HARDBOUND

A chronicle of India's transformation story

Dalton Capital Advisor's UR Bhat reviews TN Ninan's The Turn Of The Tortoise 

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Published 5 years ago on Jan 10, 2016 Read

As a senior journalist, TN Ninan has had a ringside view of the economic, political and social transformation in the country as it transitioned from being “poor” to becoming a “lower middle-income” country. He addresses the basic confusion policy-making between goals and tools by asking questions like ‘Is state ownership an objective or a means to a larger objective?’. Are subsidies meant to fight poverty or one among several ways to achieve income transfer from the rich to the poor? Is employment creation an end in itself or a by-product of a properly functioning economy? Is industry meant to manufacture goods efficiently or develop backward areas? The experience of countries like China are analysed to find answers to India’s suboptimal development choices. How the Indian tortoise can change the race to offer better livelihoods to its millions by shifting its workforce from low-productivity agriculture to high-productivity activities in manufacturing and services is well articulated. 

The book stays clear of the two contrasting narratives of recent times: one, of nationalist jingoism leading to “India, the imminent superpower” and the other, of the abject failure of the Indian state in improving the lives of its citizens. Despite the several obvious policy mistakes over the years, the fact, he says, is that India has held together quite well and its record has been rather good — a far cry from the scenario in 1947. 

India’s halting progress in freeing product markets and limited success in reforming factor markets has been highlighted. The plight of the sugar companies in UP provides a lesson on how not to regulate a business that has an enormous impact on the poor farmer and harried consumers. 23 years after being invited into the country, the tax laws are as yet unclear if foreign investors are liable to pay taxes in India and, if yes, on which activities and how much. There is clearly a need to shrink government and recast it as a reformist policy-making and monitoring body while providing purely public goods like law and order, administration of justice, defence and ensuring provision of merit goods like public health coverage and social safety net. 

Recent political changes, the growth vs environment debate, foreign policy and military positioning and India’s stance on international trade negotiations are the other subjects that are well covered. The book concludes that India is likely to chart the path of incremental reform and that there is bedrock of stability in the system that will remain unaffected by the surface churn. On the flip side, the flow of the narrative is a bit uneven, especially the one on corruption, which reads as if some research material has been transposed between anecdotes on corruption. Mostly written in a racy, journalistic style, the book is a must-read.