Opinion | The Modi government must restart the reforms process
For India to grow and flourish, it should also focus on jobs, education, healthcare and climate changeUpdated: Jun 05, 2019 12:39 IST
Prime Minister Narendra Modi’s victory in the general elections is a testament to his immense popularity across the country and his supreme talent as a campaigner. His sweeping victory gives Modi a mandate to pursue a bold agenda. As an Indian American who has followed Indian politics and its economy closely from afar, here are my suggested policies and priorities for an agenda the PM should implement in his second term.
First and foremost, the PM would be wise to focus on jobs, education and healthcare, as well as climate change. Progress on all these areas depends on completing the economic reforms his government started in 2014. Therefore, one of the initial things the government should do is to recommit to reforms. Early in the first term, former finance minister Arun Jaitley initiated and completed reforms in key areas, including reforming the bankruptcy code, opening coal mining and railway sectors and allowing foreign investments in construction projects. However, after implementing the Goods and Services Tax (GST), the government’s enthusiasm for reforms seems to have waned altogether. According to the Washington-based think tank, Center for Strategic and International Studies, “not a single reform” has been completed since the GST was introduced in July 2017. So, it is imperative that the new finance minister begins her term by renewing and intensifying the pace of the reform by going ahead with land reform and deregulation of labour.
At the moment, unemployment is the biggest challenge the world’s seventh largest economy is facing. Nearly 20 million youth are ready to enter the work force every year in India, which is a third of the population of Great Britain and Italy. To address this influx to the work force, the country needs to create nearly 55,000 jobs every day for the foreseeable future. That is a daunting, but not impossible task. To create jobs on that scale, the economy will need to grow by double digits. China did that consistently in the 1990s and 2000s. As recently as 2007, the Chinese economy grew at 14%.
A big road block to achieving double-digit growth, however, is India’s poor infrastructure, which is not where it should be in spite of efforts by successive governments in the past two decades to create a world-class infrastructure.
During this election cycle, the Bharatiya Janata Party (BJP) promised to spend nearly $1.5 trillion to improve the infrastructure. If that money is spent judiciously, with a Marshall Plan-like blueprint, it will be a game changer for India. Almost certainly, India will be dependent on foreign investors for infrastructure money. But to attract investments at such a large scale, the government should tick all the remaining boxes in the reform to-do lists.
Two other key areas where the government needs to multiply investments are education and healthcare. According to the World Bank, India ranks a miserable 143rd among countries in government spending on education. In order to develop a highly skilled work force, which is a prerequisite for meeting the overall developmental goals, public spending on basic, vocational and technical education is an absolutely necessity.
Just as with education, the next government must have a big vision and a large-scale programme for healthcare. From preventive and prenatal care to greater access to healthcare in the rural areas, the challenges are many. The Ayushman Bharat Yojana scheme is expected to help as many as 500 million people. It is a great first step. In addressing healthcare challenges, PM Modi can enlist a huge pool of physicians of Indian origin around the globe, who are willing, ready and available to help.
Another big challenge on the economic front that will have to be tackled is climate change. India must become a leader in combating climate change related issues. Investing in solar and wind energy, as well as implementing other eco-friendly initiatives, is not just a good environmental measure, it is also a good economic policy.
Last, but not the least, the most disappointing occurrence during Modi 1.0 was the alienation of India’s hundreds of millions of religious minorities and Dalits. Modi 2.0 would do well to call for and take necessary steps to rein in the fringe elements. Modi’s call for a strong, fair, just, and inclusive India is a clear signal that he understands that the survival of the republic rests on the foundation of tolerance.
I look forward to seeing the PM enable India to achieve its potential by encouraging and embracing the country’s diversity and inclusiveness. Diversity is vital in keeping India’s democracy healthy and vibrant. As an Indian American, I have had the privilege of living in the two largest — and I would add greatest — democracies in the world. That has been a gift. A greater gift would be to see the Indian democracy grow and flourish during Modi 2.0 under the governance of a truly democratic leader who would stand in stark contrast to the more autocratic and dictatorial national leaders who are emerging on the world stage today.
Frank F Islam is an entrepreneur, civic leader, and thought leader based in Washington DC.
The views expressed here are personal
First Published: Jun 04, 2019 18:49 IST