Pratim Ranjan Bose
It has been a year of
disruptions and, it was a great year for India. When I say great, I don’t mean
everything was good every action delivered the desired results to the fullest
extent. I only mean the change is all encompassing and in the right direction.
Over last 70 years especially
over the last 20-25 years, India’s political system was dominated by caste and
religious interest groups. Politics, particularly regional politics, promoted
it for vested interests and, at the sacrifice of national interests.
At least one component in this
maze, the Muslim vote-bank politics, is now under threat. The treat will only
intensify once Triple Talaq will be banned in a month or so as soon as the
President promulgates the new act.
Also under threat is BSP’s
Dalit vote bank politics. That’s a big change too as it leaves scope for huge
political churning in the days to come. Voters must not be loyal to any
political party. They should only be loyal to growth.
All these did not augur well
for the regional politics. They came up for a reason that no longer exists.
From a combination of different States and interest groups, a new India is fast
emerging with one common aspiration – growth. The old ways of living are
redundant.
You can feel this change the
most in the North Eastern Indian States. The capitalist economic interests
gained precedence over social sentiments. Young, educated, men and women from
Nagaland or Mizoram are no more interested in ‘freedom struggle’. They are
moving as far as in Mumbai, Bangalore and, Chennai to join the pool of skilled
workforce.
To maintain the tempo, India
needed to take strong measures on the economic front. As in 2014 when the
current government assumed power, the economy was in the coma, as most of the
policy initiatives of the previous government went horribly wrong. From
telecom, auto, cement, mining and metals to road construction each of the key
sectors was in paralysis and banks were flooded with bad debts.
Three and a half years later,
India is out of the woods. Highway construction a growth multiplier is
progressing 22 km a day. After decades of neglect, Railways is finally
investing in track and tech upgrade to improve its share of cargo movement. Big
money is invested in scaling up inland water transport that missed the attention
of planners for 70 long years.
On the business side, Steel
making became profitable as prices started moving north on domestic demand,
mining is on growth path, commercial vehicles sales are up, capacity
utilisation is the best of four years in cement and construction equipment
sector and, last but not the least after nearly five years electricity tariff
is ruling high on the open market indicating strong demand pull.
But this is just the beginning.
India is witnessing a major investment rush in logistics sector post
introduction of GST in July 2017.
GST was by far the single
largest reform. It has triggered a huge consolidation of trade logistics, which
is triggering demand for higher capacity vehicles and equipment, creating the
ground for fresh investments.
But this not all. GST is
triggering huge merger and acquisition activity. The consolidation will
increase the competitive strength of Indian corporate sector significantly, in
the years to come. On the way-out are a large number of small and medium
business which thrived on tax avoidance under political protection of the past.
The net result is business is getting more tax compliant which in turn will
increase their capacity to borrow. Just as politics the old ways of doing
business are over.
GST I am sure will have
far-reaching implications for Indian economy. Meanwhile, there is another
sector which is witnessing major changes. After nearly three decades of
stalemate, India is investing major sums in modernising its army. In today’s
environment, a big nation must have a formidable army. Japan does not have it
and, they are today scared of China. What is more important, unlike in the past
when India played in the hands of overseas suppliers; the new India is forcing
arms suppliers to Make-in-India. This has triggered major growth in defence
tech industry in India. There are now scores of tech firms in Kolkata, Delhi
and Bangalore, catering the security agencies.
Over the last three years,
India’s ranking improved in every World Bank index be it in EODB (ease of doing
business), logistics efficiency or corruption. But that’s not enough. The BJP
government in the centre will enjoy a majority in both houses of the Parliament
in 2018. Will they use it for taking tough decisions which were hitherto
blocked by the Opposition?
India needs consolidation of
public sector banks. There are just too many of them crowding out the lending
space. Our public sector enterprises remain under political control. Should
government retain a majority in PSEs or should they reduce stake below 50% to
allow them to be run like another corporate? Should we have a Coal India with
400,000 employees, 75% of which produce 25% coal? Why not privatise it and
allow market forces to play? Indian Railways is corrupt, inefficient and is a
major hurdle for growth. It is blocking the growth of private rail logistics.
Why not start privatising Indian Railways?
Finally, should India consider
downsizing of the government and overhaul of the bureaucracy? In India getting
a government job is like earning a ticket to fool around. Why have them?
Bureaucracy is the worst enemy of India. When in India, they ensure files move
in a circular motion from one table to another. When in abroad; they create
fiefdoms. It is they who fail the country and blame politics. It is high time,
we break the chain.
I do have a long list of
expectations from the Narendra Modi government in 2018. But I am doubtful if
they will try as much, as four major States will go to polls in 2018 before the
2019 General Election. This daily dose of election is a major nuisance and waste of money. Can
they at least change the constitution to force one election in States and the
Centre in every five-year?
Let's hope for the best. Let's
hope 2018 will bring many surprises. Happy New Year.
***
Tweet: @pratimbose
