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Business News/ Opinion / Views/  India’s big battle of ideas shouldn’t evoke hopelessness

India’s big battle of ideas shouldn’t evoke hopelessness

Dismal views of India tend to overlook the changes being wrought that Indians have long sought

Photo: BloombergPremium
Photo: Bloomberg

Bloomberg Opinion columnist Andy Mukherjee triggered a weekend storm with his loss of hope in India, as expressed here.

He has lost hope in India due to what he considers the “inept" authoritarian handling of the pandemic, arbitrariness of policy, decay of institutions, presence of zombie business houses, and the power of a few firms. He worries about a post-pandemic demand gap. He sees walls closing in: “[The] opportunity set for India is shrinking...."

His piece documents the stagnation of post-Independence India, its 1991 rebirth with reforms credited to Manmohan Singh (not Narasimha Rao), omitting to mention the International Monetary Fund gun held to our head, and how those reforms gradually lost focus and force, resulting in rampant corruption. But nowhere does he mention clearly the extent of the corruption, that had become a gouging under the United Progressive Alliance-2 regime. Mukherjee moves to the rising star of Prime Minister Narendra Modi and hopes of a muscular reform push under his leadership. And then he makes a surprising leap to connect the botched demonetization exercise with the “unquestioning devotion" of citizens, and links it to the start of allegedly whimsical decision-making, including India’s six-week lockdown. The rest of Mukherjee’s argument is mostly about how Modi has been able to mesmerize Indians so that they are willing to take any pain that he inflicts but remain steadfast in their faith.

In what is more an airing of perceptions than an evidence-based argument, Mukherjee seems to echo the 25 oped writers who after Modi’s 2014 win wrote on how voters had let the country down. But is that so? Given that V. Anantha Nageswaran has answered many of the specific data points raised by Mukherjee, let me respond to one thread through his piece: Why did India vote Modi back to power with a larger mandate in 2019 and what drives his personal connect with the average Indian? As I wrote just before last year’s election, what worked was an audacious outreach to citizens on a whole range of goods and services. Citizens did not vote Modi back to power because he promised temples. They voted him back because of real benefits flowing down the leaky pipes to people. It is this disintermediation in almost every aspect of life that seems to explain Modi’s connect, rather than some servile form of devotion.

Modi’s appeal is about also about self-worth and nationalism. Keeping Pakistan’s terror modules under control, calling its nuclear bluff, and not allowing China a face-saving retreat once it realized that India was not the push-over it expected, have all worked to restore our idea of who we are: perpetually beaten or strong enough to retaliate? This muscular foreign policy has found wide resonance in India.

Mukherjee paints a dismal economic picture of India, and says that we will never catch up with China. No, India won’t. But neither will New Delhi ride roughshod over dissent, property rights and human rights the way Beijing has, and does. Think of its treatment of Uighur Muslims. Or Ant’s initial public offer that was scotched by regulators just before its stock-market listing.

I don’t think anybody can argue that all is well in India. We have huge problems, some of them cascading from the past, and some new ones. But the hopeless view completely misses the big leaps in citizen services over the past decade ( There is plenty wrong with the Indian economy, but perhaps the story is not so much about a dystopian future, but about a pivot towards formalization that’s still a work-in-progress. If the 1991 reforms took a $270 billion Indian economy to its current level of almost $3 trillion, the next jump will not happen with the old game of crony capitalism, of public sector banks being used as ATMs by the powerful, of a closed club of insiders shaping rules and regulations to their own benefit. The next jump needs a new playbook, and if one looks at a slew of coordinated reform measures for this pivot, the picture may not be that dismal. Apart from demonetization, the bankruptcy code, goods and services tax (GST), legislation against benami transactions, real estate regulations and the PAN-Aadhaar-bank account links should be seen as just a few arrows in the quiver of all that has been shot at the problem. Some worked, others failed.

What gives me hope are examples such as our ability to put in place a state-of-the-art online payments system that acts as a public utility. This has leapfrogged India to the front of global systems. The platform is open for foreign firms, such as Google, to build their payment apps on. We should watch what new innovators creating the next version of India stack will deliver. For example, the use of GST receipts on India’s digital public utility could soon be how small and medium firms draw credit. There is much excitement and activity in the edtech, healthtech and fintech spaces. None of this is reflected in Mukherjee’s dark view of the country. If he would just plug into some of the conversations in this space, his gloom may get dispelled.

The debate that Mukherjee has set off is important because it is essentially about two alternate ideas of India. The error he seems to make is to see Modi as the cause and not the result of a driving desire to change the idea of India as constructed in the first six decades of independence. Modi is the face of an emerging country’s aspirations.

Monika Halan is consulting editor at Mint and writes on household finance, policy and consulting editor at Mint and writes on household finance, policy and regulation.

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Published: 01 Dec 2020, 09:16 PM IST
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