(a) Bureaucracy in developing countries faces several challenges and tackling of these will make them more responsive, adaptive…

(a) Bureaucracy in Developing Countries: Challenges and Reforms

Bureaucracies in the Global South operate in complex socio-economic environments. As Fred Riggs articulated in his Prismatic-Sala model, developing administrations frequently exhibit formalistic rules overlaid on traditional social structures, resulting in institutional overlap, nepotism, and corruption. Ferrel Heady similarly highlighted that the imbalance between overdeveloped bureaucracies and underdeveloped political institutions leads to bureaucratic aggrandizement alongside vulnerability to political interference.

Developing country bureaucracies face deep structural challenges: an entrenched colonial legacy tailored for regulatory control rather than welfare delivery; classic Weberian rigidity that privileges procedural compliance over outcome-driven innovation; and partisan pressures that compromise civil service neutrality. Added to these are capacity gaps at the cutting edge, large vacancies, frequent transfers that shorten tenures, and an over-criminalised regulatory regime that breeds risk-aversion.

Tackling these deficits requires building adaptive capacity and a distinct development orientation. Structural and procedural modernizations are vital. In India, Mission Karmayogi represents a paradigm shift from rule-based to role-based competency building. Simultaneously, lateral entry brings specialized domain expertise into policymaking (though its 2024 advertisement was withdrawn amid concerns over reservation, showing the need for a transparent framework), the Jan Vishwas Act, 2023 decriminalises minor procedural offences, state Right to Services laws make delivery time-bound, while e-governance initiatives and direct benefit transfers reduce administrative discretion, making the civil service responsive, agile, and aligned with contemporary developmental priorities. Reform succeeds, however, only if accompanied by stable tenures, outcome-based appraisal and political will; otherwise new structures are simply absorbed into old habits, as Riggs’ idea of formalism warns.

(b) Public Debt: Growth Catalyst versus Intergenerational Burden

Keynesian economics, and Abba Lerner’s functional finance, view public debt and deficit financing as essential macroeconomic instruments to revive aggregate demand and generate employment during economic downturns. Capital expenditure financed by debt can crowd-in private investment by developing critical infrastructure. However, excessive borrowing threatens to crowd-out private credit through elevated interest rates. Furthermore, the Ricardian equivalence proposition suggests that forward-looking households anticipate higher future taxes to service public debt, potentially curtailing current consumption and dampening the expansionary impact.

Whether debt burdens future generations was debated between Lerner, who argued that internally held debt is owed to ourselves, and James Buchanan (1958), who held that the burden falls on those who later bear the taxes to service it. Sustainability also depends on the Domar condition: debt ratios stabilise when the growth rate of the economy exceeds the interest rate. The central risk of public debt lies in intergenerational inequity. When borrowed capital finances current revenue expenditure rather than productive assets, future generations inherit debt servicing obligations without the asset base needed to generate returns. In India, the post-COVID-19 fiscal stimulus was vital for preserving livelihoods, yet general government debt rose from about 75% of GDP in 2019-20 to nearly 89% in 2020-21. Adhering to the Fiscal Responsibility and Budget Management (FRBM) framework, alongside the N.K. Singh Committee recommendations (2017) targeting a general government debt ceiling of 60 percent of GDP, and the newer fiscal anchor of bringing the Centre’s debt to about 50 percent of GDP by 2030-31, is critical to reconciling countercyclical employment generation with long-term fiscal sustainability.

(c) Institutionalizing Policy Evaluation

Policy formulation without rigorous evaluation reduces governance to speculative decision-making. A robust evaluation framework provides the feedback loops necessary to assess whether public interventions achieve their intended socio-economic outcomes.

Evaluation encompasses formative assessment during execution, summative assessment at completion, and longitudinal impact assessment. Without a systematic Post-Implementation Review, policy formulation operates without empirical grounding, perpetuating institutional inertia and resource misallocation.

In India, NITI Aayog’s Development Monitoring and Evaluation Office (DMEO, 2015, formed by merging the Programme Evaluation Organisation and the Independent Evaluation Office) institutionalizes evidence-based course correction across Centrally Sponsored Schemes. Practical mechanisms such as statutory social audits under MGNREGA (now succeeded by the VB-G RAM G Act, 2025) identify operational leakages and recalibrate wage delivery mechanisms. Similarly, the continuous, data-driven monitoring of key performance indicators under the Aspirational Districts Programme (2018) enables real-time course correction, and the continuation of Centrally Sponsored Schemes into each Finance Commission cycle is now tied to third-party evaluation. Yet an evaluation-use gap persists: findings are rarely binding, data quality is uneven and evaluation is seldom built into scheme design, so formulation risks remaining detached from evidence unless evaluation is mandated and published. Institutionalized evaluation ensures that policy formulation is dynamic, iterative, and accountable to public needs.