Indian economy: Perspective of a non-economist

I find the Indian economy the most peculiar one which shifted from being socialist to the capitalist path. It’s not the cause of concern that our economy shifted approach but the way we shifted our approach is not so fascinating. India came out of colonial rule whose roots can be traced back to mercantilism so the socialist approach was the need of the hour. The socialist–welfare approach was the right one for the poor nation but the organic nature of this strategy was not followed. I will try to put into three pillars of our approach with their pros and cons.

1. State of our economy

The bitter experience of a trading company that captured the golden bird made India skeptical about foreign investment. Indian tried to achieve growth through the public sector model which was sustainable till the point efficiency of people gets due regard. India had troubled borders from west to north to the east front which put a heavy toll on our economy. Indian growth model was on right track from the second five-year plan with infrastructure assets were created by Public sector entities. India’s health and education sector led us down with a growing population that put stress on food. The food crisis struck a blow to our socialist model. In the 70s decade, wars led to a downward trend in our economy. The Indian economy has so many facets that the one size fits all approach will never lead to a positive outcome. India tried to adopt an imported model with people with little Connection from the ground to the helm, which led to continuous policy changes and people’s ignorance due to no fixed approach. The private sector before 1991 reforms was seen with a hawkish approach and so many regulations. Foreign companies/investments were not promoted. It gave an impression of a closed economy to the world by one of the largest markets in the world. After LPG reforms, the Indian economy saw a trend reversal with the end of license raj and promotion of Private enterprises. Indian govt. did every right to their disposal but socio-political conditions forced govt. for any groundbreaking reforms.

2. Political Democracy

Indian democracy is the most vibrant and inclusive since 1947 with every person had a right to vote and a three-tier democratic set-up. Indian govt. is put to test every 5 years and in the contemporary situation, govt. is put to the test every week with every policy decision is scrutinized from the electoral outcome. It leads to a horizon problem, with every govt. has made a policy that can lead to an outcome within 5 years or less. For infrastructure development, 5 years is a very short span as they have a long gestation period. Successive governments try to put an outcome-based approach to make a political gain, this leads to policy paralysis. Most importantly, Indian elections are not held on the back of development but on the issues that have no Substances after the election. Media is considered as the fourth pillar of Indian democracy but it never puts its attention to development. Development is portrayed in the frame of political perspective. Every month or so there is some election in India or preparation for that, this put govt. in party polity mode rather than on the nation’s leader’s front. Some say it put govt. in test mode but it results in a test that doesn’t provide time to study. It’s not possible at present to amalgamate all the assembly elections and parliamentary elections together but steps towards this framework will fructify in a decade or so.

3. Societal structure

Indian society had a presence for more than 4000 years and the most coherent society in the world. Indian society worked in the collective mode so every decision had a societal impact rather than an individualistic one. The socialist model was right for Indian society but due to some alien factors and non-implementation of the socialist model in a true sense led to its downfall. Indian society for long has put economic factors in the last bag for its electoral practice. Indian society was idealized as oneness in all but political gainer put fractions among them and took advantage Every economic policy decisions have pros & cons which should not be viewed from the prism of the political gain. Every step from independence to this moment had a positive framework for the development, it’s the implementation that led us down. It’s high time for our society to see every decision or policy through the lens of herself, not by expert excerpts.

India is the superpower in terms of its market size but holistic development to become a high-income country is in progress and if we as an individual and society put a foot forward with the nation then the timeline will be shortened.