Montek Singh Ahluwalia, deputy chairman of the country’s official think tank - the Planning Commission, feels that more
than special monetary incentives or packages, the governance change is required to ease the situation in Left Wing Extremism (LWE) affected districts. Besides, Ahluwalia also strongly recommends linking fuel prices in the country with global prices as it is essential for the “economic reputation” of India.

PTI: What role you think the Planning Commission should play to deal with Naxalism?
Ahluwalia: The Planning Commission certainly recognises that development challenge in the left wing extremism (LWE) areas. The Commission has to play very integral role. Now we are looking at LWE districts and trying to review, what is the position in these districts regarding implementations of some the key (flagship) schemes of the government. I feel that one of the critical issues is the governance issue.

There is a lot of agreement in the internal discussions (of the plan panel) that we need to implement PESA (Panchayats Extension to Schedules Areas), Act, 1996 in these areas. One of the critical things in the implementation of the PESA is that right to exploit minor forest produce has to be given to tribals living in the forest. It should not be subjected to regulation by the Forest Department which actually makes them feel that they lost this right of livelihood. The PESA established certain rights in these areas of Panchayats. I think it specifically included right (given to tribal) to collect bamboo and tendu leaves. The problem arises when the Forest Department says that unless all this is regulated, you can not be sure that forest will not be destroyed. The other view is that tribal are biggest protectors of the forest and regulation limits their ability to get best outcome.

We have not taken a final view on this (PESA). One view on this is that state governments have to amend their laws to bring those in line with PESA. The other view is that in the Schedule-5 area (under the constitution). The governor on the direction of the central government can declare certain laws not applicable.

PTI: Do you think exercising the power to direct the governor would create problem between the centre and the states?
Ahluwalia: Many feel that the centre can exercise this power and implement PESA in the states, but that may create centre and state problem. We have raised the issue with states. Their (states’) view is that their agencies are not denying rights to tribals. They are protecting their own right. This is like telling farmers that you should sell your produce in Mandi and don’t go for individual deals at your level…which may lead to exploitation. If the collection of bamboo is right of tribal, let the state government compete with contractors. The state may provide support price for that.

PTI: Should the Planning Commission devise a special package for naxal hit areas? Is their any direction from the Prime Minister’s Office?
Ahluwalia: The Prime Minister’s Office has said that we need to work on LWE areas, so we are looking at entire development strategy area….which is happening for the first time. The problems are perceived earlier by a committee set up by the Commission. But now the problem has been taken up in totality.

The first thing we have done is to institute a monitoring system to find out how are the flagship schemes doing in the LWE areas. One of the things have come up is that the money is being spent on the schemes, but they (evaluators) are not able to judge how well the money is being spent. That is the next stage where one should go and do effective monitoring. In all those areas, it is the development of roads which is lying behind. In our view, there should be very big focus on development of roads in these areas. We are separately trying to monitor what state and centre were doing for the purpose. The third thing is posting of people. For administration people, you (states) need secure accommodation. They (employees) should get school for their children and there is certain amount of security. You may also need to have special incentives to post people in these (LWE) areas.

I don’t think issue is money. Some problems do require money, but some problems require governance change. We do feel that you must change the perception of the tribal that Forest Department is not some kind of alien force that is trying to keep them out (of the forest).

PTI: Road and Transport Minister Kamal Nath has said that the Planning Commission juggles figures and ministry is the doer. Comment please?
Ahluwalia: He (Kamal Nath) is right. It is absolutely correct. Everybody has his own dharma. We are not the doers. It is our job to work out the Plans and to agree on the targets and say please achieve the target. It is also true that the ministry implements that. This is normal tension in any system. The ministry of road transport in the first two year of XI Plan did not do well. In the third year of current five-year plan the performance improved after Kamal Nath took over as minister. It would further improve this fiscal.

I think it is part of the job of the Planning Commission to criticise ministries. Some ministers recognise that this position is normal others…

PTI: What is your view on deregulation of fuel price? Do you think that those should be linked to import parity price?
Ahluwalia: I have been very consistent on this. India’s international economic reputation requires us to say that fuel
prices are going to be linked to global prices. We will have targeted subsidy. If you want to give kerosene to BPL household, give them. I personally think we should explore that possibility (of giving direct subsidy) as elsewhere in the World that is regarded as very positive thing to move to the direct (fuel) subsidy.

PTI: Do you suggest the same for Coal?
Ahluwalia: I would say that (Import Parity Price for Coal) is also necessary. Obviously you need to do that in stages. It is not easy to do. The essence of the Integrated Energy Policy statement was that it should be consistent across different sources of energy. You can not have one kind of energy policy for one type of energy, another one for another type of energy. If you follow any policy other than linking energy prices with world prices, especially when you are energy importer, then any economist will tell you that this is not the correct thing to do. If you are surplus, you can subsidise, but we are importing coal. Our assessment shows that in the XII Plan the import of coal would increase substantially. So I think that linkage (of fuel prices with global prices) is unavoidable.