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Out of town

Prime minister needs more reform to cash in on his summits

Business Standard Editorial Comment  |  New Delhi 

Over the weekend, Prime Minister Narendra Modi addressed several rallies in poll-bound Maharashtra and Haryana. Mr Modi is clearly his party's chief campaigner; it is uncertain how many rallies he will eventually address in these states, but it is likely to be more than two dozen. This will, naturally, mean less time in South Block. November, in addition, is likely to be packed with summit meetings. Mr Modi will go to Myanmar in the second week for a meeting with the Association of South East Asian Nations, or Asean. After that is the G20 meeting in Brisbane; this will reportedly be followed by a summit meeting with Australian Prime Minister Tony Abbott - the second in the prime minister's brief time in office. And shortly thereafter will be the South Asian Association for Regional Cooperation, or Saarc, summit in Kathmandu, which Mr Modi has already visited in the past few months. And in December, there is the annual summit with Vladimir Putin of Russia. This will follow India hosting the 54 countries of the African Union in the first week of December.

The prime minister, of course, must do his duty by his party. He is also best placed to raise India's diplomatic profile around the world. However, his crowded schedule of electioneering and summit meetings leaves very little time for the much-needed brainstorming about reform at home that is actually essential to his agenda. It would be unfortunate if the lure of photo-opportunities meant that the prime minister postponed meaningful structural reform. Certainly, nobody can question Mr Modi's political instincts. His summits provide excellent talking points for his election meetings - they allow him to say he is restoring national pride. His "Clean India" programme, his "Make in India" campaign, his "Jan Dhan Yojana" all provide him with a message to take to voters, a message that suggests frenetic activity. But there is a limit to such atmospherics. It must be accompanied by important institutional change. The "Jan Dhan Yojana" needs proper costing, insurance and banking reform, and better regulatory design. "Make in India" requires real changes to factor markets, especially for land and labour. The branding is the easy part. There is no word yet on how the hard part will be addressed. Things are not made easier by Mr Modi giving in to populism - by promising the people of Haryana rice at Rs 1 a kilogramme, for example, or by claiming in Maharashtra that his government's work had brought down the prices of petroleum products, when it is world prices that have moderated over the past months.

In a way, Mr Modi is right. In the 21st century, the prime minister's job should increasingly be to talk about high-level policy - to set a policy direction, and to choose the best people and structures to implement it. This will free a prime minister to be the government's chief diplomat, or to agitate for social change. However, this requires solid institutional strength and a vibrant, independent Cabinet. Mr Modi does not have the strength in New Delhi he needs to spend so much time out of it.

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First Published: Mon, October 06 2014. 21:40 IST