Thought for
the day
“Learn from yesterday, live for today, hope for tomorrow.
The important thing is not to stop questioning.”
-
Albert Einstein (German, 1879-1955)
Word of the
day
Decant (v)
To pour (a liquid) from one container to another.
(Source: Dictionary.com)
Shri Nārada Uvāca
After Helen, now Lehar threatens the Andhra coast.
Is nature warning about something seriously wrong in Andhra
Pradesh?
Great hopes!
It is evident from the reports issued by various brokerages
& other agencies, and opinion publicly expressed by many corporate leaders
that a lot of hopes are being pinned on Narendra Modi’s electoral success.
The performance of the Indian stock markets post announcement of
Modi’s PMship candidature also indicates that investors are probably
front-running a Modi government post May 2014 election results. A recent
discussion with some fund managers and large corporate investors suggests that
the two day 17% jump post May 2009 election results could be a driving force
behind their actions.
In our assessment most of the hopes are emanating from the
perception of a good track record of the Modi led government of Gujarat state;
and therefore leave a lot of scope for disappointment.
While little specific are available as to Narendra Modi’s
economic philosophy and orientation, from the popular discourse Modi seems to
be an advocate of Laissez-faire or free market which entails
minimal state intervention even during crisis. He has implemented the model in
Gujarat with limited success. But it is pertinent to note that unlike many
other states, Gujarat has a history of 200years of industrialization and 60mn
people who are globally recognized for their enterprising skills.
It is therefore important to evaluate whether the Gujarat model
could be replicated at the national level, or in other words whether Modi can
deliver the same results as Prime Minister what he has delivered as Chief
Minister of Gujarat.
Presently, India is struggling with the limitations of the
Nehruvian model of economic development that we have followed since
independence. Even BJP, when it came to power, decided to leave the alternative
model “integrated humanism” proposed by its ideologue Mr. Deendayal Upadhyaya
and followed a variant of Nehruvian model terming it “Gandhian Socialism”.
The current variant of the Nehruvian model is largely a
distortion of the classical Keynesian model that advocates a larger role for
the private enterprise with active state intervention during extremities of
business cycle and argues against higher savings in both private and public
sector. The Keynesian model has its genesis in the great depression and found
useful during larger economic crisis.
In our view, considering the present state of socio-economic
development of various parts of the country, it would be 10-15years too early
to test the Laissez-faire model at the pan-India level. Hence, Modi’s Gujarat
model may not be of much relevance at the national level.
But at the same time the Gujarat model should not become his
limitation also. Modi has very successfully demonstrated his strategy skills in
past one decade. It would be totally wrong to assume that he would not be able
to adapt to the larger responsibility and formulate an appropriate strategy for
integrated development of the country.
…to continue
Also read:
Letter to Mr. Narendra Modi
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