Let’s start with our basic assumptions on the state of economy. As you go on reading the essay you will find out that economy and polity are intertwined and a discussion of one without other is practically impossible. Articles 112 and 202 deal with annual financial statements of central and state governments respectively, while Article 280 deals with financial commission and Article 148 vests power in Auditor General of India, with economic survey published by government marking start of financial year every April. Goods and Services Tax bill and LARR bill have been in war rooms of various news channels. AP Reorganization Act, 2013 was money bill which got tabled in Lok Sabha and waited for comments from Rajya Sabha for fourteen days after which it was sent to President of India for assent.
Indian Economy: In the making? Middle class in thick of things
The reality bite of economy as mixed as India’s is long overdue by developmental sentimentalists. Who wants development? It is the buoyant or performing middle class – evident from surge in its spending and also a keenness to swallow pills much ahead of ageing; the routine scene has changed from mid level eateries to air conditioned deluxe restaurants and from normal engineering to IIT ‘engineering’ where culture of return of asset and investment is highly likely. The sentiment of development with deeper sense and ambition seems to have skittled out dogma that was associated with them for too long in the last three decades. Moody’s and S and P’s report ratings gear India up for traction in the world economy with positive outlook that has wider reach in the long run.
The collective phenomena of Liberalization, Privatization, and Globalization (LPG) had way back crawled into realms of a more confident middle class man where his sustainability for longer period was in some sense in doubt when economic reforms were initiated in the year 1991 amidst cheers from the opposition parties in parliament – Vietnam introduced socialist-oriented market economy Doi Moi reforms in the year 1986. What the foreign direct investment (FDI) had promised to offer something then as a benchmark for standard of living left the consumer little concerned insofar as cultural, economic, social aspects of imperialism were concerned, and turned him into a patron of material and comfort as more wealth as a theory for gaining in more had made inroads. Socrates and Kautilya had made way to Buffet and Gates, in terms of composition of living, earning, and donating. With more money charity is as prudent as having head high.
What is happening?
Truly, the Indian contingent is neither party to IAEA nor the NSG (Nuclear Suppliers Group). Prime Ministers one after another too not appear to be worried lot even as an ordinary citizen dreams of seeing his side in the United Nations Security Council as a permanent challenging member to counter China and US which collectively take the larger cake leaving pieces to EU, Asia and Latin nations with glaring exceptions in Germany and France in the key issues pertaining to climate change, tax regulations, commerce, health and medicine. As Germany is still ruling science the US and China are busy making their medium and short term rivals run after weapons while doing business with long term rivals, economic and geographic.
What is to happen?
There is little doubt, often expressed in news editorials with an aim to calm down excitement, that Asia has emerged the strongest contender for surpassing the western Bull Run with Japan, South Korea and China leading manufacturing indices and India leading services hub, thanks to English and information technology in equal measure. While Russia is in its own elements in growth path it is no inferior to USA in defence and intelligence though START (Strategic Arms Reduction Treaty) was forged for mutual rapprochement. The ways of how India can strike chord in the fields of employment, civic amenities, health, education, and infrastructure become vital wherein foreign policy, federal politics, internal peace decide course of action. A strong economy for 150 crore population is not possible without a strong polity committed to nothing less than excellence.
How is economy shaping up?
After having seen for nearly three decades of hemming and hawing by regional and sub regional parties, of realigning and withdrawing of support, which prompted Dr. Manmohan Singh seek pragmatism in his favour on 22 July 2008 on the issue of Hyde Act supported nuclear pact with the outgoing president, India appeared resilient and voted for decisive political set up in 2014 with the voice of youth staunchly focusing on clarity and precision; job security with corruption free governance – good and decisive. Macroeconomic and microeconomic crises that plagued the nation may not give up on India’s volatile market situation and eroding rupee value immediately but, there are enough indicators of reason to believe that India will define itself with far more convincing show of strength aided by technology and innovation. What are they?
A year on since 2014 General Elections and their meaning for India and world
The issue with previous governments – more importantly the ten year rule of Manmohan, was not on clarity on how to go about work and set up an agenda for implementing result oriented work but on political constraints in the way of accommodating every support in the consultation before decision making (2G spectrum licences were allotted under a Cabinet minister belonging to a regional ally to the UPA I which had been cancelled by the Supreme Court judgment in 2012 and Coal block allocation has come under scanner with the then Prime Minister Dr. Manmohan Singh under control of the ministry). Inder Kumar Gujral, Deve Gowda, Vajpayee suffered at the hands of select few in their pursuit though Vajpayee appeared a cohesive unit with his clean image and Pokhran and Four lane highway project. Disinvestment with Arun Shourie (BJP) at the helm set the tone for impending reforms which continued in the first five year rule of Manmohan government after which they halted.
Policy making is a thin line that runs administration thread through system of rules, which is back bone for attracting investors from across globe, the FDIs and FIIs. Policy paralysis happens with any government when it lacks enthusiasm to function and courage to offer perspective of common good to citizens. Narendra Modi did try a few things, one of them being finalizing Manmohan’s 123 deal and defence ties with key NATO members, as nation watched yet another year pass by with very little to cheer about in the change they wanted to see.
The key parameters such as industrial production – vital for balancing imports and for employment for qualified jobless youth; health and sanitation – on the field and quite different from sloganeering; infrastructure and asset creation – not to be linked up with land acquisition from farmers and helpless individuals; energy and gas – have to go on board OPEC and bilateral trade offs with middle east; and finally, the much talked about structural change from roots – many acts of previous regimes including those of British era like Indian Police Act, 1861 and Indian Penal Code still not being referred to revision draft panels; have not seen any visible change and any subtleties will be known only in years to come.
Change in administration can not bring about a change in grass roots on its own, nor can it be enforced upon with change in its policy organizations, for example, planning commission’s replacement with NITI Aayog can be seen as mere renaming of the institution with minor cosmetic surgery for facelift; change is related to people with fundamental change in application regarding development and its immediate and long term relevance and participation with voluntary passion for integrity and sovereignty of nation as a whole with reasonable sacrifices at regional level. A political party with decisive mandate is surely what doctor had ordered, but only if it seizes the initiative to upgrade itself into game changer. India is an indestructible unit of divisible units is what finally lingers.
Key parameters for Indian Economy, or for that matter any nation-state, are as mentioned below, not necessarily in order.
1. Agriculture, electricity, water resources, and food security, with associated weather predictions on monsoon and possible natural hazards like cyclones with pre-emption for safeguarding crop yields along with storage measures,
2. Defence expenditure and agile research on weapon building, including nuclear and inter-continental penetrating, cross fighting and defending mechanism,
3. Electricity generation, consumer requirements, conservation, and agile electrical engineering practices, and proper funding to deserving scientific and industrial talent,
4. Health care and human development index different from normal practice, and agile research in medicinal education and pharmaceutical industry including safeguarding drinking water bodies,
5. Streamlining of administration in cities, towns, local bodies using information technology and electronic means for citizen-centric governance,
6. Tourism and sports and cultural activities health index, including best roads and buildings, rail, air, sea transport, and relevant infrastructure,
7. Export and import equation balance (BoP and CAD etc,.)
All the six above involve huge expenditure where most of foreign help is sought for getting them on to table of economic prosperity. With the advantages incurring, we must always remember that foreign aid must somehow be complementing (less or equal proportion of balance) by way of barter system (exchanging your secondary requirement for your primary requirement-this is not same always for all nations with geographical constraints and land locked regions). And for regular non planned expenditures, such as salaries, pensions, maintenance of office portfolios including those of defence and external affairs ministries, taxes must be collected at some percentage. Tax structure is somewhat complex to ordinary reader, but it enhances reader’s ability to comprehend his particular periodic income and debt or surplus.