Date : 22/08/2023

Relevance: GS Paper 2 -International Relations - G20 Summit

Keywords: G20, G-7, Bandung Conference, Jan Vishwas Bill, GST

Context-

• As the G20 summit approaches in Delhi, it signifies a pivotal juncture in India's trajectory, where democracy converges with prosperity. The expansion of the G7 to the G20 echoes a historic turning point, reminiscent of Zeitenwende in German terminology.
• While the G7 to G20 expansion might have encountered resistance from some declining, aging, and apprehensive G7 countries, it is a momentous occasion for India. The upcoming G20 meeting not only underscores India's establishment of the world's largest democracy but also celebrates the nation's economic growth and the remarkable freedoms it has achieved.

G20: A Shifting Landscape of Economic Power

• The upcoming G20 meeting in Delhi, however, is an acknowledgment of India's strides in creating the world's largest democracy against the backdrop of a hierarchical societal structure.
• It is a celebration of India's growing economic freedoms, encompassing formalization, industrialization, financialization, urbanization, and human capital enhancement. These freedoms position India to soon become the world's third-largest economy, a feat that reflects India's progress toward realizing Mahatma Gandhi's vision of merging mass democracy with mass prosperity.

India's Economic Odyssey: Challenges and Triumphs

• In 1955, the Bandung Conference marked a pivotal moment as 29 leaders represented 54% of the global population. Fast-forward to the G20 meeting; this gathering signifies a momentous occasion as these leaders now represent a staggering 85% of the world's GDP.
• However, India's post-independence economic journey was marked by challenges as economic power took precedence over geopolitical, military, and soft power. Over 72 years, India crossed the GDP of the United Kingdom, illustrating the pace of economic growth. It delves into the complexity of India's post-independence economic policies, highlighting distortions in the roles of society (samaj), market (bazaar), and government (sarkar), and the consequences of failing to differentiate between the "what" and "how" of policy implementation.

Unearthing the Recipe for Economic Growth

• India's economic progress was marred by a lack of vision in policy formulation, as illustrated by the ten-point program of 1967, the 13-point program of 1977, and the 20-point program of 1975. These lists were ineffective due to a lack of understanding of the underlying challenges and vested interests.
• Presently India emphasizes the importance of strategic planning, entrepreneurship, and distinguishing between ingredients and their proportions. It underscores how iterative progress, marked by learning from mistakes, shapes policy development. Recent initiatives such as Degree Apprentices, Jan Vishwas Bill, and the withdrawal of the Rs 2,000 note exemplify this iterative approach to policymaking.

India's Resilience and Economic Reshaping

• In the past decade, India vaulted from the world's tenth-largest economy to the fifth. This remarkable growth is attributed to a new economic recipe that prioritizes people in economically disadvantaged regions.
• This is very much visible, in how reforms centered on formalization, GST implementation, bankruptcy reforms, digital payments, and more have contributed to India's economic resurgence. It dissects India's evolving economic complexity, suggesting that development is akin to a game of Scrabble, where the government provides the "vowels" (infrastructure, policy support) and entrepreneurs contribute the "consonants" (innovation, enterprise).

Economic Reforms: The Path Ahead

• Acknowledging that a radical economic reform agenda is both contentious and challenging, it delves into specific reforms that can fuel India's growth trajectory. It discusses the need for simplifying GST implementation, addressing skilling through targeted apprenticeships, enhancing the ease of doing business by focusing on employer compliance, and more.

Diaspora, Hope, and Optimism

• The impending G20 meeting may witness offshore Indians expressing skepticism and apprehension about India's economic prospects. While pessimism often sounds prudent, it calls for optimism and patience, urging the Indian diaspora to give India a few more years and even consider returning to contribute to the nation's growth.

India's Ideological Shift: From Elite to Mass Empowerment

• Maulana Azad's words from a century ago ring true even today, highlighting the transformation of the freedom movement from an elite discourse to a mass political movement. This shift catalyzed new bonds, championed Indian alternatives, and paved the way for democracy.
• It underscores how India's post-independence economic ideas initially remained simplistic, imitative, and constraining. However, change began in 1991, gained momentum over the last decade, and culminates in the forthcoming G20 meeting. This convergence of democracy and prosperity marks India's ascendancy and underscores the confluence of two freedoms.

Conclusion

India's journey towards amalgamating democracy and prosperity reaches a historic juncture with the G20 summit in Delhi. The evolution from an agrarian society to an emerging economic powerhouse exemplifies India's resilience and adaptability. Learning from past policy failures, embracing iterative progress, and crafting reforms to enhance economic growth constitute the essence of this transformation. As India stands on the cusp of becoming the world's third-largest economy, the confluence of democracy and prosperity attains new significance. It's a clarion call to embrace optimism, engage in proactive policymaking, and catalyze India's ascent on the global stage. The G20 meeting serves as a logical milestone in this transformative journey, heralding India's rise to combine the dual freedoms of democracy and prosperity.

Source - The Indian express