Govt matters less and less to the common man

Politically, the Government may still be all-powerful, wielding in its hands the rule of the law although the Maoists may have a different take on it. However, viewed purely in fiscal terms, the Government is a pale shadow of its former glorious self.

Whether it is employment or education or such essentials as electricity, and the list is fairly long, the harsh reality is this.

Government matters less and less to the common man than it did in the past. A plethora of statistics put out by the Finance Ministry in its survey of the economy for 2010-11 bears this out in ample measure.

In 1992-93, utilities (largely owned by the State) controlled 72,300 MW of electricity generation capacity in the country while non- utilities (captive generation by the private sector, mostly) controlled a mere 10,100 MW. While utilities have added 120 per cent in incremental capacity, the latter has added 180 per cent. True, the former is still a colossus accounting for 84 per cent of the total capacity against 87 per cent earlier. Two points could still be made.

Captive capacity

One, capacity creation by non-utilities is a costly act of redundancy created by the private sector to provide for a deficient performance by the public utilities. More importantly, such captive capacity is being increasingly called into produce more electricity so as to make it a permanent feature of its operations. For instance, one MW of captive capacity was used to generate 3.1 billion units of electricity in 1992-93. By 2009-10, however, it was generating 3.85 billion units a year for one MW of installed capacity much closer to the 5 billion units generated by utilities.

At its peak in 1991-92, public sector employed 190 lakh people to the private sector's performance of employment of 77 lakh. . By 2008, the latest year for which data areavailable, the public sector's employment has shrunk to 177 lakh while the private sector employed 99 lakh by March 2008. From a gender perspective too, public sector mattered less to women than men as the latter employed nearly twice as many women as the public sector did in proportionate terms.

Indeed, the job seeker's disenchantment with the Government is so total that the number of registered job seekers with the employment exchanges has fallen from a peak of 42 million in 2002-03 to roughly 40 million in 2009-10.

Education

In education too, the private sector is playing an increasingly prominent role. There are now close to 8 lakh primary schools recognised by the Government, 1.73 lakh higher secondary schools, nearly 7,000 colleges offering professional education and over 400 deemed universities in the private sector.

The growth of civil aviation and mobile telephony are two legendary examples of the services sector of the Indian economy where the public sector has been marginalised beyond recognition. The combination of Air India and Indian Airlines, which held a monopoly on domestic aviation in the early 90s, has seen its market share down to about 25 per cent.

Resources

The Government may own intangible resources worth a great deal of wealth if the size of the 2G scam is anything to go by. But, in purely physical terms, it is a lot poorer than the private households and the corporate sector put together. The two (private and public sectors) were running neck and neck in wealth as recently as 1991-92.

The net capital stock (a measure of wealth) in the hands of the private and the public sector was almost equal with the former accounting for Rs 10.82 lakh crore in wealth to the latter's Rs 8.75 lakh crore. By 2008-09, however, the private sector has streaked ahead of the public sector by registering a 10-fold increase while the latter could manage only a more modest rate of growth of 6.4 times.

To economists outside the Government, the changed circumstances may represent merely the outcome of a pursuit of neo-liberal economic policies. Those in the Government might put a gloss on it by referring to it as the public-private partnership mode of wealth creation. As the nation awaits the unveiling of the Budget by the Finance Minister, the keen anticipation in the common man's mind associated with the event in the past, might seem just a little overdone in the current circumstances.