Scams and subsequent witch hunts have hit decision-making: Kaushik Basu

NEW DELHI: Chief economic advisor Kaushik Basu on Friday said decision-making has slowed down in the government, but blamed it on the recent spate of scams.

"There is a certain slowdown in bureaucratic decision-making. Given the corruption scandals and subsequent witch hunt, some decision-makers are going slow," Basu said.

Basu's remark is in line with what experts and industrialists have been saying about tardy decision-making affecting the business and investment sentiment in the country.

"The biggest concern is over governance issues. There is complete absence of decision-making among the leaders in the government," Wipro chairman Azim Premji had said recently.

In an open letter to the national leadership, India Inc leaders including Premji, Keshub Mahindra of Mahindra and Mahindra, and HDFC's Deepak Parekh had expressed concern over graft scandals leading to "governance deficit".

Although the government has attempted to counter criticism by pushing some decisions and project clearances, the perception has become sticky with bureaucrats and officials deferring decision-making.

The home ministry recently opted for a pre-CAG audit of a housing project that is to be implemented in public-private partnership mode, reflecting the sentiment in the bureaucracy after the 2G-airwave scam broke.

To counter the perception of policy paralysis, Finance Minister Pranab Mukherjee, the key trouble shooter of the ruling UPA government, had called a meeting with key industrialists in August.

Again, last month, Mukherjee reeled out details of the decisions taken by the government at the annual economic editors conference.

However, Basu said the situation was better than that in many countries.

"It's not really as bad as that in many countries. We still remain in the top 10-15 performers in the world. So we are still at the top, but going down," he said.