Wednesday, December 18, 2013

The best few lines I read today..


From Pratap Bhanu Mehta in today's Indian Express: "A sleepwalking economy"..


...The third fatalism comes from an excessive faith in deliverance by a leader. The complete abdication of responsibility by the top leaders of the Congress has sowed the seeds of confusion. It is also true that the institutional chaos in the wake of the corruption scandals has slowed down some sectors. But it does not follow that a single leader can come and fix this. For one thing, there is no evidence yet that the current opposition party has anything sensible to say on macroeconomics. And what Narendra Modi does in fact say on a range of issues of fundamental reform, from FDI to the value of the rupee, is not very reassuring. He also distinctly seems to lack control of his parliamentary party, which is busy putting its weight behind all kinds of half baked laws, including the Lokpal Bill. But it has little time to intelligently talk about the economy.
Admittedly, administrative decision-making at the top will help. But it will get you only so far. Cleaning up the institutional mess on a range of things from contracting to environmental clearances will be a huge task. The UPA's legacy of institutional corrosion is so deep in these areas that rebooting them will not just be a matter of one man's will to give orders. It will be setting new norms. Indeed, the big worry is that the system will again risk wheels getting stuck in the sand if new norms are not institutionalised. While there is some discussion of institutions to tackle corruption, there is very little about institutions to promote growth in a new context.

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