The government created NITI Aayog after burying the Planning Commission, a Nehruvian legacy, in January last year, and it was a given that the Congress would question its relevance. So, when former finance minister P. Chidambaram took a dig at NITI Aaayog, everyone knew it was coming, and that it would be below the belt. "NITI Aayog is a two-and-a-half person Aayog. I haven't seen any paper moving, any work being done by NITI Aayog," he said in August last year.
"We at NITI Aayog strive to deliver the modern day needs of the nation with same effi ciency and success that the Planning Commission did in its heydays"
Two months later, taking a potshot, an indirect one, at NITI Aayog, former prime minister Manmohan Singh said, "Economic policy has no sense of direction, and this is largely because the Planning Commission, with all its deficiencies, was a positive dynamic instrument of steering the country's economy."
Given the politics involved, NITI Aayog was always going to find it difficult to justify itself. It had, after all, replaced a mighty institution whose numerous powers included allocation of money to ministries and states. Without these powers, especially the power to allocate money, it is facing an existential crisis. And it is not just the political opponents that are questioning things such as the lack of a defined role.
Former Planning Commission member Abhijit Sen, who thinks the commission should not have been scrapped, says NITI Aayog has no clout in the government as it does not have the power to allocate funds. It also has too much staff (500) for a think tank, he says.
Communication Hitch
A lot of criticism is a result of the fact that neither the institution nor the government has tried to delineate its role. Bibek Debroy, Full-Time Member, NITI Aayog, attributes most of the criticism to "incomplete information".
"Some role of NITI Aayog will never be in public domain. What NITI Aayog is giving as inputs on whatever policies to whatever ministries is not meant to be in public domain," he says. He also says that though the Aayog was set up in January 2015, the vice chairman and most members joined from February 1. "You also need people below them, some of whom are still joining us," he says.
Debroy says a lot of work NITI Aayog did in its first year was in states and the national media would not cover that. He cites the example of Jharkhand, which was burdened with too many government departments. "We said let's rationalise. Jharkhand brought down the number of departments to 30. In Rajasthan, we identified old laws. Rajasthan has repealed some 60 such laws," he says. He feels the Aayog could have done a better job of telling the world what it is doing. He admits it failed to do so in its first year.
Bibek Debroy, Full-Time Member, NITI Aayog (Photo: Shekhar Ghosh)
"Some role of NITI Aayog will never come in public domain. So, when people criticise it for not doing anything, some of it is because of incomplete information"
Though the institution has decided to make its presence felt on social media, the mystery around its exact role and work done in the first year continues. BT, therefore, decided to talk to people from the Aayog and other experts to throw light on its role and performance.
Well Begun, Half Done
Arvind Panagariya, Vice Chairman, NITI Aayog, says as per the Cabinet resolution that created it, the institution's key functions are - fostering cooperative, competitive federalism; designing strategic long-term-policies and programmes; creating a knowledge, innovation and entrepreneurial support system; maintaining a state-of-the-art resource centre; becoming a repository of research on good governance and best practices; and evaluation and monitoring.
But how far has it achieved these goals? Sindhushree Khullar, former Chief Executive Officer, NITI Aayog, and former secretary, Planning Commission, says, "In one year, what it was expected to do, it has pretty much done that. I don't know what public expectation was, but when an organisation closes down and another has to be put in its place, two major issues have to be sorted out - staff and institutional restructuring. In the first year, major thrust was on reorganisation of the Planning Commission, which has been done, and the organisation is now ready to roll." The Planning Commission had 1,250 employees. This has been brought down to 500.
To start with, NITI Aayog's focus was on two areas - interacting with states and becoming a high-quality think tank. Interactions with states were kicked off by the prime minister himself at the first governing council meeting held in February 2015 that all chief ministers, except West Bengal's Mamata Banerjee, attended.
Three sub-groups of 10 chief ministers - on skill development (chaired by Punjab's Parkash Singh Badal), Swachh Bharat (Andhra Pradesh's Chandrababu Naidu) and rationalisation of Centrally sponsored schemes (Madhya Pradesh's Shivraj Singh Chouhan) - were set up. The groups met not only in New Delhi but also in many state capitals. "The kind of interest and excitement I saw, I must say I was impressed and overwhelmed," says Khullar. "My view is that if NITI Aayog can be a spokesperson of states on development issues at the Centre, it will more than serve its purpose," she says.
Sindhushree Khullar, Former Secretary, Planning Commission, and ex-CEO, NITI Aayog (Photo: Shashank Shekhar)
"I do not know what the expectations (from NITI Aayog) are. My view is that if NITI Aayog can be a spokesperson of states on development issues at the Centre, it will more than serve its purpose"
So, at the outset, NITI Aayog set out to work as a representative of states. Here, a former bureaucrat gives two instances. Sikkim wanted to use the money allocated to it from a discretionary fund of Rs 20,000 crore for meeting its 10 per cent obligation towards Centrally sponsored schemes or CSS. The finance ministry was not allowing it to use the money (Rs 200-300 crore) for any purpose other than what it was meant for. The chief minister presented his case to Panagariya. NITI Aayog supported Sikkim saying that if the finance ministry did not allow it to use the money for the CSS obligation, the Centre's schemes might not take off in the state. Despite the resistance from the ministry, NITI Aayog persisted, and the Centre agreed.
Comparison between NITI Aayog and Planning Commission
In another case, the Aayog worked out a Rs 1,000-crore special package for Andhra Pradesh in August 2015. "It played an important role in working out a middle path between the outlandish demand for special status to the state and the conservative view of the Central government," says the bureaucrat.
Meanwhile, the chief ministers' groups submitted their reports in October 2015. No action has been taken on these yet. Debroy explains why. "2015/16 was a distraught year because of the recommendations of the 14th Finance Commission. States have not been able to digest the recommendations. Many had made their budgets without knowing the recommendations," says Debroy. This was because though the recommendations were submitted in December 2014, they could not have been made public before being presented in Parliament. Also, there was uncertainty about Centrally sponsored schemes due to the setting up of the three sub-groups of chief ministers. Debroy says the recommendations of the 14th Finance Commission and reports of the sub-groups will come into play from 2016/17.
"What is NITI Aayog's role? One part of its role is to look at existing public spending schemes and link them to improvement in outcomes. But until I know what these schemes are, what I can do? This role will start from 2016/17," says Debroy. NITI Aayog has also put together a set of development indicators at the district level. The Planning Commission had similar indicators at the state level. When BT contacted CEO Amitabh Kant for his view on NITI Aayog's achievement in the last one year, he said he had joined recently it would be inappropriate for him to make any comment.
Think Tank
The role that Debroy says will start from 2016/17 is that of a think tank. Panagariya says that the Aayog is working on "a highly influential paper on revitalisation of agriculture, draft appraisal of the Twelfth Five-Year Plan, National Energy Policy (in advanced stages), paper on elimination of poverty (in advanced stages), national regulatory reform Bill, model land leasing Act (nearly ready), sustainable development strategies for North East and hilly areas, the Atal Innovation Mission and an Ease of Doing Business survey of 3,500 firms. These are some of the highlights of our work in the first year." He says the Aayog also comments on cabinet notes and appraises projects. "I personally pay a great deal of attention to Cabinet notes to ensure the policies that go to the Cabinet are sound," he says.
Abhijit Sen, Former Member, Planning Commission (Photo: Shekhar Ghosh)
"NITI Aayog has no clout in the government as it does not have the power to allocate funds. It also has too much staff (500) for a think tank"
The institution is also playing a key role in the area of international cooperation. "Our international engagement includes G20, strategic dialogue with China and cooperation with the International Energy Agency," he says.
A recent assignment involves identifying Central public sector enterprises for strategic sale.
However, it is yet to be seen how seriously the government and ministries take its research papers and comments on cabinet notes."Though NITI Aayog has written a couple of policy papers on issues that involve the Centre and states, it's unclear how effective it has been in changing policy," says Arvind Virmani, an economist and a former advisor to the Planning Commission. This, most agree, will be the test of the Aayog's effectiveness. "How many of these (suggestions and recommendations through research papers) are followed would give it credibility as a policy advisory body," says Khullar.
Of course, one positive of the end of the Planning Commission is that the ministries no longer feel that their domain is being encroached upon. States, though, would have wanted the Aayog to be more influential if it is going to represent them at the Centre. "The important function of allocating funds to states and ministries should have been continued (with NITI) and not given entirely to the finance ministry. This has resulted in diminution of the organisations role as an interlocutor between states and the Centre," says K.M. Chandrasekhar, Vice Chairman of the Kerala State Planning Board and former cabinet secretary.
With limited power to influence policies, NITI Aayog might have to look for the prime minister's support if it has to have any chance of making a difference at the policy level
