NITI Aayog and the emperor’s clothes

Live Mint, April 10, 2017

By Pradeep S Mehta

Instead of letting the government set the agenda, NITI Aayog needs to inform the government of its failings
About 180 years ago, in 1837, popular Danish author Hans Christian Andersen wrote the famous short story, The Emperor’s New Clothes. The story reminds us of the duties of advisers to the king, who are expected to present a clear picture to the king, and give fair and frank advice, without fear or favour. It is pertinent to revisit the story now when the Narendra Modi government is celebrating three years in office.

One of the key decisions taken by the government on assumption of office was to dismantle the Planning Commission, and replace it with a new body, the National Institution for Transforming India (NITI) Aayog. NITI Aayog was expected to act as the principal government think tank and adviser to the Prime Minister on key policy issues, which can really transform India.

Expectations unfulfilled

The Planning Commission was a non-legislative body, with significant powers to allocate finances to states, but marred by bureaucratic processes and devoid of fresh thinking. It failed to keep its ear to the ground, and did not take into account the divergent demands and capacities of states. The creation of NITI Aayog was expected to be a game changer, to infuse new vigour and rigour in the policy planning process, involve key stakeholders, and address the failures of the previous plan body. One anticipated that it would prioritize the challenges faced by the economy and hit the ground running to address them in a transformational manner.

During the last two-and-a-half years, NITI Aayog has worked on several agendas, such as the promotion of digital payments, reforms in agriculture, education and railways, helping states undertake social sector reforms. While all these issues were important, and the suggestions made by NITI Aayog critical, it appears that the institution’s agenda and priorities are being set by government diktat rather than an organic, independent thought process. Often, it risked acting as a government mouthpiece and failed to be the transformational catalyst that many, including Prime Minister Narendra Modi, wanted it to be. For instance, while recognizing the importance of competition, it walked with the government on promoting digital payments through select entities, and kept mum when government policies distorted competition.

NITI Aayog is yet to institutionalize a checks and balances mechanism to caution the government about the claims it makes, and apprise policymakers of the ground realities. While there have been a few exceptions, like Bibek Debroy’s suggestion on taxing farmers’ income, which challenged the government’s stand on the issue, such instances have been rare.

Pradeep S. Mehta is secretary general of CUTS International, Jaipur.

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