SPEECHES / STATEMENTS 

PM Releases a Book Titled ‘Business Standard India 2008’

February 14, 2008, New Delhi

I am delighted to release this publication that TN Ninan has launched. I compliment him for yet another publishing initiative and what he has told us today if he is venturing into Daily Hindi Newspaper, I think I heartedly welcome because in the policy dialogue, Indian national languages must get their recognition which is due to them and too often the dialogue and policy matters is limited to middleclass English speaking population and that’s not good if we are to remain a functioning democracy we must venture to be. Therefore, I am sure that T.N. Ninan will bring to this new venture the same sense of professionalism that we all associate with him. Ninan has distinguished himself in the field of economic journalism, earning a well-deserved reputation for professionalism and for integrity. I wish him well in this new project.

This volume brings together a wide range of commentators who are all respected for their intellectual qualities and for their contribution to national development. I am sure these essays will be read by all those who seek a balanced assessment of the processes of social and economic change in our country. There is growing interest in these processes and in understanding the causal factors it work and therefore there is a thirst for well-informed and balanced analysis. I hope this new book will quench that intellectual thirst.

When people seek books on India, they are not crystal gazing into the future. They want hard headed analysis about the present. I do hope Business Standard books will offer such fact based analysis of what is happening in our country in diverse field.

I do believe that India has a good story to tell, and there is growing interest in the Indian story worldwide. This is both a reflection of what is happening in India and of upgrowing appreciation of this across the world. The India story is not just about economic growth and business outcomes. It is also about social change, social mobility and the political empowerment of more than a billion human beings. The saga of over a billion people seeking their social and economic salvation through the framework of a plural democracy is without doubt one of the most uplifting stories of our times.

We must never belittle this achievement, nor take it for granted. As our economic growth accelerates, we are more focused on making that growth process socially inclusive. Our political process was, of course, built on the foundation of social inclusion, based on the idea of universal adult franchise, the Rule of Law and respect for fundamental human rights.

It is on the firm foundation of an inclusive political process, based on the principles of an open society and an open policy an increasingly open economy, that we have sought better economic performance and better economic management. Economists do not always appreciate the importance of these institutional factors in evaluating economic outcomes and performance. But one must do so. I do sincerely believe that the political foundation we have laid will contribute to the stability and sustainability of our economic growth processes.

I do believe we have unleashed the creative energy of our people and that is what is contributing to the acceleration of economic growth. The Gross Investment Ratio has now touched an all time peak of about 36% of GDP. This represents the underlying dynamism of our economy. Lord Canes used to say that the animal spirits are the foundation of the more dynamic economic and recent years have seen a very welcome exhibition and outburst of creativity among the business communities of our country. I sincerely hope that their example will be emulated by other profession including those who write and read about various issues and engage the attention of our countrymen. It also represents a vote of confidence in our policies and in the prospects for India. I am convinced that at current rates of saving and investment, we will sustain close to 9% economic growth in the medium term.

Our objective is to ensure that this growth process as I said is as inclusive as possible, in all dimensions, and it can be sustained while holding inflation under check. It has been our endeavour to ensure that inflation does not get out of control. It has been our endeavour to ensure the long term stability of the growth process, rather than seek short term gains that may have socially and politically destabilizing consequences.

I also believe that it is our responsibility today to ensure that uncertainty in the global system does not harm our growth process. A large continental economy like ours can sustain fairly high rates of growth based on the stable and sustained growth of the home market, even if there is turbulence in global markets.

In years to come, India and China will be viewed as the new growth engines of the evolving world economy. We are not yet there, but we will be. We can certainly sustain much better domestic performance based on our own effort and realization of our own immense potential. Our macro-economic policies are aimed at ensuring this sort of outcome.

I am aware that there is more to be done for us to sustain the current growth process. The Business Standard is very often reminded all of us of the unfinished agenda and I thank Ninan for consistently keep on reminding us about that unfinished task. But let us not forget what has already been done, and the distance that we have traveled. To say we must do more, as Business Standard always tells us, is unexceptionable and welcome. At the same time, there is no harm in recognizing what we have done! There is much to be proud of in what we have achieved so far. An objective assessment should give us both courage and energy to move forward. And move forward at a faster pace. I sincerely hope Business Standard and its various publications will give us such an objective assessment and continue to guide us as we move forward.

It has now become commonplace to say we are on the cusp of new opportunities. Indeed, we are. But we cannot take our success for granted. Sustained growth is not like going to a free dinner party. We need to pursue sound macro-economic policies designed to raise savings, investments and productivity. In the final analysis, as one of my teachers used to say a nation’s standard of living is a matter of high productivity and there are clearly no shortcuts to it. Our economy also needs a supportive polity. Economists are familiar with the phrase, “get the prices right”. The challenge before us today is to also “get the politics right”. If we can get “both politics and prices right”, the economy would be on surer ground for sustained growth. That is not just a challenge for political parties. It is equally a challenge for those who are in the business of shaping mindsets. T.N. Ninan has been a very illustrious path finder in that direction. I wish him and his new venture all success. God bless you.