Tripping up on sloppy policy flip-flops

The storm over Gajendra Chauhan’s appointment as chairman of the Film and Television Institute of India (FTII) is unlikely to blow over soon. FTII students are protesting against the arbitrary nature of the appointment and the perceived unsuitability of Chauhan — a functionary of the Bhartiya Janata Party — for the job.

The appointment is also contrary to the BJP’s pledge in the education section of its election manifesto: “The procedures to make appointments to senior positions shall be made transparent and merit and ability shall be the sole criterion.” In many other higher education institutes (such as the Indian Council for Historical Research), the BJP has installed party supporters and sympathisers, disregarding the vow to keep “merit and ability” as deciding factors.

This is in keeping with a broader trend. Prime Minister Narendra Modi’s 365 days in office has prompted a wide-ranging review of his achievements. When viewed against some of his promises made on the long and arduous road to the Prime Minister’s office, or soon after coming to power, the actions seem inconsistent, especially in the absence of proper disclosure and communications.

One of the Modi government’s first foreign policy actions was to block passage of the Trade Facilitation Agreement (TFA) in the World Trade Organisation (WTO). This shocked India’s trade partners, especially western economies. The Indian government had its reasons: the actions of the WTO leadership and rich countries had aroused suspicions that they would go back on the Bali agreement of December 2013 — especially on food security clauses — as soon as TFA was passed.

The western media’s din of faux indignation drowned out any rational examination of the Indian government’s action. The Indian government also failed to communicate its stand to the global audience. What further complicated matters was that India stood alone in the WTO; all the emerging, developing or poor countries, considered traditional allies, abandoned India. The rationale emerged later — on August 5, 2014 — when Commerce Minister Nirmala Sitharaman made a statement in Parliament.

Then in November 2014, at the India-US Trade Policy Forum meeting, Sitharaman and US Trade Representative (USTR) Michael Froman signed an agreement on food security issues and TFA, thereby ending a deadlock. This was made possible after Modi’s meeting with President Barack Obama. What transpired at the meeting, or the conditions agreed upon, is not known. An anodyne communique issued after the meeting noted dryly: “Minister Sitharaman and Ambassador Froman expressed satisfaction at the recent understanding between India and the United States on the issue of public stockholding for food security purposes and the Trade Facilitation Agreement as a follow-up to the discussions between Prime Minister Modi and President Obama. They committed to working with other WTO Members to ensure that the WTO General Council takes this understanding forward towards a satisfactory outcome.”

Although Sitharaman did subsequently make a statement to Parliament outlining the gains wrested from the US, it stopped short of revealing India’s giveaways. No agreement is complete without some give and take. In this case, Sitharaman chose to highlight only what India had gained. Perhaps the concessions are linked to the next instance of policy backtracking.

On April 23, 2015, Modi made a startling statement. At an exhibition organised by the commerce ministry, he announced that India’s intellectual property regime (IPR), specifically patent laws, should be brought on par with global standards. Nothing wrong with that except that India’s IPR framework is already fully compliant with WTO rules.

This statement led to speculation that India was capitulating to demands that its domestic patent rules be realigned to comply with US laws. India and the US have locked horns for the past few years over IPR differences, especially India’s refusal to allow pharmaceutical companies to ‘evergreen’ patents, an exercise undertaken to prolong a drug’s patent life by making marginal or superficial modifications.

Once again Sitharaman jumped in to save the day. She defended Modi’s statement in an interview to the media. But the import of Modi’s statement was not lost on observers. The steady push-back in domestic IPR laws has been in evidence for a while now.

One of the revelations came in the USTR’s press release of December 12, 2014. The 2014 edition of Special 301 Report (released in April 2014), a unilateral annual review of the global state of IPR protection and enforcement as defined by US laws, stated that USTR would conduct an out-of-cycle (OCR) review of India’s IPR laws in 2014 fall ; the December press release concluded: “India has made useful commitments in recent months, including to institutionalize high-level engagement on IP issues, to pursue a specific work program and to deepen cooperation and information exchange with the United States on IP-related issues under the U.S.-India Trade Policy Forum.”

Then in January, Froman’s written statement to the Senate Committee on Finance admits rather triumphantly: “Use of the out-of-cycle review helped to secure commitments from India in the 2014 Trade Policy Forum on a broad range of IP issues of concerns to the United States and its stakeholders.” Finally, the 2015 Special 301 report — released a couple of days before Modi’s curious statement — continues to place India in the ‘Priority Watch List’ and might have instigated the Prime Minister’s utterances. This also gives rise to speculation that India’s acquiescence on IPR laws might have been the sacrifice necessary to get its way in the WTO.

There are other inexplicable policy reversals. On his first official visit to France, Modi announced a decision to buy 36 Rafale aircraft in fly-away conditions. This was at odds with the Centre’s earlier decision, taken during the UPA-II regime, to purchase 126 Rafale jets. The decision was also an about-turn from the BJP’s election manifesto promise to focus on “technology transfer in defence manufacturing” and its offset policy linking defence procurement with ‘Made in India’. The Centre’s earlier agreement required the jet manufacturer, Dassault, to undertake partial manufacturing in India. The fly-away condition means all manufacturing will now take place in Europe.

The Prime Minister’s snap decision remains a mystery because it was not clearly communicated to the Indian public. There is a possibility that the Dassault agreement was flawed and required reworking. But government must inform the public; otherwise such policy reversals make governance look capricious.

The writer is a journalist and senior fellow with the Mumbai-based think tank, Gateway House