Thursday, January 9, 2014

An open letter to Yogendra Yadav

Respected Sir,

I watched your interview on CNN IBN with Sagarika Ghose and I must confess my respect for you increased many fold after watching it. You were as honest as any politician can afford to be with being at analytical best about most of the situations. You were humble which is contrary to many of your colleagues in your party and were ready to accept it.

I liked everything in that interview apart from your attack on Narendra Modi and your view on model for delivery of services to the last mile. While view on Modi is more personal opinion and any discussion on it will not yield anything, I will certainly like to point out some points you may want to consider for a change in your opinion about delivery of services. Most of the sane minds will agree with you when you said that governance is about delivery of essential services to the poorest which actually mean equitable distribution of all services to whole of population using the resources available to the Govt. You were first person I heard who was ready to change his opinion if somebody gave an proof of private sector being better at delivery of services like water, education etc. Sir, you are right that there is no empirical evidence of efficacy of private sector at a scale in these sectors as we have never tried using private sector as a channel to deliver essential services. We have relied and continue to rely on public agencies to do this even when there are enough evidence of inefficacy of public sector to do this in our country. Also, Private sector have done a tremendous job in telecom in reaching out to the poorest of poor and delivering effective and affordable services. So I have thought of a model to use private enterprise for delivering water to Delhi residents and I am presenting it here.

We can introduce 2-3 players(vendors) in the market (Delhi Water supply) who all will share the infrastructure i.e pipelines. We can install electronic meter with telecom chips at each and every connection (Private capital will come into play). All the vendors will be given time slots(may be through bidding) when they will be able to feed water through shared pipelines. Vendors will be able to control who draw water through telecom chips enabled water meters and can decide water tariff independently under control of a regulator (like TRAI does for telecom companies). This way consumers will have an option to choose between competing vendors which will usher efficiency and quality of services. Govt/ Regulator can make sure that switching cost among vendors is as low as possible to keep all of them on their toes. Infrastructure management can be outsourced to another player who will charge equally to all the vendors and it will be left on these vendors(with moderation form Govt./Regulator) to decide who will manage infrastructure for them. Still Govt can pitch in with subsidies to make water supply financially viable in all areas

Such system will have multiple benefits including but not limited to

1. Competition will ensure better services at cheapest of prices.
2. Onus of maintaining Infra will be on private party which will be paid by other private parties. Such kind of system works very efficiently hence quality of pipeline will improve or in other words clean water will be available to people of Delhi.
3. Water Availability will be limited  to 2-3 hours a day. Most of the houses already have water tanks, rest of them will have to install it. It will probably result in more judicious utilization of scarce resource.

Sir this idea is as radical as it can get in the form of delivery of essential Govt. service. In a way it is as radical as AAP as a political party was just about 1 year ago. In your words people have given a chance to alternate kind of politics and now it is your duty to take a risk and give a chance to alternate kind of delivery mechanism which is efficient and is driven by market not by Inefficiency preserved by Govt.

Thanks
A right thinking Indian

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