The prominence that India has acquired over the past two decades or so on global stage is amply evident as Prime Minister Narendra Damodardas Modi addressed the plenary of the World Economic Forum (WEF) summit in Davos, Tuesday. India, as the Prime Minister stated, has changed a lot in recent years — compared to the scene 20 years ago when an Indian PM first addressed the WEF. But, it is a debatable point whether this outreach at Davos did impress the audience comprising mainly of world leaders and business honchos of mostly developed nations. Big talk by itself makes no impact before an informed audience. Facts and figures must support claims as well as contentions. The very fact, as revealed by recent reports, that a mere 1% of Indians out of nearly 1.5 billion posses 73% of the nation’s wealth should startle all. Compare this with last year’s statistics that showed the 1% super rich of India possessing 58% of the country’s wealth. These figures indicate a widening gap between the rich and the poor, leaving barely any space for the middle class to squeeze in. India’s GDP growth, for one, on which the Prime Minister has stressed during his address, is a case in point. When HD Deve Gowda addressed WEF in 1997, India’s GDP was a little over $400billion, and this is currently in the range of $2,500billion. Not a bad performance, but also note that a six-time growth over a 20-year-period might not necessarily impress many. China’s GDP crossed $1trillion mark in 1998, and India did so 10 years later in 2007. Today, China’s GDP is having strength of more than $10trillion, while India’s stood at a modest $2.4 trillion. In other words, our growth cannot be termed as impressive or creditable by any standard.
At high-profile events like WEF, nations eye opportunities for networking and money flow. It is time to woo. India’s track record in getting FDI is somewhat dismal despite the big push that successive governments tried to make in this direction. Not many in global business have a good opinion about investing in India, even as the nation has the world’s largest proportion of middle class. This is due mainly to the huge size of its population. Prime Minister Modi has stressed that things on this count are improving. He has said investing in India, manufacturing in India and travelling to India have all become easier due to his government’s policies of liberalisation. Again big talk but barely any signs of change at the ground level.
The Prime Minister has stressed that “we have pledged to end licence raj, we are removing red tape, and laying out the red carpet”. But ground situations do not vouch for such optimism. We have begun hearing about all these since the early 1990s, the starting era of India’s liberalisation. But all these have been remaining as curses, stopping projects and investment in their tracks, while red tape or bureaucratic hurdles worsen the scenario. Misplaced public activism is another serious problem. Davos might, thus, have taken the PM’s claim of India being a Tagorean “heaven of freedom” with a pinch of salt. Activism of various hues is part of democracy’s inherent features. India is no China, where agencies of government and party act in unison and with a single-minded devotion to ensure results. The world community that heard the PM out, especially the business community, must know more about India than its own PM at a time when information is on one’s finger-tips.
The Prime Minister’s constant stress on the three Ds in his speeches back home, namely democracy, demography and dynamism, found display before the Davos audience too. We have both democracy and demography, but dynamism is still a foreign object when it comes to India’s governance mechanisms that grind slowly and with constant pauses. There is also palpable hyperbole, with the PM seeking to project India as the engine of growth for the world economy. There are hints that the Indian economy is on a recovery mode if latest citations from IMF and some other agencies are to be believed. IMF projected a 7 per cent plus growth for India and less than 7 per cent for China; but China is in a deliberate de-escalation mode to keep growth rate low as its economy has overheated due to hyper-action. India, on the other hand, seems to be buying such reports, starting from Moody’s to IMF.
Overall, India at Davos this time was not an impressive show. The largest-ever contingent of 130 delegates drawn from India this time are for a show involving over 3,000 high and mighty from around the world. There is a spread of Yoga, cultural events and presence of matinee idol Shah Rukh Khan at the five-day event but that might not take us far on the global forum. Notably, against the backdrop of this push also came embarrassment in the form of a report that said the social evil of inequality is worsening in India, and wealth is getting increasingly concentrated in a few hands, while other nations in the region presented a better picture in such respects.
Davos is where global attention will be exclusively focussed for a week. With about 3,000 mostly high-profile participants and 400 sessions, the 48th WEF summit aims at creating a shared narrative that will help improve the state of the world. The subjects for discussions span politics, economics and social issues, virtually making the popular ski-resort town in the snow-clad Alps mountain range the centre of the world. It’s a time for networking, ideas generation and give-and-take. ‘Creating a shared future in a fractured world’ is the theme for the summit, as stated by forum chairman Klaus Sachwab. That sounds fair enough.
The Davos moment comes and goes. With global political and business leaders assembling in a manner better than the drab UN meets, this is time for India to take useful lessons and see how the flaws in its governance mechanisms can be changed for the better. Here are lessons to learn.