Anniversaries are often intoxicating affairs. Usually, there is no next day at work; then, life returns to normal. Few governments are immune from such blandishments. Prime Minister Manmohan Singh’s press conference on Monday, his first in four years, proved that the United Progressive Alliance, soon to enter its seventh year in power (and the second of a second term), is no different.
In the one year that the second avatar of the UPA has been in power, there has been little semblance of coherence across the policy spectrum. From the performance of the economy to tackling terrorism and ultra-Left violence to charting a course for India’s external relations, the government has ended up registering more misses than hits. What has ameliorated its performance is a large dose of luck.
Consider economic performance first. Today, much of the so-called “India growth story” is due to the government keeping its hands off the economy. The details of this need not detain us here. Growth rates of 7-9% are the product of this benevolent disinterest. What is of interest are the areas where the government has intervened in the economy. Here the picture is much less bright. The first budget of UPA-II (for 2010-11) has projected a fiscal deficit of 5.5%. This does not include any provisions for managing galloping international oil prices. An upward swing in the deficit on account of that is a distinct possibility as the government is unwilling to face political heat. But that possibility lies in the future. In the present time, the high level of social sector spending (2.2% of gross domestic product, excluding subsidies) has certainly put money in the hands of the poor, but has gone some way in stoking double-digit inflation.
Illustration: Shyamal Banerjee/Mint
None of this, however, perturbed the Prime Minister. Instead, he chose to disclose some gravity-defying numbers: inflation to be brought down to 5-6% by December and 8.5% growth rate this fiscal. These numbers ignore a wider reality of a world economy in turmoil and assume that India can quietly pass this storm.
If India has weathered this and the government has not let the financial crisis “interrupt” inclusive growth, it owes more to a deus ex machina than any conscious effort on the part of the government, although some credit is due to several timely fiscal interventions. High growth rates have ensured higher revenue, making possible the gigantic social sector spending efforts of the past few years. But such has been the scale of that spending that even with robust growth, it has led to high deficits. If and when the storm does hit India, it would be interesting to see what the government does with politically sensitive spending. Singh’s finance minister, Pranab Mukherjee, gave a dark hint a few days earlier: more taxes.
Mercifully for Singh, there is a world beyond these depressing numbers, something intimately linked to building his legacy as prime minister: Building bridges with India’s long-time South-Asian rival, Pakistan. Unfortunately, here again, the signs are hardly propitious. After all, Indira Gandhi, Lal Bahadur Shastri and even Atal Bihari Vajpayee have been bitten by the bug of friendship and have been disappointed at a later date.
Singh knows no such fear. On Monday, he said the key problem between the two neighbours was that of “trust deficit”. But that begs the question in the first place: What has led to this state of “trust deficit”? If it were a mere matter of such deficits residing in governments, a change of personalities would lead to better chances of peace. And, going by the same logic, if, by fortuitous circumstances, there were dedicated fighters for peace in India and Pakistan, as Prime Ministers Singh and Yousuf Raza Gilani surely are, the odds in favour of peace are raised even more.
There may be disappointment in store on this count as well. Prime ministers are not solitary creatures, even if they so wish. They have to take their bureaucracies, armed forces and the political establishment along. That is far tougher than uttering soothing words at a press conference.
Speaking of the political establishment: that is the third area of dissonance that the Prime Minister chose to elide. He denied any rift between him and his party president, Sonia Gandhi. That might be believable as the two are experienced and rational persons. But what of the bitter internecine fighting between his cabinet colleagues and Congress party leaders? And what about the rifts within the cabinet and his inability to tackle some of the more unruly ministers in his council? Again, there was little save soothing words that Singh could offer.
The fact is that the India of today is a far more complex entity—economically, politically and socially—than it was for the first 50 years of its independent life. The pulls and pressures of that reality are acutely reflected in any government that tries to impose order over this variegated reality. Singh’s government is far more ambitious and the scale of challenges it faces, externally and internally, too is qualitatively different. Attempting to smoothen these and exude a picture of harmony is misleading at best.
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