When Prime Minister Narendra Modi wound up the Planning Commission and set up in its place an outfit called the National Institution for Transforming India (Niti), it was suggested that the Niti Aayog would devote its energy and intellect to think long term.
Over the past nine years, the Niti Aayog has had three high-profile economists as deputy chairpersons, two high-flying officers of the Indian Administrative Service as CEOs and has hired scores of consultants to assist in its endeavour to devise “transformative” policies for the so-called “Amrit Kaal”.
It is, therefore, ironic and amusing that the institution has now been asked to turn to a Western multinational consulting firm, the Boston Consulting Group (BCG), to help outline a policy roadmap for the journey through “Amrit Kaal”. BCG may be only one of many firms which are helping the Central and some state governments and the erstwhile Planning Commission too had hired consultants. But tasking such firms to help plan for India 2047 is certainly a departure from Prime Minister Narendra Modi’s much touted “atma nirbharata”.
Vision statements produced by consulting firms tend to be public relations exercises on behalf of the politicians who hire them. Mr Modi is not the first politician to seek the imprimatur of a Western consulting firm for his policies. Consider the case of N. Chandrababu Naidu’s “Vision 2020 for Andhra Pradesh” that another Western consulting firm, McKinsey & Co, had produced for him at the turn of the century. Mr Naidu had asked McKinsey to draw up a roadmap for development over the next two decades for the erstwhile united Andhra Pradesh. A state government official sent me the draft report for comments before its publication. I was then editor of the Financial Express. After reading the report I had several comments that were addressed, but my most important question was not addressed in the final report. That was, how would regional disparities within the state be reduced by the strategy of growth being advocated.
In the event and just over a decade after Chandrababu Naidu’s “AP Vision 2020” was published, Andhra Pradesh no longer existed in the form that it was. The bifurcation of the state and the creation of a separate state of Telangana was a direct consequence of the neglect of regional imbalances in development. It was also a result of the lack of political imagination on the part of the state and national leadership that ended up viewing an administrative division of a region as a solution to its economic and social backwardness. A vision for development that did not recognise political reality and constraint was no vision at all.
There was a time when India and the Indian political and intellectual leadership had the self-confidence to think long term about development on their own. I have outlined this history in my book, Journey of a Nation: 75 Years of Indian Economy (Rupa, 2022). Indeed, even before Independence and before the Planning Commission was set up, a group of patriotic Indian businessmen invested time and energy into thinking long term about where India is and where it ought to be. In 1944, three years before Independence, J.R.D. Tata, G.D. Birla, Lala Shriram, Purushothamdas Thakurdas and some others got together and produced a document entitled “A Plan of Economic Development for India”, that was popularly known as The Bombay Plan.
The Bombay Plan went into great detail about what free India can and should do to become a more developed economy over a 15-year period. It set a target year, it set sectoral targets, it specified fiscal implications and so on. The kind of detail into which it went, both in specifying the economic policies needed and the nature of investments to be made, was most impressive. The Bombay Plan also recognised the political realities of the time. Though written by Indian business leaders, it sought an active role for the State in the development journey to be undertaken. The full text of the plan and detailed comments on it are available in our book, by Sanjaya Baru and Meghnad Desai, The Bombay Plan: Blueprint for Economic Resurgence (Rupa, 2018).
Much of what India managed to do in subsequent decades was based on ideas emanating both from the Bombay Plan and the First and Second Five-Year Plans. One can pick many holes in what was envisioned and achieved. One can criticise the authors of those plans and the political leadership of that time. But no one can deny that their effort was their own, their imagination was defined by their nationalism and patriotism. These were very Indian plans for India’s development.
“Atma nirbharata” in its truest sense. No McKinsey. No BCG.
Self-reliance and atma nirbharta were the hallmarks of the 1950s, the era of Nehruvianism. The capitalists of Bombay and the socialists of New Delhi had the courage to think on their own feet on the kind of India that they would like to see in the years to come. In the 75th year of Indian Independence it is not clear why there is no national institution that can think on its own about India’s future? Was that not what a “national institution for transforming India” supposed to do? So, what did they do these past nine years?
The Indian economy has been on a rising growth path over the years. Having recorded an annual average rate of growth of 3.5 per cent in 1950-1980, the economy grew at 5.5 per cent in 1980-2000, close to 8.0 per cent in 2000-2012 and around 7.0 per cent since then. It is expected to grow at 6.0 to 6.5 per cent in the next few years. Pushing this rate back to 8.0 per cent requires an increase in investment, employment, share of manufacturing in national income and increased exports. Equally, it requires investment in education and public health, urban services and improved labour productivity.
There’s no magic wand waiting to be lifted by any Prime Minister. India will get to $5 trillion and onwards to $10 trillion someday. Managing the political journey in a diverse and unequal society is the real challenge.
