Frequent flyer: an A to Z primer on Modi's foreign policy

One year is too short a time to analyse the foreign policy success of Prime Minister Narendra Modi's government. However, many experts including former National Security Adviser and Foreign Secretary Shiv Shankar Menon have praised Modi's 'vigorous' foreign policy initiatives. So vigorous that his critics have often mocked him as the country's first 'non-resident prime minister'.

Modi took office at a time of great international upheaval and major geo-political realignments. A day before his swearing-in, the Indian consulate in Herat was attacked by the Lashkar-e-Taiba and his first foreign policy manoeuvre was to get 46 kidnapped nurses back home from Iraq. However, the fate of many other workers in custody of the Islamic State remains unknown.

His external engagements, a radical departure from his predecessor's, can be summed up under 'the Modi Doctrine' - a combination of neighbourhood diplomacy and securing economic interests. He kick-started his neighbourhood outreach with characteristic aplomb - sending out an invitation to regional leaders for his swearing-in.

Bhutan - reaching out to an all-weather friend

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King Jigme Khesar Namgyel Wangchuck and Modi in Tashichhodzong in June 2014. Photo: STR/AFP/Getty Images

Modi's first foreign visit as Prime Minister was not to Japan or China, as many had anticipated, but to Bhutan. In a symbolic but powerful gesture, Modi inaugurated the country's Supreme Court and reminded Thimpu that an Indian hug was gentler and more beneficial than a Chinese one.

Nepal - touching people's hearts

Modi's next stop in Nepal represented an equally effective visit. He not only struck a chord with the people, but also became the first foreign leader to address the Nepalese parliament. It took 17 long years for an Indian Prime Minister to visit this strategically important neighbour where China has been jostling for attention.

Modi made up for the past neglect by offering $1 billion in concessional loans for power plants and roads. With Operation Maitree he not only convinced the nation that India was ready to walk the talk in extending help to the quake-shattered neighbour but also helped position the country as an effective first disaster-respondent in the region.

Bangladesh - a benign overture

Modi sent out a powerful message to Bangladesh that India is willing to walk the talk on the land boundary settlement. Over the years, India's eastern neighbour has proven its mettle as an invaluable ally by keeping the lid down on religious radicalism.

Sri Lanka - making peace with people

Maithripala Sirisena's overwhelming victory in the Presidential elections was a godsend for Modi. In a grand gesture, Sirisena visited India on his first foreign visit. He assured India of his friendship and allayed fears about Chinese strategic presence in the island nation.

Later, Modi visited Sri Lanka - the first such visit in 28 years by an Indian Prime Minister. He not only made peace with the Sinhala majority but deftly reached out to the Tamils as well. He became the second foreign leader to visit post-war Jaffna - a move that went beyond mere optics.

Afghanistan - wooing a reluctant nation

This is a country where Modi is treading paths his predecessor had avoided. Acceding to a long-pending request from the Afghans, he signalled to the new Afghan President, Ashraf Ghani, India's willingness to supply arms.

In another strategic move, India also agreed to develop the Chabahar port in Iran and linking it by road to Zaranj on the Afghan border and further on to the Garland Road in Afghanistan. This will allow India access to major Afghan cities and to Central Asia bypassing Pakistan.

On his first official visit to India recently, Ghani made it a point to mention a number of times that India is part of the four of five circles that his foreign policy follows. He also made a strong pitch for an India-Pakistan-Afghanistan trade corridor, while Modi assured him that India would stay the course in Afghanistan.

However, despite these overtures, a breakthrough with Afghanistan is unpredictable as Ghani is leaning heavily towards Pakistan.

Pakistan - a different ballgame

It is Pakistan where Modi's foreign policy has stumbled. After the cancellation of the foreign secretary-level talks in Delhi, the prolonged exchange of fire on the border and the Line of Control in Jammu and Kashmir, there was an unexpected backtracking.

Foreign secretary Subrahmanyam Jaishankar was sent to Pakistan in the guise of a SAARC yatra. However, the prospects of restarting a dialogue with Pakistan do not look very bright with the government having painted itself into a corner. For now, it seems that there is no clarity in India's position on Pakistan.

Indian Ocean - ending sea-blindness

Modi has taken the trouble to end India's maritime blindness and build an Indian Ocean community. Responding to the Chinese maritime Silk Route initiative, he has been trying to forge stronger trade and investment links with three Indian Ocean island nations, Mauritius, Seychelles and Sri Lanka.

India has also leased an island each in Mauritius and Seychelles to develop maritime assets, carry out surveillance operations and present itself as a strong counter to bourgeoning Chinese influence in the region.

China - blow hot, blow cold

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President Xi and Modi at the Daci'en Temple in the former's hometown Xi'an.Photo: Sheng Jiapeng/CNSPHOTO/ChinaFotoPress via Getty Images

Talking about China, Modi's policy seems simple - engage with it but flag India's security interests clearly. The much-hyped summit with Chinese President Xi Jinping, however, did not result in any major outcome.

On the eve of Xi's visit, Modi deftly dispatched President Pranab Mukherjee to Vietnam where India signed major oil exploration deals, much to the discomfort of the Chinese.

They seem to have responded by incursions into Indian territory along the Line of Actual Control, as the undemarcated boundary between the two countries is called, when Xi Jinping was being feted in Delhi.

Also, the much-touted Chinese investment of $100 billion dwindled to a paltry $30 billion.

Nevertheless, when Modi recently visited the Middle Kingdom, and even when External Affairs Minister Sushma Swaraj had visited Beijing earlier, they were accorded a red carpet welcome.

Modi was welcomed in the ancient city of Xi'an, the home town of President Xi - a reciprocal gesture as the Chinese President had been earlier hosted by Modi in Ahmedabad in Gujarat.

The much-touted Chinese investment of $100 billion dwindled to a paltry $30 billion

Using the US as leverage, Modi has managed to keep the Chinese in his pincer diplomacy. Within weeks of Xi's visit, a joint Modi-Obama statement, issued when the two met in Washington DC, flagged concern over a 'rise in tensions over maritime territorial disputes' in the South China Sea.

Then, barely four months later, India followed this with another powerful message to China. During Obama's Republic Day visit to Delhi, India and the US issued a Joint Strategic Vision for the Asia-Pacific and the Indian Ocean Region as a direct counter to the Chinese maritime activities in the two regions.

This balancing act continues despite a strong personal chemistry between Modi and Xi. The two leaders have known each other since Modi's time as Gujarat chief minister. While there was no movement forward on the Sino-Indian border issue, there were no hiccups either, and Modi managed to attract Chinese investments worth $22 billion.

Act East - building new bridges

With China on mind, Modi is implementing his 'Act East' policy - a stepped-up version of the previous government's 'Look East policy' with outreach to Japan, Vietnam and South East Asia. He even visited Myanmar to attend the Indo-ASEAN and the East Asia Summits. From Tokyo, he was able to get a commitment of $35 billion investment.

Mongolia - a visit long due

"Mongolia is also an integral part of India's Act East Policy," Modi declared on his historic trip to Ulan Bator as the first Indian prime minister to visit the country.

Mongolia was the only country to unfailingly stand by India during the Bangladesh Liberation War of 1971. It also shares a long border with China.

Renewing ancient historical connections with the Buddhist majority country, Modi announced a $1 billion credit line to Mongolia for its infrastructure development.

A total of 13 pacts, encompassing border management and surveillance, cyber security and renewable energy were signed - once again, demonstrating India's response to Beijing's increased footprint in its periphery.

South Korea - more FDI

When Modi flew in to the Republic of South Korea, Seoul announced that it would offer $10 billion to support several ambitious projects in India including bullet trains and smart cities, affirming its faith in the India story.

A new energy has been infused in the bilateral ties, which have now been elevated to a 'special strategic partnership'. The most significant aspect of the new partnership is that it envisions cooperation between the armed forces and the defence industries of the two countries.

Modi's aggressive Act East Policy has not gone unnoticed in the region. North Korea also thought it incumbent to dispatch its foreign minister to New Delhi for talks.

Australia - coal and uranium

Modi was accorded the honour of addressing the Australian parliament during his visit to that country. He became the first Indian prime minister to visit that country in 28 years.

He signed a security agreement with Australia and there was talk of putting a free trade agreement in place by the end of 2015.

Indian businesses are interested in Australian minerals - especially coal, and India also wants to import uranium from that country in the future. Australia has backed India's claim for a permanent seat in the UN Security Council (UNSG).

France & Germany - pure business

On the eve of his European tour to France and Germany, Modi tweeted that his trip "centred around supporting India's economic agenda and creating jobs for our youth."

And at the heart of the visit lay the 'Make in India' agenda.

In France, Modi extracted a pledge of two billion Euros from the French for sustainable development. Modi also concluded an inter-governmental deal with the French for the supply of 36 Rafale fighter jets in 'fly-away' condition, much needed by the Indian Air Force, besides inking other pacts.

But, big-ticket deals with Germany are likely to be announced during Merkel's visit later this year

While inaugurating the India Pavilion at the Hannover Fair in Germany he made a strong pitch to German businesses to invest in India. German auto giant Volkswagen has already unveiled its plan to transform India into a low-cost manufacturing hub, beginning with an investment of $150 million to produce cost-effective products.

However, the really big-ticket deals with Germany are expected to be announced during Merkel's visit to India later this year.

Canada - renewing ties

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PM Stephen Harper and Modi after laying wreaths at the Air India Flight 182 monument in Toronto in April 2015. A bomb blew up the Boeing 747 in 1985 over the Atlantic Ocean near Ireland. Photo: Steve Russell/Toronto Star via Getty Images

Modi again became the first Indian prime minister to arrive in Canada on a stand-alone bilateral visit in 42 years. Feted once again by the Indian diaspora, as also by Canadian Prime Minister Stephen Harper, the visit resulted in an agreement for long-term supply of uranium to India and for an investment of Canadian $2.5 million in five health innovations in India.

The uranium deal, estimated to be worth around Canadian $350 million, heralds a new beginning of bilateral relations as it brings to an end decades of distrust around India's nuclear tests.

The visit also resulted in a host of other agreements encompassing, amongst other things, cyber security, counter terrorism, education and skill development.

Israel - it's all about business

Under Modi, the robust but low profile relationship with Israel has become open. He met Israeli Prime Minister Benjamin Netanyahu in the US and President Reuven Rivlin in Singapore.

Home Minister Rajnath Singh visited Israel and their defence and agriculture ministers have visited India.

Modi is carrying forward his policy of engaging with Israel from his days as Gujarat Chief Minister. The state benefitted from Israeli drip irrigation, port investments and water purification technologies.

Now, the country is acquiring Israeli Spike anti-tank missiles despite stiff competition from the Americans, and the fact that Chuck Hagel himself lobbied New Delhi.

Qatar - roping in the royalty

The Modi government has kept up its relations with the Arab world. In a high profile visit, the Emir of Qatar himself called upon New Delhi and signed six pacts. He even showed interest in making investments in the country.

Saudi Arabia - new found admiration

With the Saudis too, relations are on the upswing. India declared a day of national mourning for King Abdullah of Saudi Arabia and the new Saudi king Salman rang up Modi to assure help for stranded Indians in Yemen.

Oman - seeking investments

Sushma Swaraj visited Oman in February and was well received. She hard-sold India's new policies and the benign investment regime. Her visit is expected to give a boost to both bilateral relations as well as business ties.

Bahrain - opening up consultations

India and Bahrain have seen a few high level bilateral visits with the two sides opening up the first foreign minister-level consultations and signing a defence cooperation deal in New Delhi.

Palestine - upping aid

The Modi government continues to pursue the earlier Palestine policy. Since 1992 successive governments have delinked Israel from Palestine and pursued bilateral ties.

The only noticeable difference - India did not adopt any anti-Israel resolution in Parliament during the Gaza bombing last year. However, it did vote in the United Nations Human Rights Council for a UN probe into possible Israeli war crimes in Gaza.

India also pledged $5 million aid at the Gaza reconstruction conference in Egypt. Delhi continues to provide aid and scholarships to Palestinians and, in a first, even held foreign office level consultation with the Palestinians.

This, together with the issuance of visas to Palestinians from Ramallah is tantamount to recognising the Palestinian State.

Iran - picking up the threads

The framework nuclear deal that Iran is likely to conclude with the P5+1 has energised Indo-Iranian relations, sending oil imports to India soaring thereafter.

India too despatched a number of high profile delegations to negotiate the investment in to berths at the Chabahar port and revive investments to develop gas fields.

Ties with Iran had flourished under the previous NDA government and Iranians are looking at the current regime to renew them. The Islamic Republic has invited Modi for an official visit and he has formally accepted it.

Significantly, the Iranian ambassador to India has stated that 'Kashmir is a part of India' - a statement whose symbolism cannot be over emphasised.

US - balance and embrace

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Modi at the Oval Office in the White House after a meeting with President Barack Obama in September 2014. Photo: Brendan Smialowski/AFP/Getty Images

Interpreting Modi's diplomacy, strategic analyst Brahma Chellaney says that Modi has heralded a shift towards multi-alignment - he is courting world leaders for developing the Indian economy.

Though he pulled off a coup by inviting Obama, a sea of differences need to be bridged. The sticking points include issues of Intellectuals Property Rights, greenhouse gases and ironing out creases over nuclear liability insurance.

Ties with the US are special. It is India's largest trading partner, one of its largest defence partners, the first destination of choice for Indian students and a haven for IT professionals.

The civilian nuclear deal during Prime Minister Manmohan Singh's time had helped end India's nuclear isolation and, if dealt with skillfully, may now provide India an entry into the Nuclear Suppliers Group.

Ties with the US are special. It is India's largest trading partner and one of its largest defence partners

With the US, Modi is following an independent line of thought and action. He has stood his ground over the West-led sanctions against Russia. Despite the Crimean annexation and the war in Ukraine, Delhi hosted the annual Indo-Russian summit in December 2014 and signed agreements on nuclear issues and diamond trade.

To the US, the message is clear - India cannot be taken for granted.

Africa - summit announced

Africa has not been forgotten. Sushma Swaraj has made a visit to South Africa, where she was assured of backing for India's entry into the UNSC. At the same time, to rejuvenate ties with Africa, a mega India-Africa summit is to be held in New Delhi in October 2015.

Multilateral fora

Modi has kept up India's participation at various multilateral forums such as BRICS and G-20, but also those like the Asian African Summit. The adoption of the International Day of Yoga on Modi's initiative was another feather in the cap for India's international diplomacy.


One of Modi's most effective foreign policy thrusts has been to galvanise the Indian diaspora - comprising upwardly mobile and politically engaged Indians across the globe.

Relations with China remain complicated and Modi is still figuring out how to deal with Pakistan

He has reached out to them in places as diverse as the US and Australia, Fiji, Mauritius, Oman, and Canada. He wants them to invest in India and become partners in his Make in India campaign.

Experts have given a thumbs up to Modi for his decision to appoint S Jaishankar as the new Foreign Secretary. With his experience of working in China and the US, Jaishankar is known to be a seasoned diplomat and expected to provide the right kind of thrust to foreign policy.

However, challenges still remain. Relations with China and Pakistan remain complicated and Modi is still figuring out how to deal with Pakistan.

On the other hand, the global situation - increasing turbulence in the Middle East, the Islamic State phenomenon, a resurgent Taliban in South Asia, the widening gulf between Russia and the West, and an assertive China in Asia - all pose major challenges.

However, Modi seems to have successfully fused his own ideas with UPA's thinking and is revitalising moribund partnerships, where development and diplomacy dovetail into each other. Modi seems to have made a good foreign policy start, and as they say, well begun is half done.

Written by Aditi Bhaduri.

The views expressed here are personal and do not reflect those of the organisation.

Achhe Din: 10 questions Modi must answer to set the economy right

From the day Jesus Christ was born, India's national income was a third to a quarter of the world's for many centuries. Then the British wrecked the system by industrialising and acquiring colonies: that led India's share of world income to fall towards a mere one per cent. So said Angus Maddison, who spent an entire lifetime constructing the economic history of the world. But his was all guesswork, before governments began to collect figures and economists started to read all kinds of meanings into them.

How can industry be encouraged to 'Make in India'?

'Make in India' was the Prime Minister's famous slogan. He forgot to mention what he wanted made; but everyone assumed that he meant manufactures.

The next step should have been to ask firms what they wanted to be persuaded to make more in India. That too was forgotten; they are still waiting. Industrial growth went up to 10% in 2008-2011 and then collapsed; currently it is around 4%.

The finance minister presented two budgets, but did nothing to stimulate growth. He keeps jauntily telling everyone that 9-10% growth is child's play, but the child shows no signs that he knows.

How can inflation be kept down?

The UPA helped the poor through employment schemes and subsidies on wheat and rice; to maximise the subsidies, it bought up the grains from farmers who had spare crop to sell at ever higher prices. It spent on its schemes as if there was no tomorrow.

To finance these schemes, it ran huge fiscal deficits, which were inflationary. To make sure that prices rose, it hoarded crores of tonnes of foodgrains. In the end, its spendthrift strategies did not work; the UPA suffered humiliating defeats in election after election.

Its experience was a good reason why the NDA government should have rethought and redesigned the poor Mahatma Gandhi National Rural Employment Guarantee Scheme and the public distribution system. It did nothing of that sort; instead, it keeps spending on these schemes.

When can young people be employed?

"I call upon the nation to take a pledge to make India the skill capital of the world," said the Prime Minister. He is not the first one to make the promise; earlier Prime Ministers not only promised, but they created numerous institutions to impart training. The government has owned many training facilities for decades, but created few skills. He did not ask why.

Instead, he created a new ministry of youth affairs, sports, skill development and entrepreneurship. The minister, Rajiv Pratap Rudy, has collected bright young women like Radhika Maloo, Divya Nambiar, Charvi Mehta and Shivi Anand, and taken his newly recruited army on a hunt for ideas.

The first stop was the previous government's skill development policy of 2009. It is pretty detailed, and largely unimplemented. But it was not good enough for Rudy. His ministry announced long ago that it would come out with a revised policy; will it ever end the suspense?

When will foreign industrialists enter India?

The Prime Minister has discarded his party's traditional xenophobia as casually as he changes clothes; he has openly invited foreigners to come and set up industry in India.

Once a foreigner builds a factory, it is a prisoner of the government, which can do anything with it. It can even expropriate it. That would hurt its reputation and put off other foreign investors; but such flimsy considerations never stopped the previous government from taxing Vodafone on the purchase of Hutchison Essar's stake in a telecommunications company - even though it was Essar, not Vodafone, that had made the money, and the transaction happened outside India's borders where India's taxes cannot be levied.

Nor has the NDA government reversed its action. The finance minister has said that if the Supreme Court rules against his claim, he will not appeal; it sounds as if he is waiting for the court to rescue him from the embarrassing situation from which he refuses to emerge on his own.

Even if Modi wants to act, many of his ideas are so ill defined, it's difficult to translate them into policy

More generally, the finance minister has still not put a fairer tax regime in place. He has promised companies that he will reduce income tax on them very slowly over the next four years if he stays in his ministry.

The government has taken some small steps such as raising some FDI caps, and sometimes dispensing with cabinet approval required for FDI that might lead to a change of ownership; but such mincing steps do not impress foreign investors.

The finance minister should shake off his sloth. He has been travelling a lot; if it is Thursday, he must be in Timbuktoo. He should talk to the foreign investors he meets and solve their problems.

Where will reforms start in agriculture?

The BJP is too timid to tackle the two main problems of agricultural policy: the price support system, and the rationing system. The two are interlinked, but independent of each other.

The price support system subsidises the big rice and wheat farmers, who are concentrated in a few areas such as Punjab and Andhra Pradesh; it does nothing for the millions of subsistence farmers everywhere.

The public distribution system delivers foodgrains to consumers below the poverty line. But it is impossible to separate the poor from those who are not poor. They all look the same; and the poverty certificate that entitles someone to cheap rations can be bought from suitably corrupt government servants.

The best thing to do would be to make foodgrains cheap for everyone, instead of the nominally poor 80%. The rich are already well fed, and are not going to eat more wheat simply because they get it a few rupees cheaper. And if the government stops keeping foodgrain prices high, it will not have to buy millions of tons of grains and store them until they rot away.

Aside from the PDS, the BJP put forward many ideas on agriculture: unifying the national agricultural market, dividing up Food Corporation of India into functional units, more crop specialisation among regions instead of them all growing more wheat and rice, increasing efficiency of irrigation, and so on. But nothing has moved on any front.

When will we be able to fly from Mysore to Kolhapur?

Work began on the golden quadrilateral and the north-south and east-west highways under the last BJP government. The concepts came from the fertile mind of Atal Bihari Vajpayee, who is remembered for them even though none of them was named after him.

This government too does not lack ideas. In railways, it has made Suresh Prabhu, one of the two good economists in BJP, minister, and he has not wasted time. He is brimming with ideas; he can achieve a lot if he is given some money to invest and allowed to bring in some technology.

But some MPs have derailed this and wasted some time waiting for late trains; they have got the Prime Minister to pull Prabhu's ears. That is nothing new.

When will you show us some black money?

"I want to tell the people that please have faith in this pradhan sevak of yours... this is an article of faith that every paisa that has gone will come back," said the Prime Minister in his 'Mann ki Baat', "I assure you I will not be held back in bringing back whatever the amount."

And he kept his word up to a point: he appointed a committee, which till now has produced little. So many people in this country believe that a few have made billions illegally and parked it abroad. If they have, they are not going to go about telling anybody; so the view is based entirely on hearsay and superstition.

Arun Jaitley tells everyone 9-10% growth is child's play, but the child shows no signs that he knows how to play

Even if there are billions abroad, the Prime Minister has no power over money in other countries; there is nothing he can do to bring it back. Still, he says he can be trusted, so we have to wait for him to produce the rabbit out of a hat.

Meanwhile, black money in the country can be traced much more easily; all one has to do is to bring some rationality into taxation of land and property. Taxing transactions is a perfect way of creating black money; undervaluing property immediately reduces tax liability.

A low annual tax, based on locality instead of on value of individual properties, is a better way of collecting revenue. The ideas are there for the asking; the Prime Minister has just to stop holding himself back from action.

What are you doing with the 58%?

Ever since he was chief minister, the Prime Minister has held a grudge against the centre - it kept too much of the revenue, and placed conditions on what it gave. That it collected the revenue from its own taxes did not matter.

The tussle was not just over money; the self-righteous wise men in the Planning Commission that Modi had to deal with were equally irritating. Now they are gone, and he has abolished the Planning Commission - in name.

In March, the finance commission raised states' share of central revenue from 38% to 42%. Why is the Prime Minister keeping the other 58%? Why not act on his principles, and make the Centre beg before the states?

When will Rothschild get land for his factory?

The BJP government reintroduced the land acquisition act with small changes; it was approved by Parliament. Development is impossible without some compulsory land acquisition.

This law could be passed only by agreement of other parties. That was quite a change from the normal fisticuffs in the august house. It is a good precedent; the Prime Minister should talk more often to the opposition for consensus.

When will we get an efficient administration at the Centre

The Prime Minister has from time to time floated big, vague ideas about reforming administration, such as removing bottlenecks and missing links, striving for scale and speed, empowering bureaucrats, or proper planning and execution.

He could have started turning them into action as soon as he entered the South Block. But he suffers from an action-block. Even if he wants to act, many of these ideas are so ill defined that it would be difficult to translate them into policy.

They are often less about policy, and more about the process of debating and formulating policy. And that process can be changed only under the leadership of the prime minister; anyone lower down would not have the guts or the imagination to change processes that have been in place for decades. He should start to preach less, and practice more.

Written by Ashok V Desai.

The views expressed here are personal and do not reflect those of the organisation.

Ease of business: Modi promised a red carpet but wound up with red tape

If one has bad teeth, one should brush them. That, however, is not the way of the Indian government. When the World Bank relegated India last November to the 142nd rank in its list of 189 countries assessed for ease of doing business, the government immediately pointed to the limited evidence on which the assessment was based.

"India has been objecting to the findings of the World Bank's Doing Business Report for a number of reasons...Until Doing Business Report, 2014, the study was conducted only in Mumbai. In Doing Business Report, 2015, Delhi has been added as the second city ... a study conducted at two urban centres of India cannot be representative of a vast country like India," Commerce and Industry Minister Nirmala Sitharaman said.

Round 1: Nirmala Sitharaman vs the World Bank

She is right on that point. The World Bank is thrifty, since all its money comes from pennywise members like India. So to compile its reports, it goes and asks a few professionals in each country's biggest business city. After India's protest, it added a second city.

Sitharaman also said that the World Bank's findings were based on responses from professional firms which were not representative of India's boudoir: how could it ignore the panwallahs and roasted peanutwallahs and expect to get fair answers?

The minister is known for her quick, sharp repartees; she gave the World Bank a taste of her chilli sauce. To be fair, she was probably only reading out the notes placed before her by her civil servants.

They are good at taking action: as soon as they receive something from the Fund or the Bank, they clothe it in a file, cover it with a note on how to reply, and send it off per chuprassy to the minister.

Sitharaman is a quick learner: she learnt that her job as minister was to talk, not to act. The wisdom comes from the bottom of the bureaucratic well; it only finds a crisp and clear voice in her.

What the World Bank did and did not say

The World Bank could have asked her if she expected it to be easier to do business in Bhubaneswar or Thiruvananthapuram than in Delhi and Bombay. But it does not play the game of repartees; it prefers to maintain reasonably good relations with feisty ministers.

What did it say that got the goat of the honourable minister of state (independent charge) for industry and commerce? The World Bank is in the business of giving loans to governments of poor countries for development.

Unfortunately for it, more and more poor countries learnt to manage their balance of payments and ceased to borrow from it: the east Asian countries went off in the 1960s, oil-rich countries in the 1970s, and finally India after its 1991 reforms.

So World Bank had to develop new activities. One of them is the annual report on the ease of doing business, which it pioneered in 2004.

The government has criticised the World Bank report for being limited to Delhi and Mumbai

The 2014 report, which enraged the minister, was not all that uncomplimentary. It said, for example, that India had done 17 reforms between 2005 and 2013, and improved its position in the rankings by 10.6 points; but then, China had done 18 reforms and improved its position by 15.9 points.

The government also seems to be getting over its hypersensitivity and beginning to see the point: that the Doing Business Report has information that foreign investors would take seriously, and that it can improve India's attractiveness as an investment destination by tackling the infirmities pointed out by the report.

Finance Minister Arun Jaitley gave a long list in Rajya Sabha of the steps taken by the government - which also suggested that he had not quite read the Doing Business Report.

The message, not the messenger

It is not the annual reports that matter; it is the issues they raise. They matter to India, and they are relevant to the prime minister's ambition of 'Making in India'.

The World Bank will gladly give the government its questionnaire; it should give it to all the chambers of commerce and industry associations and ask them to get replies from their members. It should make up its own reports for each industry and each region, and give them publicity.

The Prime Minister has great plans of reforming the state, but has no clue where to start. The World Bank has shown him where; now he should get on its horse and charge.

It would be even better if he redressed the weaknesses that World Bank has pointed out. India's rank is 186 in enforcing contracts: it takes 46 steps and three years, 10 months on the average. Does Sitharaman doubt this? Does she not know why legal processes take so long in India? Should not her government act on it?

World Bank says that it takes 4.3 years to resolve an insolvency, and that creditors get 25.7% on average: the bankrupt debtors have looted or otherwise lost the rest. It estimates that it takes 105 days on average to get an electricity connection, and costs 4.877 times the country's per capita income.

Registries are even worse than electricity companies: it involves 25 procedures and takes 186 days on average to get a construction permit, and once the building is ready, it takes 7 procedures and 47 days to get it registered.

The PM has great plans of reforming the state, but has no clue where to start

But we are not bad at everything. We are quite good at protecting minority shareholders; our credit institutions also work fairly well. The government should stop being so paranoid; it should use the page or less World Bank gives India in the Doing Business report, and use it to improve our economic governance. That may or may not attract some foreign investors; but it will make the life of Indian businessmen a lot easier.

The less time they have to waste in dealing with a dysfunctional government, the more time they will spend in doing business, producing things and exporting them. The prime minister has an ambition of making this country great; greatness is measured, not by the complexity and arbitrariness of a nation's government, but by the prosperity of its citizens.

Written by Ashok V Desai.

The views expressed here are personal and do not reflect those of the organisation.

Unchain the jumbo: Show us the money, Mr Modi
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During the elections, Narendra Modi had repeatedly promised he would bring black money back to India. In fact, he had gone to the extent of stating that if every paisa stashed away illegally in offshore accounts was brought back, every Indian family would get Rs 15 lakh.

Is Mr Modi serious about addressing the black money issue or was it just, as BJP party chief Amit Shah put it, a 'chunavi jumla'?

How big is the problem?

The black economy accounts for more than 50% of the GDP. So it will generate roughly Rs 65 lakh crore this year.

This is not a stock figure. It doesn't refer to what has been 'stashed away since Independence' as is often asserted rhetorically. This is what will be generated this year alone.

Now, for any economic activity to be black, there has to be some illegality involved in it. If 50% of the economic activity in the country has an element of illegality, then it is not an anecdotal or ad-hoc phenomenon. It is 'systemic and systematic'. For this to happen, those in charge of the state have to be a party to it.

People have evolved a system to generate black income. If illegality has to be committed systematically, three elements are important: corrupt businessmen, corrupt political class and corrupt executive class.

The black economy accounts for more than 50% of the GDP. It will generate roughly Rs 65 lakh crore this year

This is what I call a triad. The corrupt executive class further consists of corrupt bureaucrats, corrupt police and corrupt judiciary.

This triad is driving the black economy. Therefore, the problem is a political and a systemic one. Unless it is tackled politically, this triad is not going to dissolve on its own.

Does the NDA have the political will to tackle the black economy? Possibly not since some of its own people are probably involved in black income generation.

What steps have been taken so far?

There have been at least 40 committees and commissions of different descriptions that have looked at various aspects of the black economy since 1948. They have made thousands of recommendations, of which hundreds have been implemented.

For instance, voluntary disclosure scheme was implemented six times. The last was in 1997. But since this kind of scheme is considered to be unfair to honest taxpayers, the government was forced to give an undertaking in 1997 to the Supreme Court that no further such schemes would be brought.

Further, the CAG in its report on the scheme argued that it has made people 'habitual tax offenders' and is counter-productive.

The income tax rate has been systematically reduced since 1971, when under Indira Gandhi, the tax rate was as high as 97.5%. That has been reduced to the present rate of 30%. But in 1970, the black economy was 7% of GDP. Today, it is more than 50%. So tax rates have gone down but black income generation has gone up.

Controls have been significantly reduced, especially after 1991. Foreign Exchange Regulation Act (FERA), Monopolistic and Restrictive Trade Practice (MRTP), licensing, etc, are gone and yet the black economy is proliferating.

High-denomination currency notes were demonetised in 1978, but it had no effect. A policy for the acquisition of under-valued properties was introduced but it had little impact on the under-valuation of property in real estate.

PAN cards were brought in; but people went in for multiple PAN cards. None of these steps have worked.

Under Indira Gandhi, the tax rate was as high as 97.5%. It is now 30%. But the black economy then was 7% of the GDP. Today, it's more than 50%

For a law to be effective it needs to be followed both in letter and spirit. Unless the spirit is willing, the letter of the law can be circumvented.

We must understand that no law is perfect and human ingenuity can be used to circumvent it. For instance, at one point it was said that payments above Rs 10,000 should be made only in cheque, otherwise businesses will not be allowed to include it in their balance sheets.

So people began carrying out multiple transactions of Rs 9,900.

Black economy is not just a technical issue. It is a political issue. The only way we can tackle it is by breaking the corrupt triad.

Does Modi have the political will?

The NDA government thinks it can tackle the black money problem by changing laws. This is where the problem lies. They have to display the political will to implement them.

There are some very obvious things that could have been done as soon as they came to power such as acting against HSBC, which was acting as a hawala operator.

Some of the people whose names had come out in the first list had revealed HSBC's modus operandi. It seems HSBC was working as a hawala operator. It used to take cash from the client, deposit it in the bank in Switzerland and give it back to the client when required.

Many other multinational banks and some Indian private banks are known to operate the same way under the garb of providing services to their High Net-worth Individuals (HNI).

So why didn't the government take action against HSBC? Why didn't it introduce new rules to check this hawala operation?

Further, only 626 names had come into the public domain. Herve Falciani, the Frenchman who had stolen the data, was shouting from the rooftops that only 1% of the data has come out. But the government made no effort to get the remaining 99% data from him.

It is embarrassing for the government that the second list of 600 names was released by the International Consortium of Investigative Journalists (ICIJ), of which The Indian Express was a partner. Why was there no effort from the government's side?

Herve Falciani, who stole the HSBC data, said only 1% of the data had come out. But the government didn't try to get the rest of the 99% from him

Other than banks, there are hawala houses that operate in India. Intelligence agencies track these places. Yet there has been no effort to bring them to book.

Three years ago, ICIJ released the British Virgin Islands list. The government could have acted on that. It has done nothing, so far.

Of course, it did set up the Special Investigation Team but that was because the Supreme Court had ordered it (initially in July 2011). The problem is that various official agencies are a part of it but without the political will, none of them, like the CBI or the Enforcement Directorate, would help the SIT the way they should.

Under the new 'Black Economy Bill' to bring back funds held abroad illegally, the government has offered an amnesty to people who declare their undeclared income in the next three months. This will help those who hold their black wealth abroad in their own names.

Under this bill, if anyone is caught under its provisions they would be fined 300% of the tax and could be jailed for up to 10 years. However, the moot question is how will anyone be caught?

There are no provisions for that. Since most of the money goes out via 'layering', the true identity of the person controlling an illegitimate account abroad is hidden. If people are not caught then these provisions will be mere paper tigers.

Why isn't the government revealing names?

Even on the issue of revelation of the names of offshore account holders, the NDA has been as coy as the UPA. Both took a position that the government shouldn't be forced to release names because there was a secrecy clause in the agreement under which the foreign governments provided the names.

This is a mere play of words. The government claims it cannot reveal the names because of the Double Taxation Avoidance Agreement (DTAA). But this agreement does not apply either to the LGT disk case or the HSBC list since these do not pertain to incomes in either Germany or France but to accounts in Liechtenstein and Switzerland.

Why didn't the government act against HSBC? Why didn't it introduce new rules to stop this hawala operation?

The DTAA essentially means that if a person declares an income in India but is a Swiss national, then he or she should be required to pay tax only in one of the two countries, not both.

It seems the government is only trying to hide behind the clauses to avoid revealing the names. It moved the Supreme Court but the court struck that down. As a result the government was forced to give the data to the Supreme Court and SIT.

At one time, transactions of Rs 10,000 and above had to be by cheque. People switched to multiple transactions of Rs 9,900

The government could have moved under the UN Convention Against Corruption rather than under the DTAA and revealed the names without any difficulty.

It is clear that the government never wanted to make these details public. In fact, it refused to take the data even when it was offered in 2007 and 2008 and eventually took it under the pressure of the SC.

About 1,250 names have come out so far but this is a drop in the ocean since the number of offenders could run into lakhs.

Offshore accounts are only part of the problem

Contrary to the popular rhetoric about black money, of the black incomes generated annually, only about 10% goes abroad. Nearly 90% remains in India. A substantial portion of the 10% that goes abroad is routed back to India via 'round tripping'.

Of the money that remains abroad a part is invested in real estate and businesses. So, what remains in liquid form in banks is a small part of what goes abroad.

What is left in offshore accounts actually forms a very tiny part of India's black money.

Also, there are no accurate estimates of where this money is. With about 90 tax havens in the world, the authorities have not revealed how much is in Switzerland and how much is in Jersey Island, etc, if they know it. So where do we get the black money back from? The Swiss government has mentioned that Indians have only Rs 14,000 crore in Swiss banks. But this is most likely the legitimate amount held by Indians in Switzerland.

Black money is also used to fund election campaigns of political parties. In fact, election financing plays a key role in the formation of the triad between the corrupt businessmen, corrupt politicians and corrupt officials.

The money stashed abroad is an inflated issue and there is a very little chance of getting it back. What the government needs to focus on is action here. For this, it needs to display political will.

The views expressed here are personal and do not reflect those of the organisation.

Reported by Charu Kartikeya. Edited by Aditya Menon.

The Babu Gap: why Modi's slogans are failing. And some recipes for success

Prime Minister Narendra Modi has a remarkable ability to say the right thing at the right time - and with sincerity and conviction. His communication with the bureaucracy has been faultless.

After a long time there is a Prime Minister who meets his bureaucrats regularly, encourages better communication, is receptive to new ideas and conveys a sense of energy and purpose.

Gujarat isn't Delhi, Mr PM

These qualities stood him in good stead in Gujarat and he probably thought, and continues to think, that the right kind of inspiration can breathe new life into a hibernating bureaucracy. And therein lies the rub.

The government of India is not the government of Gujarat. There is the obvious difference of size and scale. The one-on-one relationships a chief minister can have with his bureaucracy in Gandhinagar is impossible in New Delhi. Perforce, such relationships get limited to a select few and that encourages the emergence of coteries and kitchen cabinets.

While these are early days, already there are some ministers and secretaries who are seen as being more important than the others primarily because they are associated with the initiatives which are closer to the Prime Minister's heart. There is nothing wrong with that, except that in very little time they will become separate centres of power and start controlling access gateways to the PM.

In a situation where the power to say 'yes' is centralised this erodes the capability of the less privileged among the secretaries to deliver. This makes governance a patchy affair. This is already beginning to happen.

Unlike Gujarat where governments have always been relatively compact and have modelled themselves on lean and efficient private businesses with an entrepreneurial work culture, the government of India is a slothful, hormonally imbalanced leviathan.

What happened to 'Minimum Government, Maximum Governance'?

Almost 40% of the departments/ministries have far outlived their utility and exist simply because no one has had the will to do away with them. This bureaucratic deadweight is a massive drag on the system and actually perverts the most well intentioned plans.

The major surgical overhaul that one expected has not happened and one of the snappier slogans that Modi provided in 2013/2014 of 'Minimum Government, Maximum Governance' seems to have been completely forgotten. New fiefdoms have begun emerging even as the older ones continue their parasitic existence.

The danger with an obese bureaucracy is that it can never maintain the pace of change that the prime minister expects of it. Since scant attention has been paid to shedding weight and radically reforming systems and processes, there is excessive reliance on the prime minister's personal motivational skills to infuse new energy.

Unlike Gujarat where governments have been compact, the Centre is a slothful, hormonally imbalanced leviathan

The response of the bureaucracy is inevitably sluggish. Sooner or later, even the most energetic leader begins to feel frustrated. Blame games begin; motivational efforts are replaced by frenetic monitoring so that the bureaucracy spends more time making departmental presentations and filing various reports to several monitors, and the prime minister, the prime minister's office (PMO) and the Cabinet Secretariat spend more time conducting reviews rather than facilitating or empowering officers to deliver. Fear of the adverse replaces the desire to excel. This too is beginning to happen.

It does not help that after a decade of the Accidental Prime Minister's rule, Modi inherited a bureaucracy which at the top was and is lacklustre, pedestrian, amoral, pusillanimous and intellectually bankrupt. The prime minister had the opportunity to bring in a new look top team of civil servants and professionals but that has been frittered away.

Pitfalls of a presidential-style leadership

Even his PMO lacks the kind of self-assured decisiveness a Brajesh Mishra brought to the Atal Bihari Vajpayee PMO. It was known that taking up a matter with Brajesh Mishra in the PMO was as good as taking it up with the PM himself - because he functioned as Vajpayee's alter ego. Not so now. A relatively weak PMO with centralisation of power and expanded responsibilities is a recipe for eventual failure.

Over the years, successive governments have either ignored or intentionally weakened several institutions of governance. And this government is no different. One such weakened institution is the institution of the Cabinet and the Cabinet Secretariat.

Modi needs a machete to cut through Delhi's bureaucracy. Photo: Robert Nickelsberg/Getty Images

The Constitution envisages the Cabinet to be composed of equals with the PM being only 'primus inter pares'. This means three things.

One, that a good and effective government requires powerful ministers who command authority on their own and not derive it from their proximity to the prime minister.

Two, that deliberations and decisions by the cabinet as a collective are more important than decisions by a PM and his coterie.

And three, that the Cabinet Secretariat rather than the PMO is the principal instrument of oversight, of inter-departmental coordination and of providing the enabling environment for the bureaucracy to perform and excel.

A weaker PMO with centralisation of power and expanded responsibilities is a recipe for eventual failure

On all three counts the Modi government is extremely vulnerable. By sending the message that the PM prefers a direct presidential-style relationship with the secretaries, he weakens the concept of collective responsibility of the Cabinet and confuses the minister-secretary relationship in a way that both have to constantly perform a tightrope walking act.

The Cabinet Secretariat, headed by someone who is on six month temporary extensions, tries to sniff out an appropriate role for itself in a messy power sharing arrangement with the PMO, rather than being the designated clearinghouse of ideas and policy initiatives and the institution which is meant to take the final call on purpose, process and people. Adding to the institutional confusion is the NITI Aayog. No one really knows where and how it fits in.

All this has created a hiatus between words and action which can prove fatal.

So what should Modi do?

He should induct a fresh team of senior and experienced ministers who have the confidence of being their own masters. Task an empowered Cabinet Secretary to give each minister a team of civil servants with a proven track record of being bold, creative and fearless.

Give each ministry vastly expanded space to manoeuvre, revive the Cabinet as an active forum for candid discussion, careful deliberation and responsible decision making not being a rubber stamp for decisions taken by a coterie.

Shrink the PMO while expanding the Cabinet Secretariat; do a zero based audit of the utility of all Departments and Ministries and surgically remove the flab. Use outcomes budgeting as an instrument of management.

Devolve financial and administrative powers massively down the line and give to administrative reforms the same importance as one would to economic reforms.

Your serve, Mr Prime Minister.

Written by Amitabha Pande.

The views expressed here are personal and do not reflect those of the organisation.

Here's what Modi is doing to clean the Ganga: a whole lot of nothing

Cleaning up the Ganga was one of the most important promises Prime Minister Narendra Modi had made during the run-up to the 2014 elections. As the candidate from Varanasi, Modi claimed he was called to the city by Ganga Maiya herself.

High on symbolism, low on substance

Soon after he became prime minister, he took a number of symbolic steps to display his commitment towards the river. This included renaming the Union Water Resources Ministry as the Ministry of Water Resources, Ganga Rejuvenation and River Development.

The charge of the ministry was given to Uma Bharati, who has championed the Ganga's cause for many years.

The National Mission for Clean Ganga (NMCG) and National Ganga River Basin Authority (NGRBA) were placed under the newly renamed ministry.

On 7 July 2014, the NMCG organised a meeting - titled Ganga Manthan - on the issue. So far, two meetings of reformulated NGRBA have been called, one under the chairmanship of Modi and another presided over by Bharati.

Industries along the Ganga were instructed to set up online monitoring capabilities and ensure zero liquid discharge. Towns along the Ganga were told to submit an action plan in two months. Many foreign governments, including those of Japan, the US, Germany, Canada, France and Australia, among others, promised aid as well as technical and commercial tie-ups.

The report of the Ganga River Basin Management Plan, commissioned when Jairam Ramesh was the UPA's Environment Minister, has reportedly been submitted by the IIT Consortium, but we don't know what happened to it.

This, in short, is what the government can claim to have achieved in its mission to clean up the Ganga.

But the actual condition of the Ganga hasn't improved anywhere since the Modi government took over.

NDA hasn't learnt from history

It needs to be remembered that Modi is the second prime minister of independent India who has expressed concern about the state of the Ganga.

Interestingly, the first one was a Congress Prime Minister, Rajiv Gandhi, who launched the Ganga Action Plan three decades ago. In 1974, a decade before Rajiv became prime minister, Indira Gandhi's government created an institutional framework to contain water pollution.

The sordid state of the Ganga and other rivers is sufficient evidence that the country's water pollution governance and the GAP has achieved very little success.

Are the Modi government's efforts any different? Have any lessons been learnt from earlier failures? Has the Modi government provided any credible analysis as to what ails the Ganga and provided any credible road map to rejuvenate the river?

Unfortunately, the answer to each of these questions is a clear, big no.

How the government will actually end up harming the Ganga

Far from cleaning up the Ganga, there are at least five ideas of the NDA government that might just end up harming the river.

1) Nitin Gadkari's announcement that he plans to build a barrage at every 100 km along the Ganga in the 1,600-km stretch between Allahabad and Haldia. Ironically, he announced this at the Ganga Manthan.

2) The river-linking project.

3) PMO's push for more dams along the Ganga in Uttarakhand.

4) Finance Minister Arun Jaitley's budget announcement last year of a riverfront development plan along the Ganga. This is on the lines of the Sabarmati, which itself is a discredited effort.

5) The NDA's lack of emphasis on environmental norms and the setting up of TSR Subramanian committee to dilute environmental laws is possibly the biggest threat to Ganga and all rivers.

Even though the Modi government has declared Aviral (continuous) Nirmal (clean) Ganga its aim, it has not given any credible road map for rejuvenation of the Ganga.

As far as cleaning the river is concerned, the government has done nothing differently from past efforts that failed to make any favourable impact on the river.

Far from cleaning the Ganga, the Modi government has at least five ideas that might end up harming the river

Neither has the government taken up any review of why past efforts have failed. The general consensus seems to be that if sufficient amount of money, technology, infrastructure and lip service is put together, it will deliver a rejuvenated Ganga.

But that is exactly what has been going on for more than three decades, without any success.

Criticism from within

It is apt that BJP MP Hukum Singh, who heads the 21-member parliamentary standing committee on water resources, was himself critical of the government on this issue.

Singh's committee came down heavily on the government for having done little to arrest rising pollution levels in the Ganga and other water bodies in its report that was tabled in Parliament on 27 April 2015.

"So where has the first step to clean and rejuvenate the river been taken? As a first step, our parliamentary team decided to visit Rishikesh and Hardwar, which is really the head of the river. Can you imagine what we saw? Huge drains carrying untreated sewage being dumped into the river. The smell was so foul, we could not even stand there. Effluents from industry only serve to worsen the situation. All the engineers associated with this project can be seen to have built palatial bungalows for themselves, but the river remains as dirty as ever. The situation there (in Varanasi) is no better. The story is the same with only 30 per cent of sewage water flowing into the Ganga after treatment whereas nearly 70 per cent of sewage flowed directly." Singh said.

One positive step by the government was the affidavit from the Ministry of Environment and Forests submitted in the Supreme Court in December last year in the case of Uttarakhand's hydro-power projects.

In that affidavit, the ministry accepted that hydro-power projects in Uttarakhand are not only prone to disasters, they would also be of no help in rejuvenating the Ganga.

This govt has done nothing differently from past efforts that failed to make any favourable impact on the river

However, barely a month later, in January, the PMO directed the ministry to reverse its stand. The ministry obliged.

Another positive sign from the government could be seen in the report of the Union Water Resources Ministry assessing the environment flows required in India's rivers, including the Ganga.

But the government has so far shown no move to implement the recommendations of the report.

What's the way out?

1) Make the governance of rivers bottom up, with clearly defined norms of participation of the people whose lives and livelihoods depend on the river.

2) Conduct a credible review to understand what did not work for so long.

3) Make the functioning of all urban areas, pollution control boards and sewage treatment plants participatory, transparent and accountable.

4) Accept the need for environmental flows in all rivers at all times.

5) Review the hydro plans in Uttarakhand and across the Ganga basin before going ahead with any new projects.

6) Review the development effectiveness of the Farakka barrage.

7) Focus on smaller tributaries and after achieving success there, replicate it with bigger rivers.

We can learn from others' experience and techniques but we need to realise that every river is different, and that our situation is very different from most other countries.

For more details, see Delhi Declaration adopted at the first India Rivers Week in November 2014.

It seems the Modi government specialises in symbolism without substance. Even the Supreme Court of India came down heavily on the government on the Ganga issue, even calling them Kumbhakarna.

The apex court has said that at this rate, there won't be any improvement in the river even in 200 years and that the government only seems interested in keeping the issue alive for the next elections.

Unfortunately, the judiciary does not have a great track record in this regard either. The Ganga cleaning case has been going on in the Supreme Court for close to 30 years and the Yamuna Maily case has been going on since 1994. However, we see no improvement in either rivers. One possible sign of hope is the January 2015 directive of the National Green Tribunal, which gave a detailed plan of progressing from 'maily' to 'nirmal' Yamuna.

However, we need to wait and see if this will help the river in any way.

Written by Himanshu Thakkar.

The views expressed here are personal and do not reflect those of the organisation.

The Modi Plan: five clear steps to job creation

The most interesting question about poverty is why countries are poor. But the most important question is how the government of a country can put poverty in the museum, where it belongs.

Our last government at the Centre decided that the best way to reduce poverty was to have a state that spends big and provides people a framework of rights - Right to Education, Right to Food, Right to Work and so on.

However, this strategy changed India from an economy with high growth and low inflation to one with low growth and high inflation. In many ways, the spectacular victory of the BJP in the Lok Sabha elections was a product of rising aspirations.

As a nation, our collective aspiration has changed from poverty alleviation to poverty elimination and, individually, we have moved on from being inspired by Garibi Hatao to dreaming about Ameeri Banao.

The creation of prosperity - and not the alleviation of poverty - has become the main priority.

Narendra Modi came with a message that three Es - education,employment and employability - can change lives in a way that subsidies never can.

These three Es have three problems: matching (connecting demand to supply), mismatch (repairing supply for demand) and pipeline (preparing supply for demand).

As this government completes one year, how have they done in these three areas?

Judging a government elected for a five-year term in one year is like a person on a diet getting on a weighing machine every day. Nonetheless, 12 months is enough to lay the foundations of the future.

The bottom line report card of the government is: 'Very Good' in laying the foundation for non-farm job creation, 'Good' in skilling and 'Poor' in education.

5 points on the road to job creation

Let us take jobs to begin with. Farming is no longer viable - more than 50% of our labour force generates only 13% of our GDP.

The role of the government in the creation of non-farm jobs is not about lighting a fire but creating instead the conditions for spontaneous combustion. The government gets high marks for creating a fertile ground for non-farm job creation because we finally have a holistic plan that simultaneously focuses on several key factors.

1. Smart cities: We need to take jobs to people rather than the other way around. Our present demographic realities aren't conducive to this.

Two lakh villages in India have less than 200 people. On the other hand, we have only 50 cities with more than a million people, as compared to 350 in China.

2. Ease of doing business: India's 63 million enterprises translate to only one million companies, of which only 10,000 have a paid up capital of more than Rs 10 crore. This needs to be expanded significantly.

3. Make in India: This is another idea that shows that the government has its priorities right. As of now, 11 per cent of India's labour force are engaged in the manufacturing sector. We may never catch up with China's peak figure of 40% manufacturing employment. But surely we can endeavour to make ours at least 22%?

4. Energy reforms: India, in some ways, is a country with a birth defect. The country with the world's second largest population doesn't have any major form of energy available domestically, besides coal.

5. Labour law reform: Our labour laws are like marriages without an option for divorce. They breed informality, capital substitution of labour and corruption.

Labour law reform has been a taboo for governments because of a small minority of trade unions. Only 5% of the labour force have imposed a huge tax on labour market outsiders like women, young people,and people from small towns.

Only 50 cities in India have more than a million people. China has 350. We also have 2 lakh villages with only 200 people

The existing system ensures that 90 per cent of our employment is in the informal sector. This labour aristocracy, however, has been disappointed with the current government. Reforms have included competition for pension and health insurance providers and a move towards online compliance for companies.

But the big innovation has been shifting the action to states; using Article 254 (2) of the Constitution that allows states to diverge their laws from national norms. This provision has already been used by Rajasthan and Madhya Pradesh. Six more states have lined up to follow them.

While there may be something akin to an Indian capital market, there is no such thing as a unified land and a labour market in India.Therefore when it comes to job creation, 29 chief ministers matter more than one prime minister. The shift of power to state capitals has also been accompanied by a shift of funds - 62% of total receipts in the last Budget.

NDA's big innovation has been shifting action to states. For job creation, 29 CMs matter more than one PM

How to skill a billion

More has been done on skills in the last five years than in the preceding 20 years. But a lot more needs to be done.

Most importantly, the institutional and legislative structures at the Centre need to be fixed. Despite placing reform of the Apprenticeship Act, 1961 as the 20th point in Indira Gandhi's 20-point programme in 1975, India languishes with only three lakh apprentices. Japan alone has 10 million.

The amendments to the Apprentices Act, 1961 passed by this government lays the foundation of placing 'learning-by-doing' and 'learning-while-earning' at the heart of skill development.

The new Ministry of Skills is a great start because while the issue of skills is a horizontal one, the government is organised vertically and most silos have an antibiotic reaction to co-ordination or aggregation.

The recent transfer of the apprenticeship programme and the regulation of industrial vocational institutes from the Ministry of Labour will create sharper accountability.

The final turf battle in connecting vocational qualifications to the world of university degrees is still being resolved.However, the move to create a National Skill University under the Ministry of Skills may allow innovation to flourish.

Finally, the recognition of prior learning in the revamped Pradhan Mantri Kaushal Vikas Yojana addresses the heart of our skill problem where people who have skills often do not have formal certificates.

Education - missing the woods for the weeds

In education, the government has not walked the talk and has got entangled in the weeds while missing the big picture.

We need to amend the Right to Education Act because it confuses school building with building schools. We need to make it outcome-based by transforming it into the Right to Learning Act.

We need to introduce flexibility in higher education by allowing new set-ups like skill universities to innovate in flexible delivery and modularisation. We need to create a corridor with multiple on and off ramps for every qualification between three-month certificates, one-year diplomas, two-year associate degrees to three-year degrees).

We need to turn the Right to Education Act into a Right to Learning Act. We need to build schools not just school buildings

We need to liberalise medical education - we only produce 35,000 doctors a year as compared to 1.3 million engineers. We need to neuter education regulators that do not add value. Sadly, all this is not even work in process as yet.

The art of politics

In the last decade, we had forgotten that policy is a child of politics and that politics is a contact sport.

It is nice to have a government whose brain is connected to the backbone and it is important to realise that politics is not about solving a math sum but painting a picture.

We have long known what needs to be done to fix our 3E ecosystem, unfortunately the transmission losses occurred because we did not detail the how and who.

The first year of shifting policy for a greater focus on jobs, has gone well. But this is only the start of a long journey, which needs to gather policy momentum in the next one year if the government wants to look at young people confidently in the eye when they go back for votes in four years' time.

Written by Manish Sabharwal.

The views expressed here are personal and do not reflect those of the organisation.

Swachh Bharat: why Modi's toilet trouble won't end anytime soon
Swachh Bharat

Six months after its launch on 2 October 2014, the Swachh Bharat Abhiyan has hit a snag. Apart from inadequate funding, the ambitious nationwide cleanliness drive has yet to take off for want of clarity on rules and roles for implementing agencies.

Where are the funds?

While funds to build over 11 crore toilets across India in the next five years have yet to be sourced and earmarked, confusion over centre-state responsibilities and sharing of costs has left toilet construction in the lurch.

It is hardly surprising, therefore, that even the allocated Rs 2,850 crore was under-utilised by the states during the previous year. This has led to a reduction in the budgetary allocation for the current year.

Clearly, the Finance Ministry didn't have enough confidence in the Ministry of Drinking Water and Sanitation's ability to construct the required number of toilets this year. As a result, only Rs 2,625 crore was allocated against the requested Rs 12,500 crore for the year 2015-16.

India will need no less than Rs 1,33,000 crore over the next five years to eliminate the scourge of open defecation.

Of course, the fact that a Swachh Bharat cess on the lines of the education cess, will be levied, means that there will be more funds in hand for toilet construction.

The emphasis on numbers, however, is worrisome because that is not what the ambitious program was designed for in the first place.

It was instead based on the premise that changing peoples' attitude towards using toilets should precede actual toilet construction. So, the task has been to bring about a behavioural change among the 65 crore people who relieve themselves under the open sky every day.

Why did earlier schemes fail?

There were hopes that Swachh Bharat would be an ambitious new beginning rather than a rehash of earlier schemes. Sadly, this has not been the case.

The erstwhile Central Rural Sanitation Programme (CRSP) and its rechristened avatar the Total Sanitation Campaign (TSC), launched in 1986 and 1999 respectively, were aimed at transforming the sanitation landscape of the country. Both the programmes failed to achieve their goals.

India will need Rs 1,33,000 crore over the next 5 years to eliminate the scourge of open defecation

Consequently, TSC was revamped as Nirmal Bharat Abhiyan (NBA) in 2012 by giving a booster dose to mass awareness through enhanced budgetary allocations.

Expectedly, the concerned government departments which have only been setting annual targets on toilet coverage and missing it all these years, could not shift gears to go on a sanitation preaching mission. For obvious reasons, NBA didn't quite work out.

Eliminating open defecation is undoubtedly good politics, but for Swachh Bharat Abhiyan to succeed over its predecessors, the government would need more than just pulling the levers of many departments to work together.

Is constructing toilets enough?

When it comes to the subtle question of behaviour change, a centralised approach can hardly be expected to work. Government departments are neither trained nor capable of engineering shifts in social behaviour. Therefore, it isn't surprising that the allocation towards bringing about behavioural change through mass awareness has gone down.

Since the implementation machinery of the government could utilise just about half of the allocated funds in the past, the mission has been allotted only 5% of the budget (against the previous 15%) towards behavioural change processes. The government doesn't realise that this approach won't work.

The trouble with playing the numbers game alone is that there is a danger of building poor quality toilets that nobody uses.

A study of over 3,200 rural households in Bihar, Madhya Pradesh, Uttar Pradesh and Rajasthan shows that in about 45% of the households with toilets, at least one person still defecates in the open.

Why do people like doing it in the open?

It may seem a case of 'old habits die hard' but the reality is that a dingy toilet with insufficient lighting is cause enough for people to seek solace out in the open. According to writer VS Naipaul, defecating in the open was an escape from the fear of claustrophobia in a closet.

Many of those who opt to go out in the open do so because the sensory faculties of humans miss out on the need for engagement of some kind in the isolation of a toilet.

The question that begs an answer is: why is a toilet not a priority for millions of households? Is decision-making conditioned by the cognitive limitations of the human mind?

Even though it is difficult, the government will need to understand a little bit of human psychology while devising strategies to eliminate open defecation. It would need to provide context-specific architecture for people as there is a subtle distinction between a toilet and the idea of a toilet.

It is a pity that the largely absent toilet has been made the centre-point of the ambitious Swachh Bharat Abhiyan, instead of working towards building an overall hygienic environment.

The choice of toilet designs, decentralised solid and liquid waste management, and an adequate trained manpower to execute the plans have yet to be put in place.

The challenge is not only constructing over 11 crore toilets by 2019 but also to ensuring that these are put to use. It is a daunting task and policy-makers need to engage with behavioural change experts to create conditions that make open defecators think.

The government may have caught the attention of the masses but it is yet to deploy resources where they matter. And, five years do not offer the luxury of time in changing the dirty picture.

Written by Sudhirendar Sharma.

The views expressed here are personal and do not reflect those of the organisation.

The Globetrotter: how to read Modi's foreign policy moves

Prime Minister Narendra Modi completed a year in office recently. His policy approaches and actions are being carefully assessed. How should his foreign policy - its substance, style and articulation - be judged?

Prime Minister Modi has made no attempt to radically redefine India's external interests or reshape the substance of its foreign policy. He has largely flowed with policy, as it has evolved, in the post non-alignment decades. He has, however, shifted emphasis in select bilateral and regional relationships. He has also kept to Indian positions on global issues but with pragmatism.

Modi has thrown the spotlight on the pursuit of economic interests. This is a continuation of his experience as Gujarat's Chief Minister and is unexceptionable, but it should not relegate security interests to a secondary position, especially in dealing with the Sino-Pak nexus.

Where he is clearly different from his predecessors is the elevation of cultural factors almost to the category of national interests. The UN adoption of his resolution of declaring 21 June 'International Yoga Day' is indicative of the strength of his soft power. But the question remains: how does Modi measure up in the world of realpolitik?

Neighbourhood negotiations

Modi's focus on the immediate neighbourhood is appropriate and laudable. His invitation to the SAARC leaders to attend his oath-taking ceremony signalled his intention of taking India's neighbours along on the country's journey of transformation.

The decision to visit Bhutan as his first official destination further concretises the effort to bring India's immediate neighbours closer.

His visits to Nepal and Sri Lanka and the passage of the Constitutional Amendment relating to the Bangladesh enclaves were significant for the promotion of mutual and comprehensive interests with these countries.

There has, however, been a lack of coherence in Modi's Pakistan policy. The decision to object to Pakistan treating the Hurriyat as a virtual third party by briefing it on India-Pakistan bilateral engagements was correct, even as it departed from India's earlier position. The robust response to Pakistani provocations along Line of Control and the International Border in J&K was also justified.

All this was abruptly and inexplicably reversed when Foreign Secretary Subrahmanyam Jaishankar was sent to Pakistan in the guise of a SAARC yatra. What did it achieve except in making Pakistani generals feel that Modi was without stamina to hold on to his position? Dialogue is a means to an end, not an end in itself.

Indian interests in Afghanistan are threatened and relations need attention and adroit play, given Pakistan's new approaches and China's energetic diplomacy.

Chinese checkers and American bonhomie

The real test lies in the management of the relationship with China. Beyond bonhomie, the quest for personal chemistry and the talk of culture and faith, there is a clash of interests.

China is building a second and enduring pillar to its Pakistan ties through the China-Pakistan Economic Corridor. It is not reducing its desire for salience in the Indian Ocean. It continues its relentless drive to gain influence and resources worldwide. There is no subtlety to its vistaarvaad (expansionism).

As India's manufacturing sector picks up, the competition with China will inevitably increase. All this requires clarity and firmness, not a throwback to the old lulling slogan of bhai-bhai, whatever be its current variant.

The handling of the US has been a plus. Modi has not allowed personal factors to impact his policy. The US is a source of technology and investments, and the reconciliation of interests in the nuclear liability law may not get much American investments in the civil nuclear area but has provided confidence to American businesses.

Differences in the approaches towards international, political, commercial and environment issues are likely to continue, but Modi is standing up for Indian positions.

Economic diplomacy

Modi's forays to Japan, France, Germany, Canada and Australia have been essentially exercises in economic diplomacy. He has struck positive chords, but the eventual success of these efforts will lie in the success of the creation of an enabling environment in India for greater economic interaction with these advanced economies.

What has been very impressive on the bilateral front is that Modi understands the need to develop anchors for India's long-term security in the Indian Ocean Island states of Mauritius and Seychelles. This was neglected in the past and its redressing is heartening.

Modi supporters in Melbourne ahead of his visit in November 2014.Photo: Mal Fairclough/AFP/Getty

Modi has focused on the region to the east of India, and has indicated the desire to consolidate relations in what he calls an 'Act East' policy. This isn't problematic in and of itself, but it may result in the neglect of India's traditional constituencies in West Asia and Africa, as well as the new beginnings made in Latin America. Crucial interests are at stake at least in West Asia. At the same time, the India-Africa Summit later this year is a welcome move.

Modi has largely adhered to past positions on most global issues such as health, trade and nuclear. He has stressed the need to adopt the Comprehensive Convention on International Terrorism (CCIT) but concerted action at the political level is required apart from active diplomacy on this front.

All eyes will be on India at the forthcoming climate change summit in Paris. While it is fine to emphasise national efforts, the West cannot be allowed to abdicate its responsibilities as it wishes to do. This will be an important test.

Modi's participation in the G-20, BRICS, ASEAN and SAARC summits has been impressive and has earned him the goodwill of his international peers.

Highly personalised style

Modi belongs to a different intellectual tradition than his predecessors, except perhaps former Prime Minister Atal Bihari Vajpayee. However, the latter had spent decades in Parliament and an instinct for tradition made him pursue a conventional diplomatic style. This is not so in the case of Modi.

He has revelled in stamping his personal style on his diplomatic trips and meetings, with hints of his ideological persuasions coming through. He acknowledges that he was new to the "world", but asserts that he considered "it was necessary that the world's view on India underwent a change, and I accepted the challenge - I will go myself."

No world leader, and especially no Indian Prime Minister, has worked a crowd of non-resident nationals during official visits the way Modi has. The Madison Square Garden event in New York, where the chants of "Modi! Modi!" reverberated was stunning in its departure from the hitherto staid and quiet style of Indian diplomacy.

The Madison Square Garden event was particularly notable, as American political personalities thronged to pay homage to the Indian Prime Minister - in part with an eye to winning the Indian community's goodwill.

The 'Chai pe charcha' (discussion over tea) and 'Naau pe charcha' (discussion on a boat) are also extensions of the new style, as was Modi receiving Chinese President Xi Jinping in Ahmedabad and the event on the Sabarmati River Front. Earlier, a positive departure from protocol only meant a prime minister receiving a guest at Palam airport.

Modi's informality, as shown in repeatedly calling President Obama "Barack" during the joint 'Mann ki baat' during the US President's Delhi visit, has also been unlike the approach of traditional Indian political leaders, who maintain a studied formality in public even if there is a personal relationship with a foreign leader. Modi flaunts it.

Modi has revelled in stamping his personal style on his diplomatic trips and meetings. But hints of his ideological persuasions still come through

The fact that President Obama wrote in TIME magazine on his Indian friend confirms the personal relationship between the two.

Never in the past has the cultural heritage of ancient India been put at the forefront of India's foreign policy as now. This is illustrated not only by the emphasis on yoga but also through the gift of philosophical texts such as the Bhagavad Gita and the profiling of faiths that have originated in the Indian sub-continent, such as Buddhism, and also by visits to famous temples, as in Nepal.

There is nothing wrong in the new approach but it is reflective of new diplomatic norms.

Articulation: more of Chanakya, less of Machiavelli

Modi is a great communicator but his modes of articulation are more through the vehicles of the electronic age. No previous prime minister has been as aware of the potential of the new mediums of communication as him.

The objective is clearly to show to the people that the Prime Minister is on the ball, fully engaged and responsive to international developments that impact the people directly. Thus, whether it is the Yemen crisis and the evacuation of Indian nationals, or his meetings with foreign leaders, the people are informed through a series of tweets.

Along with his peers, Modi is reluctant to take media questions. Declaratory statements are his style of articulation. He has done away with the practice of taking non-official media on his travels and does not, therefore, have press conferences "onboard the aircraft", as was done in the past.

In keeping with their intellectual tradition, some of the previous prime ministers and ministers of External Affairs used to give lengthy interviews on their philosophies of the World Order. In these interviews, they often displayed an easy familiarity with ideas as they had evolved in the West.

In the present case, there is an emphasis on the ideas of diplomatic thought that are rooted in India: more of Chanakya, less of Machiavelli. For modern India, both traditions are needed.

The articulation is and should be on specifics and not on theories, on programmes and actionable policies and not on thought, theory or principles. This is the new template of diplomatic vocalisation.

Written by Vivek Katju.

The views expressed here are personal and do not reflect those of the organisation.

Catch Team

Catch Team @catchnews