Niti Aayog at 6 — some ideas too ‘ambitious’ but Modi think tank has many reforms up its sleeve

Niti Aayog came into being on 1 January 2015 as a successor to Planning Commission. It has been pitched by Modi govt as modern India’s cradle of reform.

The NITI Aayog office in New Delhi | Photo: Manisha Mondal | ThePrint

New Delhi: A storm of criticism, ridicule and memes was unleashed last month when Amitabh Kant, one of the most powerful civil servants in the country, said reforms are much harder in India than in China because it is “too much of a democracy”. 

Kant, a 1980-batch IAS officer of the Kerala cadre, might have touched a raw nerve with his comment but he would know better. He is the CEO of an institution that replaced the Planning Commission six years ago, on this day, as the cradle of reform in India.

In his first address from the ramparts of the Red Fort in 2014, Prime Minister Narendra Modi had announced the replacement of the 64-year-old commission with a new institution “having a new design and structure, a new body, a new soul, a new thinking, a new direction, a new faith towards forging a new direction to lead the country…” 

And the new direction was to be based on “creative thinking, public-private partnership, optimum utilisation of resources, utilisation of youth power of the nation” to empower the state governments and the federal structure. Accordingly, the National Institution for Transforming India (NITI) Aayog was formed on 1 January 2015.

Six years down the line, the verdict over whether the NITI Aayog has achieved what it set out for is rather divided. 

Some argue that, since 2015, every significant government policy has had the definitive stamp of the NITI Aayog. Others, however, say the organisation has become a symbol of “centralisation of ideas”, shifting the theatre of activity from ministries to the Aayog. 

While some say that the NITI Aayog effectively provides the intellectual heft needed to underpin economic policy, others believe it only performs the function of retrospectively justifying policy decisions already made by the top hierarchy in the government. 

Lastly, while some believe that the Aayog has fundamentally transformed the relationship between the central and state governments by dismantling the hierarchy between the two — the basis on which the Planning Commission operated — others note that, in the absence of powers to allocate funds, the body has become irrelevant for states, especially those not led by the BJP.

NITI Aayog – A bid to ‘transform’ India 

In the last six years, the NITI Aayog has come up with reports and targets on a range of subjects — doubling farmers’ incomes by 2022, holding simultaneous elections in 2024, a 100 per cent shift to electric vehicles by 2030, rolling out a “One Nation, One Health System” policy by 2030, which would merge allopathy, homoeopathy and ayurveda into one system, raising the investment rate in the country from 29 per cent of GDP to 36 per cent by 2022, and making India malnutrition-free by 2022, among several others. 

Within the government, many people say that the NITI Aayog’s reports are too ambitious, and bother little with the limitations of the government. 

However, an official working with the NITI Aayog said the think tank’s biggest contribution comes in terms of its ability to draft and recommend policies in a way that breaks the silos in which ministries often operate, bring ideas from across the world and evaluate their suitability for India, and plan in a long-term, disruption-friendly way. 

Articulating the organisation’s agenda for this year, NITI Aayog Vice-Chairman Rajiv Kumar said in an interview to news agency PTI earlier this week that priorities include accelerating electric mobility, enhancing the competitiveness of the textiles industry, improving credit access for small and medium enterprises, and pushing water conservation measures across the country. 

From catalysing Online Dispute Resolution to regulating Online Fantasy Sports Platforms in India – the Aayog has produced reports on a vast array of subjects this year, a trend it aims to continue in 2021 as well. 

“Our mandates were very broad, but specific,” Rajiv Kumar told ThePrint.

“We were supposed to gather new ideas from national and international sources, see their merit for policy-making, work on them, and then pass them on to relevant ministries. Several of the important policy decisions like the National Medical Commission, National Education Policy, Ayushman Bharat, etc. have come from NITI Aayog,” he said.

‘NITI stamp on every policy’

Asked if every policy of the government does indeed have a NITI stamp on it, Kumar said the think tank is, in fact, involved in every policy initiative, even if it has not originated there.

“The NITI Aayog has a role across policies because, before every Cabinet approval, NITI’s comments are recorded, and these have immense value,” he added.

Kumar’s predecessor, Arvind Panagariya, who resigned from the NITI Aayog in 2017 to join Columbia University in the US as a professor, agreed. 

“I participated in all discussion and drafting of all documents of policy importance,” he told ThePrint on email. 

“No cabinet note of importance from ministries went out without my close scrutiny, and (all) bore my final stamp on them. This was an important avenue through which I directly influenced policy decisions,” Panagariya said. 

“I monitored closely the quarterly infrastructure reviews NITI gave to the PM, and sat on all meetings presided over by the PM during the reviews. Without naming specifics, let me also say that there were also several cases of major policy importance on which ministries were not moving forward with decisions, leading the PMO to place the matter in NITI hands, and we moved swiftly in each of those cases,” he added. 

NITI and union ministries: A bittersweet partnership 

For Union ministries, the transition from Planning Commission to the Niti Aayog meant going from dealing with an organisation with fund-allocation powers to one that is enormously powerful but does not have the authority to assign funds. 

A former official of the Aayog, who requested anonymity, said it is harder to get ministries on board now because the NITI Aayog, unlike its predecessor, has no say in budget allocation. 

“There is obviously a difference with advice that comes with the power to allocate money, and advice that doesn’t,” the official added. 

As stated earlier, among several officers across ministries, the NITI Aayog is seen as an organisation that carries tremendous significance and weight in policy-making, but bothers little with the logistical problems of getting its ambitious policies through. 

“The NITI Aayog will come up with the most impressive and ambitious policies, glossy presentations and catchy slogans, but doesn’t always bother with the crude mechanics of its plans,” said a retired senior official who didn’t wish to be named. 

For example, in 2019, the NITI Aayog asked the automobile industry to submit a plan to ban internal combustion engine (ICE)-fitted two-wheelers under 150 cc by 2025, and three-wheelers by 2023, as part of a plan to reduce the number of fossil-fuel-consuming vehicles and move towards electric vehicles (EVs). 

Instantly, the automobile industry went into panic mode, and Union Road Transport Minister Nitin Gadkari had to step in. To dispel the panic, he said, “I am the minister, NITI Aayog does not have the authority to set EV deadline.”  

In 2017, the NITI Aayog released the “National Nutrition Strategy”, which formed the basis of the government’s POSHAN Mission — aimed at making India malnutrition-free by 2022. 

In its document, the NITI Aayog set 2022 as the target for reducing undernutrition in children by 3 per cent per annum, and reducing anaemia by a third in comparison to the National Family Health Survey (NFHS)-4, which collected data between 2015 and 2016. 

The NFHS-5 data, released in December 2020, indicated both a decline in the nutritional status of children aged under 5 years, and a higher anaemia rate among women. 

An official in an infrastructure ministry highlighted another oft-repeated sentiment. “Several times, when something comes from the NITI Aayog, it is known that it has actually come from the PMO. The NITI, in these cases, performs the function of justifying it through a paper or a report, something that has already been decided for all practical purposes,” the officer said. 

For instance, the government first articulated the need for simultaneous polls in 2016, with Modi making a case for holding elections to Parliament, state legislatures and local bodies together. In 2017, the NITI Aayog came out with a paper supporting synchronised elections in India in “national interest”. 

Then, on Independence Day 2019, PM Modi stressed the need for population control. Within months, the Aayog decided to hold consultations on population stabilisation, and prepare a working paper to address key gaps in India’s family planning programmes.

Clashes with ministers

While the Aayog may be prolific in terms of producing a large number of reports, they are not of high quality, said Ashwani Mahajan, the National co-convenor of RSS affiliate Swadeshi Jagaran Manch, which has often publicly raised objections with proposals of the organisation. 

“A few years ago, we organised a meeting to take stock of the NITI Aayog, its performance, contribution, etc. What we found was there were hardly any meaningful reports, they were, in fact, sub-standard — one cannot even get an MPhil degree on those reports,” he added. 

Like Gadkari, other Union Ministers have also had disagreements with the NITI Aayog.  

For example, in 2019, in another context, Union Minister Piyush Goyal clarified that the NITI Aayog’s comments “don’t reflect the government’s view unless it is announced as a policy as NITI Aayog is an independent think tank”. 

In 2017, former Union minister Maneka Gandhi clashed with the Aayog when the latter insisted that children and mothers be given cash transfers instead of cooked or uncooked food under the government’s Integrated Child Development Services (ICDS) scheme, which is aimed at offering proper care for children up to six years old and nursing women. 

Eventually, the PMO and Gandhi’s own ministry backed the NITI Aayog’s proposal.  

Even so, both Kumar and Panagariya said the relationship of the NITI Aayog with ministries has remained extremely cordial. 

“Policy-making continues to be a two-way process,” said Kumar. “There are several policies which have originated from ministries, and the Aayog has helped in working on them. And similarly, there have been instances where the NITI Aayog’s proposals have been accepted…It is fundamentally a very consultative approach.”

Panagariya was of the same view. “I certainly was active in moving forward policy agenda wherever I could but always in close consultation with the ministries. I recall no case of discord between NITI and the ministries during my years there…” he said. 

The PMO, he added, was indeed always involved in the process but never dictated the outcome to the Aayog.

“Yes, PM/PMO were always at the table but I did not see how it could have been otherwise, given that it is the PM who has the mandate from the people,” he added. “The outcome was, of course, never dictated by the PM/PMO, however. Instead, the end result came from deliberations.”  

A third official familiar with the NITI Aayog said it is the prerogative of ministries to not listen to the Aayog. 

“Our mandate is to persuade. NITI Aayog is not a super PMO that everyone will have to listen to us,” the official said. 

“Several of our reports and ideas have been accepted, and several rejected – that is the part of the institutional design to keep the healthy tension between NITI and ministries alive,” the official added. 

According to the official, several Niti reports on issues like “farm laws, production-linked incentives, National Medical Council, Ayushman Bharat, coal commercialisation, etc have been accepted”. 

“Of course, some will be rejected. We cannot have a monopoly of ideas,” the official said.

Cooperative federalism – success or failure? 

While the verdict on the NITI Aayog’s ability to make a mark at the level of the central government is mixed, many point out that it has not succeeded in strengthening the states’ relationship with the central government. 

“Initially, states took time to understand that NITI was no longer a source of funds for them and I was either visited by CMs or received calls from them for financial resources,” said Panagariya. “But eventually, they understood that NITI was different from the Planning Commission. Personally, I saw a challenge in demonstrating to the states that NITI could be intellectually useful to them and their friend in Delhi as they dealt with the PMO and other ministries and worked to reshape the institution’s role accordingly.” 

One of the biggest achievements of the Aayog with regard to states has been its aspirational districts programme, started in 2018, which seeks to transform 115 districts with the least progress, across 28 states, along certain development parameters like health and nutrition, education, agriculture and water resources, financial inclusion, skill development and basic infrastructure.

Hailed as one of the biggest governance reforms pushed by the Aayog, the initiative involves the think tank ranking the aspirational districts through a public ranking system — thereby, instilling a sense of competitiveness among local-level governments to bolster development. 

The districts whose performance is judged the best by the Aayog are allocated additional token grants to further improve their performance. 

“It is a fallacy that only funds can lead to outcomes. NITI has managed to create a system where existing funds lead to better outcomes,” said the third NITI official quoted above. 

However, it still remains hard for NITI Aayog to make interventions at the state-level, experts say. 

“It’s like the NITI can publish reports, and rank states on their performance on different parameters — it is all very useful data collection. But at the state-level, there are on several occasions, no takers,” said the former Aayog official.

“The one key change since the Planning Commission days has been that the states no longer need to come to NITI. NITI has to go to them, and convince them that it is intellectually beneficial for them,” the official said. “That is often hard to do.” 

But that, the third NITI official said, is why NITI Aayog was created. “We consult and work with states in a large number of areas, but the spirit of cooperate federalism also entails the right of the states to reject something,” he said. However, what has been a question that needs more thought is should NITI have the power to grant some funds at least, the official asked. “It is a question of political philosophy — can you have a body that only articulates ideas? Today we have a strong PMO, so NITI enjoys some weight. What happens if tomorrow there is a coalition government? Who will listen to NITI Aayog?” the official said.

But having said that, the official added, six years is too short a period to judge the success of an organisation with as vast a mandate as NITI, a point others echoed as well.

“The credit or discredit of everything cannot go to one organisation, and the job of the Aayog is to move the frontiers of governance,” the official said. “The Planning Commission had a history of over six decades to judge it by, Niti Aayog at least needs one to find its feet.”