Centralisation of power, corruption scandals made bureaucracy to step back: Former RBI Governor Raghuram Rajan

Ever since the corruption scandals surfaced in India, along with the excessive centralisation of power vested with the PMO and the resultant gagging of many federal organisations had the bureaucracy go tipsy and step back, former RBI Governor, Raghuram Rajan was quoted as saying by a PTI report.

Speaking at the University of California in Berkeley on November 9, 2018 Rajan referred to the recently inaugurated ‘Statue of Unity’ as an instance of a project that required the approval of the Prime Minister’s Office, drawing peel of laughter from the audience at the varsity.

Coinciding the 143rd birth anniversary of Sardar Vallabhbhai Patel, Prime Minister Narendra Modi unveiled the ‘Statue of Unity’ in Gujarat’s Narmada district on October 31, 2018. Considered as the tallest statue in the world, the 182-metre tall statue was built at a cost of Rs. 2,989 crore. There were many criticisms for building the statue having spent colossal amount of money by the BJP led NDA Government. Politicians and even the other sections of the society questioned the need of erecting such a statue when a chunk of the population of India are still under poverty line. Few even felt that by erecting the statue, the Government has belittled the man, as Sardar Patel never craved for immortality and quietly was creating a revolution by reorganising all the princely states into the Indian Union. A true Congressman, he was an obedient party cadre, always supporting Pandit Jawaharlal Nehru. BJP, with Narendra Modi at the helm, suddenly felt the Gujarati pride and erected the statue of Patel. Now the same party is heaping praise on Gandhi, who was assassinated by a Hindu fanatic. The double standard of the RSS controlled BJP is quite evident”, said another person, whose grandfather was one of the principal architects of the reorganisation of princely states of India into the union. There is also widespread criticism in the renaming of all the places in the UP, more particularly, the Muslim names. So, the agenda is clear. Polarisation, creating morbid fear among the minorities and create communal flareup like Sabarimala and other issues as the ruling dispensation has nothing to claim about the development aspect as every step the Union Government had taken including demonitisation was a disaster”, said a retired bank officer.

Back to the University of California, Rajan said, “India can’t work from the centre. India works when you have many people taking up the burden. And today the central government is excessively centralised.” Rajan, returned to academia in 2016 after his three-year tenure as RBI governor, choosing to not seek a second term – a first in over two decades. On Friday, he said an example of India’s centralisation of political decision-making was the quantum of decisions that required the assent of the Prime Minister’s Office.

“Nobody wants to take a decision, unless it has approval up there, which means even if the Prime Minister works 18 hours a day, a very hard-working PM, there is only so much time he has”, Rajan said. The kind of projects that get done depends on the Prime Minister, Rajan pointed out.

“For instance, we build this massive statue, the Sardar Patel statue on time,” Rajan said amidst laughter and applause from the audience. “That suggests that when there is a will there is a way. Can we find that will for everything else?” he quipped. From the ex-RBI head’s statement you can read between the lines very clearly. If the BJP government wanted to push its agenda and priorities, it can accomplish the same in record time. A case in point is the Sardar Patel statue. That is not reflected in other developmental projects is what we have to make inference. And that is not all. Rajan goes on to add, “In addition to excessive centralisation, the unwillingness of the bureaucracy, including in the public sector to take initiatives, is another major problem. Ever since the corruption scandals hit India, the bureaucracy had stepped back, he added.

To recapitulate the story, the issues at hand includes too many decisions waiting for approval at the highest level, If PM works 28 house a day, he still has limited time and zeal shown in building giant statue should extend to other areas as well. This is what the gist of Raghuram Rajan had said at the University of California.