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Tuesday, 04 December 2012 00:46
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From Nilekani to Gulati, innovative solutions

Though there have been many criticisms of the Aadhar-based cash transfers, right from the you-haven’t-got-the-numbers to they’ll-waste-the-money-on-booze, and many more including the disastrous Kotkasim pilot in Alwar, there can be little doubt the scheme represents a quantum leap in government thinking. And implementation. To be sure, the idea of cash transfers has been around for a long time, but it was never clear how it was to be implemented. This is where bringing in Nandan Nilekani proved to be a game-changer since, not only did he come up with an architecture to make it happen, he managed to dampen most fears about data theft with a unique project design. This was then followed up with innovative thinking on how to make UIDAI a demand-pull project (getting RBI to accept it for KYC was one such step, as was getting DoT to accept it as legitimate subscriber verification) and managing to cut through a lot of bureaucracy by getting different line ministries to allow proof-of-concept pilot projects.


In a similar manner, getting well-known agriculture economist Ashok Gulati to head the Commission for Agricultural Costs and Prices (CACP) seems to have paid rich dividends. Gulati’s initial hikes in minimum support prices (MSPs) have attracted a lot of criticism, including from this newspaper, for their inflationary impact (Gulati insists, though, inflation is the lowest in precisely those products that have MSPs), but he has other tricks up his sleeve. And even on the question of hiking MSPs, Gulati may have a point if production of coarse grains for which MSPs have been raised start rising. Of late, Gulati has been in the news for a variety of other reasons. For one, he’s been taking on the government for how it is killing both the private grain trade and the fisc by its open-ended procurement policy—according to Gulati, the government has food stocks around thrice what it needs and that, in turn, is adding R1 lakh crore to annual budget costs. He’s had some success in convincing state governments to start thinking about giving per acre subsidies as opposed to, for instance, large subsidies on wheat in Madhya Pradesh, which end up distorting crop patterns. Most important is the attempt to get Punjab to once again think of moving away from wheat, which has depleted the water table beyond acceptable levels, through an infrastructure-style viability gap funding. Gulati claims he’s been working on getting the government to accept the idea of not banning exports—the huge wheat glut is a result of a four-year ban—and going in for export taxes instead.

While we’ll get to know if that’s worked when the next export policy comes out, the experience of both Nilekani and Gulati reiterates the fact that inducting good professionals, and empowering them, is always a good idea.


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