Change the climate

Indias transformation is a work in progress. Nearly twenty years after liberalisation,this country has seen a vast expansion in aspirations and capabilities; much of that is because the retreat of the state in some areas has vastly increased the space for individual initiative. And yet it will not be an exaggeration to say that,in a few short weeks,that space has come newly under threat. There is a compact between wealth-generators in the private sector and the government,and society more broadly,that is fragile it depends upon a climate with moderate political risk,where investment is welcomed,where the successful are not targeted,where initiative is not bound back by red tape. This is the climate that allows them to flourish; and it is precisely this,as Deepak Parekh said on NDTVs Walk the Talk,that is today felt to be under threat.

Parekhs attempt to frame the broader picture should serve as a wake-up call for a UPA government whose agenda depends on a high-growth path. As an example,he argued that environmental regulations were being applied selectively,making it difficult for new entrants to expand and improve economic sectors. In each such case,what was affected was the spread and deepening of Indias private sector. Policy pulls in different directions. So does politics. And tough times for private sector expansion will affect us all.

The expansion of horizons for Indias citizens today is irreversible. Aspirations,once discovered and nurtured,will not vanish. Yet to make those aspirations a reality,we need continued,sustained growth,and the bubbling entrepreneurial,wealth- and idea- creating private sector that has become so associated across the world with India. That effervescence,however,can be all too reversible. Indias companies have shown that they can compete with the best. Few countries would hesitate to invite in wealth- and employment-creators such as they are especially since many of them are known for their responsibility. But if Indias climate turns unfriendly,as Parekh and others have shown they sense it could,the ebullience that defines the India story will die. Our companies might still be world-beaters but theyll create employment,jobs,and ideas somewhere else. For the aspirational citizens of India,that would be a tremendous tragedy.