India’s challenge over the next five years can be summed up somewhat melodramatically in one sentence: a medieval state is trying to run a post-modern economy. Almost every interesting story in recent days involved serious regulatory failure. These stories have belied any hope that cleaning up India’s regulatory mess is going to be easy. The right combination of technical skills, oversight mechanisms, public reason and mediation of knowledge systems is not going to be easy to institutionalise across a range of sectors.
If this diagnosis is correct, what India needs is not a new Planning Commission, not a new think tank, but a state-building commission. This is different from an administrative reforms commission, which looks at conventional issues of administration and process. A state-building commission has a different starting point. It would ask: how do we build a state fit for purpose?
Behind the recent economic logjam is not just a story of paralysis and corruption. It is also the story of a state that has not come to terms with new functions. The debilitating imbroglio over coal is not just about corruption; it also reflects an inability to understand what modern mining might look like. Disputes over electricity tariffs abound, with the recent Supreme Court stay on the compensatory tariff order for Tata-Adani being just the latest instance. Environment regulation is a general mess all around. There is no framework for thinking about the tradeoff between security and convenience even in as simple a thing as Uber. Apart from the knowledge issues, behind our inability to have a sane conversation on GM foods lies a well-founded suspicion of our regulatory capabilities. The list could go on: the police does not even have basic forensic capabilities to handle its case load; our newly commissioned warships are apparently taking to sea without submarine detection equipment. Corruption is part of the story in many of these cases. But the context in which the state operates has changed in several ways.
First, the knowledge mediation functions of the modern state are immeasurably more complex. It cannot avoid taking a call on scientific and technical knowledge, on every issue from regulating GM crops to assessing the environment, from health to the choice of energy technologies. How credible are its processes and capacities to take such calls, particularly in a context where the asymmetries in knowledge between what is produced in the state and what is produced outside it are growing immeasurably? What data does it require to have a minimum of social self-knowledge to intervene intelligently? Does it have the capacity to assess cross-cutting risks at the level of detail that matters? Our options are reduced because we do not trust the state to perform this role.
Second, while the state continued…