‘Babu Minds’ Need to be Rewired; Sacking IAS ‘Won’t Do Nothing’

The reality is that unless IAS officers give up levers of economic policy-making, their cynicism will be contagious.

Sab kuchh babu hi karengey. IAS ban gaye matlab woh fertiliser ka karkhana bhi chalayega, chemical ka karkhana bhi chalayega, IAS ho gaya toh woh hawai jahaz bhi chalayega. Yeh kaun si badi takat bana kay rakh di hai humnay?

Translation: Will babus (an unflattering, mocking description of Indian bureaucrats from the colonial era) run everything? Just because they’ve cleared an IAS exam, does it also mean they’ve become competent to run fertiliser factories, chemical industries, even fly aircraft or manage airlines? What is this all-conquering force (perhaps he meant ‘Frankenstein’?) that we’ve created?

Prime Minister Modi’s acerbic barb in parliament against IAS officers, a constituency thought to be among his ‘pets’, shocked everybody. Never one to lose control or use unmeasured words, he clearly wanted to jolt and petrify listless bureaucrats. This was music to my ears. I’ve written countless columns bemoaning how IAS clansmen have kept our economy chained and caged in archaic, anti-competitive, ‘socialist’ policies that have ironically spurred unbridled crony capitalism.

Before I proceed further, here’s an honest disclosure – my father was an IAS officer from the 1957 batch; my wife also comes from an illustrious IAS family. Yet I hold steadfast to my conviction. IAS officers may be splendid general administrators but are highly uninformed and didactic in matters of economic policy making.

A decade ago, in ‘Superpower: The Amazing Race Between China’s Hare and India’s Tortoise’ (Penguin Allen Lane, 2010), I had written as follows:

“The Indian civil servant is enormously intelligent. He is among the brightest in the land. He gets it quickly. He is usually articulate and accessible. He can see through a problem and understand solutions. But he often lacks the gumption to ‘just do it’. He is trained to see the glass as half empty, never half full. His instinct is to push a decision, not take it. He is a champion of the ‘middle route’, the ‘golden mean’. He stays clear of anything that is even remotely controversial, breakthrough or bold. He uses ‘consensus’ and ‘consultation’ as a shield to ‘protect his backside’. His favourite phrase is that ‘government decisions are process- not result-oriented’. Of course there is that exceptional officer who goes against the grain, who innovates and takes risks, but to borrow another favourite phrase, ‘by and large’ these guys like to hedge their bets to the point of inaction. Ironically, so many of them have told me, off the record, ‘Why did you even come to us? But now that you have, both of us are trapped. You need a quick decision, but I will have to consult half a dozen ministries before I can tell you that your action is not correct, but it is right!’”

Now, This is How They Torpedo Reforms…

Some years back, PM Modi had given a clarion call to empower India’s digital entrepreneurs equal to or more than their global competitors. Perhaps inspired by BBC’s iconic sitcom Yes, Prime Minister, I had written a cameo about how the IAS gang would torpedo this effort to digitally de-colonise our country:

Mr Statistically-Suspicious IAS Officer: Sir, we must ensure that a start-up does not become a proxy/front for large foreign or domestic shareholders. Therefore, we should stipulate ‘that no single shareholder shall invest more than 10 percent in the equity capital’.

Mr Structurally-Suspicious IAS Officer: But sir, you know how these large corporations can create layers of ownership behind a corporate veil. So we should add ‘directly or indirectly’ in the definition of a ‘single shareholder’. (Gosh, by inserting just this ‘innocuous provision’, our do-gooder officer has made it virtually impossible to certify the ‘parentage’ of an investor. This poor fellow will have to file a bunch of biographies, whose authenticities will need to be security checked, from Sacramento to Sitamarhi!)

Mr Small-Fetish IAS Officer: And sir, can we really call the second venture launched by Flipkart’s founders a ‘start-up’? After all, they are dollar billionaires now. So we should add a ‘second proviso’ that these benefits will be available ‘only to the first venture of a first-gen entrepreneur’. (Now go figure this one out — who is ‘first gen’ and what is his/her ‘second venture after a successful first exit’. As you can see, by now the policy has become utterly un-implementable.)

Mr Final-Nail-in-the-Coffin IAS Officer: Sir, we must distinguish between start-ups which add to the tech/innovation ecosphere, as opposed to somebody setting up a ‘pakoda’ (fried potatoes) shop. So sir, these concessions should be made available only to those start-ups which are duly certified by the Inter-Ministerial Board set up under DIPP to identify an ‘innovative business operation’.

There you go again! Even before the ink has dried on Prime Minister Modi’s instruction to create a ‘21st century paradigm to equip Indian entrepreneurs to take on the world’, his elite IAS brigade has created devilish rent-seeking powers in the hands of the Station House Officer (SHO) of Sitamarhi, Bihar (and perhaps also at the Precinct of Sacramento, but we can’t be sure about that).

Cynical Micro-Managers, Stillborn Reforms

In a similar vein, I suspect that Prime Minister Modi’s noble intention to ‘rid public sector companies of IAS managers’ could be a poor half-reform, destined to fail. The real problem is not that a handful of babus run a clutch of commercial enterprises.

The awful reality is that unless IAS officers give up the levers of economic policy-making, their cynicism will be contagious.

Why? Because their cradle-to-grave security ring-fences them from volatile success and failure. Their monetary rewards are completely unhinged from merit or achievement. Whether you are a fast-tracker or a laggard, you move in the same slow lane. This stalemate often creates an aversion to taking risks; it nurtures a deep suspicion about free markets. Hence the urge to micro-manage and ‘create provisos’. Until this malady is cured, India’s economic reforms shall always be stillborn half-measures.