India 2030: How would the Indian economy look like in 10 years?

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June 23, 2019 4:01 AM

India 2030 is a kind of omnibus on the visualisation of experts of how the Indian economy would look like in 2030, and the action points required to be taken for getting us there.

The authors think that education is a very important prerequisite for the 2030 story to unfold

India 2030 is a kind of omnibus on the visualisation of experts of how the Indian economy would look like in 2030, and the action points required to be taken for getting us there. Sameer Kochhar, better known for his remarkable work at Skoch, has gotten together 26 essays on various aspects of the economy and presents this volume, which is a very good guide for anyone trying to understand the complexities of the system.

While each of the essays is very well articulated, which can be expected as the authors are of the calibre of Ashima Goyal, Rathin Roy, Tamal Bandyopadhyay, Deepali Pant Joshi, etc, the introductory article by Kochhar in a way sets the tone.

He is generally apolitical when putting forward his views and does not go overboard in eulogising the NDA government or condemning the UPA regime. Three views expressed by him stand out in terms of controversy. The first is regarding demonetisation, where he argues that it helped to bring in digitisation and a cleaner system. He blames the RBI for very unprofessional handling of the transition, however. This is probably where all the defenders of demonetisation go wrong.

Digitisation was never the stated objective when notes were removed from the system. It came in only when it was realised that the stated objectives were not met as an afterthought.

The second is that he blames the RBI for the economy slowdown and in particular points towards Raghuram Rajan for stifling growth by choking interest rates. While critics are entitled to their views, he goes wrong because even the MPC (which has six members) took a similar stance under Urjit Patel. Therefore, to point a finger at Rajan seems out of place. Also, Kochhar misses out that interest rates are not the panacea to growth and is only one enabler.

India 2030 Sameer Kochhar and Rohan Kochhar Skoch Media Private Limited Pp 483, Rs 495

Third is a curious distinction Kochhar brings in when trying to debate the issue of conflict between the RBI and government. Here he supports the government as he draws a distinction between bringing about ‘economic development’ and ‘socio-economic development’. The government was justified in prodding the reluctant RBI to open up the doors. In his opinion the government had a long-term vision of socio-economic development, which is different from that of the RBI, which thinks of just orderly growth. Therefore, Kochhar is not for things like PCA or anything that come in the way of the SMEs. The reader can decide for herself here.

Ashima Goyal and Rana Kapoor are very optimistic about India going beyond the $10-trillion mark by 2030 and do expect GDP growth rates of 8-10% going ahead. Presently it appears to be more like wishful thinking as the economy in the last four years or so has struggled to stay in the region of 7% and even here few are convinced that the economy is really robust, notwithstanding the fact that India still remains the fastest growing economy based on the CSO data.

Tamal Bandyopadhyay discusses NPAs in a critical manner but looks positive again given the progress made so far. As this was written well before the Supreme Court ruling on RBI action relating to IBC, the author may have a different view today post this announcement as the resolution process may slow down.

There are essays on sectors like steel and energy that are useful but the one on start-up’s Rameesh Kailasam is different. This becomes relevant today where the internet has changed the way in which business is done and ‘startups’ based on technology have been widespread with different levels of success. But given that India needs to create jobs and those companies are parsimonious in this respect, individual enterprise holds the clue going forward and the plan drawn up by the author is interesting.

Similarly, there are essays on women empowerment by Deepali Pant Joshi who has been a strong advocate on the subject, and another one by Soma Wadhwa on girl counselling. Here she advocates counselling in school so that girls are aware of career options and can pursue studies that lead to a satisfying career.

Charan Singh’s views on inclusion are incisive as usual and very relevant as growth without taking along the majority of the population is less meaningful. Financial inclusion for sure is a way out, which makes individuals independent and in the long run can actually free the government from other programmes that deal in subsidies or goods.

Co-author Rohan Kochhar has provided a very important prerequisite for the 2030 story to unfold i.e. education. What is missing is school infrastructure and qualified teachers and this is what we need to build if we are to reach there. He brings to the fore the fallacy in our focus on education where an end-to-end solution is required starting with infrastructure that can be used. This has to be supported by the supply of qualified and interested teachers so that children can be taught in a meaningful way.

There is an essay on universal basic income by Rathin Roy who believes this will work for inequality, but clarifies that all that is spoken of is directed transfers and not universal basic income. Indira Rajaraman highlights the importance of investment for growth and minister Nitin Gadkari has a well-written piece on infra financing. These are well-written and comprehensive pieces that place the building blocks for the 2030 scene to emerge. This book is a very good compilation for student as well as novices who read business dailies and watch business channels and would like to clear the clutter in their minds.

(Madan Sabnavis is chief economist, Care Ratings)

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