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Moves afoot to restructure Planning Commission; Jaswant against capital account convertibility

Deputy Chairman of the Planning Commission Jaswant Singh today said a note is to be sent soon to the cabinet on restucturing of the commission.

Addressing the economic editors conference in New Delhi, he said the commission at present is fully constituted. It has two members and a member-secretary.

Jaswant Singh said the Ninth Plan was in operation, only the document was not ready. He said the new document will incorporate the five action plan and priority areas of prime minister Atal Bihari Vajpayee. There is no basic change in the Ninth Plan, only the emphasis would be different, he said.

Jaswant Singh said the complete adoption of the Ninth Plan should be over by this autumn.

The deputy chairman said the plan for restructuring of the commission was submitted to the prime minister. According to informed sources, the prime minister after examining it sent it to the committee of secretaries who gave their comments. The committee of secretaries is in broad agreement with the restructuring plan and have suggested only a few modifications.

The sources said one of the elements of the restructuring is that the Finance Commission should have closer interaction with the commission and that its deputy chairman should have a greater say in the operations of the Finance Commission. The sources said the restructuring will take two to three years.

Jaswant Singh expressed himself against capital account convertibility of the rupee saying that it was a saving grace that this had not been done. This probably is the reason why globalisation has faltered.

The deputy chairman said the Economic Advisory Council of the prime minister will be meeting tomorrow to take stock of the present economic situation.

Jaswant Singh said it was a misconception that the commission is merely a fund-allocating body. It keeps the federal structure of the country glued together. No other agency has this ability to strengthen the federal structure.

The other challenge of the commission is to evolve policy in the context of international relations like nuclear diplomacy. ''We are addressing these issues of nuclear diplomacy at the demise of the Cold War. This is an area that the commission will have to address as it evolves economic policy in the management of the country. It has to address the consequences of nuclear diplomacy,'' he said. The other challenge is foreign economic policy with the imperative of domestic political economy.

Singh said the whole of Europe has a high element of subsidy to the farming community. In the US, the wheat lobby is very strong. ''We've to accept this reality,'' he said.

He said the US is a champion of globalisation and liberalisation but it takes utmost care of its domestic economic issues.

The deputy chairman said trade in currency is another challenge facing the country. Currency markets have come under turmoil in trading. Trade in currency requires international restraint and regulation. It is one of the tasks of the commission to look into these issues. The other major challenge in foreign economic policy which is dominated by the World Bank and IMF is that these institutions operate as proper vehicles for transformation.

India cannot afford to go without food security and energy security. The problem that the country faced was excessive governance. India has to devise its own mechanisms to face the challenge of the market economy.

Singh said it was unfair that the commission was not being taken seriously.

Asked whether in an economy where the market is to play an increasingly important role, the commission has any relevance, Singh said planning had social objectives and a totally free economy was not desirable.

He said the approach to the draft Ninth Plan has been adopted. There is no plan holiday. ''We are in the process of finalisation of the state plans. We have almost covered 50 per cent of the states,'' he said.

Singh said he always found time for planning. All the states have agreed on the action plan.

Asked whether the five-year term for a plan had relevance as it was intended to be coterminus with the life of a Union government and state governments, he said the issue merited study in greater detail.

Singh said the size of population was a matter of concern. Transforming the population into the asset was the basic challenge. The strength of these people is entreprenureship. This should be harnessed locally to stop migration.

He said the international payments order is anamolous. The reform process should also address itself to the question of globalisation of the economy.

UNI