Needed: Reforms for the poor

The new (old) government is back. The question is if it has learnt its most important lesson: How to join its political agenda to the agenda of government. 

Let me explain.

It was not the Indo-US nuclear deal which won the Congress Party the elections. It was the National Rural Employment Guarantee Scheme, which provided employment to people, gave them cash to survive drought or a flood.

Similarly, it was not the ecstasy of the stock market, the opening of the retail sector or the grandiose special economic zones that won the day. This government was re-elected -- as its leaders reminded people in their rallies -- because it gave better prices to farmers, wrote off loans and gave tribals and other poor forest dwellers rights over their land. 

In other words, it got elected for all the 'wrong' reasons, as the reformists put it. Now the reformists have already made it clear: They want to divorce politics from governance. They want 'populist' measures -- good to win votes and rally people -- out of the way. Already, corporate leaders have taken over the airwaves to hammer in the market reform agenda. The people appear to have been forgotten already.

So are we in for another interregnum between elections when the government will focus on the 'real' agenda of the corporate world and forget the issues that got it the votes? Or will this second-term government grow up and understand good politics is also good governance? 

After all, this is a time the entire free-market loving world is learning greed is not so good, and that a corporate-driven agenda creates havoc. In these times, we also need a new growth model, driven by resilience and sustainability.

This is a time to be different. Instead of focusing on past bankrupt ideas -- disinvestment in the public sector; foreign direct investment in retail; privatisation of insurance, banks and pension funds -- we can think of strategies that combine the needs of all with growth for all. 

Take the example of the NREGS, dismissed as a corrupt, inefficient programme. The fact is that this scheme is no different from what the rich world is today re-discovering in the name of Keynesian public investment-driven recovery programmes. It invests public funds to create public assets with the labour of poor people. The opportunity lies in using such labour to build assets: Drought relief for relief against drought, for instance.

Today, the NREGS is already the world's biggest ecological regeneration effort -- just under a million water bodies being dug, desilted or renovated by people. Now we must make sure these water bodies are not just holes in the ground, but will capture the next rain and recharge the aquifer.

It is possible. Doable. People's desperation and demand for work, already recognised, must now be converted into a demand for development. People will use their labour to put their village regeneration plans in order and then build their own durable assets. This is not possible without giving people rights over their resources -- their local forest and water resources. This is the 'reform' the top leadership must believe in and back.

Another big-ticket concern is dryland and rainfed agriculture.

Most of India today, after years of independence and public investment in surface irrigation structures, remains dependent on increasingly variable rain. Today, our policies discount and destroy these local economies; tomorrow, our strategies must build on their strengths.

For instance, fiscal policies must recognise crops that minimise the use of water -- more crops per drop -- and include 'coarse' cereals in the Public Distribution System. Simultaneously, we must build local water security to enhance productivity. We must do this not by increasing the cost of cultivation but by reducing costs and investing in resilience. 

The third challenge is to invest in building employment opportunities for the future. But this will demand recognising jobs where we do not see they exist.

Currently, all our policies push for organised business, in retail or in manufacturing. But we forget this business is not labour-intensive and tends to collapse like a pack of cards when the world sneezes. We need employment which is domestic, built on multiple opportunities and comprises millions of enterprises.

The next reform must be in education and health -- reinvent ways to ensure the systems are efficient, but also affordable and accessible by all. We also know private investment will not flow into these sectors, which, being about the poor, are not profitable. So, we will have to do things differently, without dogma, but with the idea of reform for the poor who voted this government to power. 

Postscript: Remember, corporate India had anointed Gujarat chief minister Narendra Modi as their prime minister. They had dumped this government and its prime minister. This government is in power not because of them, but because of the blessings of the poor. This trust must be kept. It is time to be different.