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

TRENDING

Mystery around Gujarat PSU 'transfer' of Rs 250 crore to Canadian firm Karnalyte

By AK Luke, IAS (Retd)*
While returning from a Board meeting of the Oil India Limited (OIL) in Ahmedabad some time in 2012, two officers of the Gujarat State Fertilizers and Chemicals Ltd (GSFC), Nanavaty and Patel,  saw me off at the airport. They said they were proceeding to Canada in connection with a project GSFC had entered into with a company there. As we were running late, I hastily wished them the best.

Savarkar in Ahmedabad 'declared' two-nation theory in 1937, Jinnah followed 3 years later

By Our Representative
One of the top freedom fighters whom BJP and Prime Minister Narendra Modi revere the most, Vinayak Damodar Savarkar, was also a great supporter of the two nation theory for India, one for Hindus another for Muslims, claims a new expose on the man who is also known to be the original proponent of the concept of Hindutva.

Indians have made 119 nations their ‘karma bhumi’: US-based Hindu NGO tells Rupani

Counterview Desk
In a stinging letter to Gujarat chief minister Vijay Rupani, the US-based Hindus for Human Rights (HfHR), referring to the report citing his justification for the Citizenship Amendment Act (CAA) – that “while Muslims can choose any one of the 150 Islamic countries in the world (for residence), India is the only country for Hindus" – has said, he should remember, Hindus have made several countries, including USA, their home.

J&K continues to be haunted, as parts of India 'degenerate' into quasi-Kashmir situation

By Rajendran Narayanan*, Sandeep Pandey**
“Jab har saans mein bandook dikhe toh baccha kaise bekhauf rahe?” (How can a child be fearless when she sees a gun in every breath?) remarked Anwar, a gardener from Srinagar, when asked about the situation in Kashmir. On November 30, 2019, a walk through an iron gate in a quiet neighbourhood of Srinagar took us inside a public school. It was 11 am when typically every school is abuzz with activity. Not here though.

Tata Mundra's possible closure? Power ministry's 'pressure tactic' on consumer states

By Bharat Patel*
Tata power has announced to the Union Ministry of Power that Tata Power may be forced to stop operating  its imported coal-based Mundra Ultra-Mega Power Project (UMPP) after February, 2020. It is not only unfortunate but also criminal that irreversible damage has been caused to the fragile ecosystem of Mundra coast for a project that will have a running life of only seven years.

Population control? 10% Indian couples want to delay next pregnancy, but fail

Counterview Desk
Shireen Jejeebhoy, director at Aksha Centre for Equity and Wellbeing, previously senior associate at the Population Council, India, argues that the debate on the country's population was fuelled by Prime Minister Narendra Modi’s Independence Day address to the nation, where he drew attention to “concern” about the challenges posed by this ‘exploding’ population growth, needs to centre around the promotion of rights and education, instead of the language of explosion and the threat of coercion that this term implies.

Savarkar 'criminally betrayed' Netaji and his INA by siding with the British rulers

By Shamsul Islam*
RSS-BJP rulers of India have been trying to show off as great fans of Netaji. But Indians must know what role ideological parents of today's RSS/BJP played against Netaji and Indian National Army (INA). The Hindu Mahasabha and RSS which always had prominent lawyers on their rolls made no attempt to defend the INA accused at Red Fort trials.

Upendra Baxi on foolish excellence, Indian judges and Consitutional cockroaches

By Rajiv Shah
In a controversial assertion, top legal expert Upendra Baxi has sought to question India's Constitution makers for neglecting human rights and social justice. Addressing an elite audience in Ahmedabad, Prof Baxi said, the constitutional idea of India enunciated by the Constituent Assembly tried to resolve four key conflicting concepts: governance, development, rights and justice.

Savarkar 'opposed' Bhagat Singh's, Netaji's dream of India, supported British war efforts

By Shamsul Islam*
In a shocking development, the student wing of the RSS put the busts of martyrs Bhagat Singh and Subhash Chandra Bose with Savarkar's on one pedestal at the University of Delhi late in the night on August 20, 2019. Bhagat Singh sacrificed his life for a socialist-democratic-secular republic and Netaji raised Azad Hind Fauj (INA) consisting of people of all religions and regions for armed liberation of India.