The students of Indian Institute of Management Kozhikode got a chance to interact with the President of Janata Party, Dr. Subramanian Swamy on 20thJuly. Dr. Swamy visited the institute to deliver a key-note address on “Growth versus Development” as part of the leadership series organized by the Industry Interaction Cell of IIM Kozhikode
Dr. Swamy stressed the need for women to take active role in the development of the country. He drew an analogy from the Indian mythology where the Hindu deity Brahma had allotted all important portfolios to women. The topic of growth brought back the debate on India and China. Dr. Swamy firmly stated that India was a developed land 1000 years ago, so its only a matter of time when we become a developed nation again. India reigns supreme in terms of intellect and the young population. Indians absorb knowledge fairly quickly but the only issue is lack of risk-taking ability.
Dr. Swamy believes that coming 10-15 years is the time for India to grow at a rapid pace and stand in the league of developed nations. Growth alone would not suffice; it should be coupled with improvement in quality of life, infrastructure and productivity. Only then can one confidently state that India is a developed country. In the present scenario, progress of India and China has been based primarily on Innovation. The onus is on India to channel its immense human capital to transform the world.
India followed the Soviet model from 1950 to 1990. Dr. Swamy was critical of the policies framed by the then Prime Minister Jawaharlal Nehru. A strong supporter of Gandhian views, he said that globalizing agriculture would expose the immense potential of India to the world. With its lowest cost of production in agriculture sector, India can truly become a world leader. Along with agriculture, Dr. Swamy laid strong emphasis on infrastructure.
He lauded the way statistics are collected in India and criticized the manner in which China inflates its growth rate by estimating GDP on current prices instead of constant prices. He gave a simple formula to estimate the actual growth rate of China, simply subtract 2 from the data released by China. On a lighter note, he quoted an ancient Chinese belief that states – “Do not fear the gods, do not fear the devils, but do fear the foreigner who speaks Chinese.” Even China followed the Soviet model of growth from 1950-1980 but they were quick to realize the drawbacks and changed their strategy.
The issue of corruption pops up in every discussion on growth and development. The rampant corruption has pulled India back from the path of success. Dr. Swamy criticized the government on allocation of 2G spectrum, coal blocks, black money etc. and illustrated the mis-deeds rampant in these cases. He said that corruption has to cease for India to become a developed nation. Growth should be in such a manner where people do not face the burden. There was severe criticism of the investment priorities where 70% of the investments support the luxury products. The Indian economy is getting de-stabilized due to the artificial shortages being created by the foreign companies which are not regulated. Dr. Swamy expressed his concerns over the use of ‘participatory notes’ in the stock exchange which he feels is the most dangerous derivative ever invented. He also questioned the capital gains tax waiver for investments via Mauritius in the form of participatory notes.
Dr. Swamy believes India should not open its doors for everyone who comes. He has been opposed to few of the key recent deals such as Wal-Mart’s entry, Jet-Etihad deal, entry of Air-Asia, etc. He believes that these deals do not provide a level playing field for the Indian companies. He was extremely critical of the United States for pushing its cheap capital in India and refusing to allow Indian companies to employ cheap labor from India.
Dr. Swamy provided a 3-step solution to eliminate corruption in India. In the short run, eliminate the discretionary powers on the lines of the case of railway reservation where online booking completely removed the corruption. The medium term should be to catch the big fish and send them to jail which will create an electrifying effect in the entire country. In the long run, Indians should focus on spiritual prosperity instead of the material gains. Indian society has never been graded on money. Dr. Swamy also talked about the inclusive model of development and the failure of MNREGA. On a question about FDI in defense sector, he was in favor of contracts for component manufacturing, but was totally against the foreign companies collaborating in India to manufacture the entire product. He believed it as a threat to the national security.
Dr. Swamy emphasized that the need of the hour in India is to align the material and spiritual value and a mental revolution in India. People should choose to not only be prosperous but also happy. Indians are special because they can do what others cannot. If they realize their true potential, nothing can stop India from becoming a developed nation again.