A crack team led by Arun Maira is trying to breathe new life into a fading institution
In the fourth weekend of October, about 150 officials of the Planning Commission gathered at the PUSA Institute campus in New Delhi for a three-day workshop to discuss 40 major issues confronting the country. There was open and heated debate on issues such as employment, agriculture and energy.
The discussions were structured in such a way that by the end of the sessions, everyone had spoken to one another on every issue.
The experience was nothing like the everyday ping-pong of dreary files. Until then, nobody had asked the scores of officials their opinions on issues like innovation or skill shortage. It was the first time that the bureaucratic behemoth’s collective intellect was put to rigorous use in the planning process.
“This is the best time I have had in the Commission,” one official gushed. At the end of the consultative retreat, the team identified 15 issues, including employment-led growth and making markets work for the poor, as the most important and immediate ones. The Commission’s top brass will now whittle the list down to about 10. These will form the basis of the approach to the next Five Year Plan. It is a fresh start.
A year ago, the idea of reforming the Planning Commission took root once again. The objectives are formidable: The sleepy old institution will be resurrected as an organisation with cutting-edge ideas that can sense and respond to India’s long-term challenges. And the man in charge of the process is Arun Maira, the former chairman of global consulting firm Boston Consulting Group in India and now a member of the Commission.
The Planning Commission’s primary role was to allocate resources to the Centre and states. But over the years, the states had become practically disconnected from the central planning process. Bimal Jalan, former governor of the Reserve Bank of India, points out that the process was no longer integrated because there were different governments in different states and the tenures of the state governments were also different.
As the Congress Party started losing in the states, giving way to alternative ideologies, Plan priorities at the state level began to get dislocated from the Centre. As a result, the annual plan became more important than the Five Year Plan.
By and by, state inputs into the Five Year Plans became perfunctory. According to one state official, interactions with the Commission had become mere “formalities” as allocations were decided even before interacting with the states.
The disconnect has widened so much that the Commission and the finance ministry practically decided the Plan with hardly any analytical understanding of the various dimensions of major issues such as water management or basic healthcare across the country.
Lack of consultation meant preparing the approach to the Plan was practically a solitary job. “The problem was there wasn’t much of a process,” says Pronab Sen, a veteran of the past three approach papers or the guiding documents for Five Year Plans that have been the centre-piece of medium range economic planning for the past six decades. Usually, Sen and a few officials would scan mid-term appraisals to pick up issues, get it approved by the internal planning commission and write it out. It was then put out for consultations with departments. The changes, if any, were usually incremental.
Montek Singh Ahluwalia, deputy chairman of the Commission, has an interesting anecdote about the late Raj Krishna, economist and former editor of the Economic and Political Weekly. Someone asked Raj Krishna what does the approach to the sixth Plan look like. “This is not the approach to the sixth Plan. This is the sixth approach to the same plan,” Krishna said, succinctly describing the rut into which the Commission had fallen.
In many ways, Maira’s job is to reclaim the original mandate of the Planning Commission: To assess and allocate resources in the most effective manner; determine priorities and indicate factors that could hold back economic growth; and determine conditions in the given socio-political environment for successful execution of the Plan.
The Beginning
One evening in October 2009, Arun Maira got off a plane at the Delhi airport and switched on his cellphone. The message box was full with texts from journalists asking Maira about his new role at the Commission. While he was up in the air, deputy chairman Montek Singh Ahluwalia had announced that the panel was restructuring itself into a Systems Reform Commission and that Maira was in charge of the recast.
Though Maira was a bit anxious about his sudden anointment, he finally understood his purpose at the Planning Commission. He recalled Ahluwalia telling him when he had just joined the Commission as a member: “You will be highly frustrated in this place. Here nothing works. It is so hidebound. It is a challenge to get things done.” However, while trying to figure out his own role in the Commission, Maira had already begun thinking about change and had been talking to his colleagues about it.
There is an essential difference between Maira, who, as advisor to the corporate world, is trained to focus on solutions, and rule-bound bureaucrats, who instinctively keep clear of problems. In true corporate style, Maira had to get out of his windowless office at Yojana Bhavan to think out of the box.
The Preparation
(This story appears in the 19 November, 2010 issue of Forbes India. To visit our Archives, click here.)