Inefficiency of Public Sector and Quota Raj Under Pandit Nehru
Sankarshan Acharya

Pandit Nehru is perhaps the most famous author of mega inefficiency in India by laying the foundation for gigantic public sector undertakings that have wasted colossal amounts of capital created by printing rupees though decree. These PSUs have been running highly inefficiently and having a mega chokehold on Indian economy and society. Many PSUs have become broke or defunct and are poised to make the utopia of employment a mirage.

If the government runs business, it will only induce lethargy and inefficiency. It is because the managing bureaucrats and ministers have no oversight of stockholders as in the case of private enterprises. The government should only lay down policies for establishment of private enterprises and monitor them through optimal regulation. It is a blunder for the government to monopolize the operation of business enterprises.

Pandit Nehru had introduced mega quotas for babus and ministers to run this public sector business or that. Ministers and bureaucrats have jointly run down the businesses to ground zero, since their inception through preposterous punditry. This was the gravest folly of mankind that continues to haunt India. This is perhaps why our political leaders have remained oblivious of the inefficiency of reservation which was not liked by even Pandit Nehru, as per his letter reproduced below.

Pandit Nehru’s letter to Chief Ministers on June 27, 1961

I have referred above to efficiency and to our getting out of our traditional ruts.  This necessitates our getting out of the old habit of reservations and particular privileges being given to this caste or that group.  The recent meeting we held here, at which the chief ministers were present, to consider national integration, laid down that help should be given on economic considerations and not on caste.  It is true that we are tied up with certain rules and conventions about helping Scheduled Castes and Tribes.  They deserve help but, even so, I dislike any kind of reservation, more particularly in service.  I react strongly against anything which leads to inefficiency and second-rate standards.  I want my country to be a first class country in everything.  The moment we encourage the second-rate, we are lost.

The only real way to help a backward group is to give opportunities for good education.  This includes technical education, which is becoming more and more important.  Everything else is provision of some kind of crutches which do not add to the strength or health of the body.  We have made recently two decisions which are very important: one is, universal free elementary education, that is the base; and the second is scholarships on a very wide scale at every grade of education to bright boys and girls, and this applies not merely to literary education, but, much more so, to technical, scientific and medical training.  I lay stress on bright and able boys and girls.  I have no doubt that there is a vast reservoir of potential talent in this country if only we can give it opportunity.

But if we go in for reservations on communal and caste basis, we swamp the bright and able people and remain second-rate or third-rate.  I am grieved to learn of how far this business of reservation has gone based on communal consideration.  It has amazed me to learn that even promotions are based sometimes on communal and caste considerations.  This way lies not only folly, but disaster.  Let’s help the backward groups by all means, but never at the cost of efficiency.  How are we going to build our public sector or indeed any sector with second-rate people?

Jawaharlal Nehru, Letters to Chief Ministers 1947-1964, Volume 5, Oxford University Press, 1989, PP 456-7.

Govt's apathy, not social inequality, responsible for OBC backwardness

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Rajeev Ranjan Roy | New Delhi

As the reservation versus affirmative action debate intensifies, there are indicators that one of the main causes of backwardness of OBCs in education is the Government's apathy in meeting its commitment, and not social inequality. A case in point is the failure of the Government to even pay scholarships to the deserving OBC students to excel in studies.

Take the case of the ambitious pre and post-matric scholarships that are aimed at providing level-playing field to the OBC students in pursuit of quality education.

Union Social Justice and Empowerment Ministry needs around Rs 350 crore to meet the demand, but it disburses only around Rs 45 crore annually among 15 lakh students. The funds crunch has left the schemes floundering and created a situation which has been exploited by the votaries of reservation politics to push in their agenda in the sphere of education.

"We need Rs 100 crore more to meet the demands under pre-matric scholarship scheme against Rs 20 crore. Similarly, Ministry needs Rs 250 crore annually to meet the post-matric demands from across the States. At the moment, Ministry disburses Rs 25 crore through State Governments among around 1.53 lakh students in different States," a Ministry official said.

"There is also a need to increase the amount of scholarships under these schemes. Though this has been under consideration since long, nothing substantial has been done so far," Ministry sources said.

Under the pre-matric scheme, the day scholars from Classes I to V get Rs 25 per month, Rs 40 for Class VI to VII scholars and Rs 50 for scholars of Classes IX and X. The hostliers get Rs 200 to Rs 250 per month.

At the post-matric level, the maximum amount given is Rs 425 to the hostliers, pursuing medical, engineering, agriculture and other technical and professional courses. The day scholars get only Rs 190 per month. The hostliers pursuing diploma courses in medicines, engineering and other such courses get Rs 290 as monthly allowance and the day scholars get Rs 190 monthly.

"At a recent review meeting, Ministry decided to ask for more funds to maintain the efficacy and effectiveness of the scheme. The matter is being taken up with the Finance Ministry and the Planning Commission. Since the state governments are willing to spend more under the scheme, Ministry would do the needful in this regard," official added.

The monthly allowance for students pursuing certificate courses in Group C category like engineering, architecture, and post-graduate courses in teachers' training, library science and fine arts is Rs 190 for the day scholars and Rs 290 for the hostlers. Those pursuing general courses get Rs 230 per month if living in the hostels or Rs 120. It is only Rs 90 for the day scholars and Rs 150 for the hostlers if they are pursuing 10+2 courses.

The pre-matric and post matric scholarships are given to the OBC students whose parents' income from all sources does not exceed Rs 44,500 per annum. Ministry gives 50 per cent of the funds required as assistance to the state governments to disburse scholarships to the children studying in government recognized schools. The balance 50 per cent is borne by the state governments. In union territories, the centre gives 100 per cent assistance.

"Ideally, the entire scheme needs to be reviewed and reframed. There is an uneven distribution of beneficiaries under the schemes. For example, under the post-matric scholarship, the majority of beneficiaries are from Uttar Pradesh (63000), AP (15000), Gujarat (13600), Punjab (22000), Tripura (8000), and Manipur (7000)," an official said.

"Many states are not applying for funds too. The same is the case with the pre-matric scholarship. As many as 11 lakh beneficiaries are just from AP, UP, Tamil Nadu and Tripura. Around 9 lakh beneficiaries are from UP alone followed by AP where there are around one lakh beneficiaries," he added.