DNA Edit: Open for business

Twenty one years is a long time. In 1997, former PM HD Deve Gowda in his address at the World Economic Forum set a desperate tone, signalling that India was looking for foreign investors to keep its economy buoyant after the heady promises of liberalisation had started turning wan. To be fair, Gowda was at the helm of a government that could best be described as a patchwork of political parties existing in an ideologically uncomfortable yet politically convenient coalition. 

Economic interests took a backseat, and India’s economy doddered, sputtered and groaned under the weight of its bureaucracy. For all purposes, the economy had been opened but hundreds of caveats were surreptitiously laid out in fine print. Unlike the late 90s, today’s India is politically different. In 2014, it spoke in one voice, and did so rather thunderously. The result is the leadership of PM Modi who still enjoys wide-spread popularity across India. Successive state elections show that BJP’s growth blueprint has been emphatically endorsed by the people of India. 

In a nutshell, there never was a better time for India to “reform, perform and transform”. In his debut address, PM Modi reiterated his commitment to ending the license-raj, a practise that put the squeeze on the Indian economy, dragging the country’s growth rate to a dismal 3 per cent, dubbed as the Hindu growth rate by yesteryear economists. Evidently, those days are behind us and India is in a much better position: India’s GDP, according to the IMF, is poised to grow at 7.4 per cent in 2018; there is a large upside still to be explored when it comes to India’s tax-GDP ratio; the latest factory output growth shows that Indian economy is back on the recovery track while inflation is under control. Club these positives with the government’s appetite for game-changing reforms and the turnaround will be writing itself. 

Under President Donald Trump, the US administration has ceded its leadership position as the country at the vanguard of globalisation while the UK’s earth-shaking decision to exit from the EU has damaged the resilience of the global economy. At such a critical juncture, PM Modi has made all the right gestures. His statement that India is laying out the red carpet for foreign investors and stemming the red tape is exactly what the economists had prescribed. As things stand, India’s demographic dividend needs to be fed a large serving of jobs in the formal and informal sectors. 

Since public sector units seem to be immune to change, the real change of job creation and material progress can only be orchestrated by the private sector. Lastly, the pall of inequality can be felt all over the world, and India has been no exception. As per a report, 73 per cent of the increase in wealth in India has accrued to the top 1 per cent in 2017. India must pour its energies into remedying this inequity.