The Centre for Public Policy Research (CPPR) on 22nd April, Friday hosted a Round Table discussion on The Role of the State in Kerala’s Economy, a topic that is very relevant given the impending elections.

Revamp and reengineering 

An introduction to the discussion was provided by Chairman of CPPR Dr D Dhanuraj in which he stated the goal of the discussion is to understand how the Kerala economy fares and what could be done to help it improve and meet the challenges of globalisation.
Chief Economist of CPPR, Martin Patrick added that the one of the goals of this deliberation was to submit a set of recommendations to the newly elected government on the subject. The session kick-started with an introduction from Dr KK George, Chairman, Centre for Socio-Economic Studies, Former Director, School of Management Studies, CUSAT on the State and the issues and possibilities that exist. He said: “There is neither willingness or capacity in the State to play a larger role in economic and social development. The key lies in how to revamp and reengineer the State machinery.” This was followed by the first session, in which he participated as well, on Revival Mechanisms for the agricultural markets.

What ails agriculture

The session aimed to answer the following questions: Is this State’s protectionist approach disincentivising farming and despite the huge market, what steps does the government need to take to make this sector a more market-friendly and a profitable one. Moderated by Academic Director of CPPR KC Abraham, the session saw the participation of Dr Indira Devi, Professor, Kerala Agricultural University and Dr Mathew Kurien, KN Raj Centre for Planning and Centre-State Financial Relations, MG University, Kottayam.
Professor KC Abraham started the discussion and said: “Our economy is not self-sustaining and growth oriented. …It’s not a mere economic problem it is also a political and social problem.” Speaking on the Agrarian sector, Dr Devi said: “Agricultural policies, technologies and practices. There is no consensus between the three.” To this, Dr Kurien added: “Trying to fix the agricultural sector is like looking to fix a malignant cancer.” “From policy point of view agriculture take the least importance.”

Fiscal damage control

The second session: High public debt and ever increasing role of the State government, was moderated by Dr Patrick. The goal of the session was to gauge if and why Kerala wasn’t able to manage its fiscal responsibilities. Its participants were Dr D Narayana, Technical Advisor to State Planning Board; Dr Jose Sebastian, Associate Professor, Gulati Institute of Finance and Taxation; and R Mohan, IRS, Commissioner, Income Tax (Appeals) Coimbatore. “There need to be more talks on restructuring of the economy,” said Dr Narayana. “Politically opportunistic spending results in financial mismanagement,” added Mohan. The present political economy creates a system where government employees in the State are like the new Brahmins (upper-caste) everything is conducive to their welfare, felt Dr Sabastian.

Improving service delivery

The third and fourth session which looked at the Jandhan, Aadhar, and Mobile (JAM) – trinity and ways to use it to improve the efficacy of welfare service delivery and PSUs, competition and the role of the State discussed how mobile networks are being used in the State to improve service delivery and raised some very important questions on the existence of PSUs. The panel was moderated by CPPR’s Consultant Researcher Rahul V Kumar. Dr Nirmala Padmanabhan, Head of the Department, Economics, St Teresa’s College, Kochi, spoke about her field experience with learning more about JAM trinity and the State governments various pilot projects incorporating it and claimed that these initiatives will help improve “transparency”, which is necessary for a Kerala which is moving away from a socialist model to a more market-driven one.

Professionalism is key

On the topic of PSUs, Dr VK Prasad, President, Federal Bank Officer’s Association said: “Profitability isn’t a sin, but it shouldn’t be used as the only measure when it comes to public sector units. It is a crucial tool in the making of a just society and economy.” Its role cannot be obliterated, he felt. “We have to move with the times and in keeping with practical realities,” said SR Nair, MD, Mentor Guru, who was in support of private enterprise and against the protectionism meted out to PSUs. “Run an enterprise the way enterprises should be run, irrespective of it being private or public.” Rajan Varghese, former Pro Vice-Chancellor, MG University, however, begged to differ and said that “PSUs were set up as a national commitment and were enshrined in the DPSPs.” He felt they should be revived. To this, D Dhanuraj, Chairman, CPPR, retorted that inefficient public entities shouldn’t be allowed to function at the cost of compromising service delivery to customers.
Here, former Professor of Maharaja’s College Muralidharan believed, “without professionalism, whether private or public, nothing is going to be successful.”

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