When Manmohan Singh came to office as India's prime minister a
year ago, there were high expectations that this architect of the
recent boom times would be able to engineer even greater economic
miracles. Surely, the former finance minister who first opened
India's economy would sweep away bad regulations, invite more
foreign investment, and turn the elephantine Indian economy into a
racehorse. Or so the thinking went.
Today, some observers say, Mr. Singh's greatest achievement may
be simply staying in office.
Surrounded by leftist coalition supporters who oppose almost
every economic reform, and right-wing opposition parties who refuse
even to attend parliament, Singh is an isolated figure. Economic
growth has not shot up, but hovered just below 7 percent. Modestly,
Singh himself gives his government's first year a barely passing
grade of six out of 10.
In recent times, India has begun to see itself, like China, as a
future regional powerhouse. The prime minister's ability to deliver
a high-growth economy is seen not only as important for lifting
millions of Indians out of poverty, but for India's international
goals as well.
"Competing with China will require more than simply playing with
the economic levers of growth," says Sumit Ganguly, director of the
India Studies program at Indiana University in Bloomington. "It will
involve bureaucratic reform - despite changes, the bureaucracy still
remains slothful, elitist, and mostly unresponsive. It will also
involve getting more serious about improving India's
Mr. Ganguly expects that Singh will do more in the remainder of
his term, but in an incremental fashion. "His task, given the crew
that he has, and the parliamentary constraints he faces, will be to
simply stay in office, nudge and push where he can, and live to
fight another day."
To be sure, the first year of a Congress-led government was not
without successes. Indian relations with the United States have
continued to improve, and India has warmed up relations with two of
its fiercest rivals, Pakistan and China. Minor economic reforms,
such as a new value-added tax, have been imposed to simplify tax
collection, and the Singh government has opened up new sectors to
foreign direct investment.
Yet from economists and political observers alike, Singh's first
year in office has been greeted with varying degrees of
Shankar Acharya, a friend of Singh, and now an economist at the
Indian Council for Research on International Economic Relations in
New Delhi, says that Singh's greatest weakness is that he relies on
a coalition of leftist and secular parties, many of which are
completely opposed to the economic reforms Singh was expected to
Referring to the ruling coalition's agenda for its term of
office, Mr. Acharya wrote recently, "The Common Minimum Program has
been a fertile breeding ground for many bad ideas. With profound
sadness, I have to record that Bad Ideas seem to be trouncing Good
'Bad Ideas' dodged
The good news, reformers like Acharya say, is that few of the
ideas in the Common Minimum Program - including guaranteed
employment for 100 days, affirmative-action programs for India's
lower castes in the private sector, and canceling or delaying the
sale of state-owned enterprises - have come to fruition.
The bad news is that the pace of economic reform remains slow,
making it difficult to generate new jobs and to improve the lives of
the poor and rural voters who elected this government to office. …