Rooted in present, looking at future

India must continue to engage with problems rooted in legacy and current economic realities while aspiring to ace the future

Prime Minister (PM) Narendra Modi’s interview to the Press Trust of India — excerpted in various newspapers, including HT — ahead of the India AI Summit ought to be seen as an important outreach by the highest level of the political leadership of the country. In hosting the AI Summit, India is making its pitch to be an important stakeholder in what is going to be the biggest technological disruption in the history of capitalism as we know it. Modi’s comment about this Union Budget’s focus on things such as data centres and the need for India to not “be content with digital adoption but also aspire for digital leadership”, is a signal to stakeholders both within and without the country.

India’s economic prowess can only be revived with a policy approach that prioritises reforms on both the domestic and the external front. (AFP)

However, what is also important for a country like India to not lose track of is the fact that it must continue to engage with problems rooted in legacy and current economic realities while aspiring to ace the future. Modi’s remarks about issues such as inclusive development, ongoing reforms, continuing focus on rejuvenating MSMEs, plugging India’s physical infrastructure loopholes etc. are a welcome assurance of the government’s realisation of this continuing challenge. It is on this front that political stability leading to policy consistency has helped India the most. Among the most important remarks by the PM — he had made similar statements on the floor of Parliament earlier — is the assertion that India is opening itself to greater trade liberalisation from a position of strength. This is clearly an attempt to allay fears that recent trade deals, especially the one with the US, will create costs that outweigh the benefits that will accrue from them.

These pages have argued that India’s economic prowess can only be revived with a policy approach that prioritises reforms on both the domestic and the external front in a way that unleashes creative destruction in the domestic economy to boost India’s external economic prowess and generate mass incomes at the same time. There has clearly been progress on this front under the current government’s leadership, but as the PM rightly says in the interview, “public life demands a certain constructive restlessness, a constant urge to do more, to improve faster, to serve better”. India’s future can only be improved by cultivating a bipartisan consensus on this approach.