June 30, 2007

Chinese Vancouver: A decade of change

HONG KONG - Remember "Hongcouver?" You don't hear that word much anymore in the polite society of Vancouver, a city that has grown into Canada's -- and North America's -- most effortlessly Asian metropolis.

But a decade or so, ago you could hear the term "Hongcouver" everywhere.

It was an era's impolitic catch-phrase for the xenophobia and palpable occidental unease in Vancouver at the prospect of a profound upheaval in society. A sleepy city had suddenly found itself a magnet for one of the most significant -- and wealthiest -- immigration waves to ever hit Canada: the Hong Kong Chinese, who sought out Vancouver as a safe haven after the British colony returned to Chinese rule on July 1, 1997.

"The Hong Kong immigrants were really a new kind of Canadian," said Henry Yu, a history professor at the University of British Columbia. "They were educated, spoke English and middle class or wealthy. They weren't going to start out as pizza delivery men and working in Chinese laundries.

"They expected to be first-class citizens, they wanted to live in the best neighborhoods, wanted the best schools for their kids. It changed Vancouver for the better, it's made us more global, more Asian. But it wasn't always an easy process."

That's for sure.

Recall the words and debates -- now rarely worth a headline -- that polarized the city a decade or more ago, when Hong Kong's human tsunami began hitting Vancouver in the mid-'80s and late '90s.

There was the volatile debate over "monster houses" -- the name for the large homes many Hong Kong immigrants built in such rarefied and resolutely anglo enclaves as Shaughnessy and Kerrisdale, often knocking down trees and old-style houses to do so. Non-Chinese tended to see the word monster as an apt adjective for the grand size of the new homes they thought ugly and out of place; Chinese saw the word as a racist put-down, suggesting that "monsters" lived in such new homes designed to hold multiple generations.

Then there was the "University of a Billion Chinese" as the University of British Columbia was sometimes dubbed. The number of Chinese-Canadians students was soaring at the university, thanks in large part to the new Hong Kong immigrants who brought with them a diligence that made them academic stars and made it harder for the less competitive to gain entry to UBC.

Many non-Chinese parents, as University of Washington academic and Vancouver native Katharyne Mitchell chronicled in a paper about the Hong Kong immigration wave, complained the new arrivals were "too competitive" or "too one-track-minded" compared to their own "more balanced" children.

And don't forget the simmering tensions in Richmond, where many of the Hong Kong immigrants first gravitated, radically changing the racial mix of the community in a few short years -- not to mention its shopping habits. Malls opened up full of Chinese stores, in effect creating a new, well-heeled and modern Chinatown on Vancouver's outskirts. On hot summer nights, you could hear the exotic clicking off mah-jong tiles on Richmond's quiet streets, where half the residents were suddenly Chinese.

Then there was, of course, the unforgettable Hong-Kong effect on the local real estate market.

Billionaire Li Ka Shing started it by buying the Expo 86 lands and transformed them into a miniature version of the towering condos of his hometown Hong Kong. That accelerated a radical change to the city's skyline, with the luxury condos of Coal Harbour following, along with a profusion of downtown condo towers that have densified and energized the city's core, and made it more congested.

Predictably, real estate prices skyrocketed as the Hong Kong arrivals put their money into city property, new and old, often astounded at the houses they could get on the West Coast for the price of a two-bedroom apartment in Hong Kong.


Old-time Vancouverites who owned homes generally liked that consequence of the new Asian money. But even here there was a new angst that lingers on: those who didn't own property suddenly wondered how they could ever keep up with this new monied slice of Canadian society from across the Pacific.

The catalyst for all the flux was that single, momentous date: July 1, 1997.

In Canada, that was just another Canada Day. But across the Pacific, July 1, 1997 marked one of the biggest geopolitical events to take place in Southeast Asia: Great Britain would relinquish control of its colony Hong Kong to China, a transfer of power that foreshadowed China's rise as a world power in the 21st century.

More importantly, at least from Vancouver's point of view, the looming handover unnerved Hong Kong's monied classes. They figured that when the People's Liberation Army drove across the border into Hong Kong on July 1st China's Communist cadres may not be far behind, perhaps bringing with them draconian laws to crack down on Hong Kong's freewheeling capitalism. They feared Communist-mandated currency controls and Beijing's heavy-handed policy objectives on a city-state of six million people (now seven million) that had to that point been regarded as the freest economy on Earth.

So an exodus began -- to places like Toronto and New York, San Francisco and London. And to the surprise of many, Vancouver. A relative backwater compared to those cities, Vancouver was seen as a safe, sedate spot for Hong Kong families, just a 10-hour flight across the Pacific and isolated from the worst of Canada's cold winters.

"They brought sudden change and that was difficult for Vancouver," said Yu, also a professor at UCLA, whose family came to Vancouver more than two generations ago. "But what's amazing to me is how quickly the city has gotten over all the monster home stuff. We've moved on."

In retrospect, July 1st, 1997, is arguably the event that breathed life into Vancouver's oft-repeated claim as Canada's Asia-Pacific gateway.

In fact, the Hong Kong wave -- as well as the other Chinese who came from Taiwan and mainland China at the same time -- have irrevocably altered Vancouver's landscape, its culture, made us more cosmopolitan and, most important of all, more global in mindset.

In 1986, during Expo 86, Vancouverites lined up by the thousands for the rare chance to touch a brick form the Great Wall of China, airlifted in for the exposition's China pavilion. For most it was the closest they had come to China aside from the occasional trip to Chinatown.

Twenty years later, China's influence seems to be everywhere and people often take it for granted. Vancouver's streets are full of Chinese and Asian restaurants in numbers that often surprise outsiders. About one in three of the city's residents are of Asian descent, primarily Chinese. Young interracial couples are a common sight. Our mayor speaks Cantonese. The new police chief is of Chinese descent.

Some of the city's most impressive amenities are from these rich new residents, too, as the new Chinese immigrants took up former lieutenant-governor David Lam's call to the Hong Kong tycoons to make philanthropic contributions to their new home. Some gifts of note, but hardly all, can be found on the UBC campus: the Chan Centre for Performing Arts, the Sing Tao Building, the Choi Building.

"Vancouver is clearly an Asia Pacific city now," said pollster Angus Reid, a Vancouver resident who notes that surveys consistently show British Columbians are far more likely to see them selves as an Asia-Pacific city than Torontonians.

"It's not even a debate anymore. The days of 'Hongcouver' are history. People are embracing Asia now."

Vancouverites have also been given a taste of the global lifestyle that is common in Hong Kong, where people know that a key to making money is not to view the place you make money as necessarily the same place you live. It used to be that the so-called "astronauts" -- the Hong Kong breadwinners who spent much of their time aloft commuting back and forth between Vancouver and Hong Kong, -- were seen as oddities. Today its seen as a way of life for any Canadian who wants to tap into Asia's boom.

"Vancouver is now a global city that is one stop within the Pacific world, with two-thirds of male Canadians of Hong Kong origin between the ages of 25 and 40 living and working outside Canada," says Yu in a briefing note of his research. "And large numbers of Vancouver residents with multiple homes throughout the world, creating great demand for real estate in Vancouver, but also leaving many condominiums unused for portions of the year. Like Switzerland for Europe, Vancouver is considered a safe place to store money (not in banks, but in real estate) and a good place to send children to school."

Where the most fundamental change of all has taken place, however, is in the city's neighbourhoods and schools. While Chinese in Toronto and Los Angeles tend to congregate in certain areas, says Yu, it is clear that every neighbourhood and school district in Vancouver has a large contingent of Chinese. It is now the norm.


"We are now the most integrated Asian city in North America," says Yu, who said it was that fact that helped convince him to return to Vancouver from UCLA, where he also teaches. "In a lot of cities Chinese are in certain areas only. But in Vancouver, you can't go to a neighbourhood now where Chinese aren't living in significant numbers. It's incredible."

But that doesn't mean that Vancouver -- and Canada -- has gone nearly far enough on capitalizing on the possibilities presented by the Hong Kong immigration wave. A decade after the Chinese took back Hong Kong, the exodus has reversed as some of the best and brightest of the Chinese community head back to Asia to use their talents and make their fortunes.

In part, that is due to the simple, inescapable reality that even with its booming economy, British Columbia can hardly compete with the job prospects in Hong Kong, Taiwan, Singapore or the red-hot economy of China.

But there is also, warns Senator Vivienne Poy, another, a more troubling reason for the Chinese brain drain.

"Our son told me, a few years back, that there was no chance that someone like him would ever make it to the top of a Canadian corporation," Poy, who immigrated to Canada from Hong Kong in 1959, told the Vancouver Club in a recent speech. "It has nothing to do with intelligence, education and language skills. It's to do with his surname, and his ethnicity.

"On the one hand, there is a lack of opportunities in Canada, partly due to systemic racism and partly because mainstream Canada is like a small club and slow in accepting outsiders ...," she added.

"On the other hand, globally, Canada's economic opportunities are slipping away."

Yes, Vancouver -- and Canada -- have undeniably strengthened their ties to Asia thanks to the Hong Kong handover and the human exodus it sparked. Now the trick, says Poy, is to create a hiring environment in corporate Canada that keeps the talent at home, or at least eventually coming back to Canada to work in the national interest.

At the moment, there are anywhere from 240,000 to 300,000 Canadian passport holders in Hong Kong.

Ironically, that means that today the real "Hongcouver" is on the other side of the Pacific, a massive talent pool of Canadians that Canada should not forget.


Message in a Bottle: Bottled Water

he largest bottled-water factory in North America is located on the outskirts of Hollis, Maine. In the back of the plant stretches the staging area for finished product: 24 million bottles of Poland Spring water. As far as the eye can see, there are double-stacked pallets packed with half-pint bottles, half-liters, liters, "Aquapods" for school lunches, and 2.5-gallon jugs for the refrigerator.

Really, it is a lake of Poland Spring water, conveniently celled off in plastic, extending across 6 acres, 8 feet high. A week ago, the lake was still underground; within five days, it will all be gone, to supermarkets and convenience stores across the Northeast, replaced by another lake's worth of bottles.

Looking at the piles of water, you can have only one thought: Americans sure are thirsty.

Bottled water has become the indispensable prop in our lives and our culture. It starts the day in lunch boxes; it goes to every meeting, lecture hall, and soccer match; it's in our cubicles at work; in the cup holder of the treadmill at the gym; and it's rattling around half-finished on the floor of every minivan in America. Fiji Water shows up on the ABC show Brothers & Sisters; Poland Spring cameos routinely on NBC's The Office. Every hotel room offers bottled water for sale, alongside the increasingly ignored ice bucket and drinking glasses. At Whole Foods (NASDAQ:WFMI), the upscale emporium of the organic and exotic, bottled water is the number-one item by units sold.

Thirty years ago, bottled water barely existed as a business in the United States. Last year, we spent more on Poland Spring, Fiji Water, Evian, Aquafina, and Dasani than we spent on iPods or movie tickets--$15 billion. It will be $16 billion this year.

June 21, 2007

Blacked Out: India

Fourteen years of power reforms haven't solved India's electricity crisis as the Centre and the states continue to drag their feet on clearances for projects and controlling theft and wastage

Last week, as the temperature soared to 47.2 degrees to make it the hottest day of this summer, most parts of Delhi sweated the day and night out without power for over 10 hours. Over 1,400 km away, suburban Mumbaikars were playing the waiting game for the monsoon and for power which was switched off for over seven hours. In it and BPO hotspot Gurgaon, diesel gensets are not the backup but the source of power on most days. Being powerful is no guarantee of getting power—there is no escape for residents of a swish colony, home to top notch politicians and Haryana Chief Minister Bhupinder Singh Hooda's daughter—in Gurgaon either. The saga of eight-nine hours of powerless play has an echo up north in Jammu as well, even though it is hardly a buzzing commercial town.

To the inescapable certainties in a day—sunset and sunrise—India has added power-cuts. The country is in the grip of a crippling electricity crunch that is worsening by the hour and gets heightened every season. The peak-hour demand is 100715 MW of which 86818 MW is met. The massive gap of 14 per cent or 13897 MW could power two states: Delhi and Uttar Pradesh. Worst affected are the industrial and agricultural belts of Punjab, Gujarat and Maharashtra where the shortfall has triggered seven to nine hour-long power-cuts.


Many states have to go without power for up to 10 hours a day...

Delhi suffers the most with up to 10-hour-a-day load-shedding

And 7-9 hours in Maharashtra

Even small towns like Jammu go without power for 8-9 hours a day

Besides scheduled cuts, power is also switched off during shortage.


…because there's a 13,897 MW shortfall in availability...

Which can power Delhi &UP

Deficits in Maharashtra and Gujarat are 27% and 30%

Poor generation and distribution is to be blamed

Some cities are buying at Rs 7/unit from captive plants


…as 29518 MW is lost to theft and leakage. And capacity addition is slow.

Is twice the unmet demand

A third of the electricity produced

If wiped out, India could turn power surplus

At Rs 47,000 crore, the loss is equal to Centre's 2006-07 allocation for poverty alleviation

Cities are fire-fighting everyday to meet rising energy needs. The desperate situation has fuelled desperate measures. To tide over the pressing peak-hour shortfalls, Pune is buying the surpluses of power plants captive to industries and merchant outfits for Rs 7-10 per unit (against the average cost of Rs 3). The price is up on the entry of such distressed bulk buyers in the power markets.

What is most worrisome is not that successive governments have failed to kick-start the turbines that fuel investments in the power sector. But that there's little to hope for either in the future. Successive governments have toiled with reforms that range from enacting stringent legislations, empowering regulators and attacking subsidies to pushing states to privatise the distribution of electricity. And yet, the line that lights up cities and powers factories continues to trip at every point—funding, government clearances, generation, distribution and even the tariffs.

Despite sermons and reports, India has succeeded in knocking off just one percentage point of the peak shortage since 1991. In what must be the understatement of the year, Montek Singh Ahluwalia, deputy chairman of the Planning Commission, said last month: "We are at a critical point of policy credibility in this sector. We've been talking power reforms for over a decade. And yet, actual performance falls well below expectations."

Supply cannot keep up with the demand because generation projects do not come up on time. In the three five-year plans since 1992—eighth, ninth and tenth—only half of the targetted additions to generation capacity has come on steam. Thanks to the sloth at every level—from fuel linkage to land allocation to clearances from the state machinery. To gauge the ineffectiveness, stomach this: India's economic growth rate is a tad below China's, yet while the latter adds generation capacity of 70000 MW every year, we added 21180 MW in the last five years. Bihar has not even added 1 mw of capacity in the last 10 years.

The crisis provoked the Prime Minister to say that "business as usual attitude will not work". But fact is it is business as usual. Sample the "alacrity and urgency": In January 2006, Manmohan had scheduled a crisis meeting of chief ministers on the power sector. It was ultimately held after a delay of 16 months on May 29 this year. And what did it consent to? At the end of a day's brainstorming, the prime minister announced four committees including a panel of chief ministers to be set up shortly. If Manmohan evoked a sense of déjà vu, it is because scores of committees have been constituted on the power sector over the last two decades the recommendations of which are still gathering dust. In the early 1990s, one headed by the then Maharashtra chief minister Sharad Pawar, for instance, had advocated among other things progressively raising the agricultural tariff from a floor-level of Re 0.50 per unit to half the cost of supply. If acted upon, the agricultural tariff would have been Rs 1.50 per unit.

70000 mw is what China adds to its power grid every year. India in the last five years has created 21,180 MW.

27% of total power goes to farm sector. States spend Rs 11,000 cr a year on subsidies that can be used to set up 11 IITs.

The prime minister should have outlined how states can embark upon these politically-untouchable goals at the conference last month. Instead, the session concluded without yielding a breakthrough. Manmohan got the diagnosis right but he ducked providing remedies. Much of what he lectured on—the poor progress of capacity generation, heavy losses and wasteful consumption—was already known to the states. For instance, in 2001-02 the Centre had incentivised states with financial assistance to control leakages from the delivery networks by cutting them at the rate of 9 per cent a year. The reduction rate in the following four years was 1.68 per cent per annum.

"We have failed to make a breakthrough in ensuring sustainable growth of the power sector."

Part of the problem is that over a third of the power generated is lost as corrupt politicians look the other way while ingenious industrialists steal it from under their noses. Some bit is wasted as the transmission networks cannot handle overloading. Such aggregate technical and commercial (AT&C) losses have mounted to over 50 per cent in Bihar, Maharashtra and Madhya Pradesh. AT&C losses have touched Rs 47,000 crore a year—equal to the UPA's allocation to poverty alleviation last year. "The states have to treat electricity as a manmade commodity. Not gifted by God. It must be paid for. Until that realisation comes, this sector will continue to be a problem in the states," power secretary Anil Razdan told the Parliamentary Standing Committee on Energy (PSCE) last month.

The cost of inertia will be huge. Already, even 60 years after Independence and despite the UPA's claims of an aam admi agenda, one in two rural households does not have an electricity connection. And according to an estimate, the GDP growth rate of 9.4 per cent may well have been 10 per cent but for the crunch. The steep industrial growth at a new high of 12 per cent could fall flat. The likelihood of that still hasn't beeped on the states' radar. At a time when factories are losing one of the three daily shifts to load-sheddings, 27 per cent of the electricity produced is diverted to vote banks of the farm sector. That too, subsidised. Or free, if in Punjab or Tamil Nadu.

Biting the bullet on power politics can control the losses. States are, however, in reverse gear. Former power minister Suresh Prabhu had egged Jayalalithaa-ruled Tamil Nadu and Congress-governed Punjab and Madhya Pradesh into abolishing free power in 2003. But they reintroduced it within months as a poll gimmick. After the enactment of the Electricity Act in 2003, states have to foot the bill for their power profligacy. They still pass on part of the burden to the distributors by not installing meters so that supplies aren't measured. Gujarat and Andhra Pradesh are exceptions. Meters at the transmission source have helped cut their AT&C losses to 24 per cent and 16 per cent respectively.

Worse, despite the shortfall, even existing capacity is not being utilised. In Andhra Pradesh, 1499 MW is ready for commissioning but doesn't have fuel linkage. For almost three years now, an empowered Group of Ministers has deliberated but failed to re-start the 2019 MW Dabhol plant at Ratnagiri in Maharashtra. Even the skew or the bias towards thermal power plants is not being corrected. Of the total hydel potential of 1.5 lakh MW, only 30 per cent has been exploited. In 2004-05, only 5 per cent of what was generated by captive plants was made available for sale.

The UPA's latest mantra, 4000 MW ultra mega power plants (UMPPs), too seems to have tripped. Investors queued up for profitability and scale. However, only two of the nine planned have been awarded and even they—Lanco in Sasan, Madhya Pradesh, and Tata Power in Mundra, Gujarat—are stuck since December 2006 in controversy and clearances. Even if cleared, Razdan confessed to the PSCE that not even a unit of any of the nine UMPPs would be ready by 2012. The government, however, is preening on a target of 68000 MW for 2008-12, which is three times the achievement in the last five years. It is a formidable target. If the committee approach adopted at the power conference is any indication, power-cuts are here to stay.


June 15, 2007

The Trade Secrets of an Iraq Insurgency Bomb Technician

Iraq's Sunni insurgents are escalating the destructive reach of roadside bombs despite a massive U.S.-Iraqi security crackdown. To find out how the insurgency has managed to push back, Time's Baghdad bureau chief Bobby Ghosh talked to one of its key bomb builders, a man using the name Saif Abdallah.

The 28-year-old Mr. Abdallah says his devices have perhaps killed or maimed hundreds of Americans on behalf of the Sunni insurgency. He can improvise parts out of an astonishing range of scrap, from walkie-talkies to dilapidated washing machines. U.S. troops are facing a far more innovative and technically sophisticated enemy than they were four years ago, Mr. Ghosh reports. Insurgents have upgraded the power and sophistication of their radio-controlled bombs to the point where improvised explosive devices now account for about 80% of U.S. deaths, compared with 50% at the start of the year. A Sunni insurgent commander told Mr. Ghosh that once the insurgents learned of the U.S. troop increase, they prepared by getting as many bombs as possible to places they could be easily used.

U.S. commanders express skepticism about some of the insurgents' greatest IED boasts, for instance that they have planted devices in sewers that are capable of blowing up American tanks. But deep-buried bombs have had a devastating effect on other heavily armored vehicles.


June 14, 2007

Useless Ministries: India

White Elephants

Using coalition compulsions as a fig leaf, parties have kept alive 20 dead and useless ministries at a cost of over Rs 74,000 crore only to expand their umbrella of patronage and pelf

Creation of a plethora of departments has killed accountability and delivery.
The number of ministries has shot up from a mere 18 in 1947 to 53 in 2004.
October 1985. Venue: Cabinet Secretariat. In the chair: Cabinet Secretary P.K. Kaul. You could call it a meeting on downsizing government. You could even dub it one more attempt at introspection as 55 secretaries of the Government of India presented their ideas on what the Government should do or not do. Amidst the gab fest, one thought received a lot of attention. Since most of the controls on steel and coal had been withdrawn, should these ministries exist? The question was debated, but never really answered. Since the exercise 22 years ago, inspired by Rajiv Gandhi's legendary impatience with sloth, the number of secretaries to the Government of India has ballooned to 84, the size of the Union Council of Ministers has nearly doubled from 42 to 79, including 35 Cabinet ministers and seven ministers of state with independent charge. Add 40 ministers of state, who, by their own admission, have little or no work and you get a perspective of the umbrella of patronage. And yes, the Ministry of Steel continues to exist with a staff of 402 despite the fact that steel was fully decontrolled in January 1992.

Steel, though, is not the only ministry that defies logic or rationale for existence. At least 20 ministries in the Government of India have no business to exist but have been kept alive by successive regimes to park sections of the vote bank that enable them to stay in power. As alliances are formed, vote banks are exchanged—some would say auctioned—for portfolios. The team is on auto-select depending on the exigencies of alliance politics. Take the formation and the shuffles of the UPA for instance. It isn't the UPA chairperson or the prime minister but the DMK chief who decides who will drive the critical programme of the highways project or who will replace Dayanidhi Maran as it and telecom minister. So was the case with the NDA. Shiv Sena chief Bal Thackeray recalled Suresh Prabhu as minister for power and replaced him with Anant Gite, who was his choice and not that of the then prime minister, Atal Bihari Vajpayee.

Indeed, the UPA takes the cake. It has created new ministries not just to accommodate the allies but also people who it believes would enhance its relevance. So it split the Ministry of HRD and created ministries like Minority Affairs and Women and Child Development; separated mines from coal; and made a distinction between power and non-conventional energy.

The irony is that while creating more parking slots may have helped the parties come to power, the lack of delivery fuels the multiplier effect of incumbency. Every general election sees roughly half the sitting MPs trounced. The trend is worsening if the elections in Punjab and Uttar Pradesh are any indication. Sure the regional parties have reason to rejoice as they carve a niche for themselves in the cake of power. The tragedy is that both the Congress and the BJP—electorally irrelevant in over 200 Lok Sabha seats—seem to be seized of neither the ferment nor the reason for the rising anti-incumbency.

This, when the reason is staring at them. Multi-layering and the creation of a plethora of departments have killed accountability and thus delivery. In January 2007, the Finance Ministry, in a confidential note to other ministries, observed that 13 critical ministries had spent less than a third of the budget allocation or just Rs 16,237 crore of an outlay of Rs 59,743 crore. While 40 departments managed to spend only half the allocation of Rs 2,52,594 crore. Year after year, almost all ministries fail to spend a major chunk of their allocation. Yet budget allocations are rising in almost all departments. Plan and non-plan expenditure has trebled between 1997 and 2007-08, from Rs 2,35,245 crore to Rs 6,80,520 crore, which is nearly a sixth of the GDP. This is done by creating new schemes at the Centre in areas that are primarily the concern of the states. The National Rural Employment Guarantee Scheme, the backward areas development fund and the proposed dole to workers in the unorganised sector are all cut from the same fabric of political expediency. Thanks to this, a new situation has emerged. The district collector now receives funds directly from the Centre even as he reports to the state government. Ergo there is neither delivery nor accountability. Consider this—the Centre spends Rs 3.65 to provide subsidised food grain worth Re 1 to a person living below poverty line.

The crux of the matter is that departments and ministries are created not on economic or administrative logic but political arithmetic. "The multiplicity of ministries creates layers and nothing is quite delivered," says Bimal Jalan, MP and former governor of the Reserve Bank of India. As Jalan points out, such is the multi-layering that if one wants to improve sports facilities for women in rural areas it is not one but seven ministries (Rural Development, Social Justice, Sports, Youth Affairs, Finance, Women and Child Welfare and Panchayati Raj besides the Planning Commission) who will be involved. In a seminal paper on administrative reforms, S.R. Maheshwari says, "The number of departments in the Government of India grew from three (Public, Secret, and Revenue) in 1774 to eight in 1833. It then expanded to 10 in 1919 and 18 in 1947. No other country has such a large retinue of ministers."

Arun Shourie, BJP MP and former minister, says, "Accommodation of politicians leads to accumulation of babus." In 1948, the number of secretaries to the Government of India was 19 and that of IAS officers 143. The expansion has also imposed a huge cost—as high as 2 per cent in terms of GDP growth—on the economy. Today there are 134 IAS officers just at secretary-level postings, while the number of IAS officers posted in the Central Government is 820. First there is a directorate, then it is upgraded to a department and then to a ministry. And even after the ministry is disbanded—like in the case of disinvestment—the department stays.

True. In a developing economy there are new areas that require government attention. C. Rangarajan, chairman of the Prime Minister's Economic Advisory Council and former governor of RBI, points out, "There is a need to create new focus areas and retire old positions which have lost relevance." As he says: "If there is a sunrise sector, there should also be sunsets." But that hasn't been the case with India. It is not that the problem has not been studied or discussed. Between 1947 and 2007, no less than 30 committees and commissions have studied the issue. In fact the Administrative Reforms Commission (ARC) of 1966 had clearly advocated smaller governments. Neither that nor any other report was implemented, and as with the church, sin and evangelism continue to co-exist.

By allowing the multi-layered system to continue, political parties face not just a collapse of governance but also their own future. As India turns 60, it is time for some ministries to be retired, the concept of minister of state buried and funding of line ministries critical to social development relocated to the states. In 1947 we made our tryst with destiny. It's time we made a tryst with the future.

Drought of Ideas
Staff: 11,711
Wages and allowances: Rs 191.25 crore
Total plan and non-plan expenditure: Rs 9,362.21 crore

RATIONALE: To formulate and implement national policies and programmes aimed at achieving agricultural growth through optimum utilisation of land, water and plant resources; formulate overall cooperative policy, oversee research and maintain statistics.

REALITY CHECK: Production of grains and pulses is stagnant for over a decade, productivity is down, almost 20,000 farmers commit suicide every year. There has been no breakthrough in seeds or yield since the Green Revolution and agriculture is unviable. The Centre's defence is that the problem lies with the states.

Indeed everything under agriculture—agricultural education and research, protection against pests, prevention of plant diseases and improvement of cattle stock—is listed as a state subject in the Seventh Schedule of the Constitution. So what is the big idea of hosting an army of people in Krishi Bhavan? Agriculture, which is India's largest private sector enterprise, supports 56 per cent of the working population while delivering 19 per cent of the GDP.

Too many people are dependent on a crashing enterprise. The Indian farmer is growing less on a shrinking holding, spending more for inputs for an income that is not only falling but has to be shared with a growing number of dependents. Yet there has been no attempt to restructure the sector. India needs to go in for manpower-intensive, value-added crops. Post-land reforms, with land holdings at less than two hectare per capita, it cannot adopt scale-neutral methods. The situation calls for drastic action, not the usual mix of incrementalism and pious sermons. Yet the focus is on more committees. At least six committees have studied credit to farmers, four have studied use of genetically modified seeds, three have studied investment in irrigation, but there has been no action on the ground. But that has not prevented every minister from expanding the ministry. Established in 1871, the ministry has gone through 48 avataars. It deserves moksha.

Caught in Quota Warp
Staff: 424
Wages and allowances: Rs 7.01 crore
Total plan and non-plan expenditure: Rs 23,142.22 cr

RATIONALE: Universalisation of elementary education, that is, to promote education and adult literacy at primary and secondary school levels.

REALITY CHECK: The omnibus ministry created by Rajiv Gandhi by merging Education, Culture, Women and Child, Sports and Youth Welfare has been dismantled into as many ministries, negating any logic of efficiency and delivery that he might have desired.

While Culture and Women and Child Development can claim to have some legitimacy for existence, Education is as much a state subject as federal, especially school education and adult literacy. You could argue that primary education in some states requires a push from the Centre, but its report card is stained with failure. In government, spend is never equal to the result. At HRD, even the spend is inefficient. This year, for instance, the department was left with Rs 1,453.76 crore under Elementary Education and Literacy as on February 28. Even under the Education Guarantee Scheme, it achieved only 52 per cent of its target of 47.7 lakh enrolments. The two elaborate schemes launched by the HRD Ministry—the Sarva Shiksha Abhiyan and the Mid-day Meal scheme—have so far remained peripheral in developing these sectors, as implementation is in the hand of the states.

Tamil Nadu has successfully experimented with the Mid-day Meal Scheme, leading to a healthy growth from the 1960s onwards, while Central funding for primary education has resulted in a colossal waste in most states, as they tend to underutilise and experiment with the funds. Adult literacy, as the Kerala experiment has shown, is best left to the states. If the HRD must involve itself in policy, it should only be at the higher education level, although after the quota imbroglio, that too is open to debate. It would be best if the ministry focused on opening up higher education. That would force all states to sit up and design their school syllabi to suit the needs of a modern economy.

Poor Show
Staff: 139
Wages and allowances: Rs 2.59 crore
Total plan and non-plan expenditure: Rs 509.75 crore

RATIONALE: To shape the policies and programmes of the country as a whole, allocate resources, provide finances through national financial institutions for housing and urban development.

REALITY CHECK: Poverty alleviation should be the focus of all policies.

This ministry was designed to provide affordable urban housing and create jobs. If the mushrooming of slums or the absence of a framework to create jobs is any indicator, the ministry has failed miserably.

Created on October 16, 1999, merged in 2000, and re-formed on May 27, 2004, this ministry, like many others, exists as an instrument of political accommodation. All matters pertaining to housing and urban development are assigned to states and by the 74th Amendment to the Constitution, to urban local bodies. The constitutional and legal authority of the Centre is limited to Delhi and the Union territories. Even if one were to argue the case for Central intervention, neither the structure of governance nor the ministry's performance would justify it. The Centre can draw up policy, but as long as implementation is with the states, results cannot be guaranteed. The number of urban poor was estimated at 80.7 million by a National Sample Survey Organisation (NSSO) study in 2004 and housing shortage at 24.71 million units in March 2007.

The joke is, the ministry estimates only 42 million of the 285 million urban dwellers live in slums. As for poverty alleviation, it has the Swarna Jayanti Shahari Rozgar Yojana. The ministry told Parliament that allocation had been hiked from Rs 160 crore in 2005-06 to Rs 344 crore in 2007-08. That is Rs 43 per urban poor per year. To get a sense of the magnitude of work, consider these statistics: the ministry told Parliament that it assisted just 469 urban poor in Delhi in three years—133 in 2003-04, 181 in 2004-05 and 149 in 2005-06. Perhaps it couldn't find poverty in Delhi.

Urban Decay
Staff: 26,535
Wages and allowances: Rs 453.83 crore
Total plan and non-plan expenditure: Rs 3,814.52 crore

RATIONALE: To promote urban growth, transport and housing.

REALITY CHECK: Since this is largely a state subject, there is little justification for such a large edifice. This ministry is directly in conflict with the modern urban development mantra, which requires plans to be drawn up in concert with civil society.

According to the 2001 Census, India has a population of 1,027 million, of which around 28 per cent or 285 million live in urban areas. To start with, given the overwhelming vote power of rural constituencies, urban development has never been the focus of any government. Add to this the profusion of agencies and entities and you have urban India in a shambles, be it the quality of sanitation, utilities or infrastructure. By the end of the decade, urban India is estimated to deliver two-thirds of the GDP, but little has been achieved through Central intervention. As with other ministries, the Urban Development Ministry can at best preach to state governments.

India needs to renew its old cities and develop at least 50 cities like Chandigarh to enable the population to spread out. This requires funds—Rs 1,20,536 crore just in the next seven years —and a plan where local bodies have a say. Yes, the Jawaharlal Nehru Urban Renewal Mission is a good idea, but it is in conflict with the idea of decentralised development. The unique model that Dharavi in Mumbai is looking at for regeneration may or may not work in the slums of Delhi. The onus of developing new cities and satellite townships should be on the state governments.

Megawatt Failure
Staff: 378
Wages and allowances: Rs 17.31 crore
Total plan and non-plan expenditure: Rs 632.9 crore

RATIONALE: To promote alternative sources of energy and non-fossil fuel energy systems ranging from solar to biogas.

REALITY CHECK: At best it can be a section under the Ministry of Power, where alternative sources can be factored into overall power management. The generation of ideas and new systems is best left to the Ministry of Science and Technology.

Its performance can only be termed as dismal. Consider this: India has a potential to generate 47,000 MW through wind energy, whereas installed capacity is barely 1,870 MW. Obviously capital costs for renewable energy generation systems are high, the technology is still evolving and perhaps the risks are high too. Yet, it is difficult to defend the performance of the ministry. Indeed while India has the potential of generating 1,83,000 MW across the spectrum of alternative or renewable energy systems—ranging from wind, solar photovoltaic, solar thermal, small hydro, biomass, co-generation, geothermal, tidal, urban and industrial wastes—total installed capacity achieved (till March 2007) is an abysmal 10,406 MW. This is despite the fact that renewable energy was identified as a resource as early as in 1981, when the Commission for Additional Energy Sources was created (the ministry itself came into being in 1992). However, despite a compelling case for its propagation, the ministry has not been able to promote the idea.

This is despite a plethora of incentives being dished out. A host of fiscal incentives are available to both manufacturers and users of renewable energy systems, which include 100 per cent accelerated depreciation for tax purposes in the first year of installation of systems, exemption from excise duty on manufacture of most finished products, low import tariff on capital equipment and components, soft loans, five-year tax holiday for generation projects, etc. Obviously, the ministry's existence as a solo entity has not enabled or improved performance. Modern energy management requires a holistic approach and standalone entities have no place in this structure.

   The 79-member UPA Government has the largest ever ministerial structure
1. Personnel, Public Grievances & Pensions
2. Finance
3. Home Affairs
4. External Affairs
5. Defence
6. Human Resource Development
7. Environment and Forests
8. Agriculture
9. Food and Public Distribution
10. Railways
11. Consumer Affairs
12. Coal
13. Minority Affairs
14. Power
15. Chemicals and Fertilisers
16. Steel
17. Urban Development
18. Mines
19. Planning
20. Agro-rural and small scale industry
21. Tribal Affairs
22. Shipping
23. Road Transport
24. Highways
25. Textiles
26. Overseas Indian Affairs
27. Commerce & Industry
28. Law & Justice
29. Heavy Industries & Public Enterprises
30. Water Resources
31. Rural Development
32. Parliamentary Affairs
33. Information & Broadcasting
34. Panchayati Raj
35. Youth Affairs & Sports
36. Development of North Eastern Region
37. Social Justice & Empowerment
38. Petroleum & Natural Gas
39. Tourism
40. Culture
41. Communications
42. Information Technology
43. Health & Family Welfare
44. Science & Technology
45. Earth Sciences
46. Corporate

1. Labour & Employment
2. Women & Child Development
3. Food Processing Industries
4. New and Renewable Energy
5. Housing and Urban Poverty Alleviation
6. Civil Aviation
7. Statistics & Programme Implementation

The Relic
Staff: 6,908
Wages and allowances: Rs 102.51 crore
Total plan and non-plan expenditure: Rs 1,681.84 cr

RATIONALE: To enable free flow of information besides disseminating knowledge and entertainment to all sections of the society, while balancing commercial needs and public interest. It is also the apex body for formulating rules and regulation relating to information and broadcasting, press and films.

REALITY CHECK: For almost 30 years now, successive governments have threatened and promised to disband this relic of control raj. Doordarshan and air can continue to work under Prasar Bharati.

In the Soviet era, for years Czechoslovakians did not know Martina Navratilova was the best woman tennis player ever. For them, Hana Mandlikova reigned in the tennis world. Complete control over all access to information was something the Soviets cherished. India was not far behind. For confirmation of Indira Gandhi's murder, we had to depend on BBC. I&B ministers notoriously spiked films—our only source of entertainment—for their own entertainment. What is this ministry doing in the era of the Internet, 24-hour news channels and fm radio? Well, besides running a Song & Drama division, it has been devising newer ways of retaining control to suspend that fashion channel, block news on radio or simply politicise film festivals.

The Government didn't have a clue that private enterprise had devised ways to connect people to the world of satellite TV. But as soon as the system was in place, it found reason to impose new controls. Do we really need this nanny? Isn't Prasar Bharati capable of monitoring news? Why should a ministry exist simply to give licences to new entrepreneurs—something that can be done by a board? And then throttle entrepreneurship by insisting on free feed for its channels in the name of national service? DD and air can function without state control, as briefly experimented during the NDA regime. The posse of officers parked in Shastri Bhavan can be put to better use in running community radios. Let market forces decide what's news and how information is broadcast or printed.

Alchemy of Politics
Staff: 316+348
Wages and allowances: Rs 8.16 cr+Rs 7.23 cr
Total plan and non-plan expenditure: Rs 22,789 crore

RATIONALE: To enable India to play a leading role in the global market; formulate and implement policies to achieve growth of these sectors; ensure mass availability, at reasonable prices, of quality pharmaceuticals.

REALITY CHECK: The ministry has had no real role in the march of the pharmaceutical and chemical sector. The global acquisitions have been fuelled by private enterprise. In fertilisers, capacity addition has been poor, with just one plant added in 2005. Worse, nine urea plants, with a combined capacity of over 24 lakh tonne, are closed. Imports, meanwhile, are rising.

India is the third largest producer and consumer of fertilisers in the world, with an installed capacity of 12.25 million tonne of nitrogenous and 5.5 million tonne of phosphatic fertilisers. Till August 24, 1992, all fertilisers were covered by controls. Since then, the government has put them under the Essential Commodities Act. While phosphate and potassic fertilisers were decontrolled in 1992, others in the ammonium group were decontrolled in June 1994. Currently anyone is free to import diammonium phosphate and sell it anywhere in India. As per Industrial Policy Resolution dated July 24, 1991, no licence is required for setting up fertiliser plants. However, since the MRP of fertilisers is statutorily fixed or indicated, fertiliser manufacturers are compensated by way of subsidy or concession, for the difference between the cost of production and the MRP. But because new plants entail costs, approval of the Government is required for fertiliser projects. That's backdoor licence raj for you.

Meanwhile, petrochemicals are suffering because there is no clear policy enabling substitution of costly metals with cheaper polymers. Use of plastics in thrust areas like agricultural implements, water supply and management, home construction, consumer electronics and durables, has brought down costs and enabled growth in the sector. But against a global average of 25 kg, per capita consumption of polymers in India is barely 4 kg. In the pharmaceutical sector, the only debate is that of the pricing of essential drugs. With global acquisitions, Indian companies will have not just scale but also access to the latest in drugs. All that is needed is a price regulation system that is best monitored by the Ministry of Health.

Thread Bare
Staff: 4,824
Wages and allowances: Rs 94.18 crore
Total plan and non-plan expenditure: Rs 3,136.68 crore

RATIONALE: To oversee policy formulation, planning, development, export promotion and trade regulation of textiles. It is responsible for making raw materials available to both large mills and handlooms. It also coordinates the activities of Textile Research Associations.

REALITY CHECK: The industry may be the largest employer in the economy, but there is no role for the Government. One of the boom areas, it is completely open to investment and is licence-free.

India ruled the textile world before it was colonised by the British. There may have been the regal support of the maharajas, but textile was always a private enterprise. Perhaps in the post-Independence era, the ministry would have made sense since the sector needed to be nurtured back to health after the debilitating impact of British rule. But it didn't make sense to Jawaharlal Nehru, so there was no Textiles Ministry in the first Cabinet. Indeed, for three decades after Independence, successive governments didn't see any need for a Ministry of Textiles. It was only in 1976 that the Department of Textiles was created under the Commerce Ministry, only to be merged into the Department of Industry a year later. An independent ministry was created only on November 15, 1985. Since then it has expanded to include nine PSUs, two institutes, development boards for silk, jute and wool, and nine textile research associations, besides export promotion councils. Recently, it has also added textile/garment parks.

The ministry has the dubious distinction of spending less than its allocation through the entire Tenth Plan. Successive ideas like the Apparel Park for Export Schemes and the Textile Centre Infrastructure Development Scheme have failed and the Standing Committee of Parliament for the ministry recommended that instead of loading the sector with a plethora of half-baked schemes, a few effective and well-planned ones should be devised—to assist the industry, to achieve the desired growth of the sector and to make it globally competitive.

Rusting Away
Staff: 406
Wages and allowances: Rs 9.39 crore
Total plan and non-plan expenditure: Rs 150 crore

RATIONALE: To coordinate and plan the growth and development of the steel industry; formulate policies on pricing, distribution and imports; and development of input industries.

REALITY CHECK: Steel was one of the first sectors to be decontrolled in the first wave of Manmohanomics. As early as in January 1992, the Government of India disbanded all the controls that shackled the steel industry. That the ministry exists 15 years later is testimony to the power of pelf and patronage.

To get a sense of the size of babudom in a ministry that has been shorn of controls, consider the administrative set-up of the Steel Ministry, headed by a minister assisted by a secretary, an additional secretary and a financial adviser, three joint secretaries, a chief controller of accounts, an economic adviser of the rank of joint secretary, four directors, two deputy secretaries and 13 under-secretaries besides other officers.

What is ironic is that despite the disbanding of control, the ministry claims to oversee policies on production, pricing, distribution, imports and exports of steel. In its professed aims, first priority is accorded to "providing single-window clearance for large projects, to be followed by statutory clearances by the concerned ministries". That mega projects like that of the Tatas (who have projects totalling 27 million tonne lined up in the sector), Korean major Posco and Mittal-Arcelor have been struggling for clearances for over three years gives you a sense of this make-believe situation. With the private sector taking the lead in creating capacity, the ministry must be disbanded without further delay.

Colossal Waste
Staff: 296
Wages and allowances: Rs 7.91 crore
Total plan and non-plan expenditure: Rs 258.3 crore

RATIONALE: To develop a strong food processing sector, with a view to creating increased job opportunities in rural areas; enable farmers to reap benefits from modern technology and create surplus for exports.

REALITY CHECK: Nearly two decades after the formation of the ministry in 1988, just 2.2 per cent of the fruits and vegetables produced are processed. Produce worth Rs 58,000 crore—the income of two crore people—is wasted every year for want of processing facilities.

Nothing really validates the redundancy of the ministry better. It was only in 2005, that is, 17 years after the formation of the ministry, that the Government finally came out with an Act to oversee investments in the sector. But that too hasn't delivered the farmers from their wretched existence. When conceptualised, the ministry was supposed to empower the farm sector by enabling the farmer to get remunerative prices for his labour by allowing for warehousing, processing and marketing of produce. It is no secret that the ministry cannot deliver the goods on its own.

Fact is, everything or anything that the ministry may want to do is subject to the approval of three other ministries—Agriculture, Food and Health. Even after the passing of the Food Processing Act in 2005, the ministry is unable to attract investments because its policies cannot deliver in isolation. Sure the sector is open to investments, but that is not enough. Food processing the world over has taken off on the back of retail and the establishment of a logistics chain. Curiously, that critical function and its reform are vested with the Commerce Ministry. If food processing has to develop and if farmers are to get their due, it is imperative that the Government gets its act together on incentivising investments in logistics and freeing retail. It doesn't need a Food Processing Ministry.

Fabian Showcase
Staff: 3,376
Wages and allowances: Rs 65.18 crore
Total plan and non-plan expenditure: Rs 613.44 crore

RATIONALE: To facilitate investment and technology and monitor industrial development. The Department of Industrial Policy and Promotion, established in 1995, was reconstituted in 2000 with the merger of the Department of Industrial Development.

REALITY CHECK: In the last two years, Indian companies have gone abroad and acquired companies worth over $25 billion. FDI last year was over $15 billion. Sixteen years after the end of Licence Raj, do we really need a separate ministry for facilitating investment?

The original thinking behind the ministry was direct intervention in the process of industrialisation of backward areas. But after the Industrial Policy of 1991, this role is not possible and industrialisation of backward areas is largely left to state governments. There are, for instance, 26 no-industry districts in the country, but the ministry can do precious little about these. The rationale for the existence of this ministry beyond the issue of politics is to promote industrial development and employment growth. And what is preventing this? A number of studies have been done by the ministry, academics and industry chambers on the bottlenecks hindering investment, implementation of projects and employment growth. All of them point to the plethora of laws regulating projects in various sectors, cumbersome procedures prescribed under various rules and regulations, inadequate transparency and multiplicity of agencies in approvals. Even in its aim of making manufacturing competitive—it costs Rs 100 to make a product made in China for Rs 75—the ministry can do little as the problem of an inverted tax structure can only be fixed by the Ministry of Finance.

Sure with India Everywhere and high-profile campaigns, the ministry has attracted investor interest in India, leading to higher FDI. But its ability to push projects or clearances is limited. In a coalition regime it can only promote a concept thus far. More importantly, a large part of the clearances for major projects is now at the state government level.

Precious Little
Staff: 13,316
Wages and allowances: Rs 210.03 crore
Total plan and non-plan expenditure: Rs 389.7 crore

RATIONALE: Survey and exploration of all minerals (other than natural gas and petroleum), mining and metallurgy of non-ferrous metals and administration of the Mines and Minerals Act, 1957, in respect of all mines and minerals, other than coal, natural gas and petroleum.

REALITY CHECK: In the federal structure of India, the states are the owners of minerals located within their boundaries and thus the authority on clearances for mining concessions. A ministry just for issuing concessions for minerals in India's territorial waters is not justified.

India is endowed with significant mineral resources. It produces 89 minerals, out of which four are fuel minerals, 11 metallic, 52 non-metallic and 22 minor minerals. Eighty-five per cent of these are mined by PSUs. The Geological Survey of India has mapped an area of approximately 3.146 million sq km, or 94 per cent of the area of India. So we know what we have, where it is and who owns it. Hundred per cent foreign direct investment is permissible for exploration and exploitation of all non-fuel and non-atomic minerals, including gold and silver. fdi up to 74 per cent is permitted in precious stones and diamonds. But it isn't as if there is a rush of investors at Shastri Bhavan. Nor is there any great buzz amongst investors about the opportunity in India. That is because the system is layered with controls. An application for mining concession by Tata Steel in 2004 is among the 93 approvals pending with the ministry.

Its track record in resource utilisation is pathetic. Despite allocations being halved from Rs 8,344.5 crore to Rs 4,485.28 crore, total expenditure during the first four years of the Tenth Plan was Rs 2,042.95 crore, or less than 50 per cent of the revised plan outlay. To enable speedier clearances, it is best to de-layer the system. States should be responsible for mines in their territory and the Centre could institute a regulatory authority for clearances.

Self Goal
Staff: 192
Wages and allowances: Rs 65.18 crore
Total plan and non-plan expenditure: Rs 613.44 crore

RATIONALE: To harness the potential of the youth of the country and involve them in nation-building; create facilities and promote capacity building for broad-basing sports.

REALITY CHECK: Promotion of sports is primarily the responsibility of the national sports federations. The ministry's role is that of an exchequer. And considering that half the populace is under 20 years of age, the need for a Ministry of Youth Affairs is debatable.

The Ministry of Youth Affairs and Sports was initially set up as the Department of Sports in 1982 at the time of organisation of the IX Asian Games in Delhi. It was rechristened Department of Youth Affairs and Sports during the celebration of the International Youth Year in 1985, and came to be a ministry only on May 27, 2000. But beyond its role in organising the Asian Games and now its looming presence in the confusion preceding the 2010 Commonwealth Games, the ministry has little to show for its existence. Especially if you go by India's Olympics medals tally since 1984, which is a grand total of three. Promotion of sports may be the responsibility of federations, but the ministry, which may itself be a victim of cross-party political linkages of sports administrators, cannot escape the fact that it has failed to bring slack federations in line. With a shoestring budget—which is gobbled up by canny federation experts for promoting dubious coaching camps and overseas junkets—there is little the ministry can do even in terms of capacity creation other than support bids for major events.

As for its role in promoting youth activities, the Standing Committee of Parliament has criticised the ministry's inability to achieve desired results and for "injudiciously" launching new schemes, not allocating funds for old ones and underutilising allocations.

Clearly the unspent balances of various schemes indicate that the very idea of the ministry is out of tune with modern times.

   Over the years, the size of the council of ministers has only grown, from Jawaharlal Nehru's 22 ministers to Atal Bihari Vajpayee's 71


External affairs
Commonwealth states & information and broadcasting
Food and agriculture
Works, mines and power
Relief and rehabilitation
A linking minister between central government and east punjab cabinet

16 Cabinet Ministers
4 MoS
2 Deputy Ministers


17 Cabinet ministers including Mrs Gandhi
26 MoS
11 Deputy ministers


15 Cabinet ministers including Rajiv
19 MoS
6 MoS (Independent Charge)


28 Cabinet ministers including Vajpayee
36 MoS
7 MoS (Independent Charge)

Number Crunch
Staff: 7,883
Wages and allowances: Rs 131.27 crore
Total plan and non-plan expenditure: Rs 1,853.54 crore

RATIONALE: To act as an apex organisation for timely dissemination of reliable statistics consistent with international standards; ensure efficient use of resources through monitoring of projects.

REALITY CHECK: In most countries the collection and dissemination of statistical information is done by a commission and programme implementation is part of the key result area of the ministries. Why should it be any different in India?

Consider the administrative set-up of the Ministry of Statistics and Programme Implementation. The ministry is charged with the responsibility of periodically giving a statistical picture of India. The numbers themselves are collected and disseminated by three different organisations: the National Statistical Commission, the Central Statistical Organisation and the NSSO. Together, they provide different sets of statistics on different facets of the economy and the nation, at different times. But somehow the mandarins use all or a combination of some data to make sense of where the nation is headed. When you consider that the Government already has 35 Cabinet-rank ministers and seven ministers of state with independent charge heading over 45 ministries, you wonder why we would need someone just to oversee statistics. Isn't this better done by the ministries themselves? After all, the Reserve Bank of India or the Securities and Exchange Board of India do a splendid job on their own.

The Department of Programme Implementation is an even more mystifying entity. Apparently it monitors the performance of critical projects. Of the 350 government projects across ministries costing Rs 100 crore and more, 148 are delayed, entailing a cost escalation of 40 per cent. Now the question is: can it do anything about it? Obviously not. So would it not be better to ask ministries to submit a report to Parliament every session? It would at least make the other ministries accountable.

Ministers may earn low salaries, but the perks more than make up for it Housing entitlement to Type VIII government accommodation (Type VII for MoS)
Basic Rs 16,000
Daily allowance Rs 1,000
Constituency allowance Rs 20,000 p.m.

Sumptuary allowance Rs 3,000
Telephone: Two phones, 1,75,000 free calls per year, mobile allowance of Rs 2,500 per month, mobile handset, free Internet

No rent and unlimited electricity

Staff: Can keep 15 members in personal staff—one private secretary, one additional PS, two PAs, one Hindi steno, driver, clerk, jamadar and peon

Travel: Unlimited air tickets for self, 48 journeys per year for family, unlimited first-AC train journeys with a companion

Without a Job
Staff: 9,067
Wages and allowances: Rs 169.48 crore
Total plan and non-plan expenditure: Rs 1,633.48 crore

RATIONALE: To devise policy and legislation for labour concerning health, safety and welfare of workers; compile statistics; oversee labour courts and tribunals.

REALITY CHECK: Barely 5 per cent of the working population of 459 million enjoys the patronage of this ministry. The rest are outside the purview of the laws the Labour Ministry ostensibly implements. Fact is it can do little as long as the powers to change labour laws are vested in state governments.

Every statistic on labour paints a depressing picture of the inability of the ministry to reform the laws. The NSSO recently revealed that 17 per cent of the labour force in rural areas and 45 per cent in urban areas were not usually employed. Worse, the unemployment rate among the educated (secondary school and above) was higher than that among those whose education level was lower. The inability of the ministry to tune the laws to the needs of a modern economy has delivered these numbers. It could act as the motivator and get states to amend laws so that more jobs could be created. But successive ministers are unconvinced. Even where it can make a difference, say in promoting skills training, the ministry has been a miserable failure.

Last year, the Government announced that 500 ITIs in the country would be converted into centres of excellence. A FICCI survey reveals that in a majority of ITIs, unutilised seats are as high as 35 per cent. Obviously because the courses offered are not worth the time and anyway "a disproportionately large amount of funds" was allocated to salaries. Despite this, the ministry has been resisting a joint initiative of the Ministry of Finance and Commerce Ministry to allow industry chambers to adopt these ITIs. It claims to look after the health of workers, but reality is shocking. Employees depend on ESI hospitals, where 14,800 posts are vacant, including 1,500 of doctors. As for the courts and tribunals, they need to be housed in the Law Ministry.

Public Disinterest
Staff: 436
Wages and allowances: Rs 8.34 crore
Total plan and non-plan expenditure: Rs 920.73 crore

RATIONALE: To administer 48 Central psus and assist them in their effort to improve capacity utilisation and profitability, besides generating resources for them to become competitive.

REALITY CHECK: Nehru's temples of modern India are nearly in ruins because politicians preyed on it. PSEs need to be made autonomous. If corporatised and listed with widespread public holdings, they can emerge as competitive forces and deliver returns.

The road to hell, they say, is paved with good intentions. During the Third Lok Sabha, the Estimates Committee observed "the absence of any organisation in the Government to provide policy and overall guidance to the Central Public Sector Enterprises (PSEs)" and stressed the need for setting up a centralised coordinating unit which could also make continuous appraisal of the performance of public enterprises. In their wisdom, the government of the day and the ministers created the ministry. Nothing in the performance record indicates that the existence of a ministry has helped the PSEs. Worse, despite sermons on autonomy, the Government is unwilling to even appoint independent directors who could question the actions of the minister. Minister for Heavy Industries Santosh Mohan Dev told the Rajya Sabha on May 15 that in 2005-06, 58 of the 225 Central PSEs were making losses. The cumulative loss of the 107 loss-making CPSUs between 2001-2003 was Rs 30,437 crore. Worse, for 10 central PSEs there was no information available.

Forget outstanding loans, the CAG reveals that outstanding interest from 33 PSUs, till March 2006, amounted to Rs 13,761.4 crore. Loans were outstanding since 1978-79. PSUs need to be afforded true autonomy. Every report, every statistic on the subject only justifies the dismantling of this ministry. Yes, there is a role for public sector industries, particularly utilities, but we don't need a ministry for it. For a truly public character, PSEs need to be housed in a special purpose vehicle accountable to Parliament.

Mere Tokenism
Staff: 250
Wages and allowances: Rs 5.15 crore
Total plan and non-plan expenditure: Rs 512.83 crore

RATIONALE: Overall policy, planning, coordination, evaluation and review of the regulatory and developmental programmes of the minority communities; driving policy initiatives for minorities in consultation with other ministries and state governments.

REALITY CHECK: The fact that the Government of India could do without a ministry for minority affairs for 57 years is perhaps the best argument against the formation, existence and continuation of this ministry. Its creation under the UPA is also testimony to the tokenism being practised by the Congress and its allies.

Sure there is a dire need to ensure delivery of resources to the economically backward groups in the country. This could range from creation of policies that enhance education, enable employment and afford a shot at entrepreneurship. All of these are really in the domain of the respective ministries, from education to health to finance, which are in any case supposed to ensure that the weak get the first charge of the resources. Assuming that this was not happening, is the Ministry of Minority Affairs empowered to deliver? Indeed there is little evidence of the ministry having even made its presence felt even in the debate following the findings of the Sachar Committee on the educational and employment status of Muslims in India.

The ministry was charged with the implementation of programmes for uplifting the minorities. But the Ministry of External Affairs refused to part with the Haj Committee, and the HRD Ministry refused to part with minority institutions. Eventually, the ministry was asked to oversee the implementation of the 15-point programme—ranging from improvement of educational institutions and scholarships to promoting entrepreneurship and acting on communal harmony. The irony is that all these functions are carried out by eight other ministries. The Ministry of Minority Affairs—which has expanded its staff strength from 159 in 2004 to 250 now—is merely a spectator.


1866: Report on Civil Establishments and Salaries by Rickett.

1946: Tottenham Report on the Reorganisation of Central Government.

1949: Report by N. Gopalaswami Ayyangar on Reorganisation of the Government Machinery. The report looked at grouping Central ministries into four bureaus.

1950: Report on Public Administration and Report on Efficient Conduct of State Enterprises by A.D. Gorawala.

1952: Machinery of Government: Improvement of Efficiency by R.A. Gopalaswami was treated as confidential and never released.

1953 and 1956: Paul H. Appleby, an American expert on public administration, made 12 recommendations.

1954: O&M Division was set up for administrative improvement. In 1964, the division was merged with the Department of Administrative Reforms located in the Cabinet Secretariat to function under the PM.

1962: V.T. Krishnamachari Report recommended expansion of IAS to meet the needs of economic and social development, coordination of elective and administrative elements, coordination of administrative and technical services and promotion of the cooperative movement and community development programme.

1964: Santhanam Committee observed that in a regulated economy, the excessive role of government and discretionary powers with administration promote corruption. It recommended setting up of a Central vigilance commission and a code of conduct for ministers on par with the chief ministers of all states.

1966: ARC headed by Morarji Desai (later followed up by K. Hanumanthaiya) made 500 recommendations in its report. The ARC set up 20 study teams, 13 working groups and a task force. It submitted 20 reports, making a total of 581 recommendations in a period spread over 1966-70.

1976: D.S. Kothari Committee on Recruitment Policy and Selection Methods 1976.

1983: L.K. Jha Economic Administrative Reforms Commission report recommended shift in emphasis from regulation to development.

1983: Commission on Centre-State Relations headed by Justice Sarkaria.

1986: The Fourth Central Pay Commission Report.

1989: The Committee to Review the Scheme of the Civil Services Examination headed by Satish Chandra.

1993-97: The Fifth Pay Commission.

1998: The plethora of laws too contributed to creation of ministries and expanding the babudom. P.C. Jain Commission reviewed steps taken by different ministries to ascertain the efficacy of administrative laws and regulations. In its report submitted on September 30, 1998, it listed 109 laws that needed critical amendments. Subsequently a committee reviewed 2,500 laws and recommended the repeal of 1,400 and amendments to 241. Till 2002, only 393 laws were repealed and 37 acts were amended.

1999: Expenditure Reforms Commission headed by K.P Geethakrishnan submitted 10 reports by 2001. It looked at 36 ministries and recommended reduction of 20,000 posts in main ministries and another 1,00,000 posts in attached and subordinate offices.

1999: Simultaneously, the Department of Administrative Reforms and Personnel Grievances studied 10 ministries for the purpose of downsizing between 1999 and 2001. It recommended the abolition of 8,000 posts, winding up of 13 organisations and restructuring of 24.

2003: The Surendra Nath Committee Report reviewed the performance appraisal system to ensure linkage between skills, career advancement and performance to promote efficiency.

2005: Administrative Reforms Commission appointed under Veerappa Moily. The Commission submitted four reports on the Right to Information Act, human capital, crisis management and ethics in governance.

No Precipitation
Staff: 13,076
Wages and allowances: Rs 218.3 crore
Total plan and non-plan expenditure: Rs 871.76 crore

RATIONALE: To formulate general policy on water resources development, conservation and technical assistance to states; oversee the regulation and development of inter-state rivers.
REALITY CHECK: Water is a national resource. Its management, though, is largely a state subject in the federal structure. Barring inter-state disputes, the responsibility for everything from irrigation to water supply lies with state governments, municipal corporations, local bodies and panchayats.

You could argue that given the enormity of the water crisis, it is necessary to have a Central ministry to create policy and monitor implementation. But the track record of the Water Resources Ministry doesn't inspire confidence. The crux of the matter is that water management, or rather mismanagement, involves nine ministries—Water Resources, Rural Development, Panchayati Raj, Urban Development, Food, Agriculture, Health, Power and Environment—and consensus is an elusive goal. So nothing quite gets done. Nearly 60 years after Independence, over two-thirds of the cultivable land continues to be vulnerable to the vagaries of the monsoon. A recent report reveals that 159 major projects, 251 medium-scale projects and 94 renovation works have been pending since the 1960s. In fact, for nearly three decades the ministry has failed to come to a conclusion whether inter-linking of rivers across India is a good idea or not.

In reply to a question in the Lok Sabha on the inadequate irrigation facilities, Minister for Water Resources Saifuddin Soz said, "Irrigation being a state subject, projects are conceived, planned and implemented by the state governments as per their own priority." As early as in 1919, irrigation was deemed a provincial subject and the responsibility of the Government of India was confined to advice. In other words, there is little the Centre can do beyond coaxing the states. The much-vaunted Accelerated Irrigation Benefit Programme, for instance, is a classic carrot-and-stick scheme where states are "rewarded" for better performance in completing irrigation projects. The same is the case with drinking water supply. Barely a third of the rural populace has access to water on tap. A study of 12 major cities revealed that the shortfall in water supply is 4,000 million litre a day, which is what Mumbai needs every day, or in volume terms, water enough to fill 4 lakh big water tankers.

Even in terms of resolving inter-state water-sharing conflicts, the record is hardly satisfactory. The track record of the Eradi Commission set up for resolving disputes between Punjab and Haryana in 1985, or the annual flare-up of the Cauvery dispute, is testimony to the powerlessness of the Centre. The hard fact is that the administrative control and responsibility for development of water rests with state governments—be it irrigation projects, drinking water supply or even hydro power, which is the responsibility of state electricity boards. Sure the Ministry of Water Resources does a splendid job in terms of collating national data, scenario reports and evangelism. But does every evangelist need a ministry?


Most modern governments have between 15 to 20 ministries, unlike the ever-expanding ministerial structure of India

The Cabinet normally includes the vice-president and heads of 15 executive departments who are designated as secretaries. These are secretaries of:

• Agriculture
• Commerce
• Defence
• Education
• Energy
• Health and Human Services
• Homeland Security
• Housing and Urban Development
• Interior
• Labour
• State
• Transportation
• Treasury
• Veterans Affair
• Under George W. Bush, cabinet rank has also been accorded to Administration,
• Environmental Protection Agency, Director, Office of Management and Budget,
• Director, National Drug Control Policy, and the US Trade Representative.

The British Government has a council of 19 ministers led by the prime minister

• Prime Minister
• Deputy Prime Minister
• Chancellor of Exchequer
• Leaders of both Houses of Parliament
• Secretary of State for Foreign and Commonwealth Affairs
• Secretary of State for Trade and Industry
• Secretary of State for the Home Department
• Secretary of State for Health
• Secretary of State for Culture, Media and Sport
• Cabinet Office Minister and for Social Exclusion n Secretary of State for Northern
• Ireland, and Secretary of State for Wales
• Lord Chancellor, Secretary of State for Justice
• Secretary of State for International Development
• Secretary of State for Education and Skills
• Secretary of State for Communities and Local Government
• Secretary of State for Work and Pensions
• Secretary of State for Environment, Food and Rural Affairs
• Secretary of State for Defence
• Secretary of State for Transport and State for Scotland

The French Government is led by the president assisted by the prime minister and his cabinet of 15 ministers and four state secretaries (ss) besides a High Commissioner

• Ecology, Sustainable Planning and Development
• Economy, Finance and Employment
• Interior, Overseas and Local Authorities
• Foreign and European Affairs
• Immigration, Integration, National Identity
• Justice
• Labour, Industrial Relations and Solidarity
• Education
• Higher Education and Research
• Defence
• Health, Youth and Sport
• Housing and Cities
• Agriculture and Fisheries
• Culture and Communications
• Budget, Public Accounts and Civil Service
• SS in charge of Relations with the Parliament
• SS of Forecasting and Public Policy Assessment
• SS in charge of Transport
• SS in charge of European Affairs
• High Commissioner on Active Solidarity against Poverty

Small Change
Staff: 2,934
Wages and allowances: Rs 45.38 crore
Total plan and non-plan expenditure: Rs 1,785.04 crore

RATIONALE: To design policies and schemes and monitor their implementation for the growth of small and micro enterprises; oversee promotion of traditional, village and khadi enterprises.

REALITY CHECK: The small scale sector is an enclave created to encourage entrepreneurship and employment via tax arbitrage. Be that as it may, the presence of a ministry for SSI or creation of one for agro industry has done little for the sectors.

In September 2001, the Ministry of Agro and Rural Industries was created in recognition of the fact that long-term growth depends on tapping the potential of the farm sector. What would this ministry do that those of agriculture, rural development, Panchayati Raj or food processing are not doing? On the face of it, it would generate employment in rural areas, develop entrepreneurial skill, achieve rural industrialisation and facilitate credit. Now isn't that what is being done by the National Rural Employment Guarantee Scheme, six Centrally sponsored schemes on self employment and the Finance Ministry?

Rural industry is promoted by the Rural Employment Generation Programme (REGP) through the Khadi and Village Industries Commission and the Pradhan Mantri Rojgar Yojana (PMRY), instead of being run by the Ministry for Rural Development. Assistance to rural entrepreneurs under REGP has gone up from Rs 265 crore to Rs 320 crore. Under PMRY, the states could use only Rs 16.82 crore out of the Rs 20.48 crore released in 2005-06. The picture is not very different in the more ssi sector, which accounts for 39 per cent of the manufacturing output and 34 per cent of exports, delivering Rs 4,76,201 crore to the GDP. In what can only happen in India, the ministry has revealed to Parliament that of the 123 lakh units, over 104 lakh units are unregistered. And despite the ministry's efforts, net bank credit has gone down from 17.5 per cent to 8.1 per cent. With such a track record, the two ministries deserve to be shut down post-haste. In a modern economy, it is size that delivers economies and market share.

Fossilled in Time
Staff: 437
Wages and allowances: Rs 6.99 crore
Total plan and non-plan expenditure: Rs 288 crore

RATIONALE: To determine policies and strategies for exploration and development of coal and lignite reserves; run public sector units who monopolise coal output in India.

REALITY CHECK: India is projected to import about 44 million tonne of coal this year, despite the fact that the country is sitting on indicated reserves of a whopping 252 billion tonne and proven reserves of 95 billion tonne.

Thanks to the combined efforts of the ministry and the public sector units, coal production has "improved" from 70 million tonne at the time of nationalisation in 1973 to 343.37 million tonne in 2005-06. In 2006-07, it has risen to 361 million tonne, an improvement of 5.2 per cent. India, incidentally, is among the foremost producers of coal, having begun mining as early as 1774. At the time of Independence, India's output was 30 million tonne. But that was due to private sector involvement.

Ironically the CIL Board sees opportunity in rising imports and has sent a proposal to form a wholly-owned subsidiary of CIL called Coal Videsh, a la ONGC Videsh, to invest abroad. In fact CIL officers visited Mozambique, Zimbabwe and South Africa to explore possibilities of acquiring stakes in operating mines and green-field coal blocks. Any attempt to involve the private sector—beyond the concessions for captive use by private steel and power plants—has been repeatedly thwarted. A Bill to amend the Coal Mines (Nationalisation) Act to further open up the coal sector is pending in the Rajya Sabha from April 2000.


India is straddled across two worlds—private and public. Last week the Ministry of Finance revealed that the economy grew at an astounding 9.4 per cent, thanks to private consumption and enterprise. It was also the week when we learnt that a teacher had been drawing salary seven years after his death. Private India is speeding into the 21st century while the Government is stuck in the 19th century. The post-1991 R-Generation is flummoxed and frustrated at the state of public services. Governance is trapped in the "muddle path" of central intervention and state responsibility worsened by political expansionism stemming from coalition politics. While political parties are willing to accept fractured verdicts as a consequence of poor governance, they are unwilling to do anything about the cause. To start with, functions best performed by local governments must be allocated to the states, making the accountability matrix clear. This blueprint has merged 33 ministries into 18, enabling the government to address issues that concern national polity and long-term strategy. When the licence raj was dismantled in 1991, the government triggered a quantum change. Long trapped behind the wall of controls, Indian business used the enabling circumstances to improve productivity, market share and income. If political parties are serious about delivering equity in growth, improving their vote share and the life expectancy of their regimes, they must dismantle the superstructure of pelf. Political parties and institutions resist quantum change as it threatens the status quo. But status quo in the long run will kill the party.


Prime Minister
The PMO should focus on Atomic Energy, Space, Personnel and ministerial accountability.

Ministry of Defence
India needs to modernise its forces post-haste and this means more than acquisition of hardware.

Ministry for Internal Security
With over 191 districts facing law and order crises, focus should be on tackling growing militancy, spread of Naxal influence and insurgency.

Ministry of Finance
Banking and insurance should be left to regulators; exim policy and corporate affairs must be with MoF.

Ministry of External Affairs
With growing focus on economic affairs, Commerce should be merged with mea. Overseas Indian Affairs should be a strong priority within.

Ministry for Telecom and IT
Merge them. The telecom boom needs to be extended to rural India and it should be put to use for e-seva.

Ministry of Law and Parliamentary Affairs
With over 25 million cases pending, focus should be on beefing up criminal justice. In Parliament focus should be on legislation.

Ministry for Tourism & Culture
Private participation should be encouraged in tourism and managing the historical legacy.

Ministry for Health & Family Welfare
Mindset of state-funded healthcare must yield to modern instruments like insurance and public-private partnerships.

Ministry of Transport
Railways and civil aviation must be merged. The boom in rail and air traffic can be leveraged to fund development of the sectors.

Ministry for Infrastructure
Shipping, ports and roads can be merged to focus on connectivity for both goods and passenger traffic.

Ministry for Energy Security
Plans for petroleum, coal and power should be co-ordinated with renewable sources to bridge the gap between energy requirements and availability.

Ministry of Human Resource Development
There should be focus on opening up the education sector to both outward and inward investment and on creating platforms to develop skills.

Ministry of Science and Technology
The prowess of public sector institutions should be monetised to get the tech edge and spur growth.

Ministry for Environment and Earth Sciences
The spectre of climate change and global warming threatens growth, calling for a new blueprint.

Ministry for Food Security
This would be the omnibus ministry to plan for food security using all avenues including imports, acquiring farmland abroad and strategic reserves.

Ministry for Rural Development
There is a need to bundle all the functions and schemes of Rural Development and Panchayati Raj and focus on delivery of relief to the poor.