X

marks the spot

The story of India in the last decade is a story of decay, a story as we portray of Xs. Tired of comparing us to tiny nations like Pakistan or even Vietnam, we compared World Economic Forum's global ranking of India to China on key parameters over the last f ew years. The story that emerged was of an X, one of China's rank improving dramatically while ours dipping alarmingly...

Diversion of Public Funds

India's subsidy bill has grown more than f our times in the last decade in the name of helping the common man, so lets start by looking at the ranking of "Diversion of Public Funds"

49

59 Global Rank

69

79

89

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

China

India

Solution: Clearly the need of the hour is to plug leakages in public distribution systems which waste 80-90% of resources poured into them rather than pouring more good money af ter bad. Success stories include P DS systems in Chhattisgarh and Gujarat. This would be the best way to help the common man but would cut down on sources of eating money in the name of common man and hence never taken up.

Favoritism in decisions of govt. officials

This is the story of small f armer Vadra and coal scams, where instead of letting market f orces f unction, govt. ministers retain control over key decisions and allocate taxpayer's money to cronies while singing the swan song of common man...

35

45

Global Rank

55

65

75

85

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

China

India

Solution: A small govt. with policy based regime and equality bef ore rule of law rather than discretionary allocation of f avors

Transparency of government policymaking

Remember 2G scam where with arbitrary low license f ee and more demand than supply, applicants were chosen on rst come rst basis. The way to get the license was to know the time and room where license application would be accepted, courtesy payments made in advance...

34

44

Global Rank

54

64

74

84

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

China

India

Solution: Minimum government, maximum governance. Government has no business being in business unlike Indian govt. which runs planes, trains and phones to squander India's money.

Primary Education
A critical area with great positive externalities and the only way to build a sustainable f uture. A disastrously f ramed Right to Education act which Bhagwati & Panagriya estimate is most likely to destroy the education sector, just like what the labor laws did to labor market.

21 31 41 Global Rank 51 61 71 81 91 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

China

India

Solution: A bleeding heart but empty head labor act resulted in only 7% of India's labor being in f ormal sector and destroyed Indian manuf acturing and RT E is no better. Solution lies in f ocus on outcomes not peripherals. Focus on education outcomes not how the school buildings look like. With its arbitrary f ocus on school inf ra., RT E will close millions of private schools which are much more ef cient than govt. schools at a f raction of cost. Meanwhile, public school teachers remain missing f rom schools with no responsibility f or school outcomes.

Innovation & Sophistication

A Schumpeter's creative destruction which results in innovation requires companies to be created rst. Unf ortunately, with India ranked 173 out of 185 countries in ease of starting business, there is no new business activity and innovation is strangled...

31 Global Rank 41 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14

China

India

Somebody said that it is impossible to f ollow all state and central laws as with many of them conicting, you are always in violation of some law and f orced to f eed the machine. Govt. needs to dramatically ease its suf f ocating hold on the economic f reedom of Indians and give people f reedom to innovate.

The last decade has put an X on India's future, hope you now register to vote and put an X on the future of such politicians who have betrayed the trust of the nation.
Source: Global Competitiveness Index 2013, World Economic Forum
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