Aug 2, 2006

Of Indian Economy...

Beautiful piece here by Gurcharan Das, the former CEO of P&G India, whose celebrity-like status I havent quite been able to understand. But he does write well.

This piece expalins clearly what many of us suspect or believe - that India is growing inspite of the State rather than because of the State and its policies. That also explains the unique anti-incumbency trend in India. In most other fast-developing countries, parties do some good work and get voted back to power because people are generally happy with economic growth. Here, parties in power just get in the way of development, and then try to claim credit with campaigns like 'India Shining', only to be duly booted out by a frustrated public.

I've never understood why Jawaharlal Nehru is always voted as the best PM India has had, in any survey. The facts suggest quite the opposite. His 'socialist' philosophy for India wasnt in sync with the age of globalization. He's the one who nationalized everything and created incompetent PSU behemoths, that sapped the adrenaline out of India. But of course, in school we are all taught how great he was and what a wonderful thing it is to be a 'socialist, secular, democratic republic . Im sure the 'socialist' was a bad idea, and have some reservations about the secular and democratic parts also.

I also doubt the so-called 'Non-aligned movement' that we are taught as if it were gospel. Did it really make sense to go it alone and become irrelevant, rather than take a side and stay in the mainstream of world politics and trade?

India is now on the right track. But I am worried about the indoctrination of school education. We are forced to align our thinking with principles that are clearly irrelevant in this day and age, if not altogether wrong. Our past is glorified, and not critiqued till you get to late-college, and even then traditional thinking is challenged only in a few good colleges, with thinkers like Dr Veeraraghavan.

Ive heard many people voicing the opinion that Indians are too risk-averse. We lack the killer instinct, we dont have enough entrepreneurs, our best brains defect to the West. Well, you want all that to change, start with encouraging free thinking at school! How realistic is to expect children - who are taught a load of bull and pressurized to get higher grades with little freedom given to develop social, artistic, or athletic interests - to develop into risk-taking torchbearers of a new Indian economy later in life?


  1. I don't want to appear as commenting for the sake of commenting, so I hope you won't mind...

    Jawaharlal Nehru as well as Indians saw British economy as capitalist economy and at that time USSR was doing equally well as compared to US/Britan...

    Continuing above logic I do not think we have sufficient yearly data to actually predict that India is going to grow... May be after 30-40 years we might collapse just the same, because:

    1) Our exports are still shadowed by imports like Oil... (Unless hydrogen engine is available commercially)

    2) Diversity in income patterns resulting in rise in crime in red tapism and slow judicial processes...

    3) Rising competitors like China, phillipines, Ireland, and Eastern europe...

    4) Collapsing social structures in terms of community dedication...

    5) Failing infrastructure...

  2. Nehru was the worst thing that could have happened to India. He and all his cambridge educated buddies thought Keynsian economics really works. That shit is baloney. How the fuck can a Central govt. manage the production of an entire nation? It's not possible for a central authority to micromanage so many things.

    Not to mention, if everything is centralized, then there is no competition. What is the incentive to slash an inefficient department or in other words, how do people feel spurred to do things differently in order to improve things? You need some sort of incentive in order for people to shake up their routines and organizations, in order for things to change an improve. And creative destruction is REQUIRED. Jobs are not eternal. They need to go away when they are obsolete--not be protected by central bureaucracies forever.

    Manmohan Singh is the best Finance Minister ever. And he'll probably now be the best PM too.

    Even the Chinese (who love central controls) now know that you can't centralize production. It needs to be decentralized so that millions of individuals can manage production, while using price as an information carrier about what consumers want.

  3. India used to have a larger per-capita GDP than Korea. Look at us now ... sigh.

    Tata could've been bigger than Toyota or Samsung or Mitsubishi or Sony or any of those companies. Thanks Indira Gandhi and thanks Nehru, for castrating our early world-class companies.

    You know when Tatas ran Indian Airlines (or was it Air India) it used to be the number one airline in the world. Look at where it is now. Sigh.