Skip to main content

Panagariya was "unhappy": Modi govt was slow on privatization, babus displayed overbearing presence

Arvind Panagariya with Modi
By Rajiv Shah
Did Niti Ayog vice-chairman Arvind Panagariya, a renowned economist and a close follower of free market wizard Jagdish Bhagwati, resign from his powerful post because he was unhappy with the Narendra Modi government’s “slow” movement towards privatization, his favourite thrust? It would seem so, if what he said two days earlier (July 31) is any indication.
In an interview he gave to a top financial daily, Panagariya said, the Government of India wasn’t moving fast enough on his proposals for privatizing public sector enterprises (PSEs), even though the proposals for closing down sick units have progressed well.
Panagariya, who is professor of economics at the Columbia University, where Bhagwati is also based, said, though the Niti (full form National Institute for Transforming India) Ayog had proposed and the Cabinet “approved” privatization of 17 PSEs, and “some progress has happened”, and “even advisors appointed” in some cases, “in terms of actual sales we have had none.”
Pointing out that while on “closure of sick units” progress is “very good” with 15-20 units being in advanced stages of closure, he said, as for privatization, “progress has been slower”, and the only “major development” has been the move towards privatizing Air India.
Even here, said Panagariya, the matter is currently with the group of ministers, which has yet to decide on “whether 100% of Air India is to be privatised or the government is going to keep some stake”, and “what will be the extent of foreign investment to be permitted and what part of the existing debt will be assumed by the government.”
Meanwhile, sources suggest, the man who strongly opposed quick movement towards privatization was none other than Amitabh Kant, who was appointed as CEO of Niti Ayog, and had begun working as a parallel centre of power.
IAS officials, who know Kant well, have told Counterview, Panagariya’s assertion that “bureaucrats are very important” in India in all decision making suggests the top economist’s dislike for the way Kant was functioning.
A senior IAS official said, “Kant knew pretty well where his interests lie, and could sense the political direction the country would take. Earlier close to the Congress, particularly Sonia Gandhi’s political adviser Ahmed Patel, Kant, who belongs to the 1980 IAS batch, was picked up as CEO of the Delhi-Mumbai Industrial Corridor (DMIC).”
Modi's site praised Amitabh Kant in January 2013
However, said this official, Kant sensed where the winds were blowing as early as 2013, when he came to attend the Vibrant Gujarat business meet under Narendra Modi, then Gujarat chief minister. “Though still under the UPA, he declared the need for a dynamic leader like Modi to lead the country”, the official quoted him as saying, which brought Kant “very close to Modi”.
Modi’s website, in fact, chooses Kant as one of the top CEOs who had participated in the 2013 Vibrant Gujarat meet, praising him for saying, “Gujarat is creating jobs, driving manufacturing and urbanization. In Dholera a new ultra-modern City will come up. The credit goes to the Gujarat team and the dynamic leadership of Shri Modi.”
While Kant was clever enough not to reveal his dislike for PSEs in particular and the government sector in general, Panagariya had made known his views. A top site owned by a powerful business houses quoting the latter to say that he was “against subsidised food and goods, he wants the NREGA to be shut down, he prefers privatisation of public health and education, and he wants new labour laws so that companies can hire and fire at will.”
Panagariya has been quoted as saying in the prestigious journal “Foreign Affairs” as saying, “Labor laws relating to industrial disputes, trade unions, apprenticeship, pensions, provident fund, and insurance have been the major obstacles to the entry of large formal-sector firms into low-skilled labor-intensive industries.”
“Their effect has been reinforced by the absence of proper bankruptcy laws that would allow firms to close rapidly in case of failure”, he said, adding, “For example, in some case, firms with 100 or more workers are not permitted to make layoffs. There are plenty of horror stories about formal-sector firms existing for two years and then taking 20 years to wind down their operations.”

Comments

Uma Sheth said…
Good to know that all Modi's advisers are not spineless sycophants

TRENDING

Call to support IIM-Bangalore professor, censured for seeking action against Uniliver

Counterview Desk
Sections of the Indian Institute of Managements (IIMs) across India have strongly reacted to the decision to censure Dr Deepak Malghan, a faulty at IIM-Bangalore. Prabhir Vishnu Poruthiyil, who is faculty at IIM-Tiruchirapalli, has sought wider solidarity with Dr Malghan, saying, "The administration has censured Deepak for merely suggesting a meaningful action against Hindustan Unilever for their abysmal environmental record" by “disinviting” it for campus placement.

Actionable programme for 2019 polls amidst lynch mobs, caste violence, hate mongering

Counterview Desk
Reclaiming the Republic, a civil rights network, has released a document prepared under the chairmanship of Justice AP Shah (retired) -- and backed, among others, by Supreme Court advocate Prashant Bhushan, bureaucrat-turned-human rights activist Harsh Mander, economist Prabhat Patnaik, Right to transparency activist Anjali Bhardwaj and social scientist Yogendra Yadav  (click HERE for full list) -- with the "aim" of putting forth policy and legislative reforms needed to “protect” and “strengthen” the Constitutional safeguards for India’s democratic polity.

Noam Chomsky, top scholars ask NRIs to take stand on human rights violations in India

Counterview Desk
Renowned world scholars, including Noam Chomsky, James Petras, Angela Davis, Fredric Jameson, Bruno Latour, Ilan Pappe, Judith Butler, among others, have issued a statement castigating the Narendra Modi government for allegedly creating an environment of fear through arrests, intimidation and violence.

India under Modi "promoted" crony business, protected financial fraudsters, fueled bigotry

By Sandeep* and Rahul Pandey**
Narendra Modi's ascension to power was accompanied with jubilation and expectation. His supporters were expecting an end to era of corruption and initiation of good governance which was described as Achche Din. His party's adherence to idea of nationalism was believed to make India a vibrant country and guide India to be a world leader. He gave the slogan of 'Sabka Saath, Sabka Vikas' conveying that his government was for all.
Corruption The government system is infested with corruption. A minimum of 10% is siphoned off from government schemes and projects, some of which goes back to political party in power and remaining is pocketed by various administrative, executive and political functionaries. This corruption continues and has increased. Now an additional Rashtriya Swayamsewak Sangh (RSS) person working as Official on Special Duty or some equivalent position in every government department also has a share in this booty.
The Narendra M…

Inviting Rajapaksa to India "insult" to 1,40,000 Tamils killed by Sri Lankan army

Counterview Desk
In the context of Sri Lankan opposition leader Mahinda Rajapaksa being invited in India, about 75 human rights activists*, claiming to be concerned about rights violations during the civil war in Sri Lanka, especially in 2009, have joined together to express their dissent through a statement.

A Godse legacy? BJP rulers have "refrained" from calling Gandhi Father of the Nation

By Dr Hari Desai*
What an agony! On one hand, the entire India is celebrating the 150th birth anniversary of Mahatma Gandhi under the leadership of Prime Minister Narendra Modi, but on the other side, so-called Hindu Mahasabha members have been found mock-enacting the killing of the Mahatma and celebrating the murder by distributing sweets!

No aadhaar, no ration? Hard blow by Gujarat govt on poor and marginalized

By Pankti Jog*
Only those who have aadhaar registration and linked it with ration card will get ration from a Public Distribution System (PDS) shop. This decision of the Gujarat government has hit very badly thousands of poor and marginalized communities of Gujarat, especially during the drought year.

Not just Indian women engineers, men too face sexual harassment at workplace: US study

By Rajiv Shah
A recent research, carried out jointly by two US-based non-profit organizations, Society of Women Engineers (SWE) and Center for WorkLife Law (WLL), based at the University of California, Hastings College of the Law, has found that 45% of women engineers as against 28% of men engineers complained that it was perceived as “inappropriate when women argued at work, even when it was work-related.”

Post-advisory, Govt of India appears reluctant to ban e-cigarettes, "harmful" to kids

By Rajiv Shah
Is the Government of India dilly-dallying over the issue of banning e-cigarettes, which have been declared by anti-tobacco activists across the world as providing “an entryway to nicotine addiction”, especially among the kids? It would seem so, if the latest developments are any guide.

Poser to Modi: Why is Gujarat not fulfilling Constitutional obligations to minorities?

Counterview Desk
In an open letter, Mujahid Nafees, convener, Minority Coordination Committee (MCC), a Gujarat-based civil rights organization, has accused Prime Minister Narendra Modi on infringing upon MCC activists’ constitutional right to protest. Nafees says, they had no other demands except that the Gujarat government should move towards fulfilling the constitutional obligations towards minorities and international treaties to which India is a signatory.