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“Ask not what your country can do for you–ask what you can do for your country”
~ John F. Kennedy
For the past 75 years, the Indian economy has seen numerous policy frameworks, each trying to redefine how the country should grow and develop. We saw the 4 decades of socialism, we saw the liberalisation of the economy with remnants of socialism in the majority of sectors. We saw governments try to eradicate poverty and provide a ray of hope to the millions at the lowest in the social strata.
Illustration by The Geostrata
However, the next 25 years or the last quarter until we celebrate 100 years of our independence are the most crucial ones.
They are not crucial because they are our last chance at achieving parity with the developed world, but instead, it's our first chance wherein we have the ends, the ways, and the means all aligned to our side.
The aim of a Viksit Bharat or a developed India by 2047, put forward by Prime Minister Narendra Modi is a realistic one, and very well within our reach. But what does it take to become a developed nation? What does it take to change the face of a society?
It takes just one generation if you were to ask me. It takes just one generation to transform a society and awaken its long-dormant spirits of revolution.
Aligning with the aim of Viksit Bharat @2047 is the book “India@100 : Envisioning Tomorrow’s Economic Powerhouse”, authored by Professor Krishnamurthy Subramanian, and published by Rupa Publications.
The book talks at length about the ends, the ways, and the means as mentioned earlier which are necessary to transform India into an economic powerhouse by the time we celebrate the centennial of our independence.
The book is divided into five sections with a total of 27 chapters, wherein the first section introduces the readers to the foundations upon which the author builds his argument of India becoming a $55 trillion economy by 2047.
In the first section, the author stresses investing in and strengthening four major pillars of progress drawing inspiration from virtuous examples of the past such as the modernisation of China, Japan’s post-war resurrection, and Germany’s famed ‘social market economy’.
The four pillars of progress as proposed by Professor Subramanian are: macroeconomic focus on growth, inclusive growth for a large middle class, ethical wealth creation, and virtuous cycle ignited by private investment.
Through his analysis, Professor Subramanian finds that an explicit separation of macroeconomic and microeconomic objectives enables comparative advantage, thereby enhancing efficiency in policy making and implementation, while positing the Tinbergen Rule proposed by the first Nobel laureate in Economics, which postulates that, “a one-to-one mapping between a policy tool and a policy objective fosters economic efficiency.” The application of the Tinbergen rule is evident in the two sections which talk about macroeconomic and microeconomic policies which India should undertake in the next two decades.
Moving ahead, the author sheds light on the riddance of muddled narratives of the past where profit and wealth creation were looked down upon as a vice. He establishes his point by highlighting the PM’s reply to the Motion of Thanks to the President’s Address during the Budget Session of the Parliament in 2021, wherein Prime Minister Modi underlined the importance of wealth creation and the crucial role played by the private sector.
Certainly, when the head of a government signals such divergence from hurtful narratives of the past, the economy understands what is underway for it in the future.
The Prime Minister not only highlighted the importance of wealth creation but also emphasised the important role played by the private sector, upon which then the author builds his case for investment in the fourth pillar, which is a ‘virtuous cycle ignited by private investment’. To attract private investment in those parts of the economy which are the drivers of a future India, the government - as put forth by the author - needs to spend on physical and digital infrastructure to ‘crowd in’ private investment while undertaking rigorous but just supply-side reforms, further boosting private investment.
Section two of the book focuses entirely on those aspects of the economy and administration, which are or which can hinder the economic growth of India. It highlights how focussing on economic growth will automatically uplift millions out of poverty.
The section surprisingly, but importantly puts India’s justice system in the dock and analyses how a delay in judgements causes not only economic but also reputational loss to the Indian economy.
Finally, the section re-emphasizes the need to overhaul India’s bureaucracy with more participation from the private sector and not the other way around, and advocates for enhancing interoperability between the bureaucracy and the private sector. The section rightly draws attention to those reforms as befitting an economic superpower.
Section three focuses on those aspects of microeconomic policy orientation, which cater to the needs of a growing middle class in India. The section puts weight on formulating policies which foster job creation, and skill development while not undercutting the private sector and its infrastructural needs. Very importantly, the author draws our attention to the plight of small farmers in India and provides detailed policy frameworks necessary for their upliftment.
Finally, it explains how the application of behavioural economics, the Bare Necessities Index, and the famed “Thalinomics” can help eradicate multidimensional poverty, while keeping those who have just come out of it afloat.
After analysing the macroeconomic and microeconomic realities and policy frameworks necessary to propel India into an economic superpower by 2047, the book looks toward the bedrock of economic growth and market economy, the businesses of India.
Professor Subramanian lays heavy emphasis on the principle of ethical wealth creation and explains how during the decades of socialism this temperament was laying dormant and how its time has come as we adopt a more pro-business approach to governance through minimisation of unnecessary government regulation, focus on building a strong entrepreneurial base in districts, and making the professionals run the industry, and not the government i.e. privatisation of the PSUs.
In the final portion and the last of the four ‘Pillars of Progress’, Professor Subramanian talks at length about the necessity of private investment in the economy for India to become what it aims in the next 25 years or so. The section explains the crucial role played by private investment in driving consumption, job creation, and economic growth in India.
The Professor finally includes crucial aspects of human capital retention and upgradation through multidimensional investment in healthcare services and education across India.
Thus, the author has exhibited, through the nuanced analysis of data and examples from across the world, that the target of Viksit Bharat@2047 is not at all audacious, but very well within our reach, only if we work toward it.
The book becomes a go-to place for students, economists, and policymakers alike who want to study, compare, research, and scrutinise India and its performance in the coming years.
BY DIGVIJAY SINGH
TEAM GEOSTRATA
Detailed analysis
Wonderful analysis
Well analyzed
Insightful !!
This is indeed very interesting!!