Manmohan, Rajiv or…Indira?
In the 1970s, India’s businessmen were protected from foreign competition, but paralysed by government regulations. In the 1980s, the Gandhis freed businessmen but they did little to free markets. [The Economist]
The Economist reviews two recent papers that try to pin down when and who started India’s faster rates of growth. Was it in 1980 under Indira Gandhi, or was it in 1991 under Narasimha Rao and Manmohan Singh?
But…igniting growth is one thing; sustaining it quite another. Sonia Gandhi’s husband and his mother before him picked the lowest of low-hanging fruit. As it entered the 1980s, India could not have been more closely regulated, sheltered or taxed, nor the attitude of its political elites more inimical to enterprise. It is perhaps not surprising, then, that a country held so far beneath its potential would respond as vigorously as it did to a shift in the prevailing political climate. If… economists have been too quick to press their case, it is India’s decades of wasted potential that best explains their impatience [The Economist]