Illustration: Jayachandran / Mint

The authors point out that while the rising importance of foreign and private firm activity is evident, the incumbents from the pre-reform period control nearly three-quarters of the economy. There’s more: The authors say that the average total assets of state-owned firms represented close to 70% of total assets in 1988-1990 and stood at around 60% by 2005. That shows the state still dominates the corporate sector, at least in terms of assets.

So there has been change, but not a dramatic one. One reason could be the considerable government presence in sectors such as power, oil and gas and banking. Most of the big new entries have been in new industries, while established groups continued to dominate the older ones. The obvious conclusion: We need more reform. The authors point out that the continuing high levels of state ownership and ownership by traditional private firms in India “raise the question of whether existing resources could be allocated more efficiently and whether remaining barriers to competition jeopardize the effectiveness of reform measures that have been put in place".