Wednesday, March 01, 2006

Need for a new paradigm in "Bureaucracy – Business” interaction

How do you make a bureaucrat laugh on a Friday?
..Tell him a joke on Monday…
..He needs five working days to process the joke and get necessary approvals before laughing !.

This was how the bureaucrats were blamed for the Hindu (slow) rate of growth in the past.

Now when there is pressure for FDI in retail sector or reforms of outdated labour laws, the bureaucrats are blamed for being too fast. And here goes the new story:

Who is the fastest in India? …The businessman boasts he can drive 150 kmph in his Mercedes….The pilot says, he can fly at 800 kmph. But they have no chance against the bureaucrat whose office closes at 5.30 pm but he manages to reach home by 5 pm !

Poor bureaucrats ! They get the blame one way or another. Bureaucrat- bashing has become a popular sport.

At the 37th Jawaharlal Nehru memorial lecture on 21 November 2005 at New Delhi, Lee Kuan Yew had put it bluntly in his characteristic style.

“My secretaries asked Singapore businessmen with investments in India what, apart from infrastructure, they found as major constraints. To a man, they replied it was the bureaucracy.They believe it is a mindset problem. The average Indian civil servant still sees himself primarily as a regulator and not as a facilitator. The average Indian bureaucrat has not yet accepted that it is not a sin to make profits and become rich. The average Indian bureaucrat has little trust in India’s business community. They view Indian businessmen as money grabbing opportunitists who do not have the welfare of the country at heart. India must find some way to reward bureaucrats who facilitate, not hinder investments and enterprise”.

The civil servants are not allowed to defend themselves, being bound and gagged by conduct rules. Of course, there are good and bad bureaucrats as there are good and bad ones in business and politics. It is not fair to condemn everyone. Good bureaucrats need to be recognized and encouraged and the inefficient ones should be filtered. Some of the civil servants are as good as the best in business. They can deliver more, if they are given the right ambience.

Here are two examples of how they can perform, when they get the opportunity.
- One of the secrets of success of LN Mittal who has made his fortune through his steel ventures around the world is his core group of 60-70 Indian engineers from the Indian public sector steel companies. They were the ones who turned around the old inefficient steel mills from USA to Indonesia and Mexico to Kazhakstan.
- The key executives behind the success of Reliance in their oil and gas ventures are from ONGC and IOC.

The public sector employees, who are stereotyped as inefficient have delivered success and profits to these two companies, which allowed them to give their best.

So what is needed is a reform of the civil service to provide an enabling environment for delivery and efficiency. The anachronistic foundation of the bureaucracy which was made for supporting a colonial structure needs to be replaced by a new set of values and rules needed for the emerging new India.

The most fundamental need is a change in the mindset of civil servants. It is not uncommon to find bureaucrats with a bloated moral sense of superiority over businessmen whom they perceive as profiteers. Some have an inverted inferiority complex and exercise their power to show off their authority. Some presume that they are the sole guardians of national interest. These perceptions need to be corrected in this new era of diminishing role of the government and strengthening forces of free market and globalisation. The bureaucrats should be reoriented to recognise that businessmen are as indispensable for economic growth and generation of employment, as the government itself.

At the same time it is imperative for the business also to change their perceptions of bureaucracy as a power-hungry and rule-bound obstacle for progress. They need to respect and recognize the legitimate role of policy-makers and implementers.

The two sides should recognize the role of each other in the society and shed their notions of superiority or inferiority. The interaction should be based on mutual respect, trust and confidence.

The s uccess of Japan, the East Asian Tigers and recently the Chinese Dragon are to a large extent based on the shared vision and partnership between the government and the private sector. The bureaucrats in these countries work closely with the business in the strategic development of industries, business and technologies.

Business organisations such as CII and FICCI can play a role in bridging the gap between the bureaucracy and business sector. They can take the initiative and organise regular interaction with the civil service at various levels to foster better understanding and working between the private sector and the government. They could be involved in the training of the bureaucrats at various levels. Business executives could be included for brief training in civil service academies and bureaucrats could get training in the instituitions of Infosys and Tatas The government and the business could consider opening up opportunities for lateral movement of bureaucrats to business organisations and vice versa. Regular and structured interactions between the two sides could be institutionalized at the policy-making process, wherever feasible.
It is time we stop the blame-game and do something constructive to evolve a new paradigm of partnership between the bureaucracy and private sector for the larger goals of growth and prosperity. Civil service reforms can unlock the potential of the bureaucrats in the same way as economic reforms have unleashed the entrepreneurship of Indian businessmen.

This article is being given space here after it missed publication in a newspaper.

1 comment:

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