Yes, indeed its a constructive idea to be taken into consideration whatever the party comes to power.
On 4/25/14, Aravind R <[email protected]> wrote: > (article taken from hindu). > > A new economic agenda > The question before a probable Narendra Modi-led government in 2014 is > whether the statistically undeniable economic slide of the last decade > can be halted and a fresh impetus be given to growth in the Indian > economy. The answer is "yes" if good governance norms are properly > enforced to enable the Indian economy to grow at 12 per cent per year > in GDP for a decade which means efficiently deploying resources to > reduce the current incremental capital output ratio from 4.0 to 3.0, > and by incentivising the people to save more to increase the current > rate of investment (which is domestic saving plus net foreign > investment). The United Progressive Alliance (UPA) government, judged > statistically by the dangerous level of fiscal and capital accounts > deficit indicators, has squandered national financial and physical > resources mainly due to a lack of accountability, corruption and high > transaction costs arising for archaic bureaucratic procedures. Modest > goals within reach This picture emerges from comparative statistics of > National Democratic Alliance (1998-2004) and UPA (2004-2014) rule. > Efficient, corruption-free deployment of existing resources that > implies a reduction in the capital-output ratio, means a 12 per cent > GDP growth rate per year, i.e., a doubling of GDP every six years, and > that of per capita income doubling every seven years. This growth rate > over a five-year period can take us into the league of the top three > most populated nations of the world, i.e., of the United States, China > and India -- that is by 2020. Thereafter, India would be able to > overtake China over the next decade. That should be the goal of > governance for us today. India is not yet an economically developed > nation. India has demonstrated its prowess in the IT, biotech and > pharmaceutical sectors and has accelerated its growth rate to nine per > cent per year in the first decade of this century, up from an earlier > 40-year (1950-90) socialist era average annual growth rate of a mere > 3.5 per cent, to become the third largest nation in terms of GDP at > Purchasing Power Parity (PPP) rates. However, it still has a backward > agricultural sector of 62 per cent of the people, where there are > farmer suicides because of inability to repay loans. There is a > national unemployment rate that is of over 15 per cent of the adult > labour force, a prevalence of child labour arising out of nearly 50 > per cent of children not making it to school beyond standard five, a > deeply malfunctioning primary and secondary educational system, and > 300 million illiterates and 250 million people in dire poverty. > India's infrastructure is pathetic, with frequent electric power > breakdowns even in metropolitan cities, dangerously unhealthy water > supply in urban areas, a galloping rate of HIV infection, and gaping > potholes that dot our national highways. For a second generation of > reforms To become a developed country, therefore, India's GDP will > have to grow at 12 per cent per year for at least a decade. > Technically this is within India's reach, since it would require the > rate of investment to rise from the present 28 per cent of GDP to 36 > per cent, while productivity growth will have to ensure that the > incremental output-capital ratio declines from the present 4.0 to 3.0. > These are modest goals that can be attained by an efficient > decision-making structure, tackling corruption, increased Foreign > direct investment (FDI) and use of IT software in the domestic > industry. But for that to happen, what is required are more vigorous > market-centric economic reforms to dismantle the remaining vestiges of > the Soviet model in Indian planning, especially at the provincial > level. The Indian financial system also suffers from a hangover of > cronyism and corruption which has left government budgets on the verge > of bankruptcy. This too needs fixing. It cannot be rectified by a > Reserve Bank of India vitiating the investment climate with an > obsession to contain inflationary pressure. It is like killing a > patient to lower his body temperature. India's infrastructure requires > about $150 billion to make it world class, while a new innovation > climate requires investment in the education system of six per cent of > GDP instead of 2.8 per cent today. But an open competitive market > system can find these resources provided the quality of governance and > accountability is improved. Auctioning of natural resources such as > spectrum, coal, oilfields, and land for commercial exploitation can > largely substitute for tax impositions. Obviously, a wide-ranging > second generation of reforms is necessary for all this to accelerate > India's growth rate to 12 per cent per year. India has many advantages > today to achieve a booming economy. We have a young population (an > average of 28 years compared to the U.S.' 38 years, and Japan's 49 > years) that could be the base for it to usher in innovation in our > production process (a demographic dividend); an agriculture sector > that has internationally the lowest yield in land and livestock-based > products, and also, at the lowest cost of production, a full 12 months > a year of farm-friendly weather, and an internationally competitive, > skilled and low wage rate, semi-skilled labour at the national level. > The advantages are already being proved to the world by the > outsourcing phenomenon of skills in the developed world and the cheap > supply of labour to oil-rich countries. Demography as an advantage > Since the world view of economic development has now completely > changed, economic development is no more thought of as being > capital-driven, but knowledge-driven instead. For application of > knowledge, we need innovations, which means more original research > which in turn needs more fresh young minds -- the cream of the youth -- > to be imbibed with learning and at the frontier of research. For > decades since independence in 1947 we had been told that India's > demography was its main liability, that India's population was growing > too fast, and what India needed most was to control its population, > even if by coercive methods. Globally, India today leads in the supply > of youth, i.e., persons in the age group of 15 to 35 years, and this > lead will last for another 40 years. Therefore, we should not squander > away this "natural resource." We must, by proper policy for the young, > realise and harvest this demographic potential. China is today the > second largest world leader in terms of having a young population. But > the youth population there will start shrinking from 2015, i.e., less > than a decade from now because of a lagged effect of the one-child > policy. Japanese and European populations are already fast aging. The > U.S. will however hold a steady trend thanks to a liberal policy of > immigration, especially from Mexico and the Philippines. But, even > then, the U.S. will have a demographic shortage in skilled personnel. > All developed countries will experience a demographic deficit. India > will not have to experience this if we empower our youth with multiple > intelligences. Our past liability, by a fortuitous turn of fate, has > now become our potential asset. Thus, India -- by unintended > consequences of a relatively unfettered population growth -- is now > gifted with a young population. If we educate this youth to develop > cognitive intelligence to become original thinkers, imbibe emotional > intelligence to have a team spirit and develop a rational risk-taking > attitude, inculcate moral intelligence to blend personal ambition with > national goals, cultivate social intelligence to defend the civic > rights of the weak, gender equality, have the courage to fight > injustice, and the spiritual intelligence to tap into the cosmic > energy (Brahmand) that surrounds the earth, we can then develop an > intellectually more advanced species of human being; an Indian youth > who can be relied on to contribute to make India a global power within > two decades. Only then will our demographic dividend not be wasted. > This goal thus has to be at the core of the economic agenda for the > rest of this decade for a new government in 2014. (Subramanian Swamy, > a former Union Cabinet Minister, is the chairman of the BJP Committee > for Strategic Action in the 2014 Lok Sabha election.) To become a > developed country, India's GDP will have to grow at 12 per cent per > year for at least a decade. Technically this is within reach, since it > would require the rate of investment to rise from the present 28 per > cent of GDP to 36 per cent > > > > Register at the dedicated AccessIndia list for discussing accessibility of > mobile phones / Tabs on: > http://mail.accessindia.org.in/mailman/listinfo/mobile.accessindia_accessindia.org.in > > > Search for old postings at: > http://www.mail-archive.com/[email protected]/ > > To unsubscribe send a message to > [email protected] > with the subject unsubscribe. > > To change your subscription to digest mode or make any other changes, please > visit the list home page at > http://accessindia.org.in/mailman/listinfo/accessindia_accessindia.org.in > > > Disclaimer: > 1. Contents of the mails, factual, or otherwise, reflect the thinking of the > person sending the mail and AI in no way relates itself to its veracity; > > 2. AI cannot be held liable for any commission/omission based on the mails > sent through this mailing list.. > Register at the dedicated AccessIndia list for discussing accessibility of mobile phones / Tabs on: http://mail.accessindia.org.in/mailman/listinfo/mobile.accessindia_accessindia.org.in Search for old postings at: http://www.mail-archive.com/[email protected]/ To unsubscribe send a message to [email protected] with the subject unsubscribe. To change your subscription to digest mode or make any other changes, please visit the list home page at http://accessindia.org.in/mailman/listinfo/accessindia_accessindia.org.in Disclaimer: 1. Contents of the mails, factual, or otherwise, reflect the thinking of the person sending the mail and AI in no way relates itself to its veracity; 2. 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