babari masjid, communalism and sr bommai

just happened to read about the demolition of babri masjid, a very sad day in the modern history of our nation. Here are a few pertinent questions, the demolition raises?

1. If india is a secular country, why is it that the government remained a mute spectator to this brazen violation of religious right of minorities ie. the muslims. Would the Hinduz allow muslims to demolish say the brahideshwara temple or the jagganath puri temple, say becoz of certain dreams of allah being there inside the temple??
2. The fundamental right of religion enshrined in the constitution and the secularism that forms a part of the basic structure are they all only theoretical??
3. The Babri masjid kaand can be seen as the source of all communal turbulence that india has seen. This incident happened in 1991/2 ....following the Rajiv gandhi gvt policy of appeasement towards hindu post Shah bano verdict. He allowed the hindus to enter the mosque premises , which had so far been kept shut for all by the court (populism at play).
This gave wings to the hindu karsevaks and they demolished the mosque in the presence of 60000 paramilitary forces.

This hardcore violation of the already vulnerable rights of muslim population backfired resulting in 1993 mumbai bomb blasts. and then later burning of ayodhya train followed by gujarat riots.

Another interesting fallout of the babri kaand was on the nature of indian polity. The congress gvt that was in power at the centre dismissed 4 bjp led governments at the state level . Litigation followed. It was here that The supreme court gave the famous judgment of SR BOmmai case wherein it held the dismissal of state gvts legit (as the step was necessary to protect the secularism of our polity) and gave guidelines for imposition of presidents rule

The destruction of the Babri Masjid saw Central government dismiss four State governments lead by the BJP. In 1994, the challenge to this dismissal and earlier impositions of President’s Rule came to be decided by a nine-judge bench in the S.R. Bommai v. Union of India case.

S.R.Bommai Verdict is landmark judgement, where court discussed the provisions of Article 356 of the constitution and related issues.

This case has huge implications on centre state relations also.

1. It upheld the dismissal of the BJP governments to protect secularism, which was part of the Constitution’s basic structure

(Basic structure of the Constitution is protected, which include secularism as one of its unit)

2. It held that the President was required to act on objective material and that Article 356 could only be resorted to when there was a breakdown of constitutional machinery as distinguished from an ordinary breakdown of law and order.

(It clearly directed the President to follow due process and clarified the difference between Breakdown of constitutional machinery and Ordinary break down of law and order, thereby provided clarification and reduced the scope of discretion which can be used to achieve narrow political interests)

3. The court also held that in no case should a State Assembly be dissolved without Parliament approving the proclamation, and that a test of numerical strength could only be conducted on the floor of the Assembly and not outside it.

(It upholds the State legislative assembly as the place to decide the sanctity of the government and directed floor test must be conducted in Assembly, not outside

It also ensured accountability of the executive to the parliament in matter of imposition of president rule. Discretion of Exectuive is curbed due to need for parliamentary approval)

4. judgment ruled that an improperly dismissed government could be restored to office.

In this judgment Supreme Court showed signs of becoming a strong bulwark of constitutional right and propriety.

Now, Bommai doctrine is applied to protect states from discretion and political games of Central government

The doctrine in Bommai came to be applied by the Supreme Court in the Bihar case of Rameshwar Prasad & Ors v. Union of India .

t is very less known that Guru Dutt Singh, Faizabad city magistrate and K.K. Nayar, an administrator in the Indian Civil Services played key roles in the sequence of events that led to the demolition of the Babri Masjid- an event that changed the face of Indian politics forever.

This is a rough chronology of the events that are related to Babri Masjid:

• Ayodhya ('unconquerable" in Sanskrit) was the birth place of Lord Ram
• Mughal general Mir Banki builds the Babri Masjid in the Sixteenth century, under the rule of Mughal emperor, Babar.
• Edit: There isn't much that Hindus can do in the rule of the Mughals. Localized attempts continue to redeem the temple. The British try to pacify both sides. [for a more detailed account of the pre-1949 events, read Balaji Viswanathan's answer to Can someone explain the reasons for the Babri Masjid demolition?]
• Centuries later, India is freed from Mughal and British rule and becomes a free democracy.
• Ayodhya was home to a lot of sadhus (holy men). Abhiram Das, a sadhu told his disciples that he had a recurring dream that Ram made an appearance under the building’s central dome.
• Guru Dutt Singh found a soft corner for Abhiram Das, having had similar dreams himself. The two discussed how they could stealthily place a statue of an infant Ram in the muslim place of worship.
• With time, his conviction grew that the place should be amicably handed over by Muslims to the Hindus.
• He met K.K.Nayar, who belonged to Kerala. The two found common cause in  their reverence of Lord Ram and decided to take action. They used influence to get posted at Ayodhya at the same time.
• On the night of Dec. 22, 1949, they got a few sadhus access to the mosque (thanks to a Hindu guard at the mosque- a Hindu and a Muslim took guard in shifts) and placed a Ram Lalla (Infant statue of Ram) in the Mosque.
• Soon the word spread and worshipers from all over started flocking Ayodhya.
• Several governments passed and several Prime Ministers showed their disapproval (Especially Nehru who condemned what was happening in Ayodhya right from the start) but could not do much. “I am disturbed at developments at Ayodhya,” Nehru said in a telegram on Dec. 26, 1949, to Govind Ballabh Pant, chief minister of United Provinces.
• Hindus began to add more religions items in the Mosque and Muslims weren't welcome any more.
• <<several lawsuits, hearings and a couple of decades later>>
• Guru Dutt Singh and K.K. Nayar – the administrators who were instrumental in the idol’s placement — turned to politics. They played no further direct role in the Ayodhya dispute.
• Bharatiya Jana Sangh was formed-- a party that would go on to give birth to the sole challenger to the Congress monopoly- the BJP. Several other parties would also take birth- the Janata Dal, JD(U), BJD...
• In the 1980s, the Ayodhya dispute escalated from a local issue to a national one. It fed, and was fed by, other points of tension in Indian politics and society that set Hindus and Muslims on a collision course over the span of the decade. The Masjid gate was kept locked and was closed for common public.
• A woman named Shah Bano was granted alimony by the Supreme court, after divorce. The Muslims opposed it and demanded that Muslims be governed by the Sharia law. Rajiv Gandhi tried to introduce a law that provided for separate laws for Muslims. This angered Hindus-- the appeasement of Muslims. To appease the Hindus, in Feb 1986, he decided to unlock the gates of Babri Masjid to Ram devotees.
• The direct involvement of Rajiv Gandhi in these decisions remained debatable. Vir Bahadur Singh, the chief minister denied any involvement in the lock opening
• In May 1986, the government used its huge majority in Parliament to push through a law that effectively reversed the Shah Bano ruling and made it clear Muslim personal law would prevail.
• Instead of being appeased, both - Hindus and Muslims were given reasons to be outraged against each other and the government.
• Slowly, caught in Bofors controversy, Rajiv Gandhi lost momentum. In the meanwhile, by 1989, the VHP and BJP (Bharatiya Janata Party) had gained popularity. A foundation stone-laying ceremony for the Ram temple and around 2,75,000 Shriram Shilas (worshipped bricks) were brought in from around the country and around the world. The Hindus weren't going to be satisfied with just a temple 'near' the mosque while Muslims weren't going to be happy with their mosque being compromised.
• The BJP won 85 seats in the next elections, up from 2 in the previous. LK Advani gained prominence and he carried out rath yatraas (charriot processions) in an air conditioned bus made to look like a charriot- in 1990.
• In 1991 PV Narasimha Rao became the Prime Minister but the BJP formed the first non-congress govt. in UP.
• Dec. 6, 1992 was set as a date for karseva. Hindus from all over the country were motivated and stirred. The mosque’s destruction – though called for by many radicals in slogans and speeches – was not formally proposed
• Mr. Rao decided to dispatch more than 20,000 paramilitary personnel to Ayodhya’s surroundings just in case there was trouble.
• Hundreds of thousands flocked to Ayodhya on 6th December even as paramilitary forces stood by- as they were under strict orders to not use force.
• By evening the Babri Masjid was razed- even though Narasimha Rao had been promised by the Hindu forces that this wouldn't happen. The mosque was no more, after 450 years of existence. In the violence, several Muslims died and most fled Ayodhya for good.

This event led to the 1993 Mumbai blasts, the BJP coming to power in 1998, the burning of the Ayodhya train and the death of 60 karsevaks, the Gujarat riots and (edit: in some ways, the fueling of) the 2008 Mumbai attacks. One temple/Masjid in Ayodhya has led to the great divide between the two great religions of India. While most educated, sensible Hindus and Muslims have condemned both- the demolition of the mosque and the terror attacks, the issue continues to be used for gaining political mileage by both - Hindu and Muslim leaders. For years to come, this will continue to be India's past, present and future.

First, all the development projects, particularly poverty alleviation programmes should incorporate transparency and accountability norms to allow for objective scrutiny of the process of execution of programmes and to asses the extent of adherence of the norms of equity and justice in delivery of essential services to the persons who are entitled for the specified benefits. Second, with a view to reaping the benefits of RTI for rapid poverty reduction, the Government should develop the capacities for access to information. The capacities of both the public authorities (i.e. the duty – bearers) and the citizens (i.e. the claim holders) may have to be enhanced, for which a two-pronged strategy would be needed. 20 i) A comprehensive Information Management System should be developed by each public authority for storage and retrieval of data and information that may be shared with anyone who seeks to inspect the records and use the information for development purposes. Use of information technologies would not only facilitate faster dissemination of information but would also reduce the costs of servicing and sharing information. ii) In order to properly manage the demand for information from the NGOs, in general, and the citizens, in particular, a concerted effort should be made to create mass awareness among the people to promote information literacy. Awareness level among the poor is less than 10 per cent, which is a major obstacle in reaping the benefits of RTI for securing entitlements to the poor. Third, in view of high illiteracy among the poor, a multimedia approach should be adopted to educate and train people of diverse linguistic backgrounds. They should be enabled to decide and select as to what information should be sought for and that from where and how? Besides, they should also know as to how to make best use of information for effective participation in economic and political processes. This alone can ensure cost-effective use of the provisions of the RTI Act and promote efficient use of resources that are allocated for development purposes, including poverty alleviation. Fourth, the role of NGOs is critical for creating effective demand for maximum disclosure of information relating to public activities so that an informed citizenry can participate in designing and implementation of socio-economic programmes. This task is challenging in deed. At least, one-third persons, largely illiterate, have awfully low level of awareness about RTI and the manner in which it could be used as a tool to ensure the realization of their entitlements. Therefore, increase in awareness about the human rights and how to realize them would lead to a strong multiplier effects to eradicate poverty and to create necessary conditions for good governance, of which all the stakeholders would be duly proud of. Finally, democratization of information and knowledge resources is critical for people’s empowerment to realize the entitlements as well as to augment opportunities for enhancing the options for improving quality of life. The strengthening of information regime is therefore sine quo non for promoting democratic governance and right to development.


For instance, disclosure of information relating to: i) attendance of staff in schools has helped in checking teachers’ absenteeism and students’ drop out; ii) attendance of doctors and nurses at primary health centres has led to improvement in health care facilities in rural areas; iii) the details of supplies and distribution of food grains through ration shops has assured the reach of entitlements to the beneficiaries; iv) the supply and demand for petroleum products, such as, domestic gas has reduced black marketing; v) muster rolls and beneficiary of employment guarantee schemes has exposed corruption and ensured effective delivery of services to the poor who are entitled for wage employment on demand for at least 100 days in a year @ Rs.60 – 80 per day, which means additional income of Rs.6000 – 8000 per year; and vi) allotment of retail outlets (petrol pumps) and agencies for distribution of LPG gas, including the registered beneficiaries has ensured fair play and objective decisions, as reflected from substantial reduction in litigation cases in the matter. The disclosure of the list of beneficiaries for income support like wage employment and subsidized food grains and subsidized services like domestic gas has helped in weeding out the fictitious names, resulting in better targeting of services to the poor. And, reduction in corruption due to checks on black -marketing of subsidized goods and services. As a result of increased Government’s accountability in delivery of services, rural to urban migration has, of late, decelerated, as widely reported in the media. This is also corroborated by the findings of a national level survey conducted by the Transparency International and the Centre for Media Studies. The survey has revealed that in the opinions of 40 per cent of respondent (all below the poverty line), corruption and mal-practices in implementation of poverty alleviation programmes have declined due to RTI induced accountability of the Government and its functionaries at various levels. RTI route has generally been followed by a large number of people for resolving disputes between the parties on the issues pertaining to the decisions on administrative, business and commercial matters. Disclosure of information regarding the process of decision making or the grounds for action taken has helped resolve disputes on such issues as claim of refund of taxes paid by the individuals/companies, settlement of insurance claims, payment of dues of contractors, process of sanction and recovery of loans, etc. Since a reply is to be given within thirty days, disputes have been resolved faster than never before in the India’s history. A large number of grievances pertaining to service matters, mainly promotion and pension benefits have also been redressed due to openness and promptness in taking action on requests made under the RTI. 11 As a result, filing of appeals in the Courts has substantially declined, as reported, for instance, by the Oil Marketing Companies, which grant dealerships for distribution of petroleum products through retail outlets and domestic gas agencies. The Courts have also advised the petitioners to obtain information under the RTI before filing the cases before the Courts. It thus shows a strong and positive impact of RTI on transparency and accountability of the Government. 2.4. Reduction in Corruption The culture of secrecy, as known, encourages the government officials to indulge in corrupt practices, which result in lower investments due to misuse of power and diversion of funds for private purposes. As a result, the government’s social spending yields no worthwhile benefits, because, for instance, the teachers do not teach, doctors and nurses do not attend health centres, ration card holders do not receive subsidized food grains and, thus, livelihood support is denied, and the promised jobs are not provided to the poor, who are assured of income support. In the process, it perpetuates poverty and harms the poor. It creates an environment of distrust between the people and the government, which impinge upon the development and jeopardize democratic governance. Under the RTI regime, there is unprecedented transparency in the working of public departments. There is thus better understanding of the decision making process and greater accountability of government. This has led to reduction in corruption in the country as evident from the following: i) The Transparency International (TI) has reported that perceived corruption in India has declined, due mainly to the implementation of the RTI Act. This is evident from corruption reduction score of 3.4 (out of 10) in 2008, after an initial rise of 3.5 in 2007, compared to 2.99 in 2006, which indicate a decline in corruption to the extent of 15%. ii) The TI-CMS has recently accomplished an all India survey study of the poor below the poverty line. The views of the poor have been elicited in respect of all the flagship programmes that have been implemented for alleviation of poverty. At least 40 per cent of the respondents have reported that corruption has declined. iii) It has also been observed that wherever NGOs are actively involved in the development activities, the perceived corruption is abysmally low. 3. RTI and its Impact on Major Indicators of Development The challenge of development is to improve the quality of life, which calls for increasing people’s options for higher earnings, better education and health care, a cleaner environment and a richer cultural life. The record of long-term performance show that while there has been steady progress in improvement of the major indicators of development, the achievements fall far short of our expectations. At least, one third of our people suffer from all forms of deprivations, such as, inadequate livelihood support, lack of basis education and health care. 12 Of the various factors attributable to slow progress, lack of effective mechanisms for sharing information and knowledge and people’s participation in governance of development projects, is chiefly responsible. Since people’s participation in decision making process is essence of democracy, they have the right to access information held by the public bodies. In this backdrop, rights-based approach to development has proved to be very effective in realizing socio-economic goals, as this approach provides legal guarantee for realizing entitlements and promoting empowerment of people. And, the implementation of RTI provides a framework for promoting Citizen-Government participation in development process. People can access information held by the Government to develop an understanding as to how they are affected or how can they benefit from the programmes? While the Government has obligations to function in an open and transparent manner, people have right to observe and scrutinize decision making process, which forms the basis for seeking accountability of the Government. Of late, there has  

secularism ..good article indian express

I have deliberately framed the question so as not to restrict it to “India as a secular state”. For, I believe, it is not enough if the Indian state is secular, which it is not. It is equally, if not more, important that we are a secular society, a secular nation. I believe this question needs to be asked, reflected upon and answered truthfully. My latest book, Secularism — India At Cross-Roads, on this subject is under print.

It is my conviction that India’s survival as a multireligious, multilingual, multiracial, multicultural society will depend on how successful it is in working its secularism. No society can prosper or be at peace with itself if one-fourths of its population feels neglected, deprived and unwanted. It is disconcerting to see that, in recent times, serious questions are being raised about India’s secularism. It is for the first time since Independence that the Hindu rashtra ideology is being talked about so openly, defiantly and persistently. It is fortunate that the proposal of the Janata government contained in the Constitution (Forty-fourth Amendment) Bill, 1978, for effecting amendment of the Constitution by holding a referendum on certain important matters did not find acceptance in the Rajya Sabha. Otherwise, attempts would even have been made to rally public opinion in favour of doing away with the secular characteristics of the Constitution and I would not be surprised if, in the present polarised political atmosphere, it would have found a majority support. The Supreme Court itself has expressed apprehensions in this regard: “India till now is a secular country… we do not know for how long it will remain a secular country.”

Secularism — Constitutional Precepts and Reality

A series of articles in the Constitution underline the precepts of secularism. The reality is, however, quite disappointing. The majority community as also the minorities are totally disillusioned with the working of secularism. Instead of being the cementing force, secularism has led to alienation of all communities.

In my forthcoming book on secularism, I have elaborately brought out the strong opposition of Hindus which had to be resisted while enacting the Hindu Code. Even prominent leaders of the Congress party were stoutly opposed to the reforms in Hindu law. We should be eternally grateful to Jawaharlal Nehru for standing firm and getting the relevant enactments passed. It is, however, unfortunate that Nehru did not show similar courage in initiating enactment of a uniform civil code. If reforms in Muslim personal law had been pursued, the social and religious ethos of the country would have undergone significant changes by now. Having lost the golden opportunity at that time, it will be impossible to enact a uniform civil code now, irrespective of the exhortations of the Supreme Court, unless there is a strong reformist and liberal move from within the Muslim community. Sadly, all political parties are remiss in encouraging modern, scientific, enlightened, progressive and liberal leadership among Muslims.

In a secular state, religion is expected to be a purely personal and private matter and is not supposed to have anything to do with the governance of the country. The Supreme Court had observed in the Bommai case that if religion is not separated from politics, the religion of the ruling party tends to become the state religion. This seems to be coming true.

Operationalising Secularism

India’s future is intrinsically tied up with secularism. To make a real success of it, action on a number of important points is necessary. The first is to define the word “secular”. Since secularism has been declared as a part of the basic structure of the Constitution, governments must be made accountable for implementing it. But how can they be held accountable unless the meaning of the term “secular” is clear? The second is to define the word “minority”. The concept of secularism is based on recognition and protection of minorities. The two cannot be separated. One would have, therefore, expected that the founding fathers of the Constitution would first define the term minorities. Unfortunately, this was never done.

The third, and most critical, is the setting up of a commission on secularism for ensuring adherence to the constitutional mandate on secularism. To be effective, such a commission must be appointed by an amendment of the Constitution and should be presided over by a former chief justice of India.

The fourth is the separation of religion from politics. It is of such urgency that no time should be wasted in bringing this about. The Constituent Assembly (Legislative) had passed an explicit resolution on the subject as far back as April 3, 1948. Nehru had welcomed the resolution and assured that the government “wished to do everything in their power to achieve the objective which lies behind this resolution”. But, though Nehru was prime minister for 17 years, he failed to take any action on the resolution. The only other time when any political party enjoyed a two-thirds majority in the Lok Sabha, so as to be able to see through such a constitutional amendment, was when Indira Gandhi and Rajiv Gandhi were in power. But they, too, did not find it politically expedient to act on the resolution. It was only after the demolition of the Babri Masjid, when the secular credentials of the Congress party were being seriously questioned in India and abroad, that the P.V. Narasimha Rao government brought the Constitution (Eightieth Amendment) Bill and a bill for amendment of the Representation of the People Act before Parliament in 1993 to bring about separation of religion from politics. However, the bills failed to receive adequate support and had to be withdrawn.

Unless this issue is addressed so as to carry through a suitable Constitution amendment, it will be futile to talk about India as a secular nation. On the basis of past experience and to meet the concerns expressed by some political parties during the debate on the Constitution (Eightieth Amendment) Bill in 1993 regarding the likely misuse of such an enactment, I would suggest that the amendment bill should be confined only to deregistration of a political party which has religious links and restraining such political party from contesting elections at any level in the country.

The next item for action pertains to the right to propagation of religion. There are a number of decisions of the high courts and the Supreme Court according to which the right to propagation is not a right to conversion. This problem has to be nipped in the bud by amending Article 25 to delete the word “propagation”.

Another action point pertains to doing away with the protection to minority educational institutions. There was considerable opposition to this article in the Constituent Assembly. There is no justification to continue this right.

Finally, serious thought needs to be given to deleting the provision for prohibition of cow slaughter. Article 48, though a part of the directive principles, has now been elevated in public discourse to the level of a fundamental right. The basic question is whether a total ban on slaughter of cows and their progeny is justified on any grounds at all except that of the religious sentiments of Hindus. But even in regard to them, there is no universal demand for a total ban by all Hindus. Most importantly, such a ban is not in keeping with secularism. Particularly in the drought-hit areas in a number of states such as Maharashtra, it is causing largescale distress to farmers. The Indian Constitution is a mix of several compromises, particularly insofar as its proclaimed secular ideology is concerned.

Two basic electoral reforms are imperative if secularism is to be strengthened. The first is making voting compulsory. The second is making 50 per cent plus one vote necessary to win. A great deal remains to be done if secularism is to become a way of life in India.

- See more at: http://indianexpress.com/article/opinion/columns/speech-by-madhav-godbole-at-indian-institute-of-public-administration-mumbai-is-india-a-secular-nation/#sthash.3BPA0Gmw.dpuf

camu's essay on myth of sisyphus

The essay concludes, "The struggle itself [...] is enough to fill a man's heart. One must imagine Sisyphus happy."

deg dehalvi --only solace of the day

japanese dying due to work overload

Japan is witnessing a record number of compensation claims related to death from overwork, or 'karoshi', a phenomenon previously associated with the long-suffering “salary man” that is increasingly afflicting young and female employees.

Labour demand, with 1.28 jobs per applicant, is the highest since 1991, which should help Prime Minister Shinzo Abe draw more people into the workforce to counter the effect of a shrinking population, but lax enforcement of labour laws means some businesses are simply squeezing more out of employees, sometimes with tragic consequences.

Claims for compensation for 'karoshi' rose to a record high of 1,456 in the year to end-March 2015, according to labour ministry data, with cases concentrated in healthcare, social services, shipping and construction, which are all facing chronic worker shortages.

Hiroshi Kawahito, secretary general of the National Defense Counsel for Victims of 'karoshi', said the real number was probably 10 times higher, as the government is reluctant to recognise such incidents.

“The government hosts a lot of symposiums and makes posters about the problem, but this is propaganda,” he said.

“The real problem is reducing working hours, and the government is not doing enough.”

The labour ministry did not respond to requests for commen

regulators and parliamentary committees

A multiplicity of regulatory agencies has created scope for regulatory arbitrage, apart from making it difficult to protect consumer interest. It has been observed that certain market players try to take advantage of multiple regulators by operating in grey areas not covered by regulation.

The Unified Financial Regulatory Agency (UFRA) will subsume SEBI, IRDA, PFRDA, and FMC. With banks being unique and specialised financial entities, the RBI has been kept out of the purview of the UFRA. While the RBI has evolved and matured as a regulator, the same cannot be said of the other regulatory agencies. The idea of UFRA holds promise for the orderly development of these market segments.

The FSLRC has pointed out a number of benefits of the proposed UFRA. First, by dealing with all financial transactions other than banking and payments it would help in realising regulatory economies of scale and scope.

Second, it would promote efficiency, by providing a common platform, as proposed, for organised financial trading in instruments, spanning equities, bonds, currencies and commodity futures.

Third, unification of regulation and supervision of financial firms such as mutual funds and insurance companies would yield to consistency in consumer protection and micro-prudential regulation.

The need for a UFRA has been felt in the context of confusion over the jurisdiction of different regulatory agencies over different financial products.

The 2010 spat between SEBI and IRDA on the jurisdiction over ULIP is a case in point. The inadequacies of the HLCC on financial markets in addressing the dispute was brought to fore. The UFRA is not proposed as a standalone creation, but as a part of an entirely new edifice where consumer protection has received due emphasis. The provision to create a Financial Redressal Agency (FRA) with a presence in every district, where consumers of all financial products would be able to submit complaints, is a much-needed intervention.

Consumer interest deserves special attention as problems of moral hazard are acute in the finance industry, as has been exemplified in the subprime crisis.

The desirability of the proposed UFRA should be seen along with the role of other financial regulatory agencies which address resolution of financial disputes and appeals against regulators, apart protecting consumer interest.

Relations between the finance ministry and the Reserve Bank of India (RBI) have, for the moment, settled down. Is this a durable equilibrium? A certain degree of tension is inherent and may indeed be desirable in the dynamics of economic management. Unseemly public controversy, however, detracts from cohesive economic management.

RBI is India’s oldest regulator and was set up under the Reserve Bank of India Act of 1934. Historically, it has always been an autonomous entity even though the governor and the deputies are appointed by the government. Following the economic liberalization of 1991, the autonomy has been progressively strengthened and sought to be benchmarked with the best prevalent international practices.

RBI’s mandate until recently was somewhat opaque. Apart from setting interest rates, it was only in a nebulous sense that it felt obligated to promote growth as well. The government has recently concluded an arrangement with RBI for managing inflation in the band of 2-6%. RBI would like to interpret this as its overriding mandate.

Relations between the finance ministry and RBI have recently been strained on account of two factors. First, the manner of determining interest rates. The Indian Financial Code (IFC) proposed a seven-member monetary policy committee (MPC) with representatives from the Union government and RBI. The issue of whether the governor should have a final veto has, for the present, been settled given the somewhat broad-based composition of the MPC.

The second relates to the constitution of an independent debt management office. This was in accordance with recommendations of the Narasimhan Advisory Group on Transparency in Monetary and Financial Policies, 2000, suggesting separating debt management from functions of monetary policy.

In a more generic sense, RBI’s functions may involve conflict of interest. Setting interest rates, managing foreign exchange reserves, acting as a banking regulator and the government’s debt manager—all these do not entail responses that are symmetric. Reforming RBI is an ongoing process. Inculcating domain knowledge and managing an orderly transition is a continuing challenge.

Continuing economic reforms necessitated the constitution of independent sector regulators. It was necessary to ensure a level playing field, promote a predictable regulatory environment, democratize decision-making and balance conflicting interests. Thus, the Telecom Regulatory Authority of India (Trai), electricity regulatory commissions (CERC/SERC), the Insurance Regulatory and Development Authority of India (Irda) and the Securities Exchange Board of India (Sebi), among others, were constituted. More regulators for real estate, transportation and railway tariff are in the offing. There is also the Competition Commission of India with a broader remit to promote fair practices.

The sector regulators have been constituted by acts of Parliament vesting powers earlier exercised by the executive. Invariably, there are provisions for the Union government to give directives on matters pertaining to public policy such as Section 25 of the Trai Act, Section 107 of the Electricity Act, Section 16 of the Sebi Act and Section 18 of the Irda Act. In fact, even in the case of RBI, the old Act under Section 7 empowers the Union government to give directions to the bank in overall public interest.

These are enabling provisions to be used in exceptional circumstances. In practice, they have scarcely been used. The broader issue is the balance between autonomy and accountability.

When these functions were part of the executive, legislative superintendence was exercised through parliamentary questions, special debates on issues pertaining to various departments, detailed consideration of the demand for grants in the respective standing committees and the audit reports of the Comptroller and Auditor General of India. These mechanisms are not ordinarily available in respect of independent regulators.

In other parliamentary democracies, special institution procedures have been created to fill the void. In the US, for instance, the house committee on financial services and the senate committee on banking, housing and urban affairs have jurisdiction over matters pertaining to the US Federal Reserve, banks and banking, federal monetary policy and price controls.

No doubt excessive parliamentary interference would undercut their functional autonomy and may destroy their basic rationale. Judicious decision-making, depoliticizing decisions for fixation of tariffs, user charges and interest rates improve productivity and growth.

What are some of the options we need to explore to strike a balance?

1. The existing departmental standing committees of Parliament do not per se examine the working of independent sector regulators. Explicitly extending the reach of these standing committees to include sector regulators and submit periodic reports to parliament would be beneficial.

2. The standing committee on finance and planning is overburdened by legislative scrutiny, including the Finance Bill and other important items of legislation. One option could be to create a special committee to be called the committee on financial and regulatory management that can periodically interact with the RBI governor and other regulators in the financial sphere such as Sebi and Irda. Their periodic reports to Parliament would provide better understanding and hopefully augur more informed debates in Parliament.

3. In the non-financial sphere, the concerned parliamentary departmental standing committees could constitute specialized sub-committees designed to interact with sector regulators on policy-related issues.

The issue of who should regulate the regulators is an unsettled one. As liberalization proceeds further, the need for structured institutional mechanisms becomes compelling. Balancing accountability with autonomy is a learning curve.

http://www.thehindu.com/opinion/lead/lead-article-regulating-indias-nuclear-estate/article6360984.ece