Book review: Resurgent India

Resurgent India by Rajiv Kumar, Ramgopal Agarwala and Rajesh Shah

PAGES: 156

PRICE: Rs 795

Academic Foundation

For those who are sceptical about the pace of economic reform in the first 15 months of the BJP-led government, the Prime Minister's assertions in favour of reform on his recent trip to the United States of America ought to have been a very pleasant surprise. Not only did the PM reiterate his old pledge of getting the government out of the business of doing business he added deregulation as the fourth 'D' (after demography, democracy and demand) in his vision of an attractive for investors India. The challenge now is to translate that rhetoric into reality on the ground. Investors will commit their goodwill in response to the right words but will only commit their money when they see changes for real.

If Modi's team responsible for converting his vision into visible changes is looking for an easy to read menu of changes that can be made in a variety of policy spheres, they need look no further than this book by economists Rajiv Kumar, Ramgopal Agarwala and industrialist Rajesh Shah. The authors are unabashed about their faith in the Modi Government, which may have blunted their credibility had this been a general book on Indian economic policy.

Let's be clear. This book is not an academic or even semi-academic treatise. In fact, it may disappoint those looking for one. Instead, it is a policy-makers' reference guide (specifically for Modi's policy mandarins), grounded in plenty of evidence but elucidated in short (almost bullet point like) paragraphs.

Interestingly, the book is not against planning but advocates a move away from public investment planning to public policy planning. The book was probably written before Modi abolished the Planning Commission so it advocates a move away from five-year plans to ten-year perspective plans. The NITI Aayog is the government's think tank but so far it isn't clear whether its mandate is to do any time specific planning. Of course, the government has laid down time-bound targets for several things, including electricity for all and housing for all, the targets being well under 10 years in most cases. Perhaps the authors of Resurgent India under-appreciate the fact that a government which has a mandate for five years can't plan everything for ten years. Be that as it may, the authors believe that ten years is a better time frame for executing their ideas and put their suggestions up for that period.

Of course, this book isn't an attempt in advocacy at the old way in any policy area. Indeed, it tries to break new ground by including chapters on issues/sectors that economists usually give short shrift to, like water and climate change. Fortunately, the prescriptions are oriented on market principles. For water, the authors recommend a raise in tariffs and distribution by private and semi-private companies so that allocation is rational and water is not wasted. On climate change and energy, the authors recommend FDI in renewable energy, a focus on solar and an unbundling of the electricity sector to create a competitive one - all good ideas.

The book is solid in most parts. Where it is weaker is in the section of welfarism (for the youth and disadvantaged), perhaps not the core of the book and put in to make it a politically attractive proposition.

Resurgent India joins a plethora of work on what the ideas and priorities of the Modi government should be. If even a fraction of the priorities are implemented India could be transformed.

The reviewer is an Economist and a Columnist