Author Speaks: The $10-trillion Dream

How can India aim to become a $10-trillion economy by 2035? Take us through your key proposals that you have mentioned in your book. 
First of all, the basic structure of the economy needs to be reformed for delineating the role of the government and the private sector in the production function. The government is a poor businessman for a variety of reasons. The government, therefore, needs to sell off and close down the government’s departmental undertakings and public sector enterprises producing private goods and services. The $10 Trillion Dream lays out a path forward in this respect. Secondly, the government’s key societal role is to provide public goods and services like defence, law and order, macro-economic stability, clean environment, and the like. While getting out of the business, the government needs to increase its role in provision of these public goods and services.  

Finally, the government has to take care of the disabled, poor and vulnerable. Existing tax resources can be increased by levying taxes on expanding wealth and also taxing carbon and pollutant emissions. The enhanced tax revenues need to be spent on the disabled, poor and vulnerable to ensure that there are no multi-dimensionally poor in the country.  

Which areas can generate or create more jobs? Which government programme should be encouraged for job creation?  
Services have the potential of creating largest jobs in India as agriculture is beset with over-employment and industry is also saturating now thanks to automation and digitalisation. The government should pursue policies and promote programmes for greater employment in domestic services as well as to export trained people for jobs abroad.  

Finally, the government should run expanded backstop programme like NREGA for offering employment at a national minimum wage for all those who are not able to find durable employment elsewhere. In addition, the government should provide cash and in-kind services support to those households which, for any disability, physical or mental handicap, old age or otherwise, are not in a position to earn income for livelihood.  

You have covered the agricultural economy in the book. What is your take on the farm laws? 
I suppose you mean the three farm laws which the government brought in 2020 and got repealed in 2021. I have spoken clearly about these three farm laws in the book, The $10 Trillion Dream. The Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Act, 2020, which sought to free the farmers from the stranglehold of the Agriculture Produce Marketing Committees, popularly known as APMCs or mandis, was the real good reform. The law was, however, brought in a very disruptive manner bypassing the state governments which have created APMCs and regulate these.  

The pith and substance of this law—providing trading freedom to farmers and freeing them from the mandi fees—are most desirable objectives and the government should bring these back, preferably choosing the model of enacting an enabling law under which the states take decision to provide these two benefits to the farmers.  

The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Act, 2020 was an unnecessary attempt to centralise contract farming and its governance in the country. It is good that this law has been repealed.  

The Essential Commodities (Amendment) Act, 2020 sought to bring some control over the government’s power to put restrictions on prices and storage of farm produce. This was done without any serious intent of subjecting the government to such restrictions. Within a month after enactment of this amendment law, the government used convenient interpretation to put a ban on the export of onions. What actually is needed is to junk the Essential Commodities Act lock, stock and barrel. India does not need this law at all.

Your book extensively covers the digital economy. What do you think is its future? 
The global economy is fast becoming digital. In my book I talk about the agriculture economy having become miniscule in many parts of the world employing less than 5 per cent of labour and generating less than 2 per cent of GDP. The industrial economy is also plateauing and poised to go the agriculture way in coming decades. India was the global leader in agriculture economy but was quite late in adopting the Industrial Revolution. The result was for everyone to see. We became converted to one of the world’s poorest country. The data, chips, code, and platforms make up the digital economy. We have been good in using the digital technology for providing information services. But, for almost everything else in the digital economy, whether it is building semiconductor chips or laying optical fibre, or, until very recently, even writing the software and creating e-commerce and other services platforms, we have not produced any global winners. We have so far spent more energy and policy time in trying to control data flows than inventing or adopting digital technologies.

How important is crypto-currency for India’s economic growth? 
Blockchain-cryptography technology offers many more goods, services and assets than only currencies (crypto-currencies in this new-age world). Numerous services can be produced and delivered, like decentralised finance, international transfers through stable-coins, organising music, creating NFTs, etc. being a few examples. This technology is as important to India for building its digital economy as steam engine and internal combustion engine was for building India’s industrial economy. If we miss out on this, we will continue to remain a lower middle-income country.  

There is a need for a nuanced and careful approach. The government should come out with digital rupee and a ban on pure-play private crypto-currencies (those crypto-currency platforms which don’t serve as currency function need not be disturbed). At the same time, the ban should exclude in-platform use of crypto-currencies (Ethereum, for example, should continue to use Ether as its currency of operation) and a way should be figured out how to continue to use stable-coins which could be regulated.  

What do you think is necessary for the overall growth of the country? 
Consider the policy reforms proposed in my book and muster enough courage to adopt and implement these.

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