Constructive candour

The recent remarks of the chairman of Tata Sons on economic reform should be noted for their candour. Ratan Tata was forthright in identifying the fact that vested interests of all kinds are putting India’s economic prospects at risk. His warning, that uncontrolled fiscal deficits, runaway subsidies and the dominance of myopic perspectives on policy-making will dampen our future prospects, should come as a wake-up. His pessimism that we are frittering away our comparative advantage by clinging on to laws that do not allow us to benefit from low cost and abundant labour, should be addressed very seriously.

The Tata Group itself, by any measure of success, has been remarkable in taking advantage of the opportunities provided by globalisation, both in services and in manufacturing. But even if a leader as dynamic and innovative as this feels constrained by the laws, something is clearly wrong. Similarly, if someone as influential feels so powerless in combating the strangle-hold of vested interests on policy making, what hope is there for lesser mortals? What lends a certain refreshing quality to these remarks is the overall moral vision in which they were encased. Tata does not resort to the cheap trick of blaming only politicians. He also points to vested interests within his own tribe in the private sector, who are more than ready to sacrifice the interests of the nation for their own venal gain. A combination of interests working behind the scenes has rendered policy-making completely non-transparent and open to manipulation. His remarks can also be read as a candid assessment of Prime Minister Manmohan Singh’s performance. The prime minister has a commendable long-term vision but if even the occupant of the most powerful office in the country finds himself hostage to petty interests, India’s future will indeed be in jeopardy.

It can only be hoped that Tata will be able to use his position as chairman of the Investment Commission to push through desirable reforms. But, in the meantime, he has done the country a service by forcing citizens to engage with a very pointed question: How often do they — politicians, capital, labour — allow short-term interests to stand in the way of the country’s progress?