Learning from Switzerland, Israel and China we can focus on
our strengths and locally available resources for faster and sustainable growth
We have opined in many of our earlier posts that the Nehruvian
model of large industry led growth has failed in achieving desired outcome in past
more than 6 decades. Consequently, a strong structural base for the Indian
economy is yet to evolve. We have not been particularly successful in the areas
such as technological advancement, productivity gains, innovation and
localization and mostly continue to be an economy largely dependent on labor
& resource arbitrage and trading.
In our view, we have focused too much on our weaknesses and
tried hard to overcome by importing technology, energy, intellectual property,
capital and consumption patterns. As S. Gurumrthy recently highlighted
in one of his writings recently, the primary cause of structural imbalance in
trade account appears to be humongous capital goods import in past 10yrs rather
than gold or oil import as widely believed.
Instead of focusing too much on weakness, just by focusing on
strengths the flow of trade can be reversed to pre British era. The following
programs for example, could improve the balance of payment substantially and
structurally by 2025 by focusing on our intrinsic strengths like abundant sun
shine, large number of middle class youth, amazing landscape, strong and rich
tradition & culture:
(a)
Energy deficiency had been one of the primary
reasons for India’s fiscal and trade deficits. Failure in implementing an
integrated energy policy has been a major failure of policy making. It is
widely recognized that “roof top solar panel” has the potential greater than
the one seen in mobile telephoney in past one decade. Reducing energy intensity
of water and developing a world class public transport infrastructure on
priority basis, especially in tier II and III cities, and strict legal
enforcement of energy efficiency should be considered.
(b) Indians spend approx USD25bn annually on
education and related overseas travel. Creating 5 special education zones with
liberal VISA, forex, taxation and real estate ownership rules, and allowing
foreign institutions to freely set up campuses could reverse this flow.
Students from India, far-east, middle-east and Africa who find it difficult to
get VISA for US/UK etc. or find that expensive could also benefit from this.
(c) India holds tremendous potential for
tourism. However lack of proper infrastructure had traditionally constricted
the growth of this sector. On the other hand Indian outbound tourists flow is
rising. Developing some world class self contained international tourism
centers, e.g., on lines of Macau, Disney, Las Vegas, etc. with liberal VISA,
Forex, taxation and real estate ownership rules could reverse these flows.
(d) Vindavan, Tirupati, Varanasi, Gaya, etc. all
have potential to be as desirable, venerable and popular destinations as Mecca,
Vatican and Jerusalem. Converting these centers of Indian religion and culture
into self contained special zones with international airport and annual event
calendar could get substantial forex revenue.
These projects also have the potential to generate large scale
productive employment opportunity for local talent, besides contributing to
economic growth and true globalization of Indian economy.
Thought for
the day
“Don't be an art critic. Paint. There lies salvation.”
- Paul Cezanne (France, 1839-1906)
- Paul Cezanne (France, 1839-1906)
Word of the
day
Bauble (n)
A showy, usually cheap, ornament; trinket; gewgaw.
(Source: Dictionary.com)
Shri Nārada
Uvāca
Did anyone expect a
different outcome to Syrian conflict after Iraq, and Libya?
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