When talks come to how India has done for itself in 50 years of independence, the world has nothing but praise for our success in remaining a democracy. On other fronts, the applause is less loud. In absolute terms, India hasn’t done too badly, of course, life expectancy has increased. So has literacy. Industry, which was barely a fledgling, has grown tremendously. And as far as agriculture is concerned, India has been transformed from a country perpetually on the edge of starvation into a success story held up for others to emulate. But these are competitive times when change is rapid, and to walk slowly when the rest of the world is running is almost as bad as standing still or walking backwards. Compared with large chunks of what was then the developing world — South Korea, Singapore, Malaysia, Thailand, Indonesia, China and what was till lately a separate Hong Kong — India has fared abysmally.
It began with a far better infrastructure than most of these countries had. It suffered hardly or not at all during the World War II. It had advantages like an English speaking elite, quality scientific manpower (including a Nobel laureate and others who could be ranked among the world’s best) and excellent business acumen. Yet, today, when countries are ranked according to their global competitiveness, it is tiny Singapore that figures at the top. Hong Kong is an export powerhouse. So is Taiwan. If a symbol were needed of how far we have fallen back, note that while Korean Cielos are sold in India, no one in South Korea is rushing to buy an Indian car.
The reasons list themselves. Topmost is economic isolationism. The government discouraged imports and encouraged self-sufficiency. Whatever the aim was, the result was the creation of a totally inefficient industry that failed to keep pace with global trends and, therefore, became absolutely uncompetitive. Only when the trade gates were opened a little did this become apparent. The years since then have been spent in merely trying to catch up. That the government actually sheltered its industrialists from foreign competition is a little strange. For, in all other respects, it operated under the conviction that businessmen were little more than crooks who were to be prevented from entering the most important areas of the economy, who were to be hamstrung in as many ways as possible, who were to be tolerated in the same way as an inexcusable wart. The high, expropriatory rates of taxation, the licensing laws, the reservation of whole swathes of industry for the public sector, and the granting of monopolies to the public sector firms were the principal manifestations of this attitude. The government forgot that before wealth could be distributed, it had to be created. The government forgot that it itself could not create, but only squander wealth.
Some of the manifestations of the old attitude have changed. Tax rates have fallen. Licensing has been all but abolished. And the gates of global trade have been opened wide. But most of these changes were forced by circumstances partly by the foreign exchange bankruptcy of 1991 and the recognition that the government could no longer muster the funds to support the public sector, leave alone expand it. Whether the attitude of the government itself, or that of more than a handful of ministers, has changed, is open to question.
In many other ways, however, the government has not changed one whit. Business still has to negotiate a welter of negotiations. Transparency is still a longer way off. And there is no exit policy. In defending the existing policy, politicians betray an inability to see beyond their noses. A no-exit policy for labour is equivalent to a no-entry policy for new business. If one industry is not allowed to retrench labour, other industries will think a hundred times before employing new labour.
In other ways too, the government hurts industries. Public sector monopolies like the department of telecommunications and Videsh Sanchar Nigam Ltd. make it possible for Indian businesses to operate only at a cost several times that of their counterparts abroad. The infrastructure is in shambles partly because it is unable to formulate a sufficiently remunerative policy for private business, and partly because it does not have the stomach to change market rates for services.
After a burst of activity in the early nineties, the government is dragging its feet. At the rate it is going, it will be another 50 years before the government realises that a pro-business policy is the best pro-people policy. By then, of course, the world would have moved ahead
The writer’s attitude towards the government is
Show Hint
- critical.
- ironical.
- sarcastic.
- derisive.
The Correct Option is A
Solution and Explanation
The writer is surprised at the government’s attitude towards its industrialists because
Show Hint
- the government did not need to protect its industrialists.
- the issue of competition was non-existent.
- the government looked upon its industrialists as crooks.
- the attitude was a conundrum.
The Correct Option is C
Solution and Explanation
The government was compelled to open the economy due to
Show Hint
- pressure from international markets.
- pressure from domestic market.
- foreign exchange bankruptcy and paucity of funds with the government.
- All of these
The Correct Option is D
Solution and Explanation
The writer ends the passage on a note of
Show Hint
- cautious optimism.
- pessimism.
- optimism.
- pragmatism.
The Correct Option is A
Solution and Explanation
According to the writer, India should have performed better than the other Asian nations because
Show Hint
- it had adequate infrastructure.
- it had better infrastructure.
- it had better politicians who could take the required decisions.
- All of these
The Correct Option is D
Solution and Explanation
India was in a better condition than the other Asian nations because
Show Hint
- it did not face the ravages of the World War II.
- it had an English speaking populace and good business sense.
- it had enough wealth through its exports.
- Both (a) and (b)
The Correct Option is D
Solution and Explanation
The major reason for India's poor performance is
Show Hint
- economic isolationism.
- economic mismanagement.
- inefficient industry.
- All of these
The Correct Option is D
Solution and Explanation
One of the features of the government’s protectionist policy was
Show Hint
- encouragement of imports.
- discouragement of exports.
- encouragement of exports.
- discouragement of imports.
The Correct Option is D
Solution and Explanation
The example of the Korean Cielo has been presented to highlight
Show Hint
- India's lack of stature in the international market.
- India's poor performance in the international market.
- India's lack of creditability in the international market.
- India's disrepute in the international market.
The Correct Option is B
Solution and Explanation
According to the writer,
Show Hint
- India’s politicians are myopic in their vision of the country’s requirements.
- India’s politicians are busy lining their pockets.
- India’s politicians are not conversant with the needs of the present scenario.
- All of these
The Correct Option is D
Solution and Explanation
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