Indian Political Economy

The following are some of the meaningful articles which I read recently:

Clean government led by a charismatic and strong PM has redressed trust deficit between citizens and elites

The challenge of water: India’s ability to manage and govern water will determine its future

Note to the FM: India needs a new fiscal policy framework

Let’s step up efforts to get professionals in governance

Some links

"The question is why don’t these leaders do something about it then, starting with eradicating the red tape that stifles educational institutions in India?"

"The Institute of Economic Affairs, a think-tank in London, established by a follower of F. A. Hayek, had an immense impact on the thinking of the young Thatcher. India now has Hayekian think-tanks, but it awaits her own Iron Lady."

"Today, as I rewind to my childhood four decades ago, I realise why the void in me is so full of gratitude to my guru."

"A humane alternative to the current state of affairs is to recognize the property rights of tribals and allow businesses to access tribal resources only through the market, rather than through political force. Such an arrangement will improve the economic status of tribal communities and achieve better economic efficiency by directing scarce resources towards their most urgent economic ends."

Matters, of that trips reading and

Back from a visit to Dehradun, the city of pleasantness. I had good time visiting the place where our country's bureaucrats are get trained. The Lal Bahadur Shastri National Academy of Administration in Mussoorie! The climate in Mussorie was absolutely pleasant.


Meeting people and talking to them was more interesting then simply talking with bunch of people in the conference!


The following are some of interesting readings:


Economics by and for human beings by Jeff


Contemporary Indian literature by Shivaprakash


The Power of one by Ninan (its old article on Parth and the CCS achievements in India)


Restrictions on radio violation of free speech by Arvind


NY Fed: Leaving the Building by Wenzel

India’ property rights index

Parth Shah of CCS discuses the improvement of property rights index in the new report:  

• One may argue as to how could political stability in India might have declined, as the government at the Centre as well as ruling regimes in states are comparatively more stable than earlier years. It is because the index does not measure only stay of the governments in office, but all sorts of disruptive movements like naxal and Telangana, explained Dr Parth J Shah, president of the Centre for Civil Society, partner of Property Rights Alliance in India for this index.

• He said there are incidents of human rights violation in J&K and north eastern parts of the country. Besides, special and arbitrary powers are given to army through the Armed Forces Special Powers Act (AFSPA)in Jammu and Kashmir.

• As expected, the report says that judicial independence is slightly on the rise in India. Without naming court's interventions in alleged scams in spectrum allocation for 2G and commonwealth games, Shah said there are instances of the judiciary challenging the executive in recent times in India.

• In physical property rights, India scored 6.6 points in 2011 index, same as in 2010. However, Indian system of keeping records relating to physical property are too archaic. Even the last major land survey was conducted during British times.

• “So far as property rights are concerned, the poor continue to fight the battle against forceful acquisition of their land by either the government or private parties. This remains a point of serious concern for India even as we achieve high rates of growth every year” Shah said.

MPS Asia Regional Meeting-Two

Let me give you some sort of mixed picture from what I have noted from the various talks given by economists and experts in the MPS meeting on the opening dinner (Feb 10th, 2011).

Dr.Parth J Shah gave introduction with few facts about the CCS’s success stories such as its campaign (BAMBOO IS NOT A TREE!) against bamboo as a tree instead a grass, school choice campaign (education voucher or 25 percent reimbursement by Government) etc. He also mentioned that this is the second meeting organized in India.

He also mentioned that the amendments in the Shop and Establishment Act by the Government of Haryana paved a major window of opportunity to open call centres in India. Haryana was the first State in India to reform the above Act.

Professor Deepak Lal, who was immediate past President of MPS, gave Welcome Address. What was interesting from his address was that unfortunately the MPS society is divided when it comes to the debate of foreign polices!! He also said that this Society is not addressing the issues raised in the context of foreign polices.

The present President of MPS is Professor Kenneth Robert Minogu and he gave President Address. Few points from his address: (i) one point we should not be too taken by media that India, the global power, it is dangerous to think this and the State, (ii) he talked about the Prof F A Hayek’s works on the false government aims , promotion of welfare with debts, and (iii) the universal orders or spontaneous orders.

The MPS Asia Regional Meeting’s Inaugural Address (Full Paper in PDF) was given by Shri. Arun Shouri. Some major points from my noting: (i) India’s economic growth story is taking place despite of the government and not because of government has claimed to be, (ii) the former prime minister of India who initiated the economic reform in 1990s was the “honest crook”!!!, (iii) please do not go by your vision, please do not go with their past record, (iv) the Hayek’s notion of liberalism, (v) all political parties in India run by people who believe in nothing, (vi) the Indian family values for care each other which is actually the driving force for growing economy, (vii) morality is public life, (viii) the welfare polices are being promoted, despite of its weakness, with the blessings of people like Amartya Sen, (ix) natural order of society, virtual foundation of society, (x) a dog with a bone is his mouth cannot park.

Raj Cherubal had asked the important question which people like us ponder: what would the answer of Professor F A Hayek if he is alive in the mid’s of today’s crisis in India and abroad?

Mr Shouri answered rightly that the development and growth is taking place in a particular society not because of government but despite of it. But one can easily argue that Mr.Shouri is biased.

Previous posts: 1  

MPS Asia Regional Meeting- One

The 2011 MPS meeting theme was: India as Global Power: Practicing Liberal Values at Home and Abroad

This is the Second MPS meeting in India till now. The primer free market economics think tank in India, the Centre for Civil Society (CCS) had co-organized the First Mont Pelerin Society in Goa on January 27-30, 2002. The theme was: Freedom and Development: Making Democracy Work.

Attending the MPS Asia Regional Meeting was more than interesting but it was great fun. I have learned a lot. I have met many persons whose writings I read for several years. I had long conversation with some of these hard-core liberals on different issues. I have also met people whom I knew and are all concerned about liberalism in India. Thanks to the CCS for giving me the opportunity to participate in the MPS Meeting. However, I had expected some of others persons who are all often talk and write about liberalism in India; but they did not come for the MPS Meeting. I really have no clue about why they did not turn for this event.

But eight years after the democracy is stuck now rather to work. But we did not stop talking about the superpower!! This is the difference between the basic value or principle of Indian epic Mahabharata and Greek epic. In the later case you can get on to the next level of doing things but in the former case you have to justify why do we stuck, who is responsible etc. But this is not to say that we are all argumentative Indian!!

My earlier post: 1

Mont Pelerin Society (MPS) Asia Regional Meeting 2011

There is a another GREAT good news. Yes next year MPS meeting will be in India and the focus is on "

India as Global Power: Practicing Liberal Values at Home and Abroad"

Come Crook RTE…..April 1st, 2010

If this fall was waiting for one thing

It is you, the crooked RTE, are not you?

So long, more than sixty years, being republic

What has been packed earlier?

Killed millions of children, already

Rules formed helped no children,

But, The State Power to rule for nothing

Convert nothing into nothing is the learning

In the name of common man of ‘uncommon’

The State did all these years at the cost of

The people, no matter how rich/how poor are you

Pay the price for crooked man once again

We have not lacked anything in ideas

But it does not mean that everybody get provoked by those ideas

Often saying among the State functionaries is the slogan of

Look forward, future vision, out of box thinking, innovative, nowadays

All these are forged in the crooked school textbooks to

Produce good and bad number as ‘marks,’ nothing more or

Every five year election melas, yatras, etc and, then

Self celebrate, we the democracy won everything!

What is still behind out shoulder even after these 18 years of economic reform?

Is the half cooked child the “Nehruvian Socialism?”

-Chandra

These are some of my thoughts, wanted to put here, not to educate you, but to share the sense of the meaning of edification and its nonsense that has been continuing on this land of magacrime! As I have traveled more like a one man army from the North Arcot (called in British India) as a village boy to crooked country capital. I feel terribly, utterly miserable in asking myself what The State wanted to give which it could not in last sixty years!

• Is that the State was in self imposed mode of political and bureaucratic regime?
• How can the people tolerate all these nonsense which they can not just do it under the British Raj?
• How far the State rule is fundamentally different from the British Raj in promoting development of people?

With these words, let’s now look at what the so called experts of educationist/policy maker/teachers, say on this:

Economic reformist Chacha Dr. Manmohan Singh said in the morning:

• “Let us together pledge this Act to the children of India. To our young men and women. To the future of our Nation”

Supreme Court grinder will recook crooked RTE!!

A finest economist (whom I have immense respect) writes:

• “Heard of model rules? No? When an Act is passed in Parliament, there may still be vague areas that need closer attention. Model rules are written to help implement the Act. But the rules can never be better cooked than the original law was when poured into the parliamentary pressure cooker. No creative legislative masala can help cover up half-baked khana and half-thought laws.
• All students must be in the classroom? Yes sir! Teachers? Teaching? Learning? No. No. And hopefully.”

Vimala Ramachandran writes:

• “No right, however just and timely, can become a reality unless societies as whole and interested actors in particular make an effort to educate and enforce”. But she, herself is unaware of which year the 86^th Constructional Amendment was done.

The country’s education minister Mr.Kapil Sibal writes:

• “The Constitution (86th Amendment) Act, 2002, making elementary education a Fundamental Right, and its consequential legislation, the Right of Children to Free and Compulsory Education (RTE) Act, 2009, comes into force today. The enforcement of this right represents a momentous step forward in our 100-year struggle for universalising elementary education.”

Sorry I said, only sixty years!!

• “Yet there are “invisible” children — children bonded to work with an employer, young boys grazing cattle or working in dhabas, girls working in the fields or as domestic help, or caring for younger siblings, and children being subjected to early marriage. Many of these children are formally enrolled in a school, but have either dropped out or have never been there. Many others, such as migrant and street children, live in extremely vulnerable conditions; denying them education is against the universal nature of human rights.”
• Then minister went on to say (in contrast of what economist Parth J Shah have said) “The right to education goes beyond free and compulsory education to include quality education for all. Quality is an integral part of the right to education. If the education process lacks quality, children are being denied their right. The Act lays down that the curriculum should provide for learning through activities, exploration and discovery. This places an obligation on us to change our perception of children as passive receivers of knowledge, and to move beyond the convention of using textbooks as the basis of examinations. The teaching-learning process must become stress-free, and a massive programme for curricular reform be initiated to provide for a child friendly learning system, that is at once relevant and empowering. Teacher accountability systems and processes must ensure that children are learning, and that their right to learn in a child friendly environment is not violated. Testing and assessment systems must be re-examined and redesigned to ensure that these do not force children to struggle between school and tuition centres, and bypass childhood.”

Last but not least think of Prof Williams words:

• “Conflict would emerge solely because the decision was made in the political arena. Why? The prime feature of political decision-making is that it's a zero-sum game. One person's gain is of necessity another person's loss. ……….As such, political decision-making and allocation of resources is conflict enhancing while market decision-making and allocation is conflict reducing. The greater the number of decisions made in the political arena, the greater the potential for conflict.”

The march of Liberalism in India and Asia

Dr.Parth J. Shah’s interview with Young Asia Television

“Final frontiers of the quest for knowledge”

Parth J Shah says in The Sunday Indian:

“The only thing that has changed over the last 1,000 years is the architecture of school and the quality of furniture. It just reflects that we have only focussed on resources all these years while nothing has changed in the way education is provided.”

Random ideas

Manish Sabharwal is a giant in emerging skill making subject. He has a piece in the Mint where he says that:

• “Public policy education has not taken off in India because of the lack of an entry ramp into real policy action; even the small window that got us Planning Commission deputy chairman Montek Singh Ahluwalia and finance commission chairman Vijay Kelkar is now closed.
• And any thinking about fixing public policy human capital has to include politicians, because there is some truth in the cynical comment that the only highways to get ahead in Indian politics are either genetic or geriatric. The problem is complex but, as Lant Pritchett at Harvard’s Kennedy School of Government says, the Indian state’s inability to deliver outcomes ranks as one of the world’s top 10 biggest problems— right up there with AIDS and climate change.”

Thomas Sowell on disaster government groupies:

• “Nothing has torn more countries apart from inside like racial and ethnic polarization. Just this year, a decades-long civil war, filled with unspeakable atrocities, has finally ended in Sri Lanka. The painful irony is that, when the British colony of Ceylon became the independent nation of Sri Lanka in 1948, its people were considered to be a shining example for the world of good relations between a majority (the Sinhalese) and a minority (the Tamils). That all changed when politicians decided to "solve" the "problem" that the Tamil minority was much more economically successful than the Sinhalese majority. Group identity politics led to group preferences and quotas that escalated into polarization, mob violence and ultimately civil war.
• Group identity politics has poisoned many other countries, including at various times Kenya, Czechoslovakia, Fiji, Guyana, Canada, Nigeria, India, and Rwanda. In some countries the polarization has gone as far as mass expulsions or civil war.”

David Brooks on “The Power of Posterity”

Parth J Shah on education bill:

• “While evaluating the Education Bill, ask yourself this question: What has changed since the Bill got introduced? The answer is: Nothing. The same bureaucracy is in charge today, there is nothing on governance standards or on the use of independent assessments of learning outcomes. So, it is difficult to see just what the new bill hopes to achieve and how it plans to improve education outcomes in the country.”

Global Recession and Liberalism

A talk by Dr Parth J. Shah  on “Global Recession: Chances and Challenges of Liberalism”,

Glories Centre for Civil Society, New Delhi

If any one thing that the Delhi based liberal think tank achieved in its more than a decade old in the public policy it is the “five specific professions of the informal sector - barbers, cycle rickshaw pullers, dhaba owners, meat shop owners and vegetable vendors”. 

These sectors have not been reformed and there is no reason why it has not both officially and privately. In fact it is nonsense that the governments never gave thought but the often cited Constitution of India gives somehow fair role to ensure basic right to trade among people. 

Of course, one may ask what the whole private sector role in reforming these sectors? 

One answer may these sectors are very small no milliners or billionaires so no firefight. But that is not true. The same red tape “sims” is prevailing in these sector for long time. 

I have been time and again widely experienced (personal interaction while in works) with these sectors across cites in India-Chennai, Delhi, Indore, Chandigarh, etc.

Parth and Sane on India’s past economic changes

“Although much of India’s economy remains heavily regulated, this fast-growing country has also significantly expanded economic freedom. In chapter 11, Parth J. Shah and Renuka Sane discuss India’s reforms and the regulatory and societal changes needed to enable entrepreneurs to bring Indians more economic benefits”.

This is a co authored paper published in a edited book on “Making Poor Nations Rich” by Benjamin Powell

Here is forward by Deepal Lal

Here Introduction by Editor 

The other notable contributors in this book are Peter J. Boettke, Christopher J. Coyne, and Peter T. Leeson and William J. Baumol.

Dr Parth J Shah other writings by Chandra

Some of you may be interested to read about the economics of free banking interestingly written by an Indian economist and president of an only acting think tank in India is Dr Parth J Shah.

Selected Publication

1.The Option Clause in Free-Banking Theory and History: A Reappraisal.

These articles are not posted in his institute website,