Please see my article below that appeared in the TIMES OF INDIA this morning (20 Nov). It argues for building a public case for liberal market reforms.
Your feedback and response will be truly appreciated.
Dr. Rajiv Kumar
A REFORMS VOTE BANK: Economic reforms must be sold to the public to create a constituency for growth
It has been yet another triumphant foreign visit for Prime Minister Na rendra Modi. Going by the frenzied display at Madison Square Garden and now in the Allphones Arena in Sydney, he is a rock star among the Indian diaspora. During the current visit that saw him attend two multilateral summits he has also emerged as a global leader, whose words count enough for a pre-cleared G20 summit communique to be changed! Modi has thus ensured that India is firmly back on the global stage.
Having rais ..
It has been yet another triumphant foreign visit for Prime Minister Narendra Modi. Going by the frenzied display at Madison Square Garden and now in the Allphones Arena in Sydney, he is a rock star among the Indian diaspora. During the current visit that saw him attend two multilateral summits he has also emerged as a global leader, whose words count enough for a pre-cleared G20 summit communiqué to be changed! Modi has thus ensured that India is firmly back on the global stage.
Having raised unprecedented expectations not only among NRIs but also amongst his peers in G20, Modi surely realises that it will require a Herculean effort to meet these sky-high expectations. He must believe that he is up to it. Indians are excited but also apprehensive.
We have a history of high hopes repeatedly dashed to the ground circa 1962, 1975, 1989, 1996, 2004 and most recently in 2009. Another crash from current highs could have far worse consequences simply because aspirations, expectations and hopes have never been as high. Modi has raised the stakes enormously. Will we get it right this time?
In his G20 speech Modi talked of reforms having to be necessarily beneficial for the poor and undertaken only with popular support. This brief remark gives us an insight into his evolving focus on the domestic reform agenda. His emphasis on the need for generating public support for reforms is a radical change from the past, when reforms were sought to be implemented by stealth. That is now surely passé.
The media explosion combined with the most fiercely competitive political arena has ensured that nothing can remain hidden from the public gaze, which focusses laser-like on the real beneficiaries of proposed reforms. Populism and empty rhetoric will not hoodwink the people any longer. The political leadership and senior bureaucracy, following Modi’s lead, should henceforth design reform packages with an eye to enhancing public welfare and take the trouble to ‘market these reforms’ in case these benefits are not immediately visible.
In emphasising the importance of changing the public mood in support of reforms, Modi is responding to the complex ground realities in India. If successful, he will join the ranks of global leaders who changed their country’s destinies. He surely realises that India’s audacious attempt to build a private sector-led capitalist economy within a well regulated framework for markets and in conjunction with universal franchise is an audacious and unprecedented attempt.
Leaders like Deng Xiaoping, Margaret Thatcher, Lee Kuan Yew did not need to take the people along with them as long as they could show positive results at the end of a rather long reform process. Modi realises that he does not have that degree of freedom because the robust Indian media and negative verdicts in state elections can stop such reforms in mid-track.
Therefore, he must build a public case for reforms by demonstrating that these will benefit the largest sections of the population. Paraphrasing his own words, he cannot and will not allow reforms that result in dogged fights with entrenched oppositions, social conflicts and political hara-kiri.
Modi’s strategy does not in anyway imply that the country is destined to slow, marginal and incremental reforms. He knows by now that business as usual will not suffice and bold, out-of-the-box initiatives alone will take India forward at the pace required to generate 12 million jobs each year for the next 15 years. But these bold measures and reforms will have to be sold to the public.
A case for private sector-led, better governed, zero corruption economy will have to be made with as much persistence and finesse as was done by Pandit Nehru and Indira Gandhi in support of a centrally planned socialist economy.
If the two of them could push forward these ideas in a country with a centuries-old tradition of private enterprise, then it is surely possible for Modi to do the same in the reverse direction.
An example will help. It is now amply clear that the land acquisition law, in its present form, is a huge impediment to expanding manufacturing capacity notwithstanding its unanimous passage in Parliament. It will, however, surely be disastrous to try and push through the necessary amendments simply on the basis of brute majority in Parliament.
Instead, Modi as master communicator should devote his next two ‘Mann ki Baat’ programmes and other direct addresses to the nation to explain that proposed amendments will expand manufacturing capacity and generate real jobs. His party spokespersons should spread this message through electronic and print media. This will ensure that the law’s Luddite features are changed with least social conflict and minimum political costs.
It is now time to devote far more resources and effort to building a case for reforms in the public domain. Those desirous of an accelerated programme of reforms should contribute to building this case in the public domain rather than continue to criticise, crib and cringe.
Author is a Senior Fellow at the Centre for Policy Research and Founder Director of Pahle India Foundation. The most recent book is Exploding Aspirations.