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DIALOGUE FOR CHANGE

“The Middle Class Needs To Be At The Forefront Of Reform Process”

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An engineer by training, Shantanu Bhagwat is a one-time diplomat turned venture investor and now advisor, to start-ups.

In a career spanning two decades, Mr. Bhagwat has worked across geographies and industries, including several years in Japan and in the UK. He is a personal investor in several start-ups in India, including Myntra– a personalised gift company, Innovitia – a cutting-edge start-up in transaction processing and Elements Akademia – an innovative national chain of vocational schools.

A graduate in Computer Engineering, Shantanu holds an MBA from London Business School where he was a Chevening Scholar.

These days he divides his time between UK and India, working with early stage companies and on ideas to improve political systems and governance in India.

Anshuman Rawat interviewed him via E-mail about his life as a political activist and his thoughts for a better governed India.

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When and why did you decide to cut down on your life of a global business professional and immerse yourself into ideas aimed at improving political systems and governance in India? At the same time, talking in management terms, does this earnest endeavour-of-heart include an intrinsic exit plan too?

The change happened in the early months of 2008. There were several triggers:

The first was probably the shameful perversion of democracy on the floor of the house on 22nd July. In response to my post on this subject, Sanjeev Sabhlok challenged everyone to either rise and do something about it or shut up.

That shook me to the core. It hurt, probably even more because it was true.

The second trigger were the blasts in Bangalore and Ahmedabad. Ironically, I had been to both these cities just a few days before. But strangely, it did not feel like I had cheated death.

Other events and things happening around me, helped make the decision…I watched with awe and fascination as the Obama campaign changed the paradigm of fund-raising in the US by reaching out at the grassroots…and I began to read about interesting experiments that were happening around “crowd-funding”.

The process was more complex and not quite as straight-forward as what I have outlined above. And of course NONE of this would have been possible without the whole-hearted support and commitment from my wife and family. Without her support, this would have been impossible to do. The whole story is here, for those of your readers who wish to read more about the background to this transformation.

As for an exit plan, there is no exit plan here.

The only exit is a better India – far better than what we have today – a better country with a healthy, prosperous populace that has its basic necessities covered and provides equal opportunities to progress to all its citizens. An India, where in the words of Rabindranath Tagore, “the mind is without fear and the head is held high…”

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How far is the political activist in you from becoming an active politician, one who fights elections i.e.? Or, do you believe that it is not necessary for the former to evolve in to the latter?

I believe the transition from being an “activist” into electoral politics is not a sharp, linear process (after all candidates fighting at elections are activists too).

I believe standing (up) for an election should be a carefully thought-through move and the culmination of a process that necessarily includes developing at least a basic understanding of the issues that plague us, developing an ideological paradigm to frame the issues and having some thoughts on how to confront the major challenges that face our nation.

I wish I could give you a time-frame for the transition but I am unable to.

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A lot of, what seems to be, your angst and earnestness comes out clearly in your blog Satyameva Jayate. Tell us a little about it, especially about its origin and the place it holds in your overall road-map of life from here on?

The story of the blog’s origin is here but very briefly it was a reaction to the feelings and emotions I felt following the attack on Indian Parliament in 2001 and several acts of terrorism since then.

I became convinced that we were fighting an enemy so deadly and so ruthless that our whole value system and the fundamental principles of humanity were at stake.  My early posts led some to the conclusion that I was a “Hindu fascist” – or more charitably, a “neo-conservative”. I am actually neither. I would like to think of myself as a liberal who is prepared to fight to defend his ideals, his beliefs and his principles.

The blog remains my main method of communication. It is my preferred medium for having a dialogue with my readers and expressing my opinion…I have learnt from it enormously…It has been a very rich, intellectually rewarding and deeply satisfying experience. It has also taught me a lot of things – such as patience and being careful with words. You can read more on my lessons from blogging here.

The blog continues to evolve but I believe it will remain an important part of my activities in the years to come.

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Apart from exchanging thoughts via Satyameva Jayate, what are the various ways in which someone can become an active part of your battle against status-quo– both on and offline?

The best way to engage online and become more active is to participate in the Skype conference calls. Live Chats and various events that I host and coordinate periodically.

A lot of events and meetings happen offline too (such as recent meetings in Thiruvananthapuram and Chennai in early December). Almost all of them find a mention on the Facebook page (under the events tab) .

Separately, I am working on an offline initiative that should help us get more active on the ground and increase our sphere of activities. Please stay tuned.

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In your lecture series, you have said that “the root cause of all problems in India is its dysfunctional middle class”. Can you please elaborate on that?

I think Kanchan Gupta put it best. In his article on “Three Myths and an Election”, he wrote  about a middle class that is: “least bothered about corruption in high places, the relentless loot of public money, the sagging physical infrastructure …the repeated terrorist attacks…”

I labelled it as “dysfunctional”. I could not think of a more apt description.

The middle class needs to be at the forefront of this process of change and reform…and I can see some signs of that happening around me. I am optimistic and I remain hopeful.

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Assuming that the rich have got no stake in changing the status quo and agreeing that it is unreasonable to expect empty stomachs to start a revolution, don’t you think that expecting the middle class to shoulder ALL is akin to making a general quota student sit for an examination not just for his own self, but also on behalf of the one who gets his seat on account of reservation and the one who wrests his seat via capitation money?

The analogy is compelling but not accurate. This is not an examination.

What we are attempting could make the difference between a country that survives, prospers & becomes a model for heterogeneous societies around the world and a country that is breaking apart, in the throes of a civil war, with woeful infrastructure and extremely restive population.

I am afraid that we really have no choice. As my friend Surendra Shrivastava of Loksatta mentioned in an email some days back: “We are not born politicians like many, we are in politics not by choice but because of compulsion”.

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How do you see the make-up and the present state of the Indian democratic landscape – both from the perspective of governance and the various political players?

It is depressing, to be honest – both from the perspective of governance as well as the various entities.

The Congress is a party run by a single family, that is increasingly devoid of any ideology and moving from one populist measure to the next.  The “Left” are on their way to becoming a footnote in India’s political system. And the BJP – although strongly differentiated on policies with the Congress – is unfortunately a confused organization that appears to be unwilling to focus and cannot make up its mind on priorities. It does not help that its leadership appears increasingly bereft of any moral superiority. That said, this is the group that appears to be most amenable to change.  The “Left” will find it hard to jettison their ideology – it is their raison d-etre after all and the Congress (I) will find it next to impossible to become a more “normal” party of several leaders, rather than just one unchallenged head.

About governance, the less said the better! Everything you see around you is  either broken, leaking or does not work. It is the result of poor governance – a large part of which is due to ineffectual leadership and bad choices (in terms of polices).

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Which aspects of the present political system, in your opinion, require urgent revision? How can that be brought about by people like you and me?

Let me briefly enumerate the aspects that need urgent revision and are do-able provided there is sufficient political will:

(a) Stricter monitoring of election expenses and make false declaration a cause for debarring from contesting for 6 years
(b) Mandatory disclosure of source(s) of income of candidates standing for elections
(c) Allowing citizens to vote anywhere in the country (not just permanent place of residence) – with appropriate identification
(d) Mandatory disclosure of audited accounts of political parties and expenses
(e) Constitutional amendment to remove clause demanding adherence to socialism

People like you and me can help create pressure for these changes – by talking about this, discussing these points and writing to their local newspapers, demanding these moves. There are a few other things that people like you and me can do:

(a) Demand accountability from our candidates (by evaluating them against the promises made in their election manifestos)
(b) Vote en-bloc for credible and transparent candidates
(c) Create pressure groups for campaign financing reforms and to reveal source(s) of income of candidates
(d) Push for the “Right to Recall

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Do you believe that rabid rise of language-induced regionalism (or sub-nationalism) in various Indian states stands endangers the very idea of India? In any scenario, in your opinion, how should we address the issue?

Yes it does. This worries me deeply although I sometimes feel I am in a minority who worry about the “Idea of India”.

I think this notion of identity – what it means to be an Indian – is a question we have never answered satisfactorily. And this is something that we grapple with even today, 60+ years after independence. This is the reason why the havoc caused by rains in TamilNadu does not find any mention in New Delhi just as the news about blockade of Manipur is hidden somewhere in the last pages of a “national” newspaper in Mumbai.

How does one address this issue?

The main thrust has to be on creating a sense of national identity – and promoting shared history through a national curriculum in history and the social sciences. There are a couple of other things that we should consider: Rigorous implementation of the three language formula and promotion and encouragement (including subsidies) to educational exchanges. This topic is far too complex to be dealt with in a few paragraphs though. I hope to have a online discussion on this soon.

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Finally, all the four pillars of Indian democracy seem to be facing credibility crisis owing to corruption scandals of varied nature. How can a ‘non-aligned’ (to any ‘pillar’ or security net) Indian citizen ever believe that he can not only survive the – often fatal – ‘chakraavyuh’ laid by the poisonous concoction of state & non-state actors, but also bring about a change?

We need to believe we can win this battle.

The road we are on is not for the faint-hearted. This is going to be a long battle.

In the words of Shri Chandra Prakash Dwivedi (Director of Chanakya, the serial):

पर ध्यान रहे,
स्वतंत्रता का यह यज्ञ यौवन का बलिदान मांगेगा, स्वार्थ का बलिदान मांगेगा…
और तो और,  जागृत हो रही रण-चंडिका जीवन का बलिदान मांगेगी |

…Bear in mind

The “yagya” of independence will demand sacrifices, it will demand the sacrifice of our selfish desires…And the fierce “Ran-Chandi” that is being aroused will demand we sacrifice our lives.

(loose translation)

But we need to believe we can win…And I firmly believe, we can.

Jai Hind, Jai Bharat!

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Anshuman Rawat
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Anshuman Rawat is an entrepreneur, journalist-editor, writer, filmmaker and communications specialist from India. His long-term ambition is to play a leading role in the “development and spread of social welfare-oriented media convergence in India”.

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DIALOGUE FOR CHANGE

Maneka Wants All Police Officers to be Re-Trained About Sexual Offences

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NEW DELHI: In a letter addressed to Chief Ministers of all the States/UTs, Smt. Maneka Sanjay Gandhi, Union Minister for Women and Child Development has outlined various steps to be taken by the States/UTs in preventing and curbing the crimes against women and children. Some of the steps mentioned in the letter are:

  1. All police officers should be re-trained on various aspects of sexual offences particularly those related to collection and preservation of evidence.
  2. Instructions may be issued to all police officers that utmost priority is to be given to complete the investigation of cases of sexual offences against children strictly as per the timelines of Law.
  3. State Governments must take strict action against those police officers who are found to be obstructing the investigation or colluding with the perpetrators of such cases.
  4. A quick and timely professional investigation is the only method in which a potential offender can be deterred but this can be done only by the states as the police department is the state subject. Forming a special cell only for sexual offences or especially for sexual offences on children would be a significant step in this regard.

The Women and Child Development Minister offered help to State Governments in establishing Forensic Laboratories in states which can be used for forensic analysis of evidence in the investigation of sexual offences.

The WCD Minister has requested the states to generate awareness among the children in using the e-box set up under POCSO with child-help line number 1098.

The Minister also highlighted that till date 175 One-stop centres for women affected by violence have been set up by the Ministry of Women and Child Development.

One Stop Centres are to help those women who have no access to either police or medical facilities or are not able to visit a police station in times of distress.

The letter also stressed that Section 21 of the POCSO Act may be invoked in all cases wherever failure to report or record is noted. Section 21 states that any officer who fails to report or record the commission of an offence under section 19/20 of the Act is liable for punishment.

The WCD Minister called for suggestions from the state Governments on dealing with the crimes against women and children.

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DIALOGUE FOR CHANGE

Can India Make a Universal Basic Income Work?

According to the Economic Survey 2016-17, universal basic income may prove to be a more effective antipoverty intervention than India’s largest welfare schemes.

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According to the Economic Survey 2016-17, universal basic income may prove to be a more effective antipoverty intervention than India’s largest welfare schemes. Discussing the Survey’s proposal, Saksham Khosla contends that while it deserves praise for bringing substantial rigour to the UBI debate, thrusting the issue into the national spotlight, and prudently concluding that the time has not yet come for implementation; its central design features offer a weak foundation for implementing UBI.

The idea of a universal basic income (UBI) – periodic and unconditional cash payments to all citizens – has gained renewed attention amid growing concerns about technological unemployment1 in advanced economies. More recently, economists have made the case for a UBI in the developing world, where cash transfers distributed to all citizens, rich and poor, may cut through layers of red tape and lead to outsized gains in poverty reduction.

In India, a rapid expansion of direct cash transfers linked to the national biometric database and small basic income experiments have galvanised an extensive debate on a UBI. Supporters claim that no-strings-attached payments will be an effective antidote to India’s underperforming antipoverty programmes and leaky, distortionary subsidies. Critics worry that they will undermine an already-fragile social security architecture, cause workers to drop out of the labour force, and encourage wasteful spending.

The Economic Survey 2016–17 provides the most exhaustive treatment thus far of implementing an Indian UBI. It finds that India’s largest welfare schemes are poorly targeted; in comparison, it argues that a UBI distributed directly into bank accounts will limit pilferage, be easier to administer, and prove a more effective antipoverty intervention.

The Economic Survey deserves praise for bringing substantial rigour to the debate, thrusting a UBI into the national spotlight, and prudently concluding that the time has not yet come for implementation. However, should future Indian policymakers wish to implement a UBI, the Survey’s central design features offer a weak foundation. If enacted upon without deeper analysis, debate, or sufficient evidence demonstrating improvement in development outcomes, the Economic Survey’s blueprint for an Indian UBI will produce underwhelming results.

The Economic Survey’s Proposal:

A UBI, according to the Economic Survey, has three key characteristics: every citizen receives cash payments, these payments are unconditional, and each individual is free to spend these funds as they wish. The Survey marshals a number of common arguments in favour of a UBI. It contends that a UBI can maximise social justice by giving each individual ownership over a share of the country’s collective wealth. The Survey asserts that cash transfers are less paternalistic than in-kind assistance and empower India’s poor to make economic decisions as they see fit. As employment growth becomes more uncertain, the Economic Survey suggests that a guaranteed basic income can help ensure that citizens enjoy a basic standard of living. Finally, by making use of the JAM2 3(Jan Dhan, Aadhaar, Mobile) trinity, a UBI would inject administrative efficiency and transparency into a welfare system “riddled with misallocation, leakages and exclusion of the poor.”

This last point forms the bedrock of the Economic Survey’s case that a UBI is a potential poverty-fighting tool that can perform significantly better than the country’s 950-odd centrally-sponsored schemes (and scores of other state-level programmes). To evaluate the targeting efficiency of India’s current welfare spending, the Survey used administrative data on public spending from 2015–16 and population data from the 2011–12 round of the National Sample Survey (NSS) to construct ‘heat maps’ of poor households in each district and the amount that each district spent on the six largest welfare schemes. The results depict the striking extent of misallocated welfare funds: districts where poverty is most prevalent – in states such as Bihar, Chhattisgarh, Madhya Pradesh, and Uttar Pradesh – tend to be given the fewest financial resources. The districts where 40% of India’s poor reside get only 29% of this total funding.

The Economic Survey argues that a UBI would be an effective antidote to these capacity limitations. A transfer from the exchequer to individual bank accounts would be a relatively light administrative burden, and one that could conceivably eliminate rent-seeking and downstream pilferage. Moreover, in a universal system, the rate of exclusion from receiving benefits would systematically decline.

Features:

• The Survey estimates that an annual transfer of Rs. 7,620 (US$120) to 75% of India’s population will push all but India’s absolute poorest above the 2011–12 Tendulkar poverty line.
• The Survey puts the cost of such a scheme at 4.9% of India’s gross domestic product (GDP). It finds that a budget-neutral transfer can only materialise after existing programmes are withdrawn. In 2014-15, India’s major fertiliser, petroleum, and food subsidies cost 2.07% of GDP, while the 10 largest central welfare schemes cost 1.38%. So-called middle-class subsidies (that primarily benefit the better-off citizens) such as those on railways, aviation fuel, gold, and electricity, add up to nearly 1.1% of GDP.
• Arguing that true universality will be politically and fiscally costly, the Survey advises paying out the grant to all but the top 25% of India’s income distribution. It suggests several ways of preventing the wealthy from availing the grant, including proxy-means tests, voluntary opt-out, community sanction, self-targeting, and targeting demographic groups.
• The Survey also noted that universal financial inclusion, in combination with the Aadhaar3 authentication system, forms a prerequisite to send transfers directly to beneficiaries’ bank accounts. A UBI can only be financed if policymakers can hammer out an expenditure-sharing formula for central and state governments.

Any meaningful analysis of the UBI proposal must grapple with several assumptions and prescriptions that compel deeper scrutiny, and others that warrant active contestation. In particular, these include the semantic oddity of a “quasi-universal basic income,” the Survey’s inconsistent treatment of the merits of targeting welfare benefits and India’s flagship anti-poverty programmes, and its limited imagination when estimating the impact of removing existing welfare schemes. Other important matters to explore are the Survey’s insufficient engagement with non-cash-based poverty interventions and its inadequate acknowledgement of the current implementation deficit of the Direct Benefit Transfer (DBT) programme. As the debates around the idea of an Indian UBI mature, these questions should be first in line for answers.

Bugs:

• The proposed transfer is less an income and more an income supplement. The Tendulkar line has been criticized for being too conservative an estimate of consumption and expenditure. The Survey’s calculations incorporate neither the loss of consumption from withdrawing major existing welfare programmes to finance a UBI, nor the transaction and transition costs of moving to a welfare system dominated by cash transfers. Taking these factors into account is likely to result in an upward revision of the transfer amount and associated fiscal burden.
• The survey is unjustified in presenting India’s largest welfare schemes as candidates for replacement. Several such programmes are intended to achieve long-term development goals and cannot be simply substituted by cash transfers. In addition, India’s national food distribution and public works programmes, which the Survey singles out for their high levels of misallocation and leakage, have improved significantly over the past decade in terms of their coverage and targeting efficiency.
• By discarding universal coverage, the survey leaves the door open for inefficient means-testing. Targeting performance can vary quite widely, and any savings generated thus can be offset by high administrative, private, social, and political costs. If targeting must be instituted, universal transfers among clearly defined vulnerable groups offer a tentative answer to this dilemma.
• An exclusive reliance on Aadhaar-linked welfare payments is short-sighted. Pilot evaluations of direct benefit transfers have found significant room for improvement in last-mile delivery, the size of the subsidy, and grievance redressal, even as authentication failures and exclusion errors due to Aadhaarpersist. Significant progress remains to be made before large-scale Aadhaar-linked transfers can be trusted to reach recipients.

Pricing Experiments:

Rather than relying exclusively upon the Survey’s proposed methods for financing, targeting, and distributing a UBI, Indian policymakers should join their Finnish and Canadian counterparts in running one or several large-scale experimental evaluations. There is much reason to believe that in India, too, a randomised control trial (RCT) of sufficient length (ideally, more than five years so as to resist electoral pressures), administered by a state government and evaluated by an independent authority, would galvanise awareness and help clarify several of the deep knowledge gaps around the implementation design and political economy of a UBI. By determining the impact on both the government (State and fiscal capacity) and citizens (economic and social outcomes), such trials can generate new empirical evidence to inform the growing UBI debate and reveal the most effective role for unconditional transfers in India’s welfare architecture.

Conclusion:

For all its acuity and painstaking effort in defining the contours of the problem, the Economic Survey’s prescription is flawed both in its proposed design and implementation. Far from what is needed to realise its ambitious vision, the Survey proposes a cash transfer with a dubious ability to compensate beneficiaries for the transition costs of moving to a new system, and one that would be financed by an indiscriminate culling of existing welfare schemes. Examining the existing literature on targeting approaches, necessitated by the survey’s emphasis on “quasi-universalism”, reveals that their impact on efficiency and cost-effectiveness can vary greatly based on administrative capacity, imperfect information, and unintended costs. The benefits of finer targeting can often be achieved at lesser cost by expanding coverage of in-kind benefits or providing uniform transfers contingent on a simple set of transparent, verifiable criteria, if not untargeted and uniform transfers. There is also the very real possibility that both national and regional politics may distort the original intent and value of a UBI into a scheme indistinguishable from India’s DBT regime, which suffers from its own implementation deficit, compounded by the unresolved concerns surrounding the Aadhaar framework.

The uncertainty about the design choices (which go beyond targeting to include the duration and frequency of transfers) and the political feasibility of a UBI emphasises the need for an Indian UBI pilot of sufficient length to test the impact of introducing regular, unconditional, universal cash transfers. A basic income trial implemented by a state administration (or several, such as the variety of municipal tests underway in the Netherlands) to accurately mimic real conditions, with an independent organisation running a large-scale experimental evaluation, would generate the hard evidence that the empirical and political discourse around an Indian UBI gravely needs before it can graduate from academic conferences and opinion pages into parliamentary debate and legislation.

It is also important to be clear-headed about the virtues of evidence. Instituting a UBI requires public support spanning demographic lines, executive backing, and strong macroeconomic fundamentals. Weaken any leg of this tripod, and the redistributive preferences of any government may shift in favour of traditional welfare support and focusing on economic growth. And even if an experiment were to yield spectacular results, the financing question is key.

If practicalities dictate that India’s tenuous social protection framework be sacrificed at the altar of a basic income, then it would turn quickly from manna from heaven to actively undermining the Indian social contract.

None of these objections forms an insurmountable obstacle toward one day implementing a clean, well-designed UBI that simultaneously empowers Indian citizens and strengthens the Indian State. Some of them may even lose their edge if India can fill the evidence gap around such policies and build administrative muscle by recasting its systems of public financial management and tax collection, with accompanying reforms to boost digital payments and financial inclusion.

In 1961, Nehru wrote to India’s chief ministers that “It is generally recognized now, even by our critics in India or abroad, that we plan well and we lay down the most excellent of principles. The difficulty comes in implementation.” Unless both the policy’s critics and supporters undertake a concerted effort to better address the above discordances, India’s UBI will meet the same fate.

This is an edited excerpt from Saksham Khosla’s recent Carnegie India report, ‘India’s Universal Basic Income: Bedeviled by the Details’, which can be read in full here.

Notes:
1. Technological unemployment is the loss of jobs caused by technological change.

2. Jan Dhan Yojana is the National Mission for Financial Inclusion to ensure access to financial services, namely banking savings and deposit accounts, remittance, credit, insurance, and pension in an affordable manner. This financial inclusion campaign was launched by Prime Minister Modi in August 2014.

3. Aadhaar is a 12-digit individual identification number issued by the Unique Identification Authority of India (UIDAI) on behalf of the Government of India. It captures the biometric identity – 10 finger prints, iris and photograph – of every resident, and serves as a proof of identity and address anywhere in India.

Disclaimer: The facts and opinions expressed in this article are strictly the personal opinions of the author. League of India does not assume any responsibility or liability for the accuracy, completeness, suitability, or validity of any information in this article.

Published with permission from Ideas For India (www.ideasforindia.in), an economics and policy portal.

Saksham Khosla

Saksham Khosla is a research analyst at Carnegie India. His research focusses on the political economy of administrative, economic, and welfare reforms in India. Previously, he was a junior fellow in the South Asia programme at the Carnegie Endowment for International Peace in Washington, DC.

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DIALOGUE FOR CHANGE

Maneka Gandhi to Ask for Death Penalty for Child Rape

Maneka Gandhi said her Women and Child Development Ministry would move a cabinet note on April 16 to amend POCSO.

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NEW DELHI: Amid nationwide grief and anger over the gang-rape and murder of an eight-year-old girl in Jammu and Kashmir’s Kathua, there is a move to change the law for sexual crimes against children to bring in the death penalty for child rape.

Women and Child Development Minister Maneka Gandhi declared it in a video message in which she said she was “deeply, deeply” disturbed by the Kathua rape case.

Maneka Gandhi said her Women and Child Development Ministry would move a cabinet note on April 16 to amend POCSO, the Protection of Children Against Sexual Offences Act.

The Union Minister was referring to the case of an eight-year-old girl in Kathua, Jammu, gang-raped in January by a group of men, including a juvenile.

WCD secretary Rakesh Srivastava said they will send a proposal seeking an amendment to the law ministry soon.

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