Atanu Dey and I put together this note recently.
India’s economic growth and development poses challenges that are clear but fortunately are solvable. The hard part is not in the figuring out the solutions but in the implementation, and more specifically in the prioritizing and sequencing of the implementation. The elements that require immediate and sustained effort relate to “infrastructural elements” which are few in number but form the absolutely necessary foundation upon which any functioning economy is based. These elements are interrelated in complex ways and if present simultaneously, they enable that emergent multi-dimensional phenomenon we call development. The elements are:
- Education. Physical capital-both natural and man-made-combined with human capital produces wealth in all its form, from agricultural to manufactures to services. The quality and quantity of educated people strictly determine the economic prosperity of an economy. India needs a radically different education system as the current one is dysfunctional and largely irrelevant in the modern context. Fortunately, this radical re-engineering is possible through the use of powerful tools presented by the revolution in information and communications technologies. To achieve this, institutional reform of the type that encourages private sector participation in education is necessary.
- Energy. Any economic activity, like all processes in the universe, depends on energy. Today’s developed nations achieved their level of prosperity on cheap fossil fuels, an opportunity not available to India’s billion plus people. Fortunately, India is large enough to be able to leapfrog the fossil fuel stage and invest in renewable energy sources such as solar and wind. Becoming a world leader in the development and use of these energy sources requires a national will that can be articulated by visionary leadership.
(This will be continued tomorrow.)