Post-Independence growth gets a fresh perspective
Through their newlylaunched book The Political Economy of India’s Growth Episodes, authors Sabyasachi Kar and Kunal Sen offer a fresh perspective on the determinants of growth episodes in post-independence India, based on its political economy.
A sustained growth in India is implausible without keeping a check on the closed-door deals that invariably promotes crony capitalism, Mr Kar said at the book launch event here on Wednesday.
South Korea’s rapid growth in the 1960s and 1970s and China’s economic rise in 1990s and 1970s was characterised by crony capitalism and high levels of corruption, he said.
During a panel discussion at the book launch event, Naushad Forbes and Tarun Das of Confederation of Indian Industry said that some fast developing economies in Asia achieved high growth rates initially because there were lots of profits to be made in the export-oriented sectors.
In India, most of the projects with cost overruns are from the infrastructure sector, and are not necessarily linked to the manufacturing or service sector, Mr Das said. He argued that delays on account of land and credit availability and power allocations escalate the project cost.
“Public-private partnership is a new concept for India. Between 1947 and 1997, the infrastructure projects were owned, controlled and managed by the government,” he said.
Rejecting the idea of a South Korea-like growth, Mr Sen said that the country’s growth is “exceptional”, but it came as a result of a “fairly authoritarian system”. “In India, one can’t imagine that,” he said.
Mr Kar and Mr Sen argue that the transition from one growth episode to another can be explained by bi-directional relationship between growth outcomes and institutional arrangements, and by the manner in which institutional arrangements.
A man takes a bath to beat the heat in New Delhi on Wednesday, the World Water Day.