One of the biggest and relevant questions of the hour is that how do we take India to the $5 trillion economy and what are the public policy imperatives required to achieve this goal? India story has just begun.
If you look at the last five years ago, India has roughly grown at an average of 7.5 per cent. If you want to go back in time and look from 2004-2005 onwards, looking at multidimensional aspects of poverty, we have lifted close to about 351 million people above the poverty line. But the real challenge for India is to grow at a consistent high rate for at least three decades, about 8-9 per cent per annum year after year, to lift everyone above the poverty line.
India is passing through a window of demographic transition, which rarely happens in history. The average age of our population is just 29. Seventy per cent of our population is below the age of 32. Rarely has a country in the world not created wealth when it has such light dependency burden. One of the thing, the government has done is to make India easy and simple for doing business in the last four to five years. We scrapped a lot of rules and regulations, reduced paperwork, tried to digitise government, made departments speak to each other more and citizens digitally. Therefore, we have jumped up to 79th position in the World Bank Ease of Doing Business report. The Prime Minister has given bureaucracy the challenge to take India into the top-50 in the next one year and into the top-25 in the three years hence.
Global Supply Chain
Another critical aspect is to make India an integral part of global supply chain. If we are not a part of the global supply chain, goods are designed somewhere, manufactured somewhere else and assembled somewhere else. And we lose out! We have opened up our Foreign Direct investment (FDI) regime in a vast range of areas. Our FDI has grown up to 66 per cent in the last four years, at a point of time when world FDI has fallen to 13 per cent. India needs to open its economy more and more and not close, as the opening of the economy pays dividends in the long-run.
Cities are real centres of growth, dynamism and job creation. India has been a very reluctant urbaniser. Therefore, this is the first government, which has talked about smart urbanisation and which is driving 100 Smart Cities. Good planned sustainable and innovative urbanisation will drive India’s future.
Chat with Rohan
It was a chat with a difference. One-to-one and heart-to-heart. One where experience met with the aspiration! Experience being the one coming with lifetime practicing on policymaking and being at the helm of government’s top-most think tank, NITI Aayog, Amitabh Kant as its CEO and the aspiration being Rohan Kochhar, young and versatile, Economics graduate, Master’s in Public Administration from UCL, UK and Director, Public Policy, SKOCH Group. The youthful exuberance Rohan exuded that was self-evident moment the chat was kicked off, that kept Kant at his sharpest best and the ones who watched, spellbound. The response from the side of experience was seamless and crystal clear that was a stimulating delight for the audience. Aspiration remained focused on eliciting more that could create a common meeting ground as a takeaway for everyone.
Debates on policymaking aren’t of much interest to the common man. These do not generate TRPs nor attract investors or advertising. And for the informed, there is no such platform, either for inputs or learning – there is a vacuum. SKOCH-TV fills this much-needed gap and brings to you its maiden episode ‘Chat with Rohan’ that features Amitabh Kant in his full glory. In an another first, nearly 700 live audience watched the chat with a titan live and gave it thumbs-up. A few who had their lifetime opportunity to interact with a stalwart like Kant also captured the value of a live presentation.
Responding to the question of acquiring and retaining talent to build India 2.0, Kant said that the very fact that government has allowed lateral entry shows its commitment. The corridors of NITI are abuzz with more than a hundred young professionals who left Harvard, Yale and Princeton etc. Their approach is disruptionist.
Startup ecosystem is another disruption. The mindset of people needs to change. Without manufacturing, India can’t grow. Wealth creation is to be done by private sector, government can be a catalyst.
Kant added that we must make states compete—only way to grow. The next stage of transition can come only through improvement in performance, challenge being one route. For Aspirational Districts we have 49 indicators – Panchayats, BDO, Collectors, MPs and MLAs, all are competing.
On the question of convergence between schemes, Kant said that impact of schemes like Swachh Bharat will be felt for over five to six decades and its best outcome will be preventive healthcare. Reforms are inevitable and in months to come, there will be a huge transformation.
One of the key features of India’s story is that this government has done major structural reforms. The fundamental reforms that have been gathered out in India across the economy, including GST, to end crony capitalism with the bankruptcy code, in terms of real estate reforms through RERA and in terms of Direct Benefit Transfer (DBT) will make India a very competitive and productively efficient economy in the times to come.
Innovation and Technology-Led Transition
India is seeing a tremendous Startup movement. We have close to 35,000 young Startups, out of which are almost 10,000 tech Startups. This shows that you create the right ecosystem and Indian Startups will penetrate the world. We are the only country in the world with 1,200 million biometric, 1,200 million mobiles and 1,200 million bank accounts. This is what we call the JAM trinity, which will enable a lot of unique transition to advanced economy in due course.
India is amongst the very few countries globally, where the government has driven digitisation in a big way. Long back, opening a bank account in India was a nightmare. Today you can go to a bank and can open your bank account using your biometric in less than a minute. From about close to 8-9 months, we have reached to one minute in opening a bank account. We have made data very cheap. Our data cost is 1/10th of the United Kingdom and 1/15th of the United States. In the years to come we will provide size and scale of the data to the world which the world has never seen before.
India has become a centre for a huge amount of innovation for the rest of the world. The entire world is innovating from India and over 1.400 MNCs have relocated their engineering, R&D base to places like Bangalore, Hyderabad and now to Pune and Gurgaon. A massive innovation is happening in these cities at a price point that the world has never witnessed. Innovation is the key to India’s growth. The government has really eased up the patent regime. Today you can get a patent in the country just in 18 months, the way you get in the US.
Challenges to Keep in Mind
If India has to become a $5 trillion economy, there are several challenges before it. The foremost is to grow without a massive focus on learning and health outcomes. While we have been able to provide access to education to all, our learning outcomes remain extremely poor. Grade competence is very important for the country’s future growth and therefore learning outcomes must improve. Secondly, our nutrition policy and health outcomes will play a major role in the near future. Our recent studies show that the country needs to lay a massive emphasis on health outcomes at the grassroots, particularly at the state level.
If you look at the map of India, you will see 115 districts of India keeping it backward. Unless these districts are radically transformed in education, health, nutrition, infrastructure, agriculture etc, it will be very difficult for India to transform. We are now monitoring these Aspirational Districts of India in a real-time basis. Data is coming in straight from third parties on 49 indicators. We are naming, shaming and rewarding on a day on a day and month on month basis and putting it in public domain. Over time, we have to necessarily transform these 115 districts for India to grow.
It is not possible for India to grow for a long time without structural reforms in the agriculture sector. Agriculture requires a lot of technology in India. Markets have to work and a huge focus has to be laid on warehouses and cold storages. A lot of our population has to move to industry. We cannot just grow on the back of services sector and hence need to take exports and manufacturing to newer heights.
India’s growth story has just begun. These are very transformative moments in the history of a nation. We will never get an opportunity like this to change the history and destiny of India.
Modi government's flagship healthcare programme Ayushman Bharat completes one year in September 2019. This is one of the world's largest publicly funded healthcare initiatives. Indu Bhushan, Chief Executive Officer, Ayushman...
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