Expect an enabled bureaucracy and quicker decisions in 2016: Anil Swarup

The year 2016 holds a lot of hope for the Indian economy, especially in the context of what has happened in 2015. There has been a sea change in terms of understanding of issues, taking decisions and integrity at the highest level. These aspects were unfortunately at a premium till some time back. In that context, as coal secretary (of the current government), I can safely say that I didn’t get a single call from anyone to ‘favour’ anyone. So it speaks volumes about this government in terms of its integrity and commitment to do things transparently. In that sense, it is a break from the past. In a country like ours, it does take time for things to gather momentum because of the huge inertia, like when you push a leviathan that has been stuck somewhere; it will take time. As has been evidenced in the context of coal and roads, you can see that things have started happening.

No one probably expected so much development in coal. Today, not a single power plant is critical or super-critical in terms of shortage of supply of coal. Consider that even a year ago, several plants were in a critical state. Today, the average inventory level is 22 days; in late 2014, it was between three and seven days—it was as bad as that. Imports have been coming down for the last five months. Thousands of crores have been saved due to this. Of course, the coal auctions and the transparent manner in which they were conducted started this off. But much beyond coal, I see a lot of commitment to taking decisions, whether it is on FDI, Make in India or the emphasis on renewable energy despite the thrust on coal.

The most remarkable decision in the recent past has been UDAY (Ujwal Discom Assurance Yojana) to revive the discoms. Had this not been done, the power sector would have collapsed, followed by the banking sector and, finally, the Indian economy. The total exposure to the power sector is over Rs 5 lakh crore. If there is no demand for electricity on account of the condition of state electricity boards (SEBs), there will be no power generation and, therefore, no money for SEBs to pay off their debt. All this would have led to serious problems in the future. UDAY is another commitment from the government to set things right. It is not that SEBs went broke in the last one year. This happened over many years. We have now arrived at a situation that needs to be handled immediately. These are positive developments that give hope that things will improve even more in 2016.

My hope is that the Goods and Services Tax (GST) comes through in the new year and that will be a big reform, a real game changer for the country.

My sense is that the infrastructure sector, including roads, will pick up. Electricity has already shown signs of improvement, so will roads. These are the key drivers of the economy. Once the power and roads sectors move, creating more employment and capital investment, the economy will improve.

Image: Kuni Takahashi / Getty Images
Commercial mining of coal could become a reality in 2016. Though the government enacted the Coal Mines (Special Provisions) Act, 2015, which enabled commercial mining, the process has not commenced yet. The groundwork is being done so that it can start this calendar year


In 2016, you will see a more enabled bureaucracy in terms of the ability to take decisions because you have an environment where there is facilitation and encouragement to do that. In a scam-ridden environment, there is naturally a reluctance to take decisions. This is detrimental to the economy, the administration and society. With the changes that are already visible, we will see a more enabled bureaucracy. I use the word ‘enabled’ because bureaucracy is like a well-trained horse. But if the rider is not appropriate, then the horse would not do the right job. It does appear that the signals that are coming from the top are in a manner that a well-trained horse would perform very well. Of course, those that can’t perform will still not perform.

With the ease of doing business improving, private sector investment will also look up. It takes time to change a business environment and that is happening. Some results of those attempts are visible now; more will be visible in the new year. Public sector investment has picked up but for some reason private sector is still lagging behind. Perhaps they were waiting for a change in the business environment. This is already underway and will probably reach its culmination in 2016 and then private sector investment will also flow in.

A lot of new things are spawning and that is welcome because it reflects the fertility of one’s imagination. It is a positive occurrence because you can look ahead and visualise and then think in terms of implementation. Therefore, it is not a retarding existence. It is an evolutionary phase where people are coming up with new ideas and trying to do new things, which is good for the economy. There will be more ideas coming up in 2016. Commercial mining of coal could be the new thing that will happen. The government enabled commercial mining through the Coal Mines (Special Provisions) Act, 2015 but the process of commercial mining has not commenced. The groundwork is being done so that it can start this calendar year. This will bring more efficiency and competition.

But along with hope comes challenges, such as grappling with the evolving global situation in terms of falling exports and commodity prices. Ease of doing exports should also be looked into just like ease of doing business. But the biggest challenge is the expectation of the people, who expect so much that on occasions you are unreasonably pushed and the outcome is not optimum.

(As told to Shutapa Paul)