Best of BS Opinion: New rural jobs law will bring significant changes

Today's wrap looks at the new rural jobs law, the push to open civil nuclear power to private investors, a US strategic reset, RBI's views on bank ownership, and a book on American power

Hello, and welcome to Best of BS Opinion, our daily wrap of the day's opinion page.   The Viksit Bharat- Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB-G RAM G, will now replace the Mahatma Gandhi National Rural Employment Guarantee Act. While the new legislation proposes to increase the number of guaranteed work days to 150, this will help only if enough employment opportunities are created, notes our first editorial. However, the increase in states' share of funding means they will likely face increased financial outgo. Besides, some states may not be able or willing to spend more. The other important aspect of VB-G RAM G is that it accounts for labour needs in the farm sector. However, it should not be viewed as an answer to India's employment challenges; instead, the focus should be on creating better-paying jobs so that dependence on such schemes reduces progressively.  

The government has finally moved on opening up the civil nuclear energy sector to private investors. The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill allows up to 49 per cent foreign direct investment in certain nuclear activities, and removes a contentious clause on suppliers’ liability and the delineating of operators’ liabilities. However, this should not be a blanket exoneration, cautions our second editorial. These key amendments are likely to attract private sector interest in at least Small Modular Reactors. One potential pain point, however, lies in the sensitive parts of the nuclear fuel cycle such as mining and enrichment, which will remain with the government.  

  The Trump administration is reported to be working on a National Security Strategy (NSS) that reorients its position towards its European allies, as well as its own place as a global leader, notes Shyam Saran. The NSS confirms the shift of strategic focus to the western hemisphere - a “Trump corollary” of sorts of the Monroe doctrine - and is presented as key to the US remaining a front-ranking power. At the same time, there is an explicit rejection of the objective of retaining a position of global dominance for itself; instead, there is an embrace of a balance of power in other geopolitical theatres, including the Indo-Pacific. It also commits the US to encouraging India to be a part of Indo-Pacific security.  

  The arc of the Reserve Bank of India’s (RBI’s) policy on bank ownership has changed over time, notes Amit Tandon. The central bank now sees merit in diversified ownership with the “promoter shareholders” having limited or no ability to influence the board. While this could well be the RBI’s preferred path forward as it provides the banking system with a degree of stability and access to deep pools of capital, we have far too few banks for an economy of our scale and aspirations to depend on foreign capital. The RBI should reconsider its frameworks on bank ownership, voting rights, and the restrictions on industrial houses entering banking, besides encouraging large NBFCs with proven records to convert into banks. Like with equity markets, it’s domestic banks that will help the Indian economy grow. 

  Shadi Hamid, in his book The Case for American Power, makes a provocative case for why America, despite its many flaws, remains the best hope for the world, writes Dammu Ravi in his review. The book raises a fundamental question facing the United States today: How should it think about the power it has and regain its moral purpose in a world beset by tragedy? His book confronts head-on America’s failures, contradictions and resilience. Hamid, however, sees the US' misjudgments as the fulfilment of patriotic duty rather than its negation, disregarding the erosion of America’s moral fortitude. He also overlooks how the construct of a unipolar world led by America in the 21st century has serious limitations. Nonetheless, he seems to ask the reader to understand America’s past as intertwined in a certain cyclical logic of success and failures. In this intensely personal book, Hamid wills himself to optimism, realism, and calls for an America worthy of its ideals.