Creating temples of modern India versus finding God in poverty

Amidst the charged debate on the land acquisition amendment bill and the state of agriculture in the country all political parties are jostling to claim the farmer friendly mantle. All parties to the debate on the land acquisition bill – political groups, civil society activists, and industry chambers, seem to be taking diametrically opposite views. It is either pro farmers or anti farmers - no meeting ground at all.

A key opposition leader suggested to the Prime Minister that he was choosing the wrong constituency by bringing this land acquisition amendment bill as 65% of voters are dependent on agriculture.

In my opinion the Prime Minister is actually making a very astute political choice. Let me tell you how.

Unfortunately no one seems to be seriously making the argument that this land bill in conjunction with the ‘Make in India’ campaign could unlock unprecedented economic opportunities for the country. It could help us obtain the elusive double digit GDP growth.

A basic understanding of the theory of modern economic growth will tell you that an economy with some 50% of labour force still involved in agriculture is far from eliminating poverty of its people. From 70% of labour in agriculture at the time of independence in 1947 to 50% now some 68 years hence is a reflection of the failure of our economic policies. It is also representative of the reasons of our continued poverty. A significant chunk of the labour force involved in agriculture is actually disguised unemployment. Disguised unemployment is an important reason for the continued poverty of this labour force – a small pie is shared with far too many people to make it sufficient even for one.

India needs, to take off, lots of jobs. To create jobs we need an enabling environment where it is easy to do business and where factors of production are abundantly accessible.

With this land bill if infrastructure can get a boost, and manufacturing gets a shot in arm it will create a virtuous cycle of economic growth.

Manufacturing is to be a very important component of India’s economic growth. The rise of manufacturing’s contribution to India’s growth is essential for it benefit from the so called demographic dividend. By creating jobs the Prime Minister is creating loyal voters. These jobs are not only going to prevent social unrest but are going to take the country out of this abject poverty. Our manufacturing prowess will strengthen our defense industrial complex and aid India’s world power aspirations.

Development of infrastructure will allow large sections of the society to access a better quality of life – better healthcare, better housing and education. This in itself will have a far reaching multiplier effect – creating jobs, increasing disposable income and improving standards of living.

However we must guard against a shoddy implementation of the proposed provisions. Crony capitalism will put paid to any creation of virtuous cycle of growth. Adequate safeguards for environment protection is also very important for the sustainability of any economic transformation. After all ‘We do not inherit the earth from our ancestors; we borrow it from our children’

So let us get going with the land acquisition bill and start work to get labour reforms in place.

AAP’s enormous win – My two bits

In the recent Delhi assembly elections the upstart Aam Admi Party (AAP) managed to win 67 seats of the 70 available. The enormity of the win reminded us of those that you hear in ‘democratic’ dictatorships where the supreme leader gets say 95% of the popular votes. Such wins are rare in thriving democracies and more so in the cacophonous democracy called India.

 How did this come about?

In my view the primary reasons for this humungous win by Kejriwal and Co are the following.

Most important factor was the time AAP got to prepare for this election. A good 8 months of focused activity on the ground since the General elections of May 2014 allowed him to connect with the people, appreciate their issues and share his side of the story. With the benefit of time the other important factor that played out very well was Kejriwal’s acceptance of his failure to govern the last time around. His repeated apologies and humble acceptance not only helped him regain the favor of Delhi’s underclass it also endeared him to the educated talking classes. People appreciated the sincerity of his regret.

Much of this success can also be attributed to the machinations of the primary rival the BJP.

 BJPs juggernaut had looked invincible and with it came the swagger that reminded one of Tendulkar’s Sharjah swagger against the Australians. The arrogance and swagger helped people decide to bring the BJP a couple of notches down. The personal attacks on man considered by everyone as genuinely good back fired big time. Calling Kejriwal all sorts of names, much of this coming from the Prime Minister himself only strengthened people’s resolve to put BJP in its place. Remember Manmohan Singh in the general elections of 2009.

The next factor, but in no ways any less, was the other CM candidate Kiran Bedi. The bumbling Kiran Bedi just could not get her act together. Her choice caused a great deal of heartburn amongst the local leadership and dissonance amongst the numerous ordinary party workers was understandable. She didn’t realize that party workers are not police constables who can be asked to stand in a line in ‘attention’ or even ‘stand at ease’.

 Why were such mistakes made?

BJPs confidence, rather over confidence is one big reason. The delay in holding the election is also BJPs doing. While they wanted to avoid the headache of this election by cobbling together a majority and could have waited for more time. It is only when the Supreme Court forced a decision the elections as the way forward was announced.

With Congress on a decline, possibly terminal the BJP sees AAP as a viable opposition in the future. To nip this headache of the future it came out with all guns blazing – quite the Narendra Modi style of not leaving a viable opposition, and that led to the name calling and show of arrogance.

 What Next?

Either AAP picks up from where it left in its previous stint and couple of years down the line realizes that there is little money left and many more populist demands to meet or it governs well, evolves its policies of governance and goes beyond the rhetoric.

 I am hoping that they will choose the latter option and steadily fill the vacuum created by the fast disappearing Congress. I would like to see them as a key contender for power in the general election of 2019.

 On the other hand, Kiran Bedi will quit BJP over the next 12 – 18 months and the AAP government will accept her back and use expertise in an advisory capacity.