June 20 (Bloomberg) -- On most mornings for the past two years, Sanjay would caddy for a group of Indian bureaucrats as they played a round at Delhi’s most prestigious golf club amid strutting peacocks and 15th century monuments.
“Suddenly they’ve stopped playing,” Sanjay, who goes by one name and has been a caddy at The Delhi Golf Club for 25 years, said this week. “It’s because of Modi. He expects them to be at work, not at the club.”
Prime Minister Narendra Modi has sought to jolt India’s bureaucrats into action since taking power last month as he pledges to revive growth in Asia’s third-biggest economy from near a decade low. Investment projects valued at $230 billion are awaiting land and environment permits from federal and state bureaucrats, according to the Cabinet Committee on Investment.
Modi this month told bureaucrats to clean up offices, keeping hallways unobstructed and papers neatly stacked, according to a letter sent by Cabinet Secretary Ajit Seth, a copy of which was seen by Bloomberg News. Every department should repeal at least 10 rules seen as redundant, reduce the number of decision-making levels and shorten forms to one page only, it said.
“Of the many challenges that the country faces, reducing bureaucracy might be the biggest,” Jim O’Neill, the former chairman of Goldman Sachs Asset Management who coined the BRIC acronym and is now a Bloomberg View columnist, said by e-mail. “Without success in this simple area, other policy goals won’t be able to be met due to wastage, inefficiency and so on.”
India’s bureaucracy has been ranked the worst among 12 Asian countries for almost two decades, according to a survey of about 1,200 investors across the region by Hong Kong-based Political & Economic Risk Consultancy Ltd. Civil servants take too long to make decisions and the government has been reluctant to make any changes, the group said in a report last year.
Modi hosted 77 of India’s most senior bureaucrats at his official residence a week after taking office, the first such meeting in eight years. He called the meeting “very fruitful” in a Twitter post afterward and said he “asked to simplify administrative processes and make government people friendly.”
Modi gave all those at the meeting his phone number and personal e-mail address, according to P. Uma Shankar, the top bureaucrat in India’s power ministry from 2010 to 2013 and currently a board member at two state-run companies.
“If the prime minister says you can contact him directly, that is definitely very comforting,” Uma Shankar, who served under former Prime Minister Manmohan Singh, said by phone. “In earlier regimes, senior ministers could get some access. I did not. I would get a call back from his aide.”
Part of the reason for the bureaucratic inertia was a 2010 report from the national auditor that accused Singh’s government of costing taxpayers as much as $53 billion through graft in the awarding of mobile-phone licenses and allocation of coal-mining permits without auction. Afterward, many bureaucrats were afraid to make decisions that might have legal ramifications.
“It had a chilling effect and made lots of bureaucrats risk averse,” said C. M. Vasudev, a civil servant for about four decades who worked as finance secretary from 2000 to 2002. “They were shying away from taking decisions, just pushing papers and all that.”
Ministries are now full of activity. In Krishi Bhawan, an area of New Delhi located near the presidential palace that is home to several ministries, senior officials were seen this month instructing staff to replace cracked floor tiles, remove furniture from staircases and clean reddish stains caused by spitting paan, a betel leaf concoction.
Bureaucrats, referred to disparagingly as “babus” in India, are now arriving on time for work and even showing up on weekends, with many nervous that Modi may stop by unannounced, according to four officials who asked not to be named because they weren’t authorized to speak publicly. Modi calls ministers on landlines to check if they are at their desks, The Economic Times reported this week, citing an unidentified minister.
At one ministry near a driving range, bureaucrats were ordered to remove golf bags from their offices, according to a government official who asked not to be named because he’s not authorized to speak to the media. The minister directed a top bureaucrat to disseminate the unwritten order after Modi learned how often they play golf, the official said.
The Delhi Golf Club includes an 18-hole and nine-hole course, as well as two restaurants, two bars and a swimming pool. The club was informed that the number of bureaucrat annual memberships -- costing taxpayers 300,000 rupees ($5,000) each -- would fall to 100 from 200 now, according to two people familiar with the decision.
“The course is much quieter,” said Sanjay, the caddy, who visits the club almost every day. “And it’s not just because of the heat.”
India’s civil service was born as a small elite group when the British crown took control in 1858. After the nation won independence in 1947, Jawaharlal Nehru, India’s first prime minister, implemented a socialist form of government in which the state determined through permits what and how much a private company could produce.
The system came to be known as the “license raj” -- a play on words referring to British rule, or “raj” in Hindi. It lasted until 1991, when India opened its economy after a balance-of-payments crisis forced the government to seek an International Monetary Fund loan, leading to faster growth.
India’s 73 ministerial departments now employ more than 3 million people, according to the 2012-2013 annual report of the Personnel Ministry. That’s roughly similar to the number of bureaucrats in 2003, according to ministry data. K.S. Dhatwalia, a spokesman for the ministry of personnel, public grievances and pensions, did not answer two calls made to his mobile phone.
Modi campaigned on the slogan of “Maximum Governance, Minimum Government.” Besides ordering bureaucrats to shape up, he has dissolved four committees that had been formed to make decisions on natural disasters, prices, trade and subsidies.
Modi may also reduce the role of the Planning Commission, which was created in 1950 and allocates national resources based on five-year plans, CNN-IBN channel reported on its website yesterday, without saying where it got the information.
“It’s a good beginning,” Mohan Guruswamy, chairman of the Centre for Policy Alternatives in New Delhi and a former finance ministry official, said of Modi’s instructions to bureaucrats. “But they will be back to their old habits after some days, unless there is continuous pressure and monitoring.”
To contact the editors responsible for this story: Daniel Ten Kate at email@example.com Jeanette Rodrigues