Vol. 3 No. 2 (Mar-Apr) (2022): Indian Public Policy Review

The Russia-Ukraine conflict is expected to impact India’s economy through several channels but we posit first order impacts will emanate from higher crude prices. If crude prices were to average $100/barrel in 2022, they will constitute a discernible adverse terms of trade shock for India’s economy that could shave a percentage point off India’s growth, pressure inflation further and widen the current account deficit towards 3% of GDP. How should policy respond? A negative terms of trade shock would argue for a more depreciated equilibrium real effective exchange rate. Policymakers should let this adjustment gradually take place to enable the corresponding “expenditure switching” needed to bring external imbalances back to sustainable levels. A sustained supply shock will make the trade-off for monetary policy more acute, with downside risks to growth accompanied by upside risks to inflation expectations. While the 2022-23 Budget created buffers to protect against shocks, fiscal policy will face its own set of trade-offs in simultaneously attempting to accommodate the shock, support growth and preserve macroeconomic stability. Beyond the near term, policymakers must consider systematically hedging crude price imports in global markets to protect the economy from periods of outsized volatility, apart from the medium-term objective of reducing dependence on imported crude.

This paper examines the links between the history we choose to tell ourselves and its implications for national security in India. It discusses history in the Indian tradition, the history that is current in India, some common current historical tropes, and why it matters. In the process it seeks to draw some real lessons of India’s history for our national security.

Kerala has devolved a large number of functions, funds and functionaries to the local governments. The state reports the highest number of local government functionaries per 1000 population among the Indian states. Adhering to the principle of subsidiarity would suggest that line departments at the state level reduce in size. The paper analyses the size of the state government in terms of employment, and in particular examines the efficiency of the Department of Agriculture by comparing the number of employees per unit area under cultivation in Kerala with that in Karnataka and Telangana. The findings are that Kerala reports 86 percent higher number of total employees per lakh population compared to Karnataka and about 25 percent higher than that in Telanagana. As regards the Department of Agriculture, while in Kerala an employee attends to 141 hectares, it is five times that area at 778 hectares in Telangana and ten times that area at 1425 hectares in Karnataka. The proportion of drivers, typists and clerks in the department in Kerala is also high. Running revenue and fiscal deficits and facing fiscal stress year after year for the last twenty years, where salary accounts for over 30% of the total revenue receipts, the state can aim for rationalization of its administration in order to have more resources for capital spending.

The pace of urbanisation in India and China has, of late, been rapid. This raises concerns over urban governance in both countries. While urban governance in India is supposed to take place according to the 74th Amendment to the Constitution, in China, it is largely led, guided, and experimented upon by the Chinese Communist Party. With these aspects in view, this article looks at the extent to which urban governments in these countries have been moving from traditional government to network governance. What are the roles of state, civil society, and markets in the emerging scenario of urban governance so defined? The task of moving towards ‘governance’ is incomplete in both countries. While urban governance and urban civil societies are weak in India, markets are strong; whereas, in China, the urban government is strong while markets and civil society are weak. There is still a long way for both countries to go towards networked governance in urban areas.

The purpose of this paper is to study the level of parliamentary control over public finance in India for ensuring accountability and transparency expected in a democratic form of governance. As per the Constitution of India, neither any money shall be collected nor the collected money be spent without the approval of the Parliament or the State Legislature, as the case may be. The accountability and transparency expected in spending should equally apply to revenue collection also, as they are the two sides of public finance. While the parliamentary control over public spending is complete with the system of parliamentary approval for spending and monitoring of the spending against its approval, through Appropriation Accounts, such control is not complete in respect of public revenue, as there is no parliamentary procedure to monitor the realisation of all revenues authorised by it. Consequently, crores of rupees of public revenue authorised by Parliament/Legislature could remain uncollected without its knowledge. Introduction of a Receipts Accounts showing the details of unrealised revenues with reasons and its presentation to Parliament/Legislature would fill the gap in parliamentary control and transparency in realisation of public revenue.