Few weeks before he is to present the Union Budget, finance minister P Chidambaram made a strong connection between economic growth and national security.
Delivering the K Subrahmanyam Lecture at the Institute for Defence Studies and Analyses here, Chidambaram identified ‘money’ as the ‘most important’ of the three pillars of national security, the other two being human resources, and science and technology.
“It (money) is the pillar that will support the first (other) two pillars. When the economy is on a roll, tax revenues are buoyant and when the economy slows down, the first casualty is revenue from taxes... a cut back on expenditure on our defence and on the police forces will severely compromise our defence and security preparedness and diminish our capacity to meet the challenges to national security,” Chidambaram said.
The finance minister said the role of economic growth in a country’s development cannot be over-emphasised.
“Some think that the value of growth is overstated and that we would be better off if we pursued not the goal of growth but other goals such as cultural nationalism or debt-driver egalitarianism,” he said.
“As a nation, we seem to oscillate between embracing growth as the highest goal and deriding growth as no panacea for the ills that afflict the country. If we do not have sustained high growth, we will be forever, an undernourished, undereducated, under-provided and under-performing nation. ...We will also be constrained in our ability to defend national security against both external and internal threats,” he said.
Chidambaram said the choice before India was either to become the third largest economy in the world with a sustained high growth rate, or remain one of the largest economies that “muddles along with the bulk of its people trapped in a life of low income, poor quality, high morbidity and great inequality”.