Sanjay Baru says PM must heed Rahul Bajaj, Mahesh Vyas says eco slowdown could get worse

The best of the day’s opinion, chosen and curated by ThePrint’s top editors.

File photo of Bajaj group chairman Rahul Bajaj. | Photo: PTI

Mr Bajaj speaks again: In 1993, he voiced business’s ‘concerns’, today he voices its ‘fears’

Sanjaya Baru | Policy analyst

The Indian Express

Baru reminds his readers of 1993 when industrialist Rahul Bajaj had “voiced his fear of foreign competition”. Baru’s piece comes after Bajaj expressed his fear of “domestic governance”. There is a need for Bajaj’s views to be “heard with care”.

Former Prime Minister P.V. Narsimha Rao “paid heed” to his views and “reached out to business leaders and fine-tuned policy”. It is time for Prime Minister Narendra Modi “to also reassure the nation that he will neither swerve to the Right nor the Left, but walk the Middle Path”. However, Baru points out that Bajaj had voiced his “concern” initially, and is now voicing his “fear”. Concern “can be about bureaucratic procedures and delays” but fear is about “the knock on the door, the tap of the phone, mysterious acts of retribution by persons in power”.

The relationship between government and business “remains fraught” and is “characterised by feudal supplication” and a “willingness to cut corners and buy political cover”. Baru argues that the “focus of governance has to move away from divisive issues, including issues of identity and citizenship, to the here-and-now of investment promotion, employment generation and the building of a capable and competition economy”.

Ten steps to $5 trillion

Gurcharan Das | Bestselling author

The Times of India

Das claims that 4 November was a “sad day” because Prime Minister Narendra Modi “decided to walk out of the RCEP negotiations”. The “deal on offer was a reasonably good one and many of our fears had been allayed”, he writes, adding that “the $5 trillion target cannot be achieved without exports”.

Das then lists ten ways to make the nation competitive.

First, we should “change our mindset of export pessimism that has limited our share of world exports to 1.7%”. Second, “lower our tariffs” which have “worsened in recent years”. Third, “national competitiveness requires collaboration across a dozen ministries and the states”. Fourth, red tape is a “key roadblock” and there needs to be a focus on “improving the ease of doing business”. Fifth, “let the overvalued rupee slide” as it “will mitigate the many cost penalties that our exporters pay”. Sixth, “reform our rigid labour laws that protect jobs not workers”. Seventh, “acquiring an acre of land for industry is not only lengthy but also expensive”. Eighth, we should “treat farmers as business persons not peasants”. Ninth, entrepreneurs “bear a huge penalty versus our competitors in the cost of electricity, freight and logistics”. Tenth, “keep reforming our dreadful education system”.

Even though there is “nothing new about these ten ways to make India competitive”, Das maintains that “now is the time to act”.

The dubious legal case for an NRIC

Jairam Ramesh | Rajya Sabha MP

Muhammad Khan | Advocate

The Hindu

After Home Minister Amit Shah’s answer to a question on the National Register of Indian Citizens (NRIC) in the Rajya Sabha, Ramesh and Khan argue that the answer “was mischievously misleading” as it suggested that “a nationwide NRIC is mandated by law”. They “examine the 2003 Rules cited by” the home minister.

For instance, Rule 11 “confines the Registrar General’s responsibility to a periodic revision of the National Register by updating it with the information available with the Registrar of Births and Deaths.” However, Rule 4 “places the responsibility to carry out a census-like exercise on the Central government and not on citizens”. While Rule 6 “provides that every individual must get himself/herself registered with the Local Registrar of during the period of initialisation”. But Rule 11 stands in direct contradiction as it says “that updating the NRIC entails updating the information available with ‘Registrar of Births and Deaths’ with no de novo process envisaged”.

The writers state that the NRIC exercise is not “mandatory and inescapable” and the rules “envisage other less destructive scenarios to register citizens”. This exercise will “inflict a long period of insecurity on” over a billion people.

Ramesh and Khan argue that the prime minister and the home minister “are always in search of divisive issues which have little relevance to day-to-day concerns of livelihoods”. Further, their “abject failures in economic management” are being covered by “harping on NRIC”.

What a well-aimed fiscal stimulus could do for India

Ajit Ranade | Economist & senior fellow, The Takshashila Institution

Mint

In his piece, Ranade writes about the need for a fiscal stimulus to the economy. This is a time when “all eyes …on India’s [upcoming] Union Budget”, he writes. He first mentions some vulnerabilities in the current economic situation, for instance, the strain on rupee and the possible stop or reversal of foreign inflows. He is, however, hopeful that despite the GDP being 2.5 percentage points below India’s potential, “there is an escape clause even from the Fiscal Responsibility paradigm to pump in money”.

For Indian fiscal managers to rescue the economy, the policy has to be countercyclical and inclusive to ensure an “immediate boost to consumption and growth”, writes Ranade. They must also find innovative ways to “inject that fiscal rupee” into lower-income strata like an enhanced rural job guarantee scheme, which could work as “proxy unemployment insurance”. Also, “a digital tax à la France” should be considered as well as a reduction in GST that could “offer a bigger bang for the fiscal buck”, recommends Ranade.

Partners on the front

Kishore Jayraman | CEO, Rolls-Royce India

The Economic Times

Jayaraman writes that India’s jump to 63rd position in this year’s World Bank Ease of Doing Business rankings shows it is on the right path on the policy front and inclined towards ideas of co-creation. Against this backdrop, he discusses India’s development of indigenous defence manufacturing which, so far, has been curbed by “global and domestic factors”.

Instead of “import substitution”, India must invest in “co-creation programmes through collaboration with willing global players to co-develop relevant technologies and intellectual property (IP)”, he writes. This could commercialise production locally, but also turn India into “a global supplier and exporter of defence technologies”, he explains. Shared R&D programmes have worked in the past, like Britain and Japan’s co-development programme for joint air-to-air missiles, he adds.

Leveraging such partnerships and programmes will allow ‘Make in India’ to find its “true calling”, writes Jayaraman.

The third quarter could be worse

Mahesh Vyas | MD & CEO, Centre for Monitoring Indian Economy

Business Standard

Data available now tells us that the economic slowdown will worsen in the third quarter of 2019-20, writes Vyas. Widespread shrinking of the labour force in November, spiked unemployment in October and the dip in lead indicators in October and November suggests so, he explains.

Vyas first describes the gradual deterioration of the economy in recent months. In October, the fall in power generation was “exceptionally nasty”, overall consumption of petroleum products was lower than last year, core sectors collectively fell 5.8 per and unemployment peaked. In November, the labour force shrank significantly, he writes.

Official GDP statistics, however, do not account for the fact that unorganised sectors often suffer more than organised ones, points out Vyas. He suggests CMIE’s Consumer Pyramids Household Survey is a better “measure of the health of the economy” as it includes people working in organised and unorganised sectors. The survey, which tracks 15 of the 25 states, found that November’s shrink in labour force was across rural and urban regions and male participation in particular, he writes.