Whether our economy has strong growth drivers or it is exposed to a contagion — our experts debate and discuss
India’s economy is by no means short of potential. There is no doubt we must overcome significant challenges to realise our potential growth. However, we have to demonstrate self-confidence and take strong corrective and decisive measures. Self-inflicted pessimism will get us nowhere. Baby steps leading to successes, many of which are already taking place at various levels, need to be highlighted and success transferred.
The structural issues facing India and the global economic environment with its potential impact on our growth are evident. We are also aware of our domestic priorities that need to be addressed. Solutions to some of these challenges are politically contentious, depending on political philosophy and varying interests. Constantly amplifying negative sentiments and seeing ghosts where none exist, will only create further impediments to our growth and derail prospects of any reforms.
We are fortunate to have strong growth drivers — domestic consumption, high savings, low dependency on exports, burgeoning middle class, positive demographics, talent pool and intellectual capital. Very few comparable economies have all these ingredients in place that foster strong and sustainable long-term growth. Despite all this, we seem to be spinning cobwebs, instead of harnessing our resources and surging ahead while we have an opportunity. India’s sound and robust institutional infrastructure kept us in good stead for several decades, after independence. We did not pay enough attention to re-engineering and making our institutions contemporary with growing needs and changing environment. It is critical to focus and revisit our institutional structures and processes which will support our future economic growth. As in the corporate world, where managements have to be lean, nimble, flexible, responsive, innovative and customer-focused to stay competitive and profitable, the government needs to embellish its institutions to avoid becoming clumsy, rigid and uncompetitive. Fortunately, we are seeing signs of change and receptivity with some of the leadership at different levels of governance. There are examples which are getting lost in the din of negativity.
Our country, today, stands at a crossroad. Strong self- belief, integrity, communication of a roadmap and effective execution is the need of the hour to provide the necessary fillip to reinvigorate our growth. Consensus building and empowerment have been the hallmarks of our democracy. Big-bang economic reforms will fall into place as we make headway with less contentious reforms and demonstrate our ability to execute.
The India story continues to have strong promise. We will face short-term challenges, which we must overcome through team work and camaraderie. Each one of us has a role to play and make a difference, as we take the responsibility to deliver an India that our future generations will be proud to inherit.
The author is country head & CEO, AIG India
