Modi needs a paradigm shift as a PM

29 May 15
Written by
Published in Indian Economy

A system that may be very effective for a small sized entity may simply break down when adopted for a larger one and vice versa.

Direct democracy may be useful for Switzerland, and a dictatorship for Singapore. Welfare State may succeed far longer in small, homogeneous, very developed countries like Denmark, Sweden, and Norway. Communism works fine in a family (every family runs on first principles of Communism), but breaks down if even two brothers with their families live together. Modi succeeded in Gujarat by forcing bureaucrats to work. He did not dismantle socialism there (he could not have done also, as most laws are central), he simply lorded over the bureaucrats 24x7. Being honest, he could command, he could force, he could read the riot act (He could call the bureaucrat delaying a file, and scold/abuse him. Now as PM, he can not call officers under state governments). He used to do video conferencing with each Collector.
Cut to Delhi. He is not executive any longer. Central government is mostly policy maker, and fund disburser, execution is with State governments. So even if he forces government servants and bureaucrats to come to office on time, and gets them to furnish details of jewellery of their wives, nothing is going to change for the start ups. For them only separation of state and economy will work.

Somebody somewhere came up with the theory that manufacturing in India is not picking up because we lack the skills. It caught the fancy of our ruling elite, especially the current PM. And therefore now we have a Ministry of Skill Development and Entrepreneurship. The ministry is ready with a new "scheme" that would ensure that we become skilled, and therefore the manufacturing in India would pick up.

In reality, manufacturing in India is not picking up because as soon as you try to set up a factory in India, about 50 government departments rush to stop you. If you bribe them all and finally succeed in setting it up, NGT may come and shut it down, in addition to jailing you. Or Income Tax department may come up with a retrospective tax demand that would break you. Or Labour mafia may take fancy to your factory and cause labour problem leading to its closure.
Leftists never fail to come up with more Leftist schemes to solve problems caused by the Leftist schemes.
If India wants to be a manufacturing super power, and which it must be, it must immediately separate economy and state, dismantle the regulation regime. Make government policies simple and fixed over time, so that people are able to predict government behaviour and make investment plans accordingly.

Modii has improved systems and processes to some extent. But the ease of doing business especially for young companies is still at congress levels. It's alarming to see that 65% of the tech startups that plan to raise Series A are expected to be re-domiciled outside India, according to iSPRIT. Can India prevent this exodus of tech startups to US and Singapore?

Modi does say that he aims to make India number one on the ease of doing business. I hope he knows that as PM, he can do so only by dismantling socialism, not by running it more efficiently. Because howsoever he may wish, he is a PM, no longer a CM, he can do nothing about the running of the state governments.
Most of his own CMs are socialists, his Cabinet ministers are socialists, RSS is socialist. I only hope,against the hope, that he knows it.

Because everybody of BJP I have met, worships socialism.
It will be a catastrophe if he fails. If Italian gets another chance in 2019, we can kiss the country goodbye.

Leave a comment

Make sure you enter the (*) required information where indicated. HTML code is not allowed.