It has been often argued that the government of India is over-sized and it acts as a drag on the economic efficiency and growth. Critically evaluate.

The Indian government is considered as over-sized and bloated by a majority of people. A former chairman of the erstwhile planning commission acknowledged that around 80% of planning money went to the salaries of government employees.

Impact on economic efficiency & growth:

  • It creates incentives for the culture of red tapism, which gives scope for corruption.
  • Large fiscal scope of government is required to meet salaries and ‘crowding out’ of public sector.
  • It is well known fact that the most resistance to LPG reforms have came from bureaucrats.
  • Vested interests of bureaucracy also created hurdles in privatization reforms.
  • Presence of various departments and autonomous bodies & regulators, create inconsistency and uncertainty.

But not every department is bloated. The Baswan committee pointed out the level of vacancies at higher levels.

Measures needed:

  • Right sizing – Restructuring, Reorganization, Cooperatization.
  • Decentralisation and devolution.
  • Greater use of ICT and e-governance.
  • ‘Agencification’ within departments to improve expertise and coordination between departments.
  • Lateral entry at higher levels.

Thus, for minimum government and maximum governance, we need right sized, proactive, modern and future ready bureaucracy.

Originally written on August 29, 2023 and last modified on October 27, 2024.

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