Reimagining India: Unlocking the Potential of Asia’s Next Superpower (13 page)

At the heart of this new imagination of India were three radical notions: that the subcontinent’s huge and diverse population could come together as a unified people; that together they could realize a shared vision of a democratic, equitable, and humane society; and that creation of inclusive institutions and processes could overcome the obstacles created by our recent history of sectarian violence, internal division, prejudice, and poverty. Citizens of the new nation gave form and substance to those ideals through India’s 1950 Constitution.

India’s bold experiment has succeeded in many ways. The most important triumph of the idea of India is that the dreams of 1947 still have force and value. The institutions established by the Constitution have retained their core purpose of nurturing democracy and inclusiveness.
Democracy has taken deep and abiding root in our country, empowering the disadvantaged and marginalized. And yet we remain far from achieving the many goals we set for ourselves in those first years of independence. Particularly when it comes to integrating the economic and social aspects of development, our young nation cannot claim great success.

Economic development was—and continues to be—integral to the idea of India. Early on in our journey, we realized that while there can be economic progress without social development, it is almost impossible to achieve social development without economic growth. So we subordinated our economic goals to a broader social vision. In the first five-year plan, we gave great emphasis to economic growth. However, government “guidance” of economic growth—which was necessary given the nascent stage of industrialization at the time and the need to allocate scarce resources in an optimal manner—quickly morphed into the license raj, with all its attendant problems. The result was forty years of economic stagnation.

The reforms initiated in 1991 unleashed genuine economic dynamism. For a few years in the 1990s and 2000s, India’s economy accelerated at a rapid rate, leading to a mistaken belief that high growth in India was “inevitable” and the new natural state of affairs. In recent years we have learned otherwise, as the combination of a global slump and our own failure to push forward with fundamental economic reforms ushered in the current period of lackluster growth. Moreover, we are beginning to realize that, even in the high-growth years, the benefits of rapid expansion were not equally shared. The bottom line is that, after six decades, India has yet to fulfill the basic needs and desires of hundreds of millions of its citizens for access to quality education, opportunities to work, or even clean water.

What’s needed now is a new burst of imagination—not of the basic idea of India but of the way we integrate our social and economic visions and put political institutions formed in our first sixty-five years to work
in the service of our ideals. Let me highlight four areas in urgent need of reimagining.

First, we must increase our public social sector spending while cutting wasteful expenditures. We spend a mere 4 percent on education, 1 percent on basic health care, and less than 1 percent on social security against the OECD average of 5, 7, and 22 percent, respectively. For a country with our generally poor levels of educational attainment, health, and social security, these spending levels are inadequate. At the same time we spend billions on economically misguided and socially counterproductive activities such as subsidies for power and fuel and inefficient public sector enterprises, not to mention the enormous sums lost through inefficiency and graft.

Second, we must find sustainable solutions for the seven hundred to eight hundred million Indians who still live off the land and the one hundred to two hundred million marginalized urban poor. Given the current state of Indian agricultural productivity, the land alone can no longer support all those who depend on it. The time has come for a new burst of investment and innovation in Indian agriculture aimed at dramatic productivity gains. We must address complex issues such as land degradation and excess water consumption, and strengthen the links between farms and markets. India’s tangled regulatory web in agriculture and forestry has ensnared the disadvantaged; we must strip away these restrictions to unleash the entrepreneurialism of the nation’s poor farmers.

Third, we must find new ways to satisfy our growing appetite for energy. While India ranks low compared to other nations in per capita energy consumption, we face the prospect of severe energy shortages in the future. If we are to continue growing, our economy will need more energy. We remain heavily dependent on imported oil, and our domestic energy projects will not generate enough supply to keep pace with rising demand. At the same time, we must minimize the ecological costs of developing new energy resources. The solution to our energy dilemma will
require an unprecedented combination of conservation and disruptive innovation.

Finally, and perhaps most important, we must reimagine our approach to education. Over the years, the Azim Premji Foundation has worked with the public education systems of multiple states which, in total, administer more than 350,000 schools. My experience working with those schools has convinced me we need a new focus on equitable access to quality education. Over the past two decades, India has made considerable progress in ensuring that children have access to and are enrolled in schools. But the actual process of education at those schools is woefully inadequate. Unfortunately, there are no quick fixes for this problem. No one has a magic wand that can instantly improve the quality of how we teach our children. This will require increasing public expenditure and sustained, painstaking effort on the front lines.

One place to start is our teacher education system. We must overhaul the curriculum for new teachers and rethink its duration, institutional structure, and regulatory environment. We should also develop a cadre of education professionals and generate knowledge through research. To achieve that goal, I believe we should establish thirty to fifty high-quality education schools within our leading universities. At the same time, we must find better methods for enhancing the capacities of our 6.5 million existing teachers. What’s needed is nothing short of a cultural revolution to clear away the current mechanical management practices and empower our teachers and our schools. In my view, it may require twenty-five years of sustained work for us to make our education system robust, vibrant, and a genuine integrator of our social and economic vision. But this integration is critical for India to fulfill its potential and its dreams.

These issues are complex and interlinked. Solutions will require political courage—and not just from career politicians. Too often in India we abdicate responsibility for such complex socioeconomic issues to the
political class. If we are to truly reimagine our nation, every one of us—and certainly those of us in the business sector—must play a proactive, progressive role.

In sum, we must reaffirm the idea of India as articulated in our Constitution and reimagine a new India with an integrated social and economic vision. Only then can we realize the just, equitable, and humane society to which we all aspire.

Edward Luce

Edward Luce is Washington columnist for the
Financial Times
and author of
In Spite of the Gods: The Strange Rise of Modern India.

Indians often point to America’s robber baron period in the late nineteenth century as proof that freedom and rampant corruption can flourish side by side. At a time of entrenched kleptocracy in large parts of India and slowing GDP growth, many Indians find reassuring parallels in U.S. history; the alternative is to despair over the fraying health of their own democracy. Thankfully, India is in little danger of considering any other system. Yet as the twenty-first century progresses, India’s quality of government is increasingly on trial. And so, ironically, is that of the United States.

Having lived and worked continuously in Delhi and Washington since 1999, I feel entitled to at least an honorary PhD in misgovernance. The capitals of strikingly different and complex countries are home to the world’s largest and richest democracies. The names of both capitals have become national bywords for dysfunction and inertia. Both have turned paralysis into the chief default option. It is fair to assume that the recent performances of Delhi and Washington have prompted little or any soul-searching in Beijing.

Of these two great democracies, India’s predicament is the more acute. Sixty-five years after independence, the task of governing India from the center gets more difficult by the year. The country’s forty-year-long
process of party fragmentation has yet to run its course; fashioning coherent governing coalitions is likely to become more difficult, not less, in the coming years. Political scientists say the 2014 general election may prove the first in India’s history in which the two main parties, Congress and the Bharatiya Janata Party (BJP), achieve less than half the national vote between them—a worryingly low threshold for stable government.

Until recently, the transition from the single-party Congress rule of India’s early decades to the multi-party coalitions of today was assumed to have been a success. Coalition governments of up to twenty-four parties were considered stable as long as they had a strong anchor—either Congress or the BJP. But the anchors keep getting lighter. Increasingly, India’s government seems to have come completely unmoored. Manmohan Singh’s Congress-led United Progressive Alliance (UPA) offers a case study of the damage fragmented politics can do.

The UPA was born amid great optimism in 2004 with Sonia Gandhi’s well-staged act of renouncing India’s prime ministership. Singh’s admirers expected him to continue with the gradual economic reforms of Atal Bihari Vajpayee’s BJP-led predecessor, the National Democratic Alliance, while dropping its menacing communal edge. The latter was certainly borne out. India’s last really big communal flare-up was more than a decade ago. Singh also has proved adept at lowering the temperature in India-Pakistan relations. But on almost all else, the UPA has been a bitter disappointment. Time and again, reforms have been stillborn. As India’s growth slows, the human price tag of inaction rises.

The UPA has suffered from three disabling problems. The first is its peculiar separation of political from executive power within the Congress party—the so-called dyarchy between Sonia Gandhi’s dynastic center at 10 Janpath Road and Singh’s formal residence on Race Course Road. Power without responsibility and responsibility without power is a terrible formula for good government. Reformers in Singh’s government have been stymied by a kind of intraparty shadow cabinet of
Gandhians, leftists, and dynastic courtiers, all currying favor with Sonia Gandhi. The most frequent result of the tug-of-war between cabinet and shadow cabinet is deadlock. True power rests with the Gandhi family; India’s formal government has largely assumed the role of eunuch.

The UPA’s second problem is the growing leverage of narrow caste, language, and regional parties—groups with one key trait in common: the absence of any national agenda. Most, such as Mamata Banerjee’s Trinamool (Grassroots) Congress in West Bengal, or Jayalalitha’s All India Anna Dravida Munnetra Kazhagam in Tamil Nadu, view Delhi chiefly as a source of spoils. They tend to oppose privatization and attempts to slim down large state bureaucracies, such as Indian Railways, since this would deprive them of their most lucrative satrapies. In their own somewhat dyarchic way, regional parties see no contradiction between pursuing reform in their states, as many chief ministers have done, while wrecking it at the national level. Singh has spent much of his second term trying to prevent the UPA from falling apart. Since coalitions move at the pace of their most reluctant member, this has helped stall active government in Delhi.

The UPA’s third problem is the continued degradation in India’s government machinery. In 2004, Singh promised to make reform of the bureaucracy one of his chief priorities. With the exception of the 2004 Right to Information Act, which opened up much of Indian government to public scrutiny, Singh has been blocked by the bureaucracy he has sought to reform. His increasingly ineffectual efforts tapered off long before the end of the UPA’s first term in 2009. Singh’s government has been almost continually mired since then in corruption scandals from the 2010 Commonwealth Games through rigged telecoms spectrum auctions to coal block misallocations, bribery by defense helicopter manufacturers, insider government land sales, and so on. The sense of spreading graft is tangible. Delhi’s senior civil service was once seen as the steel frame of an unruly democracy. But the elite Indian Administrative Service is losing
its reputation for probity. Almost everyone, it seems, has his or her price nowadays—not just the politicians.

If fragmentation is sapping Delhi, in Washington it is polarization. The United States has only two parties compared to almost two hundred in India. But America’s deepening gridlock is producing similar results. A few months before he died, Steve Jobs, the legendary founder of Apple, met President Barack Obama at a dinner in Silicon Valley. They did not see eye to eye. “The president is very smart,” Jobs told his biographer, Walter Isaacson. “But he kept explaining to us reasons why things can’t get done. It infuriates me.” To be fair, the U.S. president was only describing reality.

There have been two distinct phases to Obama’s presidency. During the first, which ended in November 2010, Obama had a Democratic majority in both chambers of Congress. He was able to push through an $832 billion stimulus package, the Dodd-Frank bill reregulating Wall Street, and his controversial plan for health-care reform. During the second, which has yet to come to an end, Republicans took control of the House of Representatives and Obama’s legislative agenda came juddering to a halt. Obama’s priority between now and the midterm elections in November 2014 will be to win back the House and restore the conditions that he enjoyed for his first two years. Even then, he would have only a year or so to act before his term was over.