India’s Aborted Transitions

Dr Pratap Bhanu Mehta
President and Chief Executive, Centre for Policy Research

It is truly humbling and, dare I say, intimidating being here. Humbled by several things: first and foremost, the memory of the person we have gathered to honour, Prem Bhatia. I did not have the privilege of knowing him but from what I have read of him, what I have heard about him, I think there is only one thing that can be said — We just wish we had professionals of this integrity and insight and leadership around us, particularly in the media. I think he was by all accounts a truly astonishing figure. It is even more intimidating when you go into the history of the Bhatia family who are here today, Mrs. Bhatia, the brothers, a family of extraordinary personal courage, grit and determination and a really inspiring example to us all. It is even more intimidating when you begin to think about today’s awardees. I have had the pleasure of reading the work of both of today’s awardees, although I know Suhasini better and consider her a friend. She is truly extraordinary both as a person and as a reliable guide to the complexities of world politics. You cannot find a better guide with better judgement. And Priyanka Kakodkar for working on things that, as the citation suggested, are too often rendered invisible in a fog of ideological overlay. And then of course intimidated by the chairman, Dipankar Gupta, because most of what I have to say will, in a sense, be somewhat of a plain regurgitation of what he has been teaching us for a number of years and I hope he won’t mind too much. And then of course this distinguished audience, the collective wisdom in this room is going to be, in a sense, difficult to better.

What do I mean by the title, “India’s Aborted Transitions”? Of course, the first rule of speaking is that when you aren’t sure what you want to say or you aren’t even sure that you have anything to say, give as vague and as general a title as possible, so it gives you time to come up with something. But I think what the title was trying to capture was that there was a sense over the last decade or so that India, after being in the waiting room of history (to use Dipesh Chakravorty’s phrase) for two centuries, three centuries, whichever way you want to cut the story, was at last on its way to somewhere. A sense that there were some fundamental transitions happening in this society, in this economy and in our politics that would finally set India upon a path where hopefully you would have a politics with a deeper democracy and expansion of participation and capabilities. In the economy, a dynamism that could unleash the productivity of the private sector but translate the gains from that growth into a new social contract of bringing into the fold those who had been left out by this economic transformation. And in society, the beginnings of a new form or new forms of social solidarity and civil responsibility, a reciprocity that would replace the excessively conflictual, hierarchical and sometimes violent character of our society.

Nobody was under any illusion. Yes, this was going to be a very long drawn-out process, this was going to be a very conflictual process, but there was beginning to be a sense that this train is finally beginning to move somewhere. There was a sense of aspiration; and if you want to tell the story of this churning, there are all kinds of indicators you can look at. The most heartening in some ways, and also the cause of the most frustration later on, was fifteen or twenty years ago, and perhaps not even fifteen/twenty years ago, when I first moved back to India. In the early 2000s we used to debate in forums, Is there a demand for education in India? Are the poor willing to invest in education, send their kids to school? That debate is effectively over and dead. The poor are voting with their pocketbooks to send their children to school.

In the 2011 census, to my mind the most interesting data point is that in higher education female enrolment now crosses male enrolment. A truly astonishing change if you think about it. Certainly it is accompanied by all kinds of other issues where female labour force participation is much less and so forth. But just think about what a figure like that means for the future of our society. And of course there will be conflicts and dislocations in its wake but there was a sense that this society is moving somewhere. Some would want to express it in more grandiose aspirations of India having arrived on the world stage. I am never quite sure what that means but you get the general picture. The sense of dynamism was there.

Yet I think it is fair to say that over the last three to four years – and I think continuing into the present moment despite the political churning we saw – there is also beginning to be a sense of foreboding. Was this sense of movement, this sense of possibility, a mere flash in the pan or an enduring trend? After showing some economic promise, will we end up in a kind of low level equilibrium trap, call it a low middle income trap instead of a middle income trap? Will this unleashing of aspiration that we saw, almost an unleashing of the libido actually in some very fundamental sense, lead into a kind of new harnessing of desire for creative purposes? Or will it lead to the anarchy of conflict? In our politics there was a sense that economic growth offered possibilities for a new kind of politics. We expressed it in different terms, a shift from identity politics to developmental politics. The fact is that the very scale of the State was beginning to change, giving it possibilities for being an instrument of social change in in ways which were unprecedented. Was that just a pipedream? Or are we stuck in the low-performing political equilibrium that we have been in for a while?

I daresay – and that is really going back to the title – with regard to India’s aborted transitions, that the jury is out, very much out, on where these different transitions are heading but I have to say I think the sense of foreboding is growing. And what I will outline in the next few minutes, very quickly – this is more a ruminative exercise than a rigorous piece of social science, perhaps a way of collectively instigating some thinking – is that what I take to be the four key transitions we hoped were going to happen actually aren’t happening. Why are these transitions not happening, what are some of the things we underestimated about what it would take to get these transitions going? And then briefly, sort of more speculatively, where, how do we get out of this mess? I will be very brief about the four transitions that, to my mind, are central; each of these could take seminars to explicate.

The first transition, which I will just mention and sort of leave aside because I think the normative issues in that transition are relatively simple, is what I would call the transition from a segmented conception of toleration that Indian society has lived with for centuries, or decades depending on how you read Indian history, to a much more liberal conception of toleration. Briefly put, this transition can be described in the following terms. It is certainly true that India is an astonishing experiment in diversity, in managing diversity through democratic means and it is certainly true that the vernacular practices of tolerance, acceptance and diversity have deep roots in different ways. We can argue about the pressures under which they have succumbed, the pressures that lead to their abridgement, but no matter how you read that record, as a glass half full or half-empty, I think what has become clear over the last fifteen-twenty years is that whatever that model of toleration was, that allowed this society to come to some kind of accommodation of diversity, it is not going to be enough for a new century in two key ways.

The first way is that that conception of toleration even when it worked very well (and let’s take it in its best case scenario and best case presentation) was a hierarchical and segmented conception of toleration. Every group in this society found a place in this society but only as long as they stayed in their place. And this was inscribed in almost every form of social practice. Look, for example, at the spatial configurations of our cities, where you knew which community lived where. Or look at marriage practices, at food practices, I mean this is all very familiar stuff. And often we prided ourselves on the fact that some kind of what you might call metaphysical tradition of toleration combined with this kind of social practice has allowed a certain kind of diversity to be at least maintained, if not actively cherished and nourished.

But one of the things that modernity does, and one of the things that economic growth does, is it exposes the limitations of exactly this kind of toleration. The new challenges of toleration are going to impose upon us in far more intimate ways, where the primary idea behind toleration will not be ‘can communities find a place in this diverse mosaic’. It will in part be ‘can individuals be liberated from the yokes of community pressure’. The conventional debate over secularism and communalism in some ways doesn’t actually capture the central tension going on right now within our societies, which is between the forces of social orthodoxy and the forces of social liberation. This occurs across all communities in different ways, whether it is a kind of khap panchayat at one end of the spectrum or ghar wapsi at the other end of the spectrum. But more importantly, the demands of toleration placed on us by a mobile society, a society where individuals are liberated, are much, much more immediate and psychologically harder to deal with than that old segmented and hierarchical conception of toleration.

It is one thing in the abstract to answer the question, do you think a particular community has a place in Indian society and will you give it some space to flourish. It is another thing to answer the question, will you allow your children to inter-marry? Will you allow them to live in the same neighbourhood? If you look at the plethora of social conflicts that are bubbling under the surface whether it is ghar wapsi, khap panchayats at one end of the spectrum or issues of housing discrimination against minorities at the other end of spectrum, these are not problems that can actually be addressed by and appealed to the traditional vernacular grammar of segmented, hierarchical toleration that we grew up with. This will require a fundamental reorientation of self and identity in a more intimate way, in a way in which we are not even used to talking about as a society.

Similarly, and just to end this theme, there is great anxiety at the moment, rightly so, about whether freedom of expression is more at risk in contemporary India that it was in the past. As a historian of free speech jurisprudence I would argue that I am not convinced that it is actually more at risk now than it ever was at in the past. I think for much of our history our restrictions on free speech have been pretty shameful for a liberal democracy. But I think what is new is that the stakes in social conflict around free speech are going to deepen and exacerbate. As Mark Twain once said about 19th century America, a very wise remark, he said the Americans have the perfect freedom of expression and the good sense never to use it. But his point was that sometimes you can see or assume that you are a society that expresses freedom of expression simply because nobody is actually challenging the boundaries of expression. What we are seeing in the last five to ten years is there is going to be an exacerbated challenge to the boundaries of expression, people are going to offend religion more, people are going to project, defend things like pornography more. These are social realities that 25-30 years ago were kept a lid on through other forms of social control. So they did not become political and legal issues because the mechanisms of social control kept them off the agenda.

And I would submit that I think the challenge that we are facing is that those forms of social control have broken down, mostly for the good in some respects. Therefore what you are actually seeing is an exacerbation of that conflict that was implicit, which again is not going to be settled purely by legal or political means. It will have to be settled by, in a sense, redrawing the boundaries of acceptable and unacceptable social control. So though I think the conflict is intense, I don’t think this is an Armageddon for free speech, I think actually the pushing of these boundaries is going to expand these vistas in a perverse kind of way. But the central point is that the regime of toleration which was premised on forms of social control being successful – that will have to undergo a radical shift. We are at that moment where we don’t quite see how that transition is actually going to work out, whether the forces of repression using either State power or sometimes the power of intimidation in civil society are going to win. But it is a conflict that cuts across political parties and runs throughout society as a whole.

The second key transition, and this is the transition we have probably spent most of our political time on for the last three to five years, was an economic transition. The economic transition has many dimensions to it, transition from an agrarian to urban society, agriculture employment to non-agriculture employment, you can cut it many which ways but the one central architectural transition we were interested in was, can India make the transition from what we broadly call crony capitalism to a well-regulated capitalism. I am just assuming for argument’s sake here, and for brevity of time, that by and large for the foreseeable future we envisage an economic system that is based to some degree on market forces and private property being appropriately regulated, with the State compensating for market failures and the State as part of the social contract bringing in those who are left out of this process and getting them to participate. This is a sort of very conventional view of that. But even within the terms of this paradigm the Indian economy had, in a sense, locked itself into a trap from which it is still finding it hard to get out. I don’t think we have quite concentrated our focus on thinking about what the scale of that trap is. We all know that post 1991, the hope was that we will liberalise the Indian economy, the State will get out of some areas where it does not belong, we will unleash the productivity of private forces, market forces, and then the State can harness the gains from that growth to enable more participation of other groups in society.

I just want to concentrate on the productive side of this for a minute. We know for a fact that one of the things that went wrong with this story was we did not pay sufficient attention to factoring in the market side of the story. So all the areas where the big corruption scams happened, land, natural resources, mining – and you can actually add education to that list in some sense because the education market is a creation of perverse regulatory systems by the State – but look how you end up by 2010-2011. You end up with an economy, forget the corruption story for a minute, I mean many people in this audience know that much better than I do, but you end up with an economy where 50-60% of it does not have a credible pricing mechanism left. That is because in the old system the State could use administered prices. It could allocate land at whatever price it wanted. It could allocate minerals at whatever price it wanted. So though it was corrupt, it was destructive in some ways but you knew what the mechanism was. On the other hand these are not areas where markets function in quite the same way as they do in the case of other goods. So even if you put aside the corruption story for the minute, how do you expect to run an economy where 50-60% has no credible pricing mechanism left? The State lost enough political legitimacy because of the corruption scandals such that it could not go back to doing the old administered prices, the ‘we will give it away at whatever price we want’ story. On the other hand it has not been able to create institutions which can actually give you reliable pricing mechanisms in the future.

So just to take one example, everybody is talking about the coal auctions and the success of the coal auctions, in some ways a big success. The corruption scandal happens, there is public pressure, institutions intervene, we restore transparency to the process. Now we are left with this big question, has what came through this auction, the coal prices that came, is this going to be a financially sustainable price for the power sector? And almost everybody I talked to says ‘No’. So we will be back to the same trap three to five years from now, holding the can for the private sector.

Take another sector, banking, we are in probably what is the single biggest bank crisis at the moment and frankly the most unconscionable thing that the UPA did. Namely, to put our banking sector in a situation where many wonder how redeemable it is, with non-performing assets of upto 40% ,and this is a very generous interpretation. No basic practices in public sector banks of how you appraise projects, or how you actually lend to them. I mean, that is the place crony capitalism really happened. Can we actually have the confidence that we will end up with a banking system in the next four to five years? We were fed this, lie after lie, remember after the 2009 crisis, ‘India has the best banking system in the world.’ Yes, it has the best banking system in the world but only for a very few people. It is not a mess. We have been able to get out. In fact there is even a hesitation in acknowledging the depth of this crisis because of the lack of confidence in the Indian economy that this will actually exhibit.

Now why is this so-called transition from crony capitalism to a well-regulated capitalism going to be difficult in the Indian context? I want to give just three reasons because I think we do need to attack them.

The first is that one of the big casualties of the corruption scandals was that the incipient and precarious social legitimacy that Indian capital was beginning to acquire in Indian society eroded away very fast. In the mid-2000s, we sort of grew up with icons saying that you can, after all, be an honest businessman, it can be a middle class aspiration, you had icons in the IT industry, all of that credibility vanished. And one of the casualties of that credibility vanishing is that Indian capital is now between a rock and hard place, in the sense that on the one hand it rightly complains India is an inhospitable place for doing business, India is hostile to business, and there is some truth to that argument in the way the administrative practices of the State function.

On the other hand in our society and politics there is a great public clamour to hold capital to account and not just for its business practices, where unfortunately it is not as great in the environmental practices as it should be. Indian capital is kind of precariously poised between these competing demands, where to unleash its productivity it still needs some degree of liberalisation and yet the dominant tendency in society is a clamour for greater accountability. In fact AAP was one product of that. And we don’t yet have a political force that can effectively mediate between these two competing demands. So what is actually happening in State-capital relationships is this weird oscillation which we are seeing. On the one hand we are saying ‘ease of business’, on the other hand we have a black money law which in intent is fine, of course you need to hold capital to account, but anybody who has ever encountered the administrative practices of the State knows this is a recipe for flight capital. And there is no architecture, there is no framework, that tells you how you can actually credibly reconcile these apparently competing objectives. So the social legitimacy of capital is under question. Capital as a class in India has always been very weak partly because it is so ensnared in the coat-tails of the State that its ability to speak out as a class is pretty limited. Its own politics as always practiced is that of individual exceptionalism, not of the interests of the class as a whole.

The third reason why it is hard to get out of this mess is that if you take the example of the banking sector that I just gave, we are talking about stranded assets, we are talking about so much unproductive capital locked up in half-built projects. The truth of the matter is that getting out of this will require State-capital negotiation. Somebody will have to sit around the table and ask who takes some haircuts. Indian capital was used to gold-plating, Indian capital was used to super-normal profits in certain ways and banks were happy to lend to them even without due diligence or ascertaining viability of those projects, because they knew that if this goes wrong, the State stands behind it, they will renegotiate these projects.

One of the interesting things, and you might say this is the silver lining, is how hard the State is finding  to do those renegotiations. Because at one level it is scared that if it is seen to be too close to capital, its own legitimacy will be called into question. So you have a State that is not confident enough to do the dirty work of the renegotiation that will be required, and capital that is not powerful enough as a class entity. I mean, I am using this to, in a sense, create a regulatory structure that you might broadly call in the interest of well-regulated capitalism. But we are almost exactly where we were two years ago, we are still stuck there, despite anything that the government might say.

There are two other transitions that I want to talk about just briefly and then make a couple of general points about what underlines this. Just to sum up this part, the first task of politics is what you might call a liberal critique of the oligarchy to which the Indian capitalist belongs, capitalism in this sense is oligarchic and what we needed at the top was a liberal critique of that. At the other end of the spectrum, and this is the third transition, crony capitalism has its political correlate in a certain kind of populism. So the political strategy is crony capitalism to collect rents and populism to stitch together certain kinds of social coalitions. And on the welfare side therefore, the transition we wanted was a transition from what you might call populism to social democracy. But social democracy means two things. Every modern State will have to be a welfare State. There isn’t a single successful State that is not one, including the United States of America where it functions well. So it is a pipe dream that some Indian libertarians have that we need to roll back welfare. The question is, what is the objective of this welfare State? Is it constructed in ways that enable greater participation in this economic process, or is it constructed in ways that lead to a short term populist redistribution without lasting gains either in productivity or people’s ability to participate? So if you needed a liberal critique of oligarchy at the top you need a social democratic critique of populism at the bottom. Now that critique has run aground in two respects. One, there has been a lot of debate about the architecture of welfare in the Indian State, and the big idea on the cards, which again continued across governments, was to replace a broken populist leaking welfare State with a State premised on cash transfers. That is broadly the idea. The idea was cash transfers will be more efficient. They will empower the poor more because they will ostensibly give them more choices about what they do with their money. Cash transfers will do away with the gigantic government bureaucratic structures that allow leakage. So all kinds of subsidies, fertiliser subsidy will move to cash transfers, gas will move to cash transfers, PDS we might move to cash transfers, that is in a sense the only kind of big architectural idea on the table. What is now called ‘JAM’, that is, Jan Dhan Yojana, Aadhaar and Mobile number kind of put together and I think there is an intentional pun in this acronym.

Now this is not the place to debate the merits of cash transfer. I mean that is a kind of technical argument we can have in different ways, but I think what is worrying about the cash transfer story, about the transition story, is that many are seeing this as an alternative to fixing the State. So just like liberalisation in the 1991 was ‘the State has failed, let us move to markets’ without thinking about where market failures would rise again, the implicit model is that if you can create this architecture of direct cash payments – and they certainly have benefits in some respects – it will then do away with the need for actually building and repairing the State. This becomes a kind of alternative to the State. You give people money, they will go to private schools. You give people cash, they will buy food. You get the picture. And that ideological placing of cash transfers as a solution to the State’s dysfunction is a fundamental conceptual and ideological mistake. It is a fundamental conceptual and ideological mistake because actually you could argue that cash transfers require an even more sophisticated State rather than a less sophisticated State. I don’t quite believe that private schools are the solution to our education but even if you believe that, let us for a moment take it on its own terms. The kind of fixing of the State’s system you would have to do to create a supply response that can respond to these cash incentives is enormous. Just to take one example, how do you expect a supply response if land markets are broken to build schools? You know the geographical distribution of schools in Delhi. So the ideological placement of this story is in a sense itself deeply mistaken as if this is a solution to the State’s dysfunction.

And the second reason this transition is going to be tricky is this. The other aspect of moving from populism to social democracy is, can you allow for more participatory ways of both identifying beneficiaries and actually designing welfare programmes. One of the criticisms, and rightly, was that the architecture of India’s programmes is too centrally designed and therefore designed to fail. I mean even if there were no other issues it was designed to fail. And fundamentally, again beginning with the last government, the main idea was that if we invoke a principle of subsidiarity and push decision making and design capacity down tiers of government, it will allow for more experimentation to emerge. It will allow for communities to change the structure of conflicts in local level, and hopefully out of that some new forms of accountability will emerge. Certainly, people have talked about decentralisation in that vein, 73rd, 74th Amendments, 14th Finance Commission, but it is not yet clear how fundamentally committed this country is to decentralisation and whether we want to follow the architecture of creating a local social democracy all the way through. There are arguments to be had on both sides, I am not adjudicating those arguments right now. But all I am in a sense suggesting is that the authority architecture that would go with a participatory social democracy and these demands are being expressed in different ways. I mean even AAP in a strange way, with all these kind of ward councils and stuff, was a kind of articulation of that demand, but its institutional expression is still so weak and still so inchoate that you aren’t quite sure what those participatory structures are that will sort of emerge. And the fourth and the last transition, which I will just mention in two sentences and then move to the concluding points, was the transition in the State itself. We are – as is familiar to everybody in this room – literally using a 19th century State (with not even the virtues of 19th century formalism about that State) to run a 21st century economy. On every measure of State capacity the deterioration of the Indian State is staggering. I mean, my co-author in this public institutions volume, Devesh Kapur, has a long paper coming out on State capacity by every measure. All kinds of issues about the kind of State it is, raw capacity, what attributes are we selecting people on, the breakdown of internal hierarchies within the State which is truly astonishing across all services now. I mean it is a bit of a myth to say that we have actually a police force. We have an IPS, but which other country in the world selects police officers, forest officers, tax officers on the same exam attributes. We are buying Rafaels. If you look at our accident record in Sukhois and MIGs we lose one squadron every two years, what is the point of buying this. There is great atrophying in State capacity, you can just go on and on, and at the moment there is not one shred of evidence that there is actually a commitment to build a 21st century State and what it would look like. Now why is all of this so difficult? I just want to mention something that is cutting across all of these four areas particularly for this audience, I mean this is the IIC crowd, we can talk about different kinds of social forces that make these transitions difficult. But look at the way other countries have experienced these transitions. My colleague at CPR, Michael Walton, has been talking a lot about the transition from the gilded age to the progressive age in the US, a similar kind of challenge though obviously under different circumstances, which led both to the transformation of American politics and the character of economic regulation in America. There were similar transitions in 19th century Europe and so forth, and these transitions are always difficult. I mean they are protracted processes full of conflict, no illusions about that. So what is it that we lack fundamentally in making this transition? I think the three things that are very peculiar to our conceptualisation of these transitions are making our job even more difficult.

The first and very simple one is the degree of elite cohesion that any society can muster. When I look at the regulatory architectures of the Indian State and all the debates about reforming the Indian State or Indian welfare or Indian capital or even this decentralisation debate, the thing that strikes me most about it is there is no internal institutional integrity to the design we are trying to institutionalise. What do I mean by that? As an example, we can debate endlessly on the virtues of private schools versus public schools. I have my views on it but let us for a moment bracket it. But internal to the functioning of each system there are certain preconditions. If you want to run a successful public system this is what you would have to put in place. If you want to run a successful private system this is what you would have to put in place. And you can take a call whether you can put those things in place or not.

Post 1991 the biggest intellectual confusion, and I think many of us are contributors to it, was when we thought of 1991 and what 1991 was supposed to clarify. It was supposed to clarify what the relationship between public and private is going to be. We said production would not be in the public sector. But if you look back now, in the last twenty years the relationship between the public and private is even more confused than it was in 1991. Just to take one simple example, any healthy society, modern society, relies on three different motivations for creativity. One is capital profit, I mean that is what it is supposed to do, that is what gives it such dynamism as it has. The State, on the other hand, is supposed to be for public purpose backed by democratic legitimacy which it can express through coercive power as well. That places a certain character and burdens of justifications on the State and civil society oversimplifying is voluntary persuasion. We can set up clubs, we can set up thinktanks, we can even set up IIC. Now each motive has a particular creativity and dynamic that is intrinsic to it and a structure of accountability that is intrinsic to it. If you hold private capital to government standards of accountability, let’s say on accounting, on discretion, you are actually going to kill its organisational dynamism.

On the other hand if the State tomorrow decides that its main function is revenue maximisation, it is no longer acting as a State. And then you decide you will have elements of everything. This is exactly what has happened to every sphere. Take public-private partnerships, this mantra, this absolute institutional disaster that we unleashed. What was the core rottenness at the heart of it? The core rottenness at the heart was that of course you can do road contracts and PPP and so forth, but did you really imagine that you could have 60-70% of the Consolidated Fund of India going out through private channels and that at some point the public is not going to demand democratic standards of accountability of those entities? Entities which, by their own logic, can neither govern or be creative by these accounting standards. That is exactly what happened to PPPs. Companies now complain ‘Please don’t subject us to CAG audit.’ I mean, I can understand the rationale for saying it but this is Public Private Distinction 101.

Then there is Compulsory CSR, Corporate Social Responsibility. Frankly on first principles and on practical grounds it’s the nuttiest idea invented. It sort of makes capital the arm of the State. I am not against philanthropy, by the way, but compulsory CSR is a very different story. The Prime Minister of India says spend money here, spend money there. And it is going to be another sort of.question mark because it is taking away what is essential to voluntary civil society, the creativity of voluntary persuasion. Lots of different experiments at people’s own risk.

So the big mistake post 1991 is that this whole conception of what is public and what is private in the institutional space is now very messed up. Public universities don’t know whether they are revenue collectors or whether they are public universities. Doordarshan doesn’t know whether it is a public broadcaster or it also needs to maximise ad revenue if the CAG quotes foregone loss on advertisements or whatever. On the other hand the private sector will now be subject to accounting standards and pricing mechanisms that are actually more appropriate for the State.

And, by the way, there is a personal side to this public-private thing as well, which we all experience with the social media. One of the things that social media has done is to ask that, in that other space where the public-private distinction matters, what is the sphere of protected liberty that an individual has. This is a fundamental question that we are going to be debating – whether it is through the litigation on Aadhar, whether it is on the litigation through moral policing – we are now encountering a social form where that distinction has become in a sense totally blurred. And it is best captured by this wonderful novel by Dave Eggers called The Circle which is a very nice twist. Where in the 19th century we used to say ‘property theft’, now we say ‘privacy theft’, where of course the argument is, if you withhold information from either private companies or the State, then how will they be able to serve you better. So you are actually detracting from the public good if you don’t reveal your tastes and preferences on FaceBook. The fundamental architecture which runs through any social contract is the distinction between public and private; those lines are now so entangled and I think we are not having a first principle’s discussion of where we actually want to go with this.

The second institutional feature which follows from the first is in almost all the regulatory reforms that we have seen. As I said, there is no respect for the integral internal or integrity of a particular approach. Let’s say you want to do private, ask what it will take for a private to succeed. If you want to decentralise ask what it will take for decentralisation to succeed. Instead what we do with regulatory reform is a kind of institutional pan (1.16.21) where we try and tick off every box. We decentralise to panchayats but also give bureaucrats power over them. We want lateral dispersal into independent regulatory agencies but we still want government oversight and control over them. There have been very few institutional innovations in India that have passed the test of what I would call internal architectural integrity: namely, that for that institution to work in its own right what are some of the things you would actually have to keep out of it.

So there is this public private distinction, this kind of regulatory polyglotness, as it were, which in languages may be creative but in institutions and regulations is actually a pretty bad idea

And the third and final thing which I think is peculiar is the nature of ideological divisions amongst the Indian elite. One of the symptoms of societies that make the successful transitions is not so much whether they are authoritarian or democratic. It is, do you at some point reach enough of a consensus and a social contract where you can say we have decided to go this way and let us follow through with the logic of this. In sphere after sphere we seem unable to do this. Why is education so politicised? and I don’t mean the Hindutva politicisation versus the left liberal, that is an epiphenomenal debate in some ways. The crux is that we cannot decide between the public and private parties and so what you are getting is this dilatory compromise which is neither a horse nor a camel. Our habits lead us to, in a sense, intellectual argumentation; and this diversity could be a source of strength provided there was an elite process that could actually mediate this conversation in a disciplined way. Mediation means harmonising the different components together so that they make internal sense. But in our case what mediation has come to mean is distributing; we see this even in laws, okay you get your favourite clause, I will get my favourite clause. Now this could be a product of a lot of things, it could be a product of the fact, as Dipankar has written many times, that we are a low trust society. But I just cannot imagine these transitions happening without the elites in a sense mediating these three conversations and that is where elite responsibility matters a lot more. Now just one concluding thought and I will end there, which is what about social movements? That is the other source through which social contracts get redrawn. One of the brief glimmers of hope we had last year or a couple of years ago was that out of this chaos would emerge social movements that would reenergise exactly these conversations. But again, as Dipankar has pointed out, in politics the world over social movements have generally declined or weakened, at least social movements in the classic sense. What do we mean by that? Think about the 70s, in the 70s you had an interesting combination of movements. They were sectoral movements in the sense that you had a farmer’s movement, you had a student’s movement and at the same time they also represented a certain contribution to an argument about what the next step in development should be, and it was a competing clash of visions. I am surprised that for all its other limitations it is still instructive going back and reading Charan Singh and what he actually thought, and wanted to do with the Indian economy. Those were the social movements which in a sense then also spawned new political actors. The entire 70s generation came through either peasant politics, or labour politics or came through student politics. One of the interesting features of the structure of politicisation in Indian political life is that these political structures have pretty much destroyed those social movements.

I mean there is an agrarian crisis, so why is there not a farmer’s movement with the kind of power that we used to see in the 70s? Lots of reasons. Class identities have become more complex, there is internal differentiation between farmers. I would submit one of the reasons is probably actually one of the unintended consequences of political decentralisation – where what could have been a regional local basis of solidarity now gets converted into forms of competition. Consequently you don’t have a grammar emerging of social movements that have the credibility to knit together this conversation.

So where are we? We have no idea what the consequences of that are going to be because frankly we are at a time in the global economy where (and if we were being fair to ourselves we would admit this) we actually don’t have a very clear sense of what an appropriate economic model is. We are taking leaps of faith; in exports, not only are exports down but actually it is not a sustainable model. We don’t know what the employment elasticity of capital is going to be. We are in a globalised environment where the slightest mistake is very costly in global terms. I mean capital is willing to move to Africa. I mean our biggest competitor is the United States. And right now I think we are intellectually at that level floundering from one extreme to another – to whom are we trying to send signals? But having said all of this, there is probably a floor below which this dynamism will not fall and we just hope, and this is a complete leap of faith, that it is enough to keep enough social peace at least for the time being.

The economic stuff will maybe at some point sort itself out. But if I were to express my worry, it will be that I think it is actually probably the first time in our history where almost all sections that historically performed the role of this mediating conversation have lost their legitimacy simultaneously. It is not civil society against the State, civil society itself is as much under question. You talk about self-regulating professions, as much under question. My own profession, I hope Dipankar won’t mind my saying this, our own profession, academia, has its social legitimacy as much under question. And where that’s cumulatively leaving us is expressed by this lovely poem by Pushkin about longing for another freedom; he says it with a kind of disenchantment, I mean this is of course in the 1930s and he hasn’t experienced democracy but I think the sentiment is very recognisable.

I will just end with this thought since Independence Day is coming up, and since this is an award for journalists.

He asks, will we reach a point where, I do not greatly value those famous rights
Which give vertigo to so many minds.
I do not mutter at the gods having denied me
Sweet participation in disputing taxes
Or interfering with kings at war with one another;
And it is even small grief to me whether the press is free
To mystify the numbskulls, or a sensitive censorship
Does cramp some wag in journalistic schemes;
All this you see are words, words, words.
Other and better rights are dear to me;
Another better freedom do I need:
Be subject to a king, be subject to a people-
Is it not the same to us, let them be.
To no one

And I can see the sentiment in a sense growing in society. What Pushkin wanted however is unfortunately not the response we are giving to this anxiety. He said,

To be accountable, oneself alone
To serve and please; to power, to a livery
Not to have to bend either conscience, ideas, nor one’s neck;
By one’s own whim to wander here and there,
Marvelling at Nature’s godlike beauties,
And before works of art and inspiration
Joyfully tremulous in transports of emotion:
This is happiness! These are the rights I want…

And unfortunately I think our response to Pushkin’s anxiety is we match sin with more sin, villainy with more villainy and the tearing down of each other with more tearing down of each other.