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Mint
14-06-2025
- Politics
- Mint
Why the Indian government needs to redefine the idea of reform
When the Soviet Union collapsed in 1991, political scientist Francis Fukuyama prematurely declared the 'end of history'. He believed that capitalism and democracy—the Washington Consensus—had finally prevailed over socialism and totalitarianism. History has returned. Ideological conflict between democracy and capitalism has not ended. In fact the two ideologies are conflicting within the Western victors of the old Cold War. Civil society movements are speaking in the West on behalf of people left behind by the 'free market' of private enterprise. Other voices on 'the Left' demand a larger role for governments in providing public services and social security. And others speak for protection of the natural environment. Meanwhile the Right advocates for lower taxes, less regulation, and more freedom for capital to roam the world. The fundamental conflict between the core principles of capitalism and democracy—i.e. between the rights of owners of capital on one hand, and the rights of all humans on the other—continues. It is a conflict between political conservatives and political progressives. Between conservatives, who want to retain their power to fix the rules of the game from which they have benefitted, and progressives who want to change the rules for the benefit of those left behind. Also read: How John Matthai became a leading light of economic policy Democracy and capitalism are founded on different conceptions of fundamental rights. Capitalism's foundation is property rights. Democracy's is human rights. Capitalist institutions run on the principle that whosoever owns something has the right to use it as he wishes, and also that whosoever owns more of a shared resource must have a greater say in how that resource is used. Therefore, whoever owns more shares in a corporation has a larger vote than those who own fewer shares. On the other hand, ownership of property does not matter while assigning voting rights in democratic institutions. Because, in democracy, every living person, whether she has a billion dollars of wealth, or no dollars at all, has an equal vote in the governance of the collective human enterprise. The clash between capitalism and democracy is a clash of fundamental principles for good governance of societies. When appliances designed to run on AC power are plugged into sockets providing DC power, there will be blow-outs. Similarly, when institutions of governance designed to run on fundamentally different principles are plugged into each other, something will blow up. Fundamental contradictions between the principles of capitalism and democracy are causing violent conflicts amongst nations and within nations. To create an equitable, sustainable, and more harmonious world in the 21st century, institutions of democracy and capitalism must evolve, from the shape in which they have been locked in with the so-called 'Washington Consensus'. Humanity must find new solutions to many societal, economic, and environmental challenges in a hurry. They are listed in the 17 Sustainable Development Goals all governments have signed up for. Institutions are vehicles designed by humans to realize their collective aspirations. Institutions of capitalism, as well as institutions of democracy, must be reformed to solve the existential crises of increasing inequalities and rapid climate change that are threatening all humanity. Reforming Capitalism [Lawyer and Deputy Chairman of the Tata Engineering and Locomotive Company (Telco)] Nani Palkhivala supported private enterprise for economic growth. He was also a great defender of the democratic rights of citizens. When Indira Gandhi declared an Emergency and suspended political freedoms, he withdrew from a case in which he was representing her. This caused consternation in the Tata companies. J.R.D. Tata was naturally concerned about the effect Palkhivala's uprightness would have on Tata's businesses. But he supported Palkihivala nevertheless. Designs of new forms of capitalist institutions, such as the limited liability company invented in the 17th century enabled capitalism to expand. With the evolution of institutions for governing international finance and international trade in the twentieth century, capitalist corporations have been able to spread across national borders. Capitalist institutions have enabled global and national GPDs to increase and have lifted millions of people out of economic poverty. Also read: Fitzgerald's critique of capitalism in 'The Great Gatsby' remains valid 100 years later Economists promoting free markets gained more power within Anglo-Saxon governments from the 1970s onwards. Milton Friedman, who became famous for his dictum that 'the business of business must be only business', and Frederik Hayek, known for his thesis that more governance was 'the road to serfdom', persuaded Margaret Thatcher in the UK and Ronald Reagan in the US to push back against governments in their countries and to privatize public services. Reagan even said that Government is not the solution; rather, Government is the problem. This turn of ideology gave big capital greater power. Democratic governments, as mentioned before, must represent the interests of all people, rich and poor equally. Though the richest people within any society will always be numerically less than the numbers of poorer people (it is a mathematical distribution as the Italian economist Vilfred Pareto had pointed out in the nineteenth century). However, the rich few will acquire greater power in the governance of societies than the poorer many whenever the principle of property rights dominates. The shift in the balance between democracy and capitalism towards capitalism in the last thirty years is made vivid by the creation of international tribunals who adjudicate in disputes between foreign investors in countries and the governments of those countries. Governments of countries represent the interests of millions, even billions, of people in their countries. On the other side in the dispute are a few investors of capital. Global institutions have come to pander too much to financial investors, making it easier for them to enter and exit countries at will, while stopping human migrants searching for better opportunities across national borders. The rules of globalization have made life much easier for capitalists than for workers. The word 'reform' has taken on a one-sided connotation: reforms seem to imply removal of constraints on investors and businesses. This was starkly revealed in India, and other countries too, during the Covid pandemic. The poor lost incomes and homes while stock markets broke records making investors even richer. The Indian government's move at that time, to 'reform' labour laws to attract more foreign investments, making it easier for employers to fire workers and curbing unions too, made clear that large investors had more political power than common people. Excerpted with permission from Speaking Tiger Books. Also read: This women farmers' network envisions a feminist future for agriculture
The Hindu
22-05-2025
- Business
- The Hindu
Nalanda University is in take-off mode, says Vice-Chancellor
Eminent economist Sachin Chaturvedi, who took charge as the Vice-Chancellor of Nalanda University in Bihar on Wednesday (May 21, 2025), told The Hindu that the university expects enrolment of about 900 students in the new academic session. The university is in a 'take-off mode', Prof. Chaturvedi said, noting that 99% of the construction work has been completed. Prof. Chaturvedi said the university, which functions under the External Affairs Ministry, is working to expand international connections by drawing students and faculty from across the globe. 'Nalanda will give the message of peace and promote more rigorous research to connect Indian philosophy with the contemporary world,' he said, adding that the institution will bring together researchers, policy-makers and those in the diplomatic community. Prof. Chaturvedi is also Director General at the think tank Research and Information System for Developing Countries (RIS). With the collapse of the 'Washington Consensus', the Global South requires a new philosophy of development drawn from a rich legacy of knowledge. 'We need to revisit that knowledge and my priority would be to bring it back for the Global South with a new development philosophy,' he said. To a question on administrative issues that had created hurdles, the Vice-Chancellor said the Bihar government had given almost 500 acres for the university. Of that land, 100 acres have been allocated for water bodies and 300 acres have been kept aside as forest, he stated. 'The connectivity has improved now. The admission has already touched 540 in various streams as of now. Our expectation is that this year it may go up to 900,' he added. 'The university now is in a take-off mode and this year we are going to widely advertise the space. Now 99% of construction work is over, so we can now focus on quality education,' he said, adding that unlike the South Asian University, supported by the South Asian Association for Regional Cooperation, India is the sole decision-maker in the functioning of Nalanda University.
Economic Times
09-05-2025
- Business
- Economic Times
India must choose its own path for a stronger and more equitable future
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of .) Donald Trump got one thing right. Working-class people are hurting. Neoliberal, free-market capitalists want financial capital to roam the world, unhampered by tariff and non-tariff barriers. They are unconcerned about the freedom of human capital - its citizens searching for work and incomes to live, who are being shut out to protect the cultures of rich and his corporate friends are hammering on India's doors again to open its borders to import US corporations-manufactured and agricultural products, and their services. India's leaders must rise above US pressures and reflect. What will be best for India's workers and farmers?History can be a good teacher. The Washington Consensus (read: ideology) was presumed to have won the ideological war with the collapse of the Soviet Union in 1991. Free-market capitalism had defeated government-regulated socialism. Ease of doing business trumped the ease of living of markets were forced on Russia by the US, and its state sector was dismantled, with disastrous consequences. Russia's GDP shrank by nearly 40% between 1991 and 1998, industrial output dropped and poverty rose, with 30% of the population living below the poverty line by the mid-1990s. Ironically, out of the shambles, Vladimir Putin emerged in 1999 as the leader to Make Russia Great and India took different paths in the 1990s. India toed closer to the US anti-socialist, free-market line. China did not succumb to US pressures. It continued the development of a centrally guided ' socialist market economy ', and to build its industrial capabilities before joining the global per-capita GDP has grown 7.3x since 1990; China's 42x - six times faster. China's manufacturing sector has grown 9x as large as India's. Its exports of hi-tech goods are 48x. Trump wants to Make America Great Again by curbing China's remarkable growth. He says the global trade regime - which the US itself put in place in the 1990s - is not fair to the 2010, Adair Turner said the time has come to reconstruct economics. Too much reality was being left out of economists' models for them to explain the world. These flawed models are incapable of predicting the future condition of an a twist of Keynes' famous statement that 'practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist', Turner warned that 'the great danger lies with reasonably intellectual men and women who are employed in policy-making departments of central banks, regulatory bodies, and governments, who are aware of intellectual influences, but who tend to gravitate to simplified versions of the dominant belief of economists who are very much alive'.Communist China escaped the shock therapy Western economists imposed on communist Russia in 1992. China continued its path of reforms to a 'socialist market economy' - China's way of adopting capitalist tools without abandoning socialist her book, How China Escaped Shock Therapy: The Market Reform Debate, Isabella M Weber writes, 'The famous Harvard development economist Dani Rodrik represents the economics profession more broadly when he answers his own question of whether 'anyone [can] name the [Western] economists or the piece of research that played an instrumental role in China's reforms' by claiming that 'economic research, at least as conventionally understood', did not play 'a significant role'.India's economists have two challenges before them:Redesign, along with other nations, structures of global trade and financial systems to make them fair for structures of India's economy, and take a new road to create an equitable, democratic society, and achieve the vision of poorna swaraj - a country that provides equal political, social and economic freedom to all its 'socialist' model India followed until 1991 was too top-down and controlled by government. The capitalist model of the economy it followed afterwards has turned out to be too much 'trickle-up'. Inequalities have increased, and incomes are not growing sufficiently in the lower half of the needs a new model of economic growth to strengthen its economy, and to make it a more equitable country.
Time of India
09-05-2025
- Business
- Time of India
India must choose its own path for a stronger and more equitable future
Donald Trump got one thing right. Working-class people are hurting. Neoliberal, free-market capitalists want financial capital to roam the world, unhampered by tariff and non-tariff barriers. They are unconcerned about the freedom of human capital - its citizens searching for work and incomes to live, who are being shut out to protect the cultures of rich countries. #Operation Sindoor India-Pakistan Clash Live Updates| Missiles, shelling, and attacks — here's all that's happening Pakistani Air Force jet shot down in Pathankot by Indian Air Defence: Sources India on high alert: What's shut, who's on leave, and state-wise emergency measures Trump and his corporate friends are hammering on India's doors again to open its borders to import US corporations-manufactured and agricultural products, and their services. India's leaders must rise above US pressures and reflect. What will be best for India's workers and farmers? History can be a good teacher. The Washington Consensus (read: ideology) was presumed to have won the ideological war with the collapse of the Soviet Union in 1991. Free-market capitalism had defeated government-regulated socialism. Ease of doing business trumped the ease of living of citizens. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like These 20 Scary Bridges Will Test Your Fear of Heights Learn More Undo Private markets were forced on Russia by the US, and its state sector was dismantled, with disastrous consequences. Russia's GDP shrank by nearly 40% between 1991 and 1998, industrial output dropped and poverty rose, with 30% of the population living below the poverty line by the mid-1990s. Ironically, out of the shambles, Vladimir Putin emerged in 1999 as the leader to Make Russia Great Again. China and India took different paths in the 1990s. India toed closer to the US anti-socialist, free-market line. China did not succumb to US pressures. It continued the development of a centrally guided ' socialist market economy ', and to build its industrial capabilities before joining the global game. Live Events India's per-capita GDP has grown 7.3x since 1990; China's 42x - six times faster. China's manufacturing sector has grown 9x as large as India's. Its exports of hi-tech goods are 48x. Trump wants to Make America Great Again by curbing China's remarkable growth. He says the global trade regime - which the US itself put in place in the 1990s - is not fair to the US. In 2010, Adair Turner said the time has come to reconstruct economics. Too much reality was being left out of economists' models for them to explain the world. These flawed models are incapable of predicting the future condition of an economy. With a twist of Keynes' famous statement that 'practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist', Turner warned that 'the great danger lies with reasonably intellectual men and women who are employed in policy-making departments of central banks, regulatory bodies, and governments, who are aware of intellectual influences, but who tend to gravitate to simplified versions of the dominant belief of economists who are very much alive'. Communist China escaped the shock therapy Western economists imposed on communist Russia in 1992. China continued its path of reforms to a 'socialist market economy' - China's way of adopting capitalist tools without abandoning socialist ideology. In her book, How China Escaped Shock Therapy: The Market Reform Debate, Isabella M Weber writes, 'The famous Harvard development economist Dani Rodrik represents the economics profession more broadly when he answers his own question of whether 'anyone [can] name the [Western] economists or the piece of research that played an instrumental role in China's reforms' by claiming that 'economic research, at least as conventionally understood', did not play 'a significant role'. India's economists have two challenges before them: Redesign, along with other nations, structures of global trade and financial systems to make them fair for all. Reimagine structures of India's economy, and take a new road to create an equitable, democratic society, and achieve the vision of poorna swaraj - a country that provides equal political, social and economic freedom to all its citizens. The 'socialist' model India followed until 1991 was too top-down and controlled by government. The capitalist model of the economy it followed afterwards has turned out to be too much 'trickle-up'. Inequalities have increased, and incomes are not growing sufficiently in the lower half of the pyramid. India needs a new model of economic growth to strengthen its economy, and to make it a more equitable country.
Asia Times
24-04-2025
- Business
- Asia Times
World Bank 2d try at ranking economies for investors also lacking
In 2021, the World Bank shut down one of its flagship projects: the Doing Business index, a global ranking system that measured how easy it was to start and run a business in 190 countries. That followed an independent investigation that found World Bank officials had manipulated the rankings to favor powerful countries, including China and Saudi Arabia. The scandal raised serious concerns about the use of global benchmarks to shape development policy. Now, the bank is trying again. In October 2024, it launched its newest flagship report, Business Ready. The 2025 spring meeting of the World Bank and its sister institution, the International Monetary Fund, mark the first time the report will be formally presented to delegates as part of the institutions' high-level agenda. Nicknamed B-READY, the report aims to evaluate business environments through more transparent data. This time, the annual assessment has a broader ambition: to go beyond laws and efficiency and also measure social inclusion, environmental sustainability and public service delivery. As experts on international organizations, law and development, we have given B-READY a closer look. While we appreciate that a global assessment of the economic health of countries through data collection and participation of private stakeholders is a worthwhile endeavor, we worry that the World Bank's latest effort risks recreating many of the same flaws that plagued its predecessor. To understand what's at stake, it's worth recalling what the Doing Business index measured. From 2003 to 2021, the flagship report was used by governments, investors and World Bank officials alike to assess the business environment of any given country. It ranked countries based on how easy it was to start and run a business in each of 190 economies. In prioritizing that as its marker, the index often celebrated reforms that stripped away labor protections, environmental safeguards and corporate taxes in the name of greater 'efficiency' of common law versus civil law jurisdictions. As economist Joseph E. Stiglitz argued in 2021, from its creation the Doing Business index reflected the values of the so-called Washington Consensus − a development model rooted in deregulation, privatization and market liberalization. Critics warned for years that the Doing Business index encouraged a global 'race to the bottom.' Countries competed to improve their rankings, often by adopting symbolic legal reforms with little real impact. In some cases, internal data manipulation at the World Bank penalized governments that did not appear sufficiently business-friendly. These structural flaws − and the political pressures behind them − ultimately led to the project's demise in 2021. B-READY is the World Bank's attempt to regain credibility after the Doing Business scandal. In recent years, there has been both internal and external pressure to create a successor − and B-READY responds to that demand while aiming to fix the methodological flaws. In theory, while it retains a focus on the business environment, B-READY shifts away from a narrow deregulatory logic and instead seeks to capture how regulations interact with infrastructure, services and equity considerations. B-READY, which in the pilot stage covers a mix of 50 countries, does not rank countries with a single score. Rather, it provides more accurate data across 10 topics grouped into three pillars: regulatory framework, public services and operational efficiency. The report also introduces new themes such as digital access, environmental sustainability and gender equity. Unlike the Doing Business index, B-READY publishes its full methodology and makes its data publicly available. On the surface, this looks like progress. But a criticism of B-READY is that, in practice, the changes offer only a more fragmented ranking system — one that is harder to interpret and still shaped by the same investor-driven macroeconomic assumptions. In our view, the framework continues to reflect a narrow view of what constitutes a healthy legal and economic system, not just for investors but for society as a whole. A key concern is how B-READY handles labor standards. The report relies on two main data sources: expert consultations and firm-level surveys. For assessing labor and social security regulations, the World Bank consults lawyers with expertise in each country. But when it comes to how these laws function in practice, the report relies on surveys that ask businesses whether labor costs, dismissal protections and public services are 'burdens.' This approach captures the employer's perspective, but leaves out workers' experiences and the real impact on labor rights. In some cases, the scoring system even rewards weaker protections. For example, countries are encouraged to have a minimum-wage law on the books − but are penalized if the wage is 'too high' relative to gross domestic product per capita. This creates pressure to keep wages low in order to appear competitive. And while that might be good news for international companies seeking to reduce their labor costs, it isn't necessarily good for the local workforce or a country's economic well-being. According to the International Trade Union Confederation, this approach risks encouraging symbolic reforms while doing little to protect workers. Georgia, for example, ranks near the top of the B-READY labor assessment, despite not having updated its minimum wage since 1999 and setting it below the subsistence level. Another troubling area, to us as comparative law experts, is how B-READY evaluates legal issues. It measures how quickly commercial courts resolve disputes but ignores judicial independence or respect for the rule of law. As a result, countries such as Hungary and Georgia, which have been widely criticized for democratic backsliding and the erosion of the rule of law, score surprisingly high. Not coincidentally, both governments have already used these scores for propaganda and political gain. This reflects a deeper problem, we believe. B-READY treats the legal system primarily as a means to attract investment, not as a framework for public accountability. It assumes that making life easier for businesses will automatically benefit everyone. But that assumption risks ignoring the people most affected by these laws and institutions − workers, communities and civil society groups. B-READY introduces greater transparency and public data − and that, for sure, is a step up from its predecessor. But in our opinion it still reflects a narrow view of what a 'good' legal system looks like: one that might deliver efficiency for firms but not necessarily justice or equity for society. Whether B-Ready becomes a tool for meaningful reform − or just another scoreboard for deregulation − will depend on the World Bank's willingness to confront its long-standing biases and listen to its critics. Fernanda G Nicola is a professor of Law at American University and Dhaisy Paredes Guzman is a research assistant at American University. This article is republished from The Conversation under a Creative Commons license. Read the original article.
