Easy outs and hard decisions
So far, the word for 2009 is “stimulus”. The government has come into the spotlight in the business pages, as different sectors put in appeals for interest breaks and sops. Some of these are likely necessary. But this is also probably a good time to consider the elephant in the room, which has fundamentally held back our growth - the lack of access to India’s economy for many of its citizens, a theme I revisited in my book and in this blog . A piece written by Arjun Swarup in the Indian Economy blog in October, titled - ‘The Indian Political Business Complex‘ is worth rereading - he discusses the same issue:
If ever we had a chance of changing this, its in 2009. After all, the best time to make radical changes - such as improving access beyond ‘oligarchic systems’ is when an economy is in downturn. The great advantage India has in this global recession is that unlike the developed markets, so much of its potential still lies untapped - in productivity growth and in the use of its vast human capital - who could be entrepreneurs, investors, consumers, inventors, if we give them the tools, capital, and education to do it.
So far however, the proposed stimulus has been unambitious. There is little effort for example, to improve access to capital beyond the people who are already within our banking and trading markets. As just one example, the government has cut interest rates, and is encouraging foreign investment into real estate and infrastructure. It is considering further sops for home loans. But is the government looking at rural areas that lack bank branches and access to capital outside tyrannical moneylenders, all of which limit people from making investments, buying and selling and starting small businesses?
If we are not considering these fundamental changes, we are doing nothing more than repainting the walls of a half-built house.
January 8th, 2009 at 9:30 pm
Good post sir.
January 9th, 2009 at 4:25 pm
Sir,
I think HR & industry are going to play a vital role for the year 2009. It’s here even the biggest of the biggest player make a mistake of choosing a Round-Robin fashion. If the gap can be reduced, iif a gap exists, it may be equated with the Country’s HR development. There should be no change as far as Industry HR is concerned. The industries should be clear with their requirement. What do they need from the candidate is going to play a crucial factor.
January 19th, 2009 at 6:05 am
Sir, thank you for blogging and using the internet to reach out directly to us. There are some other, more sinister manifestations of this politician-businessmen complex.
One of them is the Environmental Impact Assessment (EIA) legislation which threatens to make already weak and laxly enforced environmental protections in the country even weaker. It is already in force through a ‘notification’ and has not been debated or discussed widely in the media. NGOs like Kalpavriksh (Delhi) and ESG (Bangalore) are actively campaigning against this draconian legislation.
Since you have some access to the media and government, it would be good to highlight this important issue that can have severe long-term effects.
June 25th, 2009 at 3:05 pm
Good post Sir!! I think govt has these ideas in mind when they talk abt inclusive growth. They now need to go hard on implementing various welfare activities they talked abt.