Book Summary: MADE IN INDIA: 75 Years of Business and Enterprise" by Amitabh Kant

Happy Sunday,

About the Book:

The book kicks off on the eve of colonial rule when India’s share in the world’s GDP was estimated to have been 24 per cent (no credit given to the Mughals, though) and then progresses onward to decipher how India’s economy shrank even as the Raj reached its zenith. Then, after a gleeful recounting of the pitfalls of the post-Independence ‘licence raj’, Kant paints the 1991 liberalisation attempts as unsurprisingly “incomplete” and surprisingly “a bottleneck to India’s growth and prosperity”, before launching into an exuberant and laudatory second half of the book chronicling the Modi years.

There are anecdotes about others, like his recollection of his meeting with then prime minister Vajpayee in Kumarakom which eventually paved the way for his transfer to Delhi from the Kerala cadre, or how he swam against the wave to mastermind the tourism branding exercise ‘Incredible India’ in 2002.

Kant loses no time hurtling off on a whirlwind tour through India’s economic and business history. Nowhere along this ‘expressway’ journey does he lose sight of his eventual destination of ‘Amrit Kaal’.

Book publication date: March 2023.

About the Author:

Amitabh Kant is a 1980-batch Indian Administrative Service (IAS) officer of the Kerala Cadre, Kant has been a key driver of initiatives like Make in India, Startup India, Incredible India! and God’s Own Country, which has positioned India as a leading manufacturing and tourism destination.

I. Secretary, of the Department of Industrial Policy & Promotion.

II. CEO of the National Institution for Transforming India (NITI Aayog), the Government of India’s premier policy think tank.

III. Amitabh Kant is presently the G20 Sherpa of India during its Presidency year.

Kant is the author of Incredible India 2.0: Synergies for Growth and Governance (2019) and Branding India: An Incredible Story (2008), and the editor of The Path Ahead: Transformative Ideas for India (2018). --This text refers to an out-of-print or unavailable edition of this title.

Introduction, Looking Back to March Ahead: In the early 1990s, a complete reorientation of policies placed India on the path to becoming a global player again.

The chapter:

'Tryst with Reforms' chronicles the economic reforms of the 1990s, before presenting their impact. The effect of economic liberalization was clear. After a period of deindustrialization, it was the Indian entrepreneur who led India's reindustrialization. New industries boomed and new career paths came to the fore. A new kind of entrepreneur built the behemoths of today. Soon, Indian companies entered and thrived on the global stage.

Technology and sunrise sectors of growth will enable a new era of prosperity in India's growth story.

1. Legacies of the Past: When India’s share in the world’s GDP was estimated to have been 24 per cent (no credit given to the Mughals, though) and then progressed onward to decipher how India’s economy shrank even as the Raj reached its zenith. Then, after a gleeful recounting of the pitfalls of the post-Independence ‘licence raj’, Kant paints the 1991 liberalisation attempts as unsurprisingly “incomplete” and surprisingly “a bottleneck to India’s growth and prosperity”, before launching into an exuberant and laudatory second half of the book chronicling the Modi years.

2. From British Raj to License Raj: The new economic model post-Independence moved us from the British Raj to licence Raj, he writes. No one can disagree with that. Given Nehru’s push, the public sector became the prime vehicle for economic development. Alas, it could not return surpluses as envisaged, due to outdated technology and inefficient management. The foreign exchange crisis was a permanent feature and the period was a tale of missed opportunities notwithstanding the Green Revolution and the establishment of good institutions of higher learning.

3. Tryst with Reforms: The tryst with reforms began in 1991 in response to a severe foreign exchange crisis wherein trade policy liberalisation, reduction in import duties and FDI liberalisation came up. This period saw growth in the software and telecom industries, the BPO sector, etc. Reforms also helped the consumer goods industry evolve. Simultaneously, the transformation of the financial sector also began. PPP projects made their beginning in the infrastructure sector, civil aviation opened and entrepreneurship began flourishing. However, the manufacturing sector did not keep pace with the need and agriculture remained the prime source of employment.

4. The World, India Inc's Oyster: Post reforms, the growth improved, though with hiccups. FDI started coming in and Indian companies also made investments abroad. Within manufacturing, industries that benefitted from protection moved out and competitiveness set in, resulting in income and wealth generation. Aviation and tourism industries grew in real earnest. A substantial middle class was in the making. A large part of Indian investment was financed by debt but given inflationary conditions leading to demand, curbs combined with procedural/approval delays caused the NPA problem to rise.

5. A New Paradigm, Revitalizing the Economy: The beginning of 2014, took the reform process further with IBC, GST and RERA coming in. Digitisation of approval processes, policies to attract FDI and a revamped IPR regime happened. PLI schemes, MSME redefinition and a new labour code came in. A key feature was the emphasis laid on building infrastructure and improving governance (through the JAM trinity) which brought in a transformation. Divestments and privatisation saw light of the day and the private sector’s leading role was acknowledged. That was a tectonic change in our mindset. Earlier, we never respected wealth creators, which seems to have changed substantially.

6. Upstarts, The World of Start-Ups: The world of startups focuses on India’s major achievements: The launching of over 65,000 startups with a multifold increase in investors and investments, resulting in the creation of over a hundred unicorns valued at over $340 billion. Thus, significant innovations have come about in the finance, agriculture, education and health technology sectors. The gig economy has seen a phenomenal rise and, going ahead, will be the key to defining the future of work.

7. Climate Change Is Everyone's Business: Climate change is the new challenge on the horizon. Despite the high emission history of the developed world and India barely taking two per cent of the available carbon space, we have emerged as a leader in the battle against climate change. India has, already, taken a lead in the renewable energy and transport sector and is simultaneously focussing on decarbonising difficult sectors through devising a Green Hydrogen policy. India is also propagating the LIFE movement to catalyze the potential of a circular economy. India is looking at several policy options to achieve Net Zero emissions by 2070, but all this is dependent on the availability of about $1tn of climate finance. For this, it is proposing to use the G-20 presidency to help facilitate huge amounts of climate finance for the Global South.

Epilogue, Beyond India@75: Looking to the future beyond India@75, he finds India has built a robust innovation ecosystem and can become a “tech garage of the world”. For India to transform, it has to achieve sustained growth made possible through the enhancement of investment and savings rates from the current 30 per cent to at least 35 per cent of the GDP. The PLI schemes for key sectors will enable private investment to flow in and liberalisation of sectors like space and geospatial systems will further add to private sector innovation.

Conclusion: The rich countries of today grew through carbonising their economies but India faces a different challenge and has to drive a growth model that does not rely on carbonisation. It focuses more on digital and Green. India stands to benefit from all four trends shaping the global order — demographics, digitisation, deglobalisation and decarbonisation.

Learning: A must-read for students, policymakers, India watchers, industry and global players who are interested in the Indian economy.

A vision of India’s economic development envisaged by the leading industrialists of the pre-Independence era, and arguably an early example of private sector-led efforts to design an economic road map for India. It makes one think how different India would have been if the Bombay Plan had been fully adopted and honestly implemented.

Amitabh Kant

Grab your copy now: https://amzn.to/4c2CASs