It examines three components under which this kind of learning can be understood: The generation of new information, the transmission of that knowledge upwards and horizontally across the system, and acting upon that information (“implementation”). Then it considers the comparative setting of China and India for an empirical comparison of the framework.
China has achieved much more in the last 20 years than India in terms of both economic growth and human development indicators. Per capita incomes have increased four-and-a-half times faster in China than India since 1979. What has enabled the Chinese state to learn and implement faster than the Indian state? The authors give the following explanations.
—In public administration, China has undertaken reform once every five years since 1978, while India has only attempted it twice in 65 years, with the last attempt (the Second Administrative Reforms Commission) still unimplemented. Thus China has been continuously tuning up its capacity to learn and deliver. In India, substantial institutional reforms are overdue.
—China has think tanks with their units spread in its states observing and explaining change. India’s think tanks are concentrated in New Delhi and they do more theoretical work.
—China effectively uses its federal structure as a means for learning through experiments in states, comparisons amongst them, and distribution of best practices learned. India’s federal system is oriented overly towards a centre and spoke system to the states. The centre has yet to develop effective platforms for lateral inter-state learning.
—China has a far more effective “HR” management system for its bureaucracy than India. For example, promotions in China are based on 360-degree appraisals. In India, confidential reports by superiors are the means of assessment. Chinese bureaucrats are judged on performance. Tenures of Indian bureaucrats are too short to make such judgements.
—In China, political leaders at the centre always have prior experience of management at the state level first. Thus their capacity to implement is developed and evaluated. The authors observe that in India, since the early 1990s, no Prime Minister has been a former state chief minister.
Institutional reforms are overdue in India. Two steps for systematically wide and faster change are:
1. The Planning Commission had undertaken an evaluation of itself in 2009. Inputs had been sought from Indian leaders in government, academia, and industry. The Prime Minister had summarized what the change in the Planning Commission must be to fulfil the country’s 21st century requirements. He said it must become a systems’ reform commission rather than an allocator of funds and reviewer of ministries’ and states’ plans. Little progress has been made to reform the Commission.
2. The Second Administrative Reforms Commission has recommended many reforms, including reforms of the civil services. Its recommendations have been approved by the Cabinet. They must be implemented as soon as possible.
In conclusion, the government’s urgency to expedite stuck projects is welcome (The Cabinet Committee on Investment). An even greater urgency is required to implement stuck institutional reforms.
Arun Maira is a member of the Planning Commission. Comments are welcome at email@example.com