In­dia looks out

Financial Mirror (Cyprus) - - FRONT PAGE -

To­day more than ever, to para­phrase the poet John Donne, “no coun­try is an is­land en­tire of it­self.” In­dia, too, has recog­nised this, be­com­ing fully in­te­grated into the world econ­omy by way of trade in goods and ser­vices, as well as flows of cap­i­tal, tech­nol­ogy, and ideas. And, of course, In­dia’s uniquely large and wide­spread di­as­pora is play­ing a unique role in strength­en­ing its ties with the world.

It is a world in which In­dia to­day oc­cu­pies a spe­cial po­si­tion. Whereas many coun­tries – ad­vanced and de­vel­op­ing economies alike – are ex­pe­ri­enc­ing a grow­ing sense of eco­nomic anx­i­ety and even gloom, In­dia is a bea­con of hope, pos­i­tive change, and eco­nomic dy­namism.

Our econ­omy has sta­bi­lized: in­fla­tion has fallen, the ru­pee’s ex­change rate is steady, and our com­mit­ment to fis­cal dis­ci­pline is solid. Eco­nomic growth, now the fastest among the ma­jor economies, is poised to ac­cel­er­ate fur­ther. In­vestors, not sur­pris­ingly, are flock­ing to our mar­kets.

As proud as we are of our achieve­ments, we also recog­nise our re­spon­si­bil­i­ties. I am keenly aware that the In­dian peo­ple have given the gov­ern­ment in which I serve a man­date for de­ci­sive eco­nomic change and po­lit­i­cal re­form. We will honor that man­date, which, in a glob­al­ized world, re­quires us to achieve in­clu­sive growth do­mes­ti­cally and en­gage con­struc­tively in­ter­na­tion­ally.

One rea­son to fo­cus on in­clu­sive growth is that to­day’s In­di­ans are dif­fer­ent from those of the “Mid­night’s Chil­dren” gen­er­a­tion. Un­like that gen­er­a­tion, the first to come of age af­ter in­de­pen­dence, to­day’s In­di­ans – even the poor­est – over­whelm­ingly think of them­selves as “mid­dle class.” The twenty-first-cen­tury In­dian is younger, on av­er­age, than al­most any­where in the world. He or she is also con­fi­dent and, above all, as­pi­ra­tional. Hav­ing seen pos­i­tive change, tasted a bet­ter life, and glimpsed or ex­pe­ri­enced broader op­por­tu­ni­ties, to­day’s In­di­ans want more – and rightly so. Our chal­lenge is to meet those expectations.

That is why in­clu­sive growth is not a mantra but an ex­is­ten­tial ne­ces­sity. We are a large coun­try of many dif­fer­ences: class, caste, lan­guage, and re­li­gion, in ad­di­tion to age, gen­der, and opin­ions. Dif­fer­ences, if pre­served and cel­e­brated, are a source of cul­tural rich­ness and new ideas. But there is also a chal­lenge. Econ­o­mists have found that such het­eroge­nous so­ci­eties face greater chal­lenges in fos­ter­ing eco­nomic growth and de­vel­op­ment.

There is also greater scope for po­lit­i­cal con­flict, which can chal­lenge the pur­suit of eco­nomic de­vel­op­ment. If peo­ple are dif­fer­ent, they also tend to mis­trust one an­other, making it more dif­fi­cult to gov­ern – and po­ten­tially lead­ing to in­fe­rior pol­icy choices.

Achiev­ing in­clu­sive growth will pro­vide the ba­sis for In­dia to en­gage in­ter­na­tion­ally. The year 2015 ends with two ma­jor ef­forts at in­ter­na­tional/mul­ti­lat­eral co­op­er­a­tion: the COP21 cli­mate change con­fer­ence in Paris and the World Trade Or­gan­i­sa­tion ne­go­ti­a­tions to con­clude the Doha De­vel­op­ment Agenda in Nairobi. In­dia in­tends to be a con­struc­tive player in both ef­forts, not least be­cause we have so much at stake.

The re­cent floods in the state of Tamil Nadu are a re­minder that In­dia is es­pe­cially vul­ner­a­ble to cli­mate change. We have un­der­taken a ma­jor ef­fort to in­crease the role of renewables, to price car­bon di­rectly and in­di­rectly, and to boost green pub­lic in­vest­ment. We call upon the ad­vanced economies to take ac­tion to price car­bon, which has be­come es­pe­cially im­por­tant in the wake of the large de­cline in the price of oil and other fos­sil fu­els. Only by boost­ing in­no­va­tion in green tech­nolo­gies, in­clud­ing green coal, can we rec­on­cile the press­ing im­per­a­tive to pro­vide en­ergy to hun­dreds of mil­lions while en­sur­ing good cus­to­di­an­ship of our planet.

Like­wise, In­dia’s gov­ern­ment and peo­ple rec­og­nize that trade is an en­gine of growth and a source of ef­fi­ciency and dy­namism. Mul­ti­lat­er­al­ism is the best way to en­sure that global mar­kets re­main open to all, not just a few. Pre­serv­ing and re­vi­tal­iz­ing the WTO re­quires suc­cess­fully con­clud­ing the Doha Round. Our goal is to en­sure that our de­vel­op­ment in­ter­ests, es­pe­cially the liveli­hood of mil­lions of farm­ers, are pro­tected, and then frame an agenda that en­sures mul­ti­lat­er­al­ism’s crit­i­cal role in pre­serv­ing and open­ing mar­kets in the fu­ture for all coun­tries.

Ma­hatma Gandhi, the fa­ther of the na­tion, best de­scribed how In­dia should en­gage with the world. He wished “the cul­tures of all the lands to be blown about my house as freely as pos­si­ble. But I refuse to be blown off my feet.”

We don’t want In­dia’s econ­omy to be walled in on all sides, or our win­dows to be shut­tered. We want the winds of ex­ter­nal learn­ing and ex­pe­ri­ence, for­eign cap­i­tal, tech­nol­ogy and en­trepreneur­ship, to blow around the In­dian house. In­dia will en­gage with the world with open­ness and re­cep­tiv­ity, but also with the con­fi­dence in our val­ues, rich history, and promis­ing fu­ture that will keep us from be­ing blown off our feet.

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