From UPSC perspective, the following things are important :
Prelims level : nothing much
Mains level : Need of reforms in Niti Ayog
There must be a review of what the think tank has achieved to adopt the new role described in its charter
Now, when the country’s economy has not performed to the high expectations Mr. Modi had created, and citizens’ aspirations for ‘ache din’ have not been realised, the performance of the NITI Aayog is under scrutiny, as it should be.
History of reforms
Dr. Singh declared that reform of the Planning Commission was long overdue.
Planning Commission Reforms
- An outline was drawn of a substantially reformed institution which would, in Dr. Singh’s words, have a capability for “systems reform” rather than making of Five-Year Plans, and which would have the “power of persuasion” without providing budgets.
- A commission chaired by C. Rangarajan, then chief economic adviser to the Prime Minister, examined budgetary processes, divisions of responsibilities between the Finance Ministry and the Planning Commission, and distinctions between ‘plan’ and ‘non-plan’ expenditures.
- Chief Ministers retorted that the Planning Commission must improve its ability to understand their needs and to develop ideas that they would want to adopt because they accepted the ideas as good for them, not because they would have to if they wanted the money.
A good starting point
- The NITI Aayog charter is a good starting point for a new journey in transforming the governance of the Indian economy.
- The NITI Aayog and the government would do well to conduct an open-minded review of what NITI Aayog has achieved so far to adopt the new role described in its charter — that of a catalyst of change in a complex, federal, socioeconomic system.
- And assess whether it has transformed its capabilities sufficiently to become an effective systems reformer and persuader of stakeholders, rather than merely an announcer of lofty multi-year goals and manager of projects, which many suspect it is.
Concerns regarding independence
- There is deep concern that NITI Aayog has lost its integrity as an independent institution to guide the government; that it has become a mouthpiece of the government and an implementer of the government’s projects.
- Many insist that NITI Aayog must have the ability to independently evaluate the government’s programmes at the Centre and in the States.
- Some recall that an Independent Evaluation Office set up in the last days of the UPA-II government was swiftly closed by the NDA government.
- Others counter that the Planning Commission had a Programme Evaluation Organisation all along and which continues. They miss the need for a fundamental transformation in the approach to planning and change.
- The transformational approach to planning and implementation that 21st century India needs, which is alluded to in NITI’s charter, requires evaluations and course-corrections in the midst of action.
- It requires new methods to speed up ‘organisational learning’ amongst stakeholders in the system who must make plans together and implement them together.
- The NITI Aayog’s charter has provided a new bottle.
- It points to the need for new methods of cooperative learning and cooperative implementation by stakeholders, who are not controlled by any central body of technical experts with political and/or budgetary authority over them.
Merely filling this new bottle with old ideas of budgets, controls and expert solutions from above will not transform India. The debate about NITI Aayog’s efficacy must focus on whether or not it is performing the new role it must, and what progress it has made in acquiring capabilities to perform this role, rather than slipping back into the ruts of yesterday’s debates about the need for a Planning Commission.