Prime Minister Narendra Modi endorsed the idea of ‘Minimum Government, Maximum Governance’ as a guiding principle for his government back in 2014, yet few structural reforms have been undertaken over the past five years to make it a reality. As the BJP government starts its second tenure, with the largest parliamentary majority in over three decades, the Prime Minister is presented with a unique opportunity to realise this vision.
Here are some key ideas to make ‘Minimum Government, Maximum Governance’ a reality:
1. Ease of Doing Business for ALL
Marginal entrepreneurs (street vendors, informal recyclers, etc.) along with micro and small enterprises form the backbone of India’s economy. Placing an institutional emphasis on reducing regulatory barriers for this segment is key to ensuring sustainable development at scale (or ‘Sabka Vikas’). On the other end of the spectrum, disruptive tech enterprises in India desperately need a respite from archaic regulations that fail to understand their technology and innovations.
Additionally, one can’t have a fair and efficient free market when the government is being both the facilitator and an active player in the market. Publicly owned companies need to be privatised and the government should restrict its presence in only those enterprises that are required for ensuring National Security (e.g., uranium mining, ordnance factories, etc.).
2. Creating a Right to Education Act 2.0
The government’s one-size-fits-all education model fails to capture the diverse needs and aspirations of over 250 million school students. Thus, the first step towards reforming the education sector is to separate the government’s role as the financier, auditor, and executor of education. The government should instead just focus on financing education through school vouchers, leaving the job of audit and execution to independent institutions and edupreneurs respectively.
Also, recognition should be given to schools on the basis of learning outcomes and not structural requirements, i.e., schools should be gauged on the basis of the quality of education they impart, not the size of their classrooms and number of swimming pools. A reworked Right to Education Act incorporating these elements can thus enable an education of choice for all while promoting quality using the power of market competition.
3. Liberalising Agriculture
Welfare-centric schemes to uplift our farmers have in reality prevented them from benefiting from market opportunities and kept them dependent on welfare for survival. A classic example is the Agricultural Produce Market Committee (APMC), a highly regulated market for buying farm produce which has turned into a cartel that keeps the farmer from realising the market value of her produce. The Essential Commodities Act, with the intention of preventing hoarding of goods by the middlemen, effectively prevents price stability across seasons. Technology ban on GM seeds, land ceilings and restrictive policies for contract farming further prevent farmers from realising their full potential.
For the farming community to truly achieve prosperity, all these regressive regulations need to go. Just as the liberalisation reforms of 1991 benefited industries, liberalising agriculture would benefit the farming sector, and in the process, make our farmers truly prosperous.
4. Decentralising Governance
While the 73rd and 74th Amendments to the Constitution enabled devolution of powers and finance to local authorities, lack of political will has stalled the implementation of these provisions across the country. Since there is no mandated demarcation of funds for local governments, the state authorities often lack political incentive to willingly devolve tax revenue to local authorities. Hence, efforts towards implementation of these amendments is the stepping stone towards empowering local governments.
Also, the position of the city mayor needs to be strengthened beyond its current titular role and measures need to be taken to increase transparency. A strong local government can do wonders to improve the everyday life of our citizens and ensure that the electoral focus remains on efficient usage of their taxes.
5. Ensuring Autonomy for Institutions
Independent institutions enable different branches of the state to perform their duties in an efficient manner and are invaluable in ensuring effective governance despite political uncertainties. As such, their functioning should be based on set processes of internal decision making and insulated against arbitrary political interventions. Boards and committees of these institutions should have minority representation by government officials and vacancies should be filled in a time-bound manner.
Creating policy frameworks that ensure the autonomy of institutions is, in the long term, beneficial to both the government and the people. After all, ‘Minimum Government’s will need efficient institutions to impart ‘Maximum Governance’.