The new government in New Delhi will take charge at a time when the geopolitical winds are blowing in India’s favour. The Sino-American trade war has made it increasingly attractive for companies to invest in emerging markets outside the Chinese sphere of influence. India’s large market is an added attraction.
Will the new government be able to seize the moment? A lot will depend on how far the government succeeds in upgrading the plumbing of the Indian State. If the big challenge in 1991 was to get an overly intrusive State out of the lives of people and businesses, the challenge now is to make it deliver critical lines of support to people and to companies.
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Be it negotiating trade deals or monitoring communicable diseases, the Indian State often fails to deliver where it is needed most. The lack of State capacity is “the major binding constraint” to national progress today, the economist Karthik Muralidharan argues in his recent book, Accelerating India’s Development.
The Indian State’s overreliance on a generalist and clannish civil service cadre is a big part of the problem. The Indian civil service took shape during the British Raj, when a small team of elite administrators controlled an extractive “security state”. As the Indian State took up a developmental role after Independence, the colonial-era civil service came under strain.
To some extent, the strain was mitigated by the entry of specialists in key ministries. Scientists such as Homi Bhabha, statisticians such as PC Mahalanobis and Pitambar Pant, and economists such as KN Raj and IG Patel began frequenting the corridors of power. India’s first Prime Minister, Jawaharlal Nehru, wanted to subjugate civil servants to the “superior rationality of scientists and economists”, the political scientist Sunil Khilnani has argued.
The civil service wasn’t very welcoming of expert advice. As the Planning Commission chief DR Gadgil observed in a 1968 lecture, “new elements of specialists or managers of business” ranked low in prestige and authority. Gadgil identified the incompetence of the generalist and the “degradation and frustration of the experts and specialists in government service” as key reasons behind governmental failures.
In the Indira Gandhi era, loyalty came to be valued much more than competence. In his memoirs, Patel recounts how Nehru helped him on a personal matter “without making him feel any sense of obligation”. For Gandhi, “nothing was by merit, and everything had to be a favour granted by her”, Patel wrote in Glimpses of Indian Economic Policy. When the Indian Civil Service (ICS) and Indian Administrative Service (IAS) lobbies opposed Patel’s promotion as secretary to the department of economic affairs in 1967, Gandhi hinted that she could weigh in his favour. In return, she expected unquestioning loyalty. Patel refused to take the bait and had to serve as “special” secretary for two years before that adjective was dropped from his title.
Compared to the first three decades after Independence, levels of integrity and neutrality in the civil service are much lower today, a 2017 essay by civil servants KP Krishnan and TV Somanathan said. Politicians have learnt to use a mix of carrots (post-retirement extensions and postings) and sticks (transfers and arbitrary demotions) to reward loyalty and punish dissent, the duo argued.
Frequent transfers of IAS officers means that “nearly every incumbent is on the learning curve in nearly every post,” Krishnan and Somanathan wrote. The system of frequent transfers was designed in the colonial era to keep administrators distant from the population and feel less guilt about their extractive role, Muralidharan argues. In modern India, this system is counter-productive.
Given their lack of domain knowledge, civil servants have turned to external consultants for input. However, these consultants have less authority and influence compared to the specialists of the Nehruvian era. Temporary hiring is also a short-term fix. Over the long-run, it may even undermine investments in State capacity. “The widespread reliance on external consultants both reflects and contributes to the long-term atrophy of core state capacity in India,” writes Muralidharan.
Any agenda for upgrading State capacity must focus on how civil servants are hired and appraised. Rather than hire civil servants for a lifetime, the Union Public Service Commission (UPSC) could hire them for a fixed term (of say 10-15 years) and appraise them after that term is over. This would ensure that below-average performers are retired from service with a golden handshake. Above-average performers could be provided training in their chosen areas of specialisation and posted accordingly.
Senior positions in the Union and state governments could be fixed-term contracts, with stringent norms put in place to guard against premature transfers. Even if the recruitment process is handled by the UPSC, private sector executives and specialists should be allowed to compete for such posts. A well-designed acclimatisation programme could help such lateral hires find their feet in government.
The Union government has taken baby steps to induct lateral entrants in recent years. But unless such entrants are posted in large numbers across ministries and departments, they will have to struggle hard against the entrenched bureaucracy. If the Indian State is to meet 21st-century needs, it will need an ample supply of fresh thinking and knowledgeable personnel.
Pramit Bhattacharya is a Chennai-based journalist. The views expressed are personal
