The ongoing slowdown in Indian economic growth has resulted in grave opportunity costs, including jobs not created. Additionally, the declining numbers for India’s trade in goods for the past several years reflect a downward drift in competitiveness. The causes and consequences of these worrisome trends have been discussed in public forums before and after the Budget presentation on February 1.
A sense of anguish that many express mostly in private conversation is that several senior regulators and officials involved in decision making just do not have the strength of character, relevant work experience, or understanding of the complexities involved. It is possible that some in crucial positions choose to be discreet and not speak up even if they know better. Or, as was said about many in senior government positions during the Emergency in the mid-1970s, when asked to bend, they were more than willing to crawl.
Anyone following governance in New Delhi would be aware of the Appointments Committee of the Cabinet (ACC). For those who are not that familiar with the ACC, it is headed by the prime minister and the other two members are the home minister and the minister of the relevant ministry. For all constitutional positions, heads of regulatory bodies, those at the level of joint secretary and above in the central government, the ACC selects the appointees and specifies the length of appointment. For example, the ACC appoints the election commissioners; comptroller & auditor general; chairpersons of the Telecom Regulatory Authority of India, Competition Commission, and Central Electricity Regulatory Commission; information commissioners; secretaries to the central government; the RBI governor; heads of the Securities and Exchange Board of India, the Insurance Regulatory and Development Authority, and the Pension Fund Regulatory and Development Authority; chief economic adviser (CEA) in the Ministry of Finance (MoF), etc.
Currently, nearly all constitutional, regulatory, and secretary-level positions in the Central government are occupied by retired or about to retire officers of the Indian Administrative Service (IAS). It is theoretically possible that appropriate persons are being chosen for all these crucially important assignments. However, it could also be that restricting appointments to these senior positions to mostly retired officers from just one service in government does not serve the national interest. As fewer than suitable selections have been made all too often by the Central and state governments, it is likely that current appointment practices serve the interests of the Indian political executive.
In the limited context of the MoF, I remember a conversation with one of editors of this newspaper. The editor’s point was that for positions such as CEA or, say, RBI governor, the government should, if necessary, look outside the country and select those who are best-qualified. The government has done so on some occasions and those who were recruited from foreign locations were eminently qualified. I am not sure though whether they had any work experience in the Central governments or regulators in countries where they had spent most of their adult lives. This may not be a disadvantage as they could be quick learners. However, positions such as CEA or RBI governor are also opportunities to grow into jobs and subsequently contribute within India.
Illustration by Ajay Mohanty
At times it is argued that there was no one well-qualified enough within India to do the job. This just cannot be factually accurate for most government-related positions. It is likely that universities, specialised institutions, and private companies would be prepared to release their professors/experts/executives for a period of up to five years on secondment to work in the Central government or a regulatory body. The persons concerned would be an asset to their institution once they return.
Knowledge about governance is lost when those who are recruited from abroad return to their home countries. However, exceptions should be made for foreign engineers and scientists who could be recruited for term appointments whenever financially feasible, e.g. in Indian Railways, Power Grid Corporation, or the Defence Research and Development Organisation.
The Central government invariably does not take the trouble to start selection processes in time. It is often not clear till an incumbent’s term is nearly over whether that person would be granted an extension or not. The selection process for senior positions should begin at least six months before the office is due to fall vacant. This should be for all positions without exception and minimum educational qualifications and appropriate work experience should be stipulated. For instance, aspirants for financial-sector positions, including those in the MoF, should have at least one degree in economics/finance from a reputed institution. Thereafter, three candidates with domain knowledge could be shortlisted by a five-member selection committee. Selection committees could consist of two retired secretaries from different services, and three subject experts. One of the experts should have had at least 30 years’ work experience in a large private sector firm. Such committees of five “nothing to lose” members could submit three names to the ACC for its final approval.
A significant difference from options that have been tried in the past would be if the ACC does not find any candidate suitable, it should ask the selection committee to go back to the drawing-board and submit a fresh list of three candidates rather than come up with a name on their own. This does of course reduce the flexibility of the ACC to choose just about anybody. However, it cannot be anyone’s case that the process outlined above would result in inferior selections compared to the prevailing practice of leaving all senior appointments entirely to the subjective judgement of the political executive.
I would agree with those who yawn and say that the suggested appointment process is similar to recommendations made by past administrative reforms commissions. Of course, an apathetic approach would mean that we continue with the current sub-optimal policies of appointments to crucial positions. The political executive hears the message if the crescendo of voices rises to sufficiently high-decibel levels. Voters matter and if public opinion
reaches a critical mass, Indian governments reluctantly change even self-serving policies.
The writer is former Indian Ambassador and World Bank Treasury professional