September 30, 2014 2:02:37 am
At Madison Square Garden, Prime Minister Narendra Modi displayed the power of persuasion, perhaps his greatest asset, and his ability to recruit participation in the story that he is scripting for a new India. But he was preaching to the already converted. Besides, he was fleshing out ideas of considerable vintage. Ever since liberalisation changed the game in 1991, governments of all hues, at the Centre and in the states, have used the cocktail of democracy, demographic dividend and demand to lure investment from liberal democracies. An arms-wide-open attitude to NRIs and persons of Indian origin (PIOs) dates from the Vajpayee government, which established the Pravasi Bharatiya Divas in 2003 and, just before its term expired in 2004, created the ministry of overseas Indian affairs.
Influential NRIs and PIOs got involved in the India story years before these overtures were made. It wasn’t just Sam Pitroda’s celebrated decision in 1984 to work on Indian telecom on a token salary. Thousands more have used their wealth, expertise and connections to do their bit for the mother country. Now, to move beyond this warm, fuzzy and sporadic level to a more businesslike engagement, the government must be inclusive rather than merely receptive. And to be either with any degree of credibility, it must act quickly on its other agendas. Ease of doing business is a priority, and the facilitation embedded in the Make in India campaign is urgently required. However, unless the government cuts out corruption and removes the unnecessary processes and controls that the corrupt leverage for gain, Make in India will become a manufactured reality. Besides, it would be a mistake to focus exclusively on commerce and markets. Some activities are best performed by the nonprofit route. For instance, investing in universities for profit and endowing chairs, centres and departments for philanthropic reasons generally have utterly different consequences for education.
But whether for profit or not, the ease of making in India is hampered by the same problem: a trust deficit. In his Make in India pitch, Modi had focused on the need for a new covenant of trust between institutions. No such contract can emerge if investors and donors who take the initiative face a miasma of suspicion. Apart from cutting the clutter in sanctioning and regulation, the government also must end the political tradition of using the taxman as a hatchet-man, and take its beady eye off compliant NGOs. NRIs and PIOs will not be inclined to engage with the very system that had frustrated them, and even forced them out of India.
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