I don’t think any modern market economy has as many as five daily newspapers devoted to business, economic and financial news. It is a mark of the growing interest of our people in the developments on the economic and business front, both at the national and international level, that so many publications find an audience. It is also a testimony to India’s pluralism that a variety of voices are heard on important policy issues. What is, however, encouraging to note is the fact that there is in the media as a whole a consensus on the general direction of economic policy.
The media has a responsibility to draw the attention of policymakers to market distortions and to malpractices. It has a responsibility to hold a mirror up to those in authority as well as those in control of the levers of power, patronage and wealth.
The financial and business media should firmly and steadfastly uphold the rights of consumers and investors. It should demand and defend transparency in the functioning of government, firms and markets. It should ensure that markets are competitive and function efficiently in the interests of consumers, investors, shareholders and all other stakeholders.
We are approaching the fifth consecutive year of more than 8% growth. There is great optimism about our prospects. Take a long view of history and you realize how dramatic this phase is. Through the entire first half of the 20th century, the economy grew at the rate of nearly 0% per year. For 30 years, from 1950 to 1980, the economy grew at the annual rate of 3.5%. For more than two decades after that, from 1981 to 2003, the economy grew at close to 6% per year. In the past four years, it has grown at more than 8%. In the first half of 2006-07, the growth rate rose to nearly 9%.
This is an impressive achievement for a democracy of over a billion people. Yet, this is not enough. To be sure, we must work hard to make the growth process more inclusive and equitable. We must also work to make it more efficient, employment intensive and sustainable. I have said often in these past two years that there are really no binding external constraints on India’s growth process and that our problems are by and large internal. The world wants India to do well. Our economic partners, big nations and small, have realized that they will benefit from our prosperity.
If there are any constraints on our development process, they are essentially domestic ones. I can identify three types of constraints. First, the constraint imposed by inadequate investment in human capabilities, and in social and economic infrastructure. Second, the constraint imposed by our systems of governance. The lack of a political consensus on vital policies, corruption and red tape, bureaucratism and political expediency and, above all, lack of transparency and accountability at various levels of the government. Third, the constraint imposed by antediluvian and archaic mindsets and outdated ideologies.
Our government has been committed to easing the first two constraints. The rate of investment has risen in recent years and is at an all-time high of 31% of gross domestic product. We have increased public investment, facilitated public-private partnership and encouraged private investment.
We are paying equal attention to new investment in social infrastructure, such as education and health, and economic infrastructure, such as roads, railways, airports and sea ports, power and telecommunications.
To ease the second constraint, we have devoted considerable time to widening the political consensus in favour of economic reform. The National Common Minimum Programme is based on the widest possible political consensus in our country.
Going beyond this, we hope to widen the area of agreement on economic policy as the growth momentum picks up. People accept change when change is accompanied by new opportunities. As employment opportunities grow and incomes grow, the willingness to accept new policies will also grow.
But there is more to governance reform than economic reform. We need a more transparent government, we need a more efficient and humane government. Most people come into contact with government at the lowest level of administration. It is here that we need greater efficiency and transparency. The cancer of corruption has been eating into the vitals of our polity and society. Here, the media can be a source of support for those who wish to reform government and the economy.
Where the media can truly play a significant role is in the ultimate battlefront of change—our mindsets. Unless we get rid of old and redundant mindsets and are willing to think anew, we cannot change the way we function. I have often said that our real bane is the so-called “chalta hai” attitude that we adopt. Equally debilitating is our unwillingness to reward risk and punish inaction, especially in government. There is a larger issue of mindsets. That is to do with the mindset of our social and political leaders.
Manmohan Singh is the Prime Minister of India.