Surjit Bhalla: 'Deep state' of senior babus unaccountable for policy

Economist Surjit Bhalla said India's "deep state" comprises unaccountable "senior babus". He argued that unlike politicians or industrialists, they face no repercussions for bad policy decisions, stifling innovation and economic reform.

Indicating that economic decisions or policies which define logic can be attributed to the "deep state", author and economist Surjit Bhalla has said that it comprises "senior babus" who make decisions but are never held accountable.

'Babus' Immune to Consequences

In an interview with ANI, Bhalla, a former part-time member of Prime Minister's Economic Advisory Council, contended that unlike politicians, who are accountable to the electorate, or industrialists, who are answerable to the market, senior civil servants remain largely immune to the consequences of their policy decisions.

Bhalla defined this "deep state" not as a conspiracy, but as a reality where decision-makers operate without fear of repercussion. "A politician makes a decision; he's answerable to the public. He can get voted out. An industrialist makes a decision; he's answerable to the market and the board. So who in our society... is not answerable to either? The babus, senior babus," he noted.

Secrecy and Aversion to Risk-Taking

The economist highlighted the secrecy surrounding economic policymaking, specifically the formulation of the annual budget, as an archaic practice that defies modern standards of governance. "We are in 2026. The world is completely transparent. And you are making policy in secret? There's no accountability, right? You don't know who made this particular bad policy," he questioned.

Bhalla argued that the current incentive structure within the bureaucracy actively discourages risk-taking. In his view, officials are rewarded for maintaining the status quo rather than fostering economic innovation, often prioritising post-retirement job prospects and internal promotions over the national interest.

To illustrate his point, he pointed to the historic 1991 economic liberalisation, which he noted was driven by individuals operating outside the traditional civil service mould, such as Montek Singh Ahluwalia. "When was the last time a bureaucrat... made a decision that changed anything? I'm giving you a counterfactual....It'd be very hard to come up with the incentive; I don't blame them," he said.

Reflecting on what he perceives as a deeply rooted cultural resistance to change, Bhalla remarked, "Maybe it's in our DNA. Babu Giri."

Call for Structural Overhaul and Accountability

To address these systemic failures, the author advocated a structural overhaul. Bhalla, a former Executive Director, IMF for India, Bangladesh, Bhutan and Sri Lanka, suggested that genuine reform is impossible without introducing concrete measures to hold officials accountable, including the potential for dismissal in cases of poor performance or consistent failure to deliver results.

"Everybody knows what needs to be done. Everybody can identify what is wrong....but what if wrong continues?" he asked.

He said everybody wants a government job and the system in India does not reward innovation risk. (ANI)

(Except for the headline, this story has not been edited by Asianet Newsable English staff and is published from a syndicated feed.)