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How Modi could have avoided Rajan's exit

By BS Bureau
July 05, 2016 13:30 IST
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If senior government officials are attacked by a senior BJP member without any condemnation from the government, the bureaucracy is likely to feel even more isolated and look for safety in inaction and postponement of legitimate decisions.

IMAGE: Narendra Modi defended Rajan, but he took a long time to dub criticisms against the RBI governor. Photograph kind courtesy: Press Information Bureau
 
 

The unedifying spectacle of a senior leader of the Bharatiya Janata Party (BJP) firing a broadside at the government’s key policy makers and even its policies has occupied a lot of media space in the last few weeks. 

The media attention to a series of such attacks is to be expected, particularly when they originate from Subramanian Swamy, who was recently nominated by the BJP to be one of its newly elected members of the Rajya Sabha.

Mr Swamy is known for his sharp views for which his critics have often called him a political maverick.

But when these attacks take place relentlessly against senior policy makers of the government, who are otherwise quite defenceless, they become a cause for serious concern. 

It is true that the BJP as a party and Finance Minister Arun Jaitley had dissociated themselves from Mr Swamy’s baseless criticism of the Reserve Bank of India Governor Raghuram Rajan.

But that clearly was not enough. It will be recalled that soon after those attacks, Mr Rajan decided against seeking a fresh term as the RBI governor at the end of his current tenure in September and, although he did not say so, one of the reasons for his decision to get back to academia must have been the kind of brazen attack he was subjected to in the last couple of months.

It could be argued that Mr Rajan’s decision not to seek a fresh term at the central bank and, more significantly, the government’s reluctance to unequivocally condemn the bitter diatribe against the RBI governor might have egged on Mr Swamy to launch a much wider attack - this time against Chief Economic Advisor Arvind Subramanian and Economic Affairs Secretary Shaktikanta Das.

Raghuram Rajan’s exit: Complete Coverage 

What’s more, Mr Swamy threatened to name 20-odd more senior civil servants, whose credentials to serve the BJP-led government, according to him, were questionable.

These attacks not only undermined the independence of the institutions these officials served, but more worryingly, there was the real fear of a paralysis of decision making in the government.

If senior government officials are attacked by a senior BJP member without any checks or condemnation from the head of the party or the government, the bureaucracy is likely to feel even more isolated and look for safety in inaction and postponement of legitimate decisions, which could deal a body blow to governance.

Mr Swamy did not even spare the government’s pet reforms plan to usher in the much-delayed goods and services tax, claiming that the new taxation regime was no big deal for the economy and would not benefit the economy significantly. 

Two signals from these developments are difficult to ignore.

One, the BJP has always taken pride in being a disciplined party. It was not like the Congress, whose leaders could escape unpunished even after acts of indiscipline and insubordination.

But Mr Swamy so far is yet to be completely reined in, raising the question if the BJP can still claim to call itself to be a disciplined party.

Two, it is significant that Prime Minister Narendra Modi defended Mr Rajan, but it would be debated why he took so long to dub criticisms like those against the RBI governor as improper.

An unequivocal condemnation of Mr Swamy’s attacks soon after they were first made could have arguably spared the country the trauma of one of its finest economists leaving the central bank under what were clearly unsavoury circumstances.

The prime minister’s reluctance to stop Mr Swamy from launching personal attacks against Mr Rajan and other finance ministry officials must have also had an unsettling effect on his finance minister.

Now that Mr Modi has spoken out, such concerns, hopefully, would be a thing of the past.

Raghuram Rajan’s exit: Complete Coverage 

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