I just started reading it a book called “India Unbound” by Gurcharan Das It is suppose to be about India’s journey from Independence to the Global Information age.
Reading books of this genre on our economic liberalization or the Information Reveolution (The world is Flat by Thomas L. Friedman) makes me feel like I have lived though history…It is like world changing events have happened around me and I have been a part and parcel of it! (Don’t know if I am able to communicate…but the feeling is like I am reading ‘history’ which I have lived through and can relate with.)
A good part about the “The World is Flat” and “India Unbound” (although I have just strated reading the book ) is the style of writing and since they are both written by journalists/authors and not hard core economists, they are very easy to read…
I always feel…I read something nice and then I forgot about it! And the best way to remember is to write about it and talk about it! By doing that you not only remember it longer for yourself but also sharing it with others!
So here is something interesting I read today in India Unbound!
Six things that went wrong with India’s economy
1. Took up an inward looking import substituting path rather than an outward looking export promoting route thus denying it self the prosperity that came with post war trade.
2. It set up a massive, inefficient and monopolistic public sector to which it denied the autonomy of working.
3. It over regulated private enterprises with the worst control in the world. This was popularly know as the “License Raj”.
4. It discouraged foreign capital and denied itself the benefits of technology and world class competition.
My ex boss was someone who brought one of the 4 big consulting firms to India and set up their operations here. He used to tell me stories on how they used to do road shows in the US and Europe in the 80’s and the entire talk would be around how to work around the ‘license’ requirements.
5. Pampered organized labor(Unions) to the point where we have extremely low productivity.
6. Ignored education especially of the girls.
There is an old idea in economics which says that If the rich and the poor countries are linked by trade their standard of living would converge in the end. Well this makes sense logically…because the standard of living depends on productivity and productivity depends on technology and when the rich and poor countries are linked, the poor countires can simply adopt the technological innovations without having to reinvent the wheel and grow much faster and eventually catch up!
Since it is so logical….then why has this not happened so far??
Two Harvard scholars did Jeffery Scachs and Andrew Warner did a study and concluded that only 13/87 third world counties were open to world trade between 1970 to 1990 and they grow 6 times faster!
India was part of the group which was closed to trade…the Singapore and Hongkongs of the world were in the group that were open to world trade…and the results are for the world to see.
Post 1991…India has changed…someone coined it as our “Economic Freedom”. I think we should celebrate the day 1991 as much as we celebrate 15th august 1947! But the irony is I don’t even know if there is a particular date that we can coin. I think maybe the ‘day’ that the economic reforms were announced should be celebrated as our “Economic Independence Day”
I personally think we are doing very well in the first 5 pointes mentioned here….but still have a long way to go on the education front…
The students who are educated and have degrees are very often not employable.Our Education system leaves so much room for improvement.
Someone in a toast masters meeting had given a speech called “Operation Black Board”. She called it “Operation Blackboard” so that it sounds like an urgent military operation which it should be. A very nice analogy in her speech was that our education system is like filling a pot with information till it is full what we need is an education system which is like lighting a lamp in the darkness.
We need to train students to think analyze apply and enjoy studying… I will do something in this area someday!