The Congress, in the best traditions of a party going into elections that will probably throw up a coalition government, has desisted from casting its economic reforms agenda in stone. It carries the ‘growth with equity’ theme from the previous government with the implicit assumption that policies will be tailored accordingly as it goes along. The bits and pieces that do emerge in the party’s manifesto include a revival of divestment (put in cold storage by the communist partners in the UPA); commitment to fiscal responsibility; a ‘new deal’ for small enterprise; and affirmative action for the underprivileged in private jobs. The pursuit of growth is left up in the air with a promise of “maintaining high growth with low inflation, particularly in relation to prices of essential agricultural and industrial commodities”.
The manifesto preserves its breath for its “inclusiveness” agenda. A raft of schemes that are a continuation of the UPA’s redistributive policies has, understandably, as their main focus the aam aadmi: a food security law, cheap power and health insurance for the poor, a higher minimum wage, interest relief for farmers, a more judicious land acquisition law, and comprehensive social security for vulnerable sections. Missing, oddly, is a commitment to developing the country’s infrastructure. The price tag for putting in place better roads, airports and bigger power stations is a jaw-dropping $500 billion. So far the UPA has cobbled together a mechanism to finance a puny $20 billion through India Infrastructure Finance Company. ‘Bijli-sadak-paani’ is as much a political issue as an economic one.
Rapid economic growth in the first four years of the outgoing government’s term provided it the space to fund its social spending agenda. That luxury has evaporated for whichever configuration comes into office this May. Restoring the economy to its long-term growth path will lay an overriding claim on national recourses. Smart management would require tying it in with our infrastructure and social security imperatives. The backlog of reforms, some of which cost not much more than political will, could keep mounting if parties find it difficult to commit them to paper. But our politicians will be well advised to keep in mind that economic restructuring has given the ‘Hindu rate of growth’ an entirely new meaning.