Pushing the reforms envelope

I had the occasion to meet with a few representatives of the new government at the Centre some three weeks ago. I had presented to them a few ideas that to my mind are critical to place India on a 7-8 per cent growth trajectory.

These are:

Continued economic reforms

Fiscal prudence through power sector reforms and better targeting of food subsidy

lmplementation of VAT

Focus on closing the infrastructure deficit

Creating employment through leadership in services,and

Quality basic education to all

Let me comment on the Budget 2004-05 keeping in view this agenda.

The Budget pushes the envelope of economic reforms further. For instance, de-reservation of 85 more items from small-scale reservation, enhancement of FDI limit in telecom, insurance and civil aviation, disinvestments of select PSUs, etc. I would also count the implementation of VAT by April 2005 under the same reform process.

The Budget is silent on power sector reforms, but I am happy to see the government trying out, at the pilot level, the scheme of food stamps to better target the food distribution among the poor.

There have been attempts to work on the infrastructure deficit, specifically healthcare, and water -- both for irrigation and drinking. I have specially liked the idea of completing irrigation projects already on the ground in a phased manner, as well as the idea of reviving water tanks and lakes over the next 10 years. I believe the water scarcity is clearly on us and it is heartening that government has worked out a plan to manage it.

The Budget also continues the policy of supporting the service sector by maintaining the commitments given earlier, such as tax holidays for a defined period.

This brings me to the most critical issue of quality primary education. I believe quality of education is fundamental for India to achieve a sustained 8 per cent growth. Educating the girl child has huge benefit in terms of family planning and better healthcare for children.

Our performance so far has been dismal. For instance, only 31 per cent of the children complete their education up to the 10th standard. One out of three children in standard 5 are unable to read and write. In addition to increasing access to elementary education, the government should steer education system to deliver quality education which is relevant and holistic. Only then we will stem the dropouts.

Since the Kothari Commission report, we have been speaking about education budget being at 6 per cent of the GDP. I would like to congratulate the government for taking concrete steps to raise the finances required for education through the 2 per cent proposed cess.

However, we need to clearly outline the utilisation of this additional fund of about Rs 5,000 crore. I would strongly recommend that we spell out specific improvements that we will make in quality universal education.

Some of the most important ones are:

Infrastructure as per current norms of the government -- especially toilets for the girl children

Curricular reforms to define and deliver the education envisaged in the National Policy for Education

Significant reforms in pre-service and in-service teacher training to promote the kind of child-centric, individual learning that needs to be achieved

Reforms that are required to build systemic accountability to deliver the universal quality of education

Provision to evaluate the efficacy of various programmes in the context of furthering accountability

The task ahead is nothing less than challenging.