Tackling India’s transitions is tough
India’s challenges need visionary leadership that can break entrenched political interests
Is India at the cusp of a new phase in its developmental trajectory? And is the Indian state -- our politics, our public institutions -- equipped to credibly negotiate this transition? Earlier this month, 13 of India’s foremost economists released an “economic strategy for India”. The strategy contains a shopping list of old and new reforms. While the reform proposals have been part of the public debate for some time now, what distinguishes this “strategy” is the argument it makes for change. The benefits of 25 years of growth, they argue, has not been distributed equally and “our current policies do not add up to an inclusive, sustainable agenda”. Moreover, pressing problems like the environment pose new threats to India’s development model. As challenges mount, old models are no longer sufficient.
This sentiment was echoed at a recent conference organized by the Centre for Policy Research (full disclosure: I am the President of CPR and HT was the print partner, and the pieces referred to below have all appeared in this paper). India, it was argued, has reached the end of the road of the gains made through the 1991 reforms. The challenge of unequal growth is real but addressing this is complicated by the many, often-conflicting transitions that India has to negotiate today. From the need to balance increased energy demands to fuel growth with developing sustainable and clean energy systems; to the need to shape India’s urban transition in ways that are both sustainable and responsive to technology-led shifts in the labour market, the development challenge India faces today cannot be solved through the delivery models that India has deployed thus far. This is not about “inclusive growth” but about India forging a new development deal, one that goes beyond the 1991 paradigm to focus more explicitly on equitable and sustainable growth.
While India’s policy shaping elites are slowly (and somewhat belatedly) acknowledging the limits of the 1991 paradigm, the average Indian voter has been expressing deep discontentment with what development models have done for their well being for some time now. As Rahul Verma and Neelanjan Sircar argue, Indian voters today are primarily concerned about agriculture, public services and jobs. Electoral choices are a reflection of voter assessments of their economic conditions against these indicators. As was evident from the recent elections, economic well-being rather than identity is the driver of electoral performance. This changing, impatient Indian voter affords a unique opportunity for our polity to forge a new development discourse for India.
But can the Indian state credibly respond to this current moment and craft a new development deal? At minimum, this will require the Indian state to identify new frameworks through which to understand old problems. Take the challenge of urbanisation. As Partha Mukhopadhyay and Mukta Naik illus- trate, the bulk of India’s urban transition is taking place in small, semi-rural towns that are slowly transitioning from agrarian to non-farm economies. But these towns are governed by structures that are simply not designed to be responsive to changing needs. If policy needs to fuel growth and respond to the country’s urban transitions, the focus has to shift from smart cities and the metropolises to these semi-rural locations. But the nature of India’s urban transition is also, closely intertwined with India’s energy transitions. The emergence of sustainable urban growth centres is closely linked, as Navroz Dubash argues, to shaping electricity demand, which is likely to double in the next decade, and urban infrastructure investments made on the one hand and the kind of energy systems (coal versus renewables or some judicious mix of both) India locks itself in to, on the other. The intersections between India’s economic, urban and energy policies, to name a few, are significant and decisions taken in each policy sphere will fundamentally influence the other. This is made more complicated by the fact that demands of one kind often create conflicting pressures on others.
Negotiating these intersections and building new frameworks requires a nimble, agile state that has the capacity to break silos, move beyond one-size fit all approaches and decentralize decision-making. It requires a shift from a hierarchical, top-down approach that the Indian state is comfortable with to a deliberative, problem-solving one that absorbs expertise and brokers political compromises. In essence, it requires a sophisticated and capable state – far beyond the capacity of current state institutions.
Prime Minister Narendra Modi captured the challenge confronting India today in an important statement. India, he said, has a 19th century administration dealing with 21st century problems.
But even as he understood the problem he has failed to provide the leadership needed to build a 21st century state. India’s challenges need visionary leadership that can break entrenched political interests and push policy imaginations beyond business as usual. This is where our politics has repeatedly failed us.