India's Long Road

Book excerpt: "India's surge in high, well-sustained economic growth captured the world's attention for much of the period from the 1990s to the early 2010s. Often paired with China as being at the leading edge of emerging economies, the last few years have witnessed shortfalls in India's performance, which have also occurred in the cases of other "BRICS," namely, Brazil, Russia, and South Africa. India is now facing a possible fiscal crisis, higher inflation, greater concentration of economic wealth, and a slowdown in productivity. While its business sector remains vigorous, the Indian state has not yet found a viable way to fund food subsidies or come to grips with the costs of its employment guarantee program. Corruption also hinders growth at many turns. All these factors bring into question how feasible or wise it is for India to pursue a path toward global political power rather than concentrate on improved economic engagement worldwide. Dr. Joshi believes India's economic problems are serious and systemic, not a temporary blip. His analysis sets forth that the only way the country can truly prosper is to find the means to return to the earlier levels of growth through massive economic reform. This policy reorientation calls for eliminating price controls as well as both explicit and hidden subsidies to industries, introduction of direct cash transfers to the poor in place of the state's own costly production of goods and services, and an aggressive move toward privatization rather than over-reliance on family firms and widely-held corporations. Without these, the requisites of economic stability cannot be fully established, let alone propel significant growth"--