Friday, July 19, 2024

Regional cooperation

Since India’s independence more than seven decades back, the North East region of India has remained solidly in the hinterland of economic globalization. This is in spite of the fact that the region has all the potential to be an economic leader in the country, particularly taking into account the abundance of natural and human resources available in the region. But due to varied reasons, and not necessarily only because of the separatist movement rife in some parts of the region, the region has so far seen too little of the boom experienced in other part of the country, and its economies are still struggling. One problem is that the states in the North East are not relying enough on one another for the boost necessary to start their economies. Corruption is another problem, as is a lack of economic innovation. Surely, it can be said that there is too much corruption and too little cooperation among the states in the NE region, thereby hindering economic interdependence while also inflating the cost of doing business. One reasons for the precarious economic condition of the region is that most of the leaders in the region are what can be called the ‘first generation’ leaders, who are still used to the economic policies of the past and each approaching economic reform at a different level, and from a different direction. This alone makes economic interdependence difficult in the region. And compounding the problem is the menace of corruption. Much of it is attributable to government officials who are paid so little that they have no choice but to find other ways of increasing their incomes, usually by accepting bribes. One solution suggested repeatedly in the past and even today is simply for governments to reduce their civil-service payrolls so they can afford to pay their employees more and make them less susceptible to corruption. The underlying reasoning behind this view is that it will benefit not only private businesses but, in the long run, the government, too. This, perhaps, is a good idea because it is cheaper to have a professional and non-corrupt government. And the consequences of a bad government, as is well known, are in terms of crores of rupees. However, reducing government payrolls alone will not get to the root of the problem facing the region. The problem is institutional and must be handled institutionally. Apparently, it is not only the wages; it is also the whole culture, which is there in each and every institution involved. In order to solve the problem of corruption, one has got to have a situation where heads of institutions are clean themselves and they are cleaning up the institutions. Obviously, if every bureaucrat at his place does this job, eventually we will get there and eliminate corruption. But it also needs to be pointed out that the issue of corruption, besides being a problem, is also an excuse. Most of the leaders in the region find it easier to blame corruption than to summon the ‘political will’ to move forward with crucial reforms. Instead, of focusing on cooperating with their neigbours, the leaders are competing with them. Sure, there is a lot of talk and a lot of lip service is paid by politicians about economic cooperation in the region, how if united the region can march ahead towards economic growth, etc, etc. But the truth of the matter is that not much is happening. And the reason for this is, in many cases, that while talking about the need for cooperation, states in the region prefer to protect their interests first, thereby failing to promote regional cooperation in practical terms. The political leaders apparently do not see the economic growth of North East as benefiting their own interests. This again proves that not all politicians are economists and they should not act as what they are not. Rather the need is instead of trying to compete with one another, NE states should consider serious reforms geared at improving regional cooperation.