Bibek Debroy. Photo credit: GettyImages
Snapshot
  • “The single most important change that this government has brought about is a complete institutional overturning of the system with focus on decentralisation,” Bibek Debroy, member of the NITI Aayog, tells Surajit Dasgupta, while explaining the new Union-state relations.

Excerpts from an exclusive interview.

It’s going to be two years since the formation of the NITI Aayog. How different states, depending on whether they supply or receive more goods, are coming to terms with the transformation from the Planning Commission.

Technically, it will be two years on 1 January. There is an institutional context to the question you are asking. There was a recommendation from the 14th Finance Commission. Subsequently, there was a recommendation of the Shivraj Singh Chouhan-chaired committee of chief ministers on restructuring centrally-sponsored schemes, which rationalised the existing central sector, centrally-sponsored schemes. As a corollary of that, there has been an abolition of the plan-versus-non-plan distinction.

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The states have to align everything in accordance with the new conditions – untied funds, redoing the budget not with the plan and non-plan distinction in mind but revenue capital switching, readjusting their public expenditure schemes at the state level to reflect the enhanced, untied devolution and the new centrally sponsored schemes. To reflect what the state finance commissions are now going to say about devolution, in turn – all of this requires an enormous transition in public expenditure accounting, public expenditure delivery, linking expenditure to outcomes; in some cases it completely overturns what we were familiar with for 65 years. The most important preoccupation for all states is to adjust to this new process.

This is important because some of these changes were not reflected in the state budgets of 2016-17, but they are going to be in 2017-18. The clarity in terms of the transition is only beginning to set in now. The state governments’ reaction to NITI, needs to be viewed against that context.

Sometimes the state governments come to NITI to help resolve clearances. Historically, they used to come to the Planning Commission for money. They don’t come to NITI for money; they come to NITI either because some clearance process is stuck that needs to be facilitated – we need to step in as an intermediary between, let us say, the state governments and union ministries or departments.

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Alternatively, they may come for intellectual help. At NITI, we have neither the carrot nor the stick. We have the intellectual capacity: to help if or when the state government wants. Our position is that we are quite happy with the situation, where we cannot forcibly inflict ourselves on the state government. But if the state government says, we are happy to help.

If you look at all the states and union territories, it would be unrealistic to expect all the states and union territories to come to NITI, but several of them have. It’s not all, neither is it zero. When I say they have come, I need to stress the fact that this is not determined by political considerations. There have been non-BJP states, which also have come.

Can you share some case studies?

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Let me take the theme of law reforms. By law reforms, I mean statutory law, and I don’t mean things that are extremely high profile and visible like the Industrial Disputes Act. Rajasthan has rationalised all of its statutes – eliminated old ones, rationalised and harmonised some existing ones. So, from 900 statutes, we are already down to 250. By the time we finish it, it will be 150. Now that Rajasthan is out of the way, we have started a similar exercise with Maharashtra. “We” means ‘in collaborationwith the states’. We have started a similar exercise with Himachal Pradesh and Uttarakhand.

If you ask me ‘why are you not doing it for all the 29 states’, well, all the 29 states have to be willing and we must have the capacity to do that. You have to understand that NITI’s size is half that of the Planning Commission in terms of expertise and manpower; so there are limited things that we can do.

All public expenditure schemes are delivered by whom? They are delivered by departments, and departments in the states often work through silos. Sometimes there are too many departments; I personally think no state government needs to have more than 30-odd departments, but there are states I shall not mention, which have pretty close to 60 departments. With Jharkhand, we tracked down and rationalised the number of departments.

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I can give you examples from the North East, where we intervened in projects that were stuck, mostly transport-related projects. The upshot of what I am trying to tell you is that the degree of engagement (of NITI with the states) varies. Even the nature of engagement varies a little bit from state to state.

But I should also say that we have begun to monitor the states in terms of outcomes. So, there has been a switch from public expenditure and utilisation, which used to go to the Planning Commission, for actual monitoring.

We have sat down with the states and agreed upon certain indicators, at the moment, which we will use to monitor the states. This will eventually look like a dashboard that you put out in the public domain. We have got water, education and health. It’s a bit like the doing business, the kind of thing that the DIPP does; NITI’s focus is on the social sector.

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Since different members have different states and portfolios, what if a state wishes to dump its unnecessary laws but that state is not with you. Then who has the portfolio of laws?

No, different members have different portfolios depending on (a) states and (b) themes. The law thing is really mine, so, it will not be fair to expect other members to work in that area. For example, Dr (V K) Saraswat’s things are science, technology… those kinds of things. I know that he has been working with the Railways, the governments of Telangana and Andhra Pradesh. Prof Ramesh Chandra’s focus area is agriculture. He has been pushing for specific agricultural reforms, including land leasing in some states. I think – I am not sure – it’s in states like Maharashtra and Madhya Pradesh.

Given the structure and functionality you have described, shouldn’t it be out of fashion to look up to the Centre for reforms? It’s going to be a joint effort by the Centre and the states and, to a certain extent, the civic authorities.

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Yes. But I’m glad you asked the question, because that gives me an opportunity to object strongly to the question. People incessantly use the word “Centre”. The term suggests there is a centre and the states are all in the periphery. The word “Centre” does not figure anywhere in the Constitution. It uses the word “Union government”. Consciously, therefore, in anything that I do at least, I do not use the word “Centre”; I use the word “Union”. The reason I am stressing this apparently pedagogic point is that it is symptomatic of the change that is happening. This is probably the single most important change that this new government has brought about: a complete institutional overturning of the system with focus on decentralisation, which is much more than fiscal devolution.This is decentralisation from the Union government to the states. What the state government should now push is decentralisation from the state government to the local governments.

Let me pose to you a typical business scenario. When an entrepreneur sets up his office, he is hassled the most by the civic authorities and then, of course, also some anti-social elements. How does any government, be it of the Union or of a state, deal with this? The civic authorities are not even under the state governments. For instance, in this very capital Delhi, the day you set up an office, you will get a hell of a lot of notices from different authorities that you have not complied with this order; there is no clearance for that; there will be extortions by eunuchs, etc. How does a Narendra Modi or an Arvind Kejriwal or, say in another state, Raghubar Das deal with a situation like that in Ranchi?

Delhi is probably a bad example because it has a multiplicity of governance authorities. Let me react to it as a representative of NITI. I can react to it also in a broader way. Before that I should say that, at the Union government level, several things it could do have moved to self-reporting: coordination with MSMEs, incorporating information technology to eliminate human interference, etc. Both of these can be important instruments in eliminating many instances of harassment.

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At NITI Aayog, we cannot and should not tell the state government that this is what you should do. It is the prerogative of the state government to do it. What we do is monitor the states. In instances where one has the data, we publicise that so as to trigger a competition among the states so that they improve the climate for entrepreneurship and reduce these instances.

What we can also do is, where there is a specific instance of law or administrative order or circular getting in the way, NITI writes, not in the public domain, to the state government, requesting them to have a look at the phenomenon. We can never say ‘take a look at it’; we can only say, “please take a look at it”. This is what we essentially do.

How do you coordinate between the members of NITI Aayog handling different portfolios based on themes: statutes, science, agriculture? For example, there is an overlap between science and technology and agriculture.

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It depends on what we need. We bring out a document. Like right now we are doing what the newspapers have described as a vision document, although it is the National Development Agenda. There are chapters that are drafted by individual advisers; it goes to the members, but the whole thing has to be integrated. Anything that comes out from NITI as a document has gone through that process of consultation and coordination.

The second part of it is more functional. How do I get to know what another member is doing? How do we talk to each other? The way it works is through weekly meetings – not necessarily as part of a formal agenda. It may be an exchange of notes about who is doing what, how can NITI function better… This is every Monday at 3 o’clock.

As far as some flagship schemes of the Union government are concerned, are they framed in consultation with NITI Aayog? Are you in active consultation with the Finance Ministry or is their some other mechanism?

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The NITI think tank, not just for the states but also the Union, works at several layers. Firstly, there is a formal Cabinet note, which comes to us for comments before it is finalised. Secondly, without the formality of a Cabinet note, a Union ministry or even the Prime Minister’s Office may write to us, flagging an issue. Thirdly, we may, of our own volition, without being asked, say “here is an issue; we’d like you to take a look at it”. Fourthly, there are instances where committees, task forces etc are set up, headed by someone or the other from NITI.

Finally, still after almost two years of functioning, the people at large are not very clear about NITI Aayog, while they were quite knowledgeable about something called a Five Year Plan that used to exist in the era of the Planning Commission. So, is NITI Aayog, the Union government or any other agency working towards communicating what you are all about to the people?

This is a slightly difficult question. If you look at our website, it has plenty of things now. We have ensured that a lot of information about what we do, how we do it is conveyed to the Press. The problem is that not everybody goes to the website.

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But we also have a significant presence on social media. I am not on Facebook, so I cannot comment on that medium, but NITI is. On Twitter, we have some 700,000 followers, and NITI constantly tweets about what it is doing.

If I talk of the state governments, the chief ministers, the chief secretaries and the finance secretaries generally know what NITI is doing. But I agree these are all selective segments. Where is the citizen?

There is the newspaper editor who frames public opinion; there is the news correspondent; I must also mention the vernacular press. Are we doing enough to disseminate what we do? The answer is “not yet”.

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Why not, say, talk to the HRD Ministry and ask it to include what NITI is in the school curriculum of civics? The children need to know what it is.

Fine, I take the point. But you must also appreciate that the Planning Commission was in existence since 1951. So, you are comparing an organisation that had existed since 1951 with an organisation that is a little less than two years old. It’s not a fair comparison. The process of transition does not happen overnight, but part of the solution lies in recognising that there is a problem. We recognise that there is a problem in dissemination of information. But the correctives cannot happen overnight; it is not binary in that sense.

I’ll give you a serious example. I get about 1,000 emails a day, with all the people writing to me as a member of NITI Aayog, not to the person Bibek Debroy. Tell me, what am I supposed to do with 1,000 emails a day. If I even read those 1,000 emails a day, I’ll be able to do nothing else. I am stating this on the record so that your readers appreciate the problem. If I ignore the emails, people will complain that NITI does not interact. Eventually, I devised a very mechanical response and instructed that the mechanical response should go out. But the person who is sending that email is not stupid. People can distinguish between a mechanical response and a proper one. So, now they want a personalised response, too! There must be some way of meeting this challenge; I do not know what it could be. I get requests from 20 people who just want to meet. I can’t meet as many people; I’ll then be able to do nothing else. Maybe I can meet a maximum of five people; the remainder 15 will complain “I don’t know what NITI does”. I am not defending it; I am just stating that there is a problem.

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