Today Morning, when I woke up to the last quarter growth figures, which have plummeted to lowest levels since last nine years, I got a feeling that this was coming and perhaps it will be difficult for India to come back to the growth trajectory it witnessed in last two decades.
As the analysts are busy attributing this down fall to drought, Greek Crisis, fiscal Deficit, high inflation, bank rate, etc. I think India never looked at its growth impediments holistically. India’s Honourable finance minister is of the view that that factors which have contributed to slow down have bottomed out, I beg to differ with him. I am of the view that “Era of high growth” for India is over, only a monumental repair work can bring back it to High Growth Trajectory, which it witnessed in last two decades.
There are myriad reasons, why it has happened and all of them are plausible but I don’t blame it to pure economics or structural problem, root cause of the problem is somewhere else. I have tried to narrow down it to following three reasons of Why India missed a great opportunity.
1. Growth taken for granted
The perception amongst the policy makers, business People as well state apparatus was that of confidence or, rather, over-confidence, it depicted a sense where all was hunky dowry and is the momentum of growth will remain unabated. Perhaps the basis of this confidence stemmed the way India remain insulated, when 2008 Sub prime crisis hit the world.
Another aspect is the way India story was constructed, basis some reports, it gave a false belief amongst India that high growth is fait accompli. In the bargain, it overlooked the inherent problems in Infrastructure, Bureaucracy & Polity.
2. Lack of Commensurate Reforms
Reform was a new word in our lexicon, but the commensurate reforms I am talking about is not typical what we hear like Insurance sector, aviation or retail policy reforms. The two sets of reform which were not commensurate to India’s growth aspirations were Administrative and Political reforms. The way India was administered three decades back, same set of procedures are in vogue.
With such an archaic administrative blanket, still one had ambition to become super power – this defeats logic. As far as the political reforms is concerned, barring some reforms in election process, overall India polity has worsened.
3. Over-reliance of Great Indian ‘Jugaad’
Shortcuts, manipulations and a short term view was still the way of life in India. It did some global acquisition, some of its corporations are in fortune 500 list but that ambition of setting up a global empire was conspicuous by its absence. The overall enabling atmosphere encouraged holding a short term view than a coherent long term Nation building Vision.
In brief, the history, in this part of this world, has missed a great opportunity when several million people could have been extracted from poverty. India has a global power, given its History as Nation state, would have been a great balancing Power.
Its not the misfortune of India, that it missed an opportunity, but of world, as it could have been a great contributor to the world progress, if India would have leveraged this opportunity.