India Economic Seminar 2016

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India Economic Seminar 2016

It’s not often that one gets to be in a room with eminent economists who have a wide range of views on a subject that sounds alien to most. The Public Policy Club, IIMB, in association with Swarajya, organised a speaker series on some of the most pressing issues ranging from GST to the imperative of creating 100 million new jobs by 2022.

Dr. Nageswaran started his session by debunking the much loved theory of “small is beautiful”. The central message he wanted to put across was that it was always better to under-promise and over-deliver. He suggested that the way forward for India was to devolve decision making power so that a million ideas and models can proliferate, to encourage cooperative and competitive federalism and to resist growth through bubbles and fads.

Next, we had Mr.Manish Sabharwal who argued that wages cannot be artificially propped up by schemes such as the NREGA.  He engaged effectively with the audience on the importance of skilling India and pointed out the triad of trade-offs in the form of scale vs. quality vs. costs. He asserted that even though the government is deficient in its execution, the private sector in trust and the non-profit sector in scale, the only real solution to the creation of a 100 million jobs in India was in the synergy of the three sectors to provide a holistic solution.

To provide his analysis of last mile problems in economic policy and decision making, Mr.Narayan Ramchandran brought in an interesting mix of ‘economic theory’ and policy, considering he was on hallowed academic ground! He explained how curated ivy league economic theories and jugaadled ad-hoc solutions were both not quite suited to solve problems. His talk revolved around customising solutions and focusing on making the ‘conduct’, and not only the ‘ease’, of doing business, better.  He left us with the motivating words of Swami Vivekananda, “the world is the Great Gymnasium where we come to make ourselves strong.”

Despite a bandh and a downpour that showed no signs of abatement, a packed auditorium of inquisitive minds readied themselves for Nandan Nilekani. The big theme of Mr. Nilekani’s talk was that the next big thing in India was not from exports, or manufacturing or indeed from large businesses. Instead, they would be from increased domestic consumption, services, technology platforms and other small businesses. His arguments borrowed heavily from the burgeoning smartphone technology and increased internet penetration. He seemed visibly confident about the success of the Aadhar initiative, as it was the only initiatives of its time to reach a billion users in the span of five and a half years. India would soon be the only country with a fully digital identity infrastructure, a true digital desh. This was truly a massive transition of the country from being data poor to data rich and had far reaching disruptive consequences for many of the established industrial set-ups. Manufacturing and banking have already been changed beyond recognition owing to the increased levels of digitization and automation.

Mr.Nilekani also made predictions of what was in store in the future- mobility, moving from owning cars to sharing rides, energy sources, moving from fuel to electricity and automation, moving from driving to being driven. Today, a payments solution could be designed at a hundredth of the cost of a traditional bank. It could employ merely 200 people and still manage to serve the whole country through its mobile. On a side note, he mentioned that the increased productivity through software automation would mean that surplus engineers would have to become entrepreneurs! BPO services would be replaced by bots, internal IT systems would be shifted to the cloud and the price of these services would drop substantially. Essentially, it was an imperative for India to encourage urbanisation, literacy and make business easier.

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