AFTER years of drift and sleaze, the Congress-led government of Manmohan Singh has found some pizzazz. The initiatives that the prime minister announced on September 13th and 14th are nothing compared with the “big bang” reforms of 1991 that set India growing and for which Mr Singh, then finance minister, was chiefly responsible. They do not even match the incremental reforms of Mr Singh’s first term as prime minister from 2004-09. Still, from an ageing man whose second-term performance has been feeble, they mark a welcome change. Businesspeople are suddenly less despondent.
Mr Singh began with a small but bold cut in diesel subsidies, which mainly benefit the better-off. As the oil price has risen and the rupee fallen, the subsidy bill has exploded—one reason why budget-deficit targets will be missed by a mile. He has also revived a push to allow foreign supermarkets to operate in India’s spectacularly inefficient retail sector, dominated by small shops. A fragmented wholesale-distribution network spoils a high proportion of fruit and vegetables before they reach the consumer. That hurts both farmers and the hungry.
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