GS Paper II
News Excerpt:
This article examines the issue of whether a coalition government can pave the path for economic transformation in the country.
Present Scenario
- In terms of economic governance, the one aspect that distinguished the past two Lok Sabhas was the fact that it was the first time since the start of economic reforms that a single party — the Bharatiya Janata Party (BJP) — enjoyed a majority mandate.
- Since 1991, when India was forced to open up its economy and give up on the planned economy model, all governments were coalitions of the sort where even the lead party was quite far from the majority mark of 272.
- While everyone agreed that economic reforms were required, the parties of the ruling coalition pulled in different directions when it came to deciding the exact nature of an economic reform.
About Coalition government
- Coalition government is the form of a parliamentary government in which more than two or multiple parties cooperate and come together to form the government.
Evaluation of coalition government in India
- After independence, India has largely been ruled by the single largest party, the Indian National Congress. The organized congress party ruled India with no competition.
- First experience of coalition government at the union level goes back to 1977 when the non-congress forces united under the leadership of Moraji Desai in the name of Janata Party.
Challenges of coalition politics in India
- Government is very unstable: Coalition governments often fail to complete their term at the office and are prone to immature dissolution. In many such coalition governments the governments failed to complete their term for example: Morarji Desai, Charan Singh, V.P Singh, Chandra Shekhar, H. D. Deve Gowda, I.K Gujral and Atal Bihari Vajpayee government.
- Coalition governments can be less effective and non-durable as compared to the governments formed by a single party with definite principles and specific ideology.
- Horse trading is another demerit of the coalition government in India.
- The party manifesto presented to the public before the elections becomes diluted due to influence of coalition parties therefore affecting growth and development.
Arguments in favour of Coalition Government
- It represents a broader spectrum of people and a wider range of views, therefore making them more democratic and fairer.
- It offers a chance for supporters of other parties to be represented in Government.
- Public are more interested in this type of government as smaller parties which fulfills local aspirations, get a chance to participate in government.
- Government Policies are more likely to be debated with various points of view considered before policy is implemented.
Can a coalition government derail India’s economic reforms trajectory?
There are two ways to look at it:
- One, the past decade under the NDA Government was supposed to sort out that weakness and provide confidence to investors — both local and foreign — about policy stability, and a concerted push towards economic reforms.
- While NDA’s first two terms saw several reforms such as the introduction of the Goods and Services Tax (GST) and the creation of the Insolvency and Bankruptcy Code, it was not exactly a smooth ride in the context of land acquisition reform.
- Similarly, during the second term, the NDA government could not convince farmers about the farm reforms and was forced to repeal them. Indeed, the announcement of the demonetisation injected a deep sense of uncertainty among all economic agents.
- Two, if one looks back at India’s economic history since 1991, it becomes clear that coalition governments have undertaken some of the boldest and most visionary reforms that laid the foundation for India’s resurgence.
Notable reforms brought by coalition governments
- The biggest example is the whole host of reforms during the P V Narasimha Rao-led government, which was essentially a minority government. It discarded centralised planning and opened the Indian economy to global completion by removing the licence-permit raj.
- The country also became a member of the World Trade Organisation.
- Under the short-lived Deve Gowda government, then Finance Minister P Chidambaram came out with what is still referred to as the “dream budget”. It placed faith in the Indian taxpayers and cut tax rates — both personal income tax, corporate taxes, and customs duties.
- Under the National Democratic Alliance (NDA) government, India framed the Fiscal Responsibility & Budget Management (FRBM) law for fiscal rectitude, and limited the government’s ability to borrow within prudential limits.
- The NDA government further advanced the push towards disinvestment of loss-making Public Sector Undertakings (PSUs)
- Focused on boosting rural infrastructure and connectivity through the PM Gram Sadak Yojana.
- The very first NDA also brought in the Information Technology Act, in 2000, that laid the foundation for the bustling e-commerce giant that India is today.
- Under the United Progressive Alliance (UPA), India expanded on the Vajpayee-era Sarva Shiksha Abhiyan to establish the Right to Education Act.
- The UPA government brought in several reforms under the rights-based approach:
- Right to Information Act, which boosted transparency in India’s democracy
- Right to Food, which ensured that no Indian should go hungry.
- Mahatma Gandhi National Rural Employment Guarantee Act (MG-NREGA), which provided minimum employment to the rural poor.
- Deregulation of fuel prices.
- Started work on direct benefit transfers as well as Aadhaar and Goods and Services Tax.
Conclusion
- In today’s political scenario, the Indian parliamentary system and multi party system are very much correlated, and have significantly changed the face of the regional political parties in India.
- In this scenario every regional political party plays an important role in forming the central government, and has changed the relation between government and opposition.
