India @75 - Setting the Agenda

 

When India attained independence in 1947, it was one of the poorest countries in the world.  Holding its diverse population together, with different religions, speaking in more than 20 different languages, and preventing mass famine and fatal epidemics was India’s main challenge.  However, thanks to its freedom movement, which brought together educated and visionary leaders and idealistic masses, the country retained a core dignity and promise which other newly independent nations strived for.  India became a natural leader of the developing world, forming the non-aligned movement which carved out a separate space for countries that did not want chose between the Soviet and USA blocks.  The country’s leadership worked hard to modernize India, creating public sector organizations that industrialized India, creating national labs for industrial, nuclear and space research, and technology universities that were world class.  While India made steady progress in major indicators – 60% increase in life expectancy from 1950 to 1990, a 300% increase in per capita GDP from 1960 to 1990, other developing nations leaped ahead, some close to joining the ranks of developed economies such as South Korea or Taiwan.  China while remaining under the rule of the Communist Party, opened its economy in waves, starting from 1979, and again in 1990s to now emerge as the world’s second largest economy.  Smaller nations such as Malaysia and Thailand embraced the manufacturing and services economy to grow out of poverty by the early 1980s.

 

India by contrast never quite had a plan.  The opposition was more interested in identity politics – mobilizing people along the lines of caste or religion.  Congress was stuck in scams and slogans of the past, till an impending economic collapse forced it to liberalize in 1991.  While the potential benefits was all too evident, when one considered nations like China, Korea, or Malaysia, neither the intellectuals nor the opposition had really signed up for the policy changes in 1991.  After a decade of moderate growth, India began to accelerate economically from the early 2000s, with benefits in the form of better amenities, airports, metros, malls, communication tools, higher wages available to many; more than 140 million people climbed out of poverty.  Even relatively poor states such as UP by now have about one in three homes with a two-wheeler.  Yet about 38 to 52% of the population is poor in states like UP, Bihar and MP, as defined by NiTI Ayog’s Multi-Dimensional Poverty Index (MDPI) in 2022.   When one examines other metrics such as infant and maternal mortality , % literacy, life expectancy, we continue to perform poorly as compared to neighbours such as Bangladesh and Sri Lanka, and not much better than several Sub-Saharan nations.  So the benefits of liberalization and economic growth have not been far reaching  - and India remains in several large pockets, poor and underdeveloped.  For many in the middle and upper middle class – about 30% of India, life has turned out to be better.  The amenities that one could afford now were way beyond reach or unavailable a generation ago, and this includes TVs, appliances, vehicles, smart phones, vacations, air travel. 

 

However there is work to be done, the roads tend to be dusty, potholed, with pockets of garbage strewn around.  24x7 water and power supply for many is a pipe-dream. Sanitation is poor in villages, with open gutters carrying sewage being the norm.   The railway transportation is way behind China and Europe in terms of speeds and comfort.   Pollution is a major issue across northern and eastern India, and impacts over 500 million people.  The society is unequal and stratified along religious and caste lines.  India is facing extreme weather events thanks to climate change and increased emissions.  And over the past 3 decades India had to face up to sponsored terror from one country and military intrusions from another.

The question is seventy-five years post-independence, can the country square up to these challenges and get its act together.  Do citizens of the country understand and feel the pain?  Do its citizens realize that the agenda for the country needs to be far more focused going forward compared to what it is being driven today?    So what should be on the agenda for the country?

There needs to be a quantum leap in the level of amenities that need to be available and within reach for its citizens – this includes roads, piped water, sanitation, primary health care, good schools, and housing.  India’s GDP is $3 trillion.  The country spending in the social sector is barely 10% of its GDP.  The resources required need to be an order of magnitude higher.  This cannot be done by the government on its own.  It needs to be a partnership with the private industry and NGOs, where it makes sense.  The government needs to spend more on human resources – teachers, anganwadi workers, asha workers, nurses, doctors to make a dent in education and health care.  Yet the country cannot print money – any strategy that does not consider macro-economic factors such as fiscal prudence would quickly put India and Sri Lanka of 2022 on par.  The resources required to make India a developed nation can come only from broad based economic growth, aided by a supportive government, a moderate and soft tax regime, a simplified bureaucracy, and innovative policies that direct economic growth and better wages towards the poor.  The last masterstroke was MNREGA.  The country cannot ride that horse forever.  It needs to drive business innovations and technologies where rural India derives more value from its food grain and horticultural produce, and find new opportunities from agro-waste, resulting in agrofuels and energy.  The county needs to democratize renewable energy and ensure that even poor households are able to sell power back to the local grids from their roof tops.

The citizens need to internalize and understand that it is only broad-based socio-economic growth that will help the country stand tall.  Yes, India’s unique cultural heritage and plurality makes the country special.  But if India’s culture gets mired in identity politics, its heritage would become a millstone.  To progress India needs to maintain a focused agenda which is stated below.

1.       The basics cannot be compromised, this includes maintaining fiscal prudence, strong defence, preserving its nature capital, and increased self-sufficiency especially for its basic needs – food, energy , transportation.

 

2.       8 to 10% GDP Growth.  A decade of 8 to 10% growth in GDP would result in the economy trebling in size which would provide the required resources to upgrade India’s infrastructure when it comes to roads, housing, healthcare, sanitation and water, and education to that of a middle-income country.  India grew at 8 to 10% GDP for nearly a decade from 2002 till 2011.  India must do this again. 

 

3.       New Jobs in Sustainability and Climate Change:  This would take investments, R&D and building capacity in current and emerging modes of renewable power and water resources.  The country needs to create skilled manpower to support renewable energy and decarbonization.  However mitigating climate change would also involve maintaining and augmenting the country’s natural capital.  Ecological restoration is required in arguably 10 to 15% of India’s landmass and this would require knowhow and participation of local communities.  Sustainability as an economic pillar could readily exceed 15% of India’s GDP and can cut across manufacturing, agricultural and services sectors   Sustainability should be treated as a key vertical for the country and provide employment across the spectrum, from  manual labourers to PhDs.

 

4.       Agriculture – throughput and value creation and addition:  India has made impressive gains in agriculture.  Techniques such as SRI have improved productivity of rice and sugarcane.  Mechanization compatible with small land holdings has emerged in several parts of the country which reduces input costs and improves productivity.  Drip irrigation is now commonly used to reduce water consumption.  Solar and wind powered pumps can improve energy and water security.  Cold storage, seamless and decentralised farm to retail shop connect can help.  Developing new pillars around biomass-based fuels specially for the ethanol blended fuels and energy would be vital.

 

5.       Current segments in full throttle:  India has a fairly mature services and manufacturing economy.  Its IT and financial sectors are booming.  Inflation and efficient taxation have reduced disposable income for most consumers.  India’s recovery will be consumption driven.  India’s taxation policies need to in tune with the imperatives of growth.  Once growth is kickstarted across the country, India’s coffers would automatically go up.  And this would enhance the ability of the government to make a more positive impact on the livelihoods and amenities enjoyed by the common man.

 

6.       A decade of peace:  it is a given that for any country with a history as long as that of India, there could have been historical injustices and violence suffered by different segments of the society.  But that is distant past.  India has signed up for a secular present and future where everyone is equal.  At least now, this should be the decade for Indians to live in amity, knowing that heart of heart very few countries provide the space and freedom to practise one’s cultural heritage and identity the way India does.   We as citizens of India need to watch out and ensure that the agenda is that socio economic growth, and not strife.  We have a President of the country who comes from the Adivasi community.  She cannot be a token leader. Just as the tiger, a flagship species represents India’s nature capital, so do Adivasis, in demonstrating how life could be led in coexistence.  Their aspirations and needs have to be met too,

 

India, the world’s 5^th largest economy is at a fork, never has the promise of prosperity for most been more within reach, nor has its vulnerabilities so sharply exposed. This is the time for India to stand up.  On the 75^th anniversary of our independence. 

The Manali Leh Meanderings

We just got back from an amazing, exhausting trip to the Manali-Ladakh region - endured AMS of some form, Priya was diagnosed with COvid after we returned, and now getting out of it,. Manasi had AMS (Acute mountain sickness for sure).

The logistics - We thought we would gracefully ascend from Manali to Leh - 7000 to 11000 ft by road and be all set, but about 6 hrs of that journey was at 15000 to 17500 ft.  Starkly beautiful - but enough to get you into AMS in-spite of the preventive medication and the 3 to 4 liters of water which each of us had - I was quite OK.  But oxygen levels for family ranged from 73 to 83 at 16500 ft and that had an impact.  We skipped other halts at 15000 feet and drove to Leh at 11400 ft and were all set.

The look and feel - compared to the early 2000's which was my first trip to Manali, one can clearly see signs of prosperity - tourism has had an impact But there is construction everywhere - roads 4 laned from Mandi to Manali, rocky faces blasted, tunnels bored, landslides as common as sink-holes in Bangalore  - can't imagine this being done to Western Ghats - the protection lobby is too strong here.  The microcosm which is India is still seen - a family in burkha enjoying dosas in a breakfast place near Chandigarh, a Gurudwara which is a universal halt, Hippies from Israel living a life of weed and austerity in Manali..  And the SUVs small and large that have colonized the mountains north of Manali - license plates from Kerala, karnataka, Tamil nadu, Maharashtra, Gujarat.. Interesting indeed.  Once one leaves Jispa - 11000 ft and continue to climb northwards - the traffic thins out - it is largely heavy duty Indian trucks - Leyland and Tata - multi-axled that manage 16 to 17000 feet braving the roads.  The dhabas enroute are a place for decent food, tea, even beds to sleep in - the rugged hospitality is so evident. Indians seem to be enjoying India in a way that was not quite common a decade or two ago.  The transition from Mandir to Monastery starts around Manali - by the time one reaches Lahaul and then on to Ladakh it is all Buddhism - a heritage which is lost to the vain unbridled commerce and uniformity in China.

Got a chance to visit many monasteries - masterpieces in terms of aesthetics, location, architecture and spiritual power perhaps.  But is it like the most intricate of pieces in Carnatic music - grasped by only a few - nodded off as must be good by the masses?  A Gurudwara that I visited surely has its mystic layers if one chooses to unpack it all - but in its form of practice it is so open and warm - interesting indeed to visit the patharwaala Gurudwara - a boulder that turned to sand when pushed towards Guru Nanak by a demon.

There is army everywhere once one enters the Ladakh valley - largely unobtrusive - no individual checks except for the RTOs. Among the sights and sounds - we visited the hall of fame museum in Leh - chronicling the various wars that the army had to fight - from 1947 to Kargil (2018-21 at Ladakh was yet to be featured).  Plenty of pride for sure - for the jawans who were hosting some of the show and tells - such as the Kargil recap - the enemy is Pakistan.  That there is a larger bear to the north has not quite sunk in.  Which is unfortunate - from two counts - all wars are unfortunate, and if an enemy to the west is synonymous with a group of people within India it is a big problem.  That said, defending the border in Himalayas is really arduous - and the conflicts over the last two decades are all too real.  China is too cynical a country to wage peace.  Pakistan and India will have an axe to grind for ever..  We are stuck with people from all parts of India defending these borders - the museum cafe was supposed to have Momos - there were Tamil soldiers who were manning the counters - sorry sir - Momos innum ready yaa illai - he replied, when I asked him in Tamil.

Ten minutes later we stop at a cute little restaurant.  The owner took the order and asked me to sit down while I waited for the Momos to be packed.  A group of young men and women were seated at the next table - a guitar being strummed while they sang.  The door opened and a group of women - some with head-scarfs,  others well dressed in western clothes - looked around and picked a table out in the open - my momos came.    Got into the car, went past the army cantonment to our very cute hotel.  Our taxi driver and friend Harnam was tipped handsomely - one of the best drivers I have seen - on road and off road - at the hotel a Mr. Abdul shook my hands and said he will drop us at the airport the next day.

A holiday was complete - In spite of our glorious treks - we had AMS.  The sights and sounds of Himalayas are too magnificent to be put in words.  A microcosm of India was enjoying the country and living in peace - while those protecting the borders do what they have to do to ensure that we remain this way.

Can we honour this in letter and spirit - respect and cherish what we have - and just live in peace.

I sign off with a quote from the Hall of Fame museum..

 "It is better to conquer yourself than to win a thousand battles. Then the victory is yours. It cannot be taken from you, not by angels or by demons, heaven or hell." The message has a very deep meaning and conveys one of the most important lessons for mankind.

 

India’s  Imperatives vs Immediacy of Actions

 

India’s economic independence, after several scattered attempts, came to fruition in 1991.  While the trigger was India’s plunging forex reserves and impending default with IMF, the malaise was clear for many.  India’s socio-economic policies locked the poor into poverty and stifled the middles class from bettering themselves and generating surpluses for the country which could in turn more opportunities for the poor.  1991 changed much of that.  After the initial shock in the form of a depreciated rupee, and a spike in interest rates, as well as austerity measures, the policies to stoke the private sector began to bear fruit.  India began to see GDP growth rates approach 6 to 7% per annum through the 1990s.  The market for cars grew from 1 lakh (100,000) per year in 1990 to 1 million in 2000 and to 3.6 million by 2012.  Similar explosive growth was seen in the two-wheeler industry.  With cheaper cell phones, greater employment opportunities in the formal and informal sectors, widening of the social net through programs like MNREGA, more than 140 million people grew out of poverty.  The traditional bugbears for the upper middle class in the form grungy airports, poor shopping options, dirty public transport systems became history, with even Tier 2 towns having airconditioned shopping malls, modernization of most airports by 2010, and functioning of metro in several cities by 2015.  The question that was being asked at the cusp of the new decade in 2010 was whether India could break free from poverty within a generation.  With Tata Motors offering the Nano for One lakh, it looked like India was going to deliver for all – the poor to find their way out of poverty, the aspirational classes who could  stretch their wallets a bit and get a car and for the upper middle classes too.  The Lokpal movement in 2011 took on corruption and brought in new political players.  While a new leader who had been making waves since 2002 from Gujarat, apparently shaking off the communal baggage assumed centre stage in 2014, with the promise of governance and a laser like focus on economic growth.  With the foundations laid in 1991 for economic growth, and the surge from the 2000’s with dividends form liberalization, and  socio-economic programs, and the promise of governance in 2014, India could take off emerging as a nation without poverty and run-away economic growth.

 

The truth is that the promise of 2014 remains just a promise.  India’s vehicle sales in 2021 has slid back to the levels seen in 2014 (18.5 million in 2014 to 26 million in 2019 and back to 18.5 million in 2021).  The textile consumption in India peaked in 2015 and has started to slide down again.  India’s per capita GDP after having increased by 300% between 2000 and 2010 ($443 to $1358), has increased by only 40% from 2010 to 2020 ($1358 to $1912).  With plummeting interest rates for savings and deposits, and an unavoidable surge in fuel prices, stagnating wages, and disruptions to the economy from 2018, and most notably since 2020 due to COVID, India is getting stuck.  India went through a slow-down in growth (we still grew at 5% and not decline) in 2012 and 2013.  When India was faced with a growth blip the entire media was focused on the growth slow down – decision paralysis became a watchword, and the government quickly tried remedy the situation, with notable results.  Poor economic growth translates into poor Human Development Indices.  The HDI of states such as UP, MP, Bihar remains below several Sub-Saharan African counties such as Kenya, Ghana, or Gabon, today in 2022.  If one were to view India today from the promise of 2010, when it seemed to have learnt how to show rapid economic growth between 2000 and 2010 and poised to fix its governance issues from 2014 from a leader who could get things done, the truth is that India has not lived up to its promise.  The disruption caused by COVID to livelihoods, income, poverty levels is barely captured.  There are pressing reasons to fix the economy and ensure that the tens of millions of Indians are climbing up the economic ladder every year while providing continued growth and security to the middle- and upper-income groups. 

 

India is faced with this situation while it is negotiating some pressing challenges – both internal and external.  India’s biggest internal challenge apart from poverty, poor HDI of several states and growing inequality is combating climate change.    Emissions from developed nations such as USA and Europe have already started to drop.  India’s emissions per capita has gone up by 150% between 1990 and 2018 and continues to rise.  India’s emissions per square kilometre is higher than USA.  India is losing old growth forests to mining, power projects and highways, and getting increasingly replaced by monoculture plantations.  While India has correctly embarked on an aggressive capacity addition in the form of renewable energy, barely 13% of its energy comes from wind and solar.  India’s reliance of thermal power is nearly 70% and comprises of ageing power plants with outdated carbon inefficient technologies.  India is faced with extreme rainfall events and scorching summers, milder winters which can adversely impact its citizens.  India’s neighbourhood continues to remain hostile.  While India is well equipped to deal with Pakistan, the borders with China remain contentious .  The disparity between China and India in terms of economic might has widened over the last 6 years, which China’s economy being nearly 6 times larger in size of India compared to four times over a decade ago.  As recent world events have shown, such a status quo is hardly advisable, and India needs to double down on economic growth.

 

Given the gravity of challenges facing India, one would think that the country and its populace are focused towards facing the future with a laser like focus.  Unfortunately, the political parties, significant sections of the country and the media are utterly distracted.  The excessive focus on religio-cultural issues has skewed the debate in several parts of the country.  Kerala and Karnataka are in the frontline combating climate change in the form of extreme weather events that have hit the state three years in a row.  Portions of northern Karnataka are significantly underdeveloped compared to southern Karnataka.  States like UP have remained largely agrarian.  As a result of new rules on how bovine cattle are handled, a seamless rural economy has ben impacted, while stray cattle roam the streets and raid the farms.  With a per-capita income which is one third of that of Maharashtra,  and limited investments in manufacturing and services, UP could remain poor for years to come unless policies change. 

 

The government is making earnest attempts to propel the economy forward.  Its tax collection machinery is very efficient.  When the crude prices were low, the government refrained from passing the benefits to the common man; rather it used the resources to drive infrastructure spending and keeping the safety net for the poor in place.  The government needs to realize that the large infrastructure projects are not yielding the results anticipated.  Large corporates have been the only ones to benefit.  Economic policies would need to be reconfigured.  Ways need to be found to leave more spending power in the hands of the common man – starting with better minimum support prices and covering more crops under the MSP scheme.  Agro-waste needs to be converted into fuel and energy while rewarding the farmers more handsomely.  By allowing ethanol blends to rise to 20% at the fuel pumps and ensuring at least 20% of agro-waste ends as thermal power, the nett emissions footprint can be improved significantly, while enhancing rural incomes significantly.    The country recognizes that at least 33% needs to be under green cover.  Ecological restoration of degraded forests needs to become a government program.  These are unchartered territories.  The government needs to enlist NGOs and academia in ecological restoration efforts.  With over 50,000 square kilometres of degraded forests, and at least another 65000 square kilometres of agricultural lands lying fallow, the opportunities to green are tremendous.  If this is handed over to the forest department and corporates a golden opportunity to convert this into an economic opportunity would be lost.  Greening the country could arguable employ at least 25 million people across the country and add to the economy.  Reducing the carbon footprint of the energy sector and greening the country could be the next major economic activity.  The surpluses generated would clearly boost GDP growth, improve India’s coffers, help it strengthen its defence and help it counter the might of its northern neighbour by standing up.

 

The question is are the citizens, politicians, and the media truly aware of the challenges and the opportunities ahead of the nation and the need for everyone to step up.  Or are we so distracted that we are only focused on the divisions that we have created in the country.