Manmohan Singh: Quiet Indian Prime Minister Plans Loud Policy Thrust

By: CaraTan   Date: 10 June 2009

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Bangalore, India, 10 June 2009. Prime Minister Manmohan Singh was once derided as a lame-duck, weak prime minister. Others may have been tempted to crow after winning a landslide election victory, but not PM Singh, who instead gave all of the praise to Sonia and Rahul Gandhi.

Dr Manmohan Singh: The Mouse Who Roared Credit: Shrimali Vijay

Prime Minister Dr Manmohan Singh

On closer analysis we begin to see that it is the very qualities that led critics to call weak, that have become his greatest strength. It is a kind of political jujitsu that will surely go down into the history books. With so many characters seeking out the limelight, Dr Singh prefers to retire from it. With so many beating their chests, he is humble. Crucially, with a quarter of Indian MPs under corruption investigations of one kind or another, he is absolutely clean.

He doesn't have the instant charisma of Bollywood stars, cricket players or famous political families, and yet these gentle qualities have endeared him to increasing numbers of Indians. They have also acted as a velvet glove around an iron-willed determination, such as his decision to lose coalition partners and face down opponents in a no-confidence vote over the US nuclear pact.

That decision did indeed prove a milestone, and it has been further bolstered by another humble giant in Congress. Rahul Gandhi. Rahul has led a revolutionary policy to present Congress as a party for all Indians, irrespective of caste, religion or region. He has been out to remote rural areas building grass roots organisations. And he has ushered in a new era of young politicians free of the machinations of the party elders, betting that in a country where most of the populace is young (70 per cent under 50 and 50 per cent under 25), the electorate was sick of the same octogenarian faces.

Rahul has also been derided as weak and odd, and his approach was predicted to lead to disaster. Instead, Congress has given itself a whole new lease of life, and can now chart its own course without having to bend to the will of coalition partners.

So what will Dr Manmohan Singh do with his new mandate? The indications are that an American-style First 100 Days of Office plan has been prepared and is now being worked on. The feeling is that this is a historic opportunity to lay the groundwork for a economic policy renewal in India.

His to-do list includes:

NREGS is particularly interesting. Western bankers and economists think this scheme goes against free-market capitalism, and domestic opponents think it was little more than an election bribe. There is a decisive logic in the plan, however. Often times, most or all of the funds allocated to development projects where siphoned off by officials and middlemen.

NREGS seeks to cure this chronic Indian disease by giving the money directly to village-level elected officials, to use it for services that will enhance the infrastructure and services provided in and for that village. It will also be used to help out in disasters such as famines and droughts, and for the needy, such as the newly widowed.

If this bold plan is successful, it could have the same transformative effect on the Indian economy as Roosevelt's New Deal did on the US, by making India's vast rural population economically productive and active. That could then lead India to the same growth levels as China, albeit using a radically different approach.

The Right to Information Act will for the first time give ordinary people the right to look at government records. Historically, everything in the government was secret, including its trash. RTI means that citizens can vet local and federal officials, and this could have a dramatic effect in reducing corruption.

Can all of this work? It is of course too soon to say, but the heartening news is that investors are flocking back to India in unprecedented numbers. On average over the last month, $1 billion a week has been invested into India by foreigners, and if anything that number is now growing.

Dwayne Ramakrishnan, EconomyWatch.com


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