Editorial

The maiden Union budget of the Congress-led United Progressive Alliance government presented to Parliament by Union finance minister P.C.Chidambaram on July 8 provides considerable satisfaction to us in EducationWorld. Right from day one since this publication was first offered to an indifferent public, EW has been pressing for the redemption of the half century old pledge to raise the annual outlay for education to 6 percent of GDP (gross domestic product) and the creation of a dedicated special fund for the expansion and upgradation of the nation’s moribund elementary education system. Simultaneously we have been pressing for a new deal for mass suicides prone rural India, wholly bypassed by the economic liberalisation and deregulation initiative of July 1991.

Fortunately both these historic aberrations which have torpedoed the national development effort and sentenced hundreds of millions of children and citizens of independent India to nasty, short and brutal lives, have been addressed in this historic and conscience-driven Union budget. Though the annual outlay for education will be progressively — rather than immediately — raised to the promised 6 percent of GDP, the imposition of a 2 percent cess on all Central taxes to swell the annual allocation for elementary education is an overdue initiative which should be welcomed by all right-thinking citizens.

Likewise the package of detailed proposals in the Union budget to stimulate a great leap forward in the cruelly neglected agriculture sector where mass self-destruction by despairing farmers is assuming epidemic proportions, is long overdue. As has often been stressed in these columns, an economy which tolerates almost 70 percent of its population scratching out a stone-age existence without meaningful education, healthcare or food security can never attain developed nation status. It’s astonishing that the reputedly intelligent Indian establishment hasn’t quite grasped the simple proposition that a modestly prosperous rural hinterland offers Indian industry perhaps the world’s largest market for goods and services.

But while the diagnosis of the Indian economy articulated in the Union budget proposals for fiscal 2004-05 is accurate even if belated, the major impediment to sustained orderly growth is the nation’s 20 million-strong bureaucracy which has consistently failed and neglected to translate plans and statements of great intent into workable initiatives at the implementation level. The late prime minister Rajiv Gandhi’s famous observation that barely 15 paise of every rupee allocated to projects dedicated to the upliftment of the poor and dispossessed actually reaches them, has been much recalled in recent days. And that’s the Achilles heel of the Union budget 2004-05. The mission of fulfilling the overdue top-priority programmes to deliver "quality basic education" to all children in languishing government schools and to provide a package of regenerative services to rural India has yet again been entrusted to the withered arm of the bureaucracy, feebled by decades of corruption and rot. Neither the Union budget speech of the finance minister nor the torrent of informed comment it has precipitated provides any worthwhile suggestions as to how this Gordian knot is to be undone.

Therefore immediate supplementary measures need to be initiated to ensure translation of the conscience-driven proposals of the Union budget into actionable programmes at ground zero level. Constraints of space and time don’t permit detailed proposals to realise the aims and objectives of the elementary education and rural regeneration programmes in this column. However some broad guidelines which could — and should — be converted into action plans by the vast bureaucracies of the Union and state governments and the 28,000 employees of the Planning Commission are in order.

One of the major lessons that the education bureaucrats of HRD ministries at the Centre and in the states should have learned but haven’t, is that the prime administrative authority for the effective delivery of elementary education has to be the local authority — municipal corporations and village panchayats. Though given the continuous withering of the arm of the state there is no guarantee that local governments will be more efficient in delivering quality basic education, the reality that they are situationally closer to targeted beneficiaries and local communities make them the lesser evil. They are likely to prove more amenable to control and supervision by watchdog committees made up of local communities, NGOs and state governments.

Likewise the regeneration of rural India requires structural administrative reforms rather than the throwing of additional money at its problems. As the celebrated Peruvian economist Hernando DeSoto has perceptively observed, the great majority of ‘poor’ farmers in the developing nations of the third world are not in reality worthless in terms of assets. Their poverty is due to their lack of title documents to land which disables them from raising money against it and/or selling it at profit. Therefore it’s all very well for the finance minister to promise to double credit to the farm sector. But this initiative will remain a dead letter in a society in which two-thirds of the population is illiterate unless all paperwork related to banking transactions is drastically simplified.

Instead of sinking ever larger allocations into the black hole of venal state-level bureaucracies, a more rational expedient would be to transfer the onus of preparing land and property titles to chronically under-employed state government servants and the completion of bank paperwork including the filling of deposit slips and loan applications, to bank employees. Greater interaction between government and bank officials would not only secure bank advances but would also transform dead rural land assets into marketable real estate. Naturally all paternalistic legislation which impedes the easy marketability of rural land needs to be abolished.

Despite the fact that defence expenditure has been raised by a difficult-to-defend 18 percent to Rs.77,000 crore, after balancing the credits and debits, the budget presented to Parliament on July 8 is a landmark in the nation’s socio-economic history. For the simple reason that it unequivocally accords priority to the vital needs of the largest and most neglected segments of the population — children and farmers. True there is a real possibility that it may not be able to deliver its central promises. But acknowledgement of grievous mistakes of the past and forthright commitment to deploy the instruments of state power to realise the greater good of the greatest number is the most outstanding characteristic of Union budget 2004-05.