“India shining” is a nice expression and it's a pity that it got mixed up with politics. Since it is synonymous with India's economic success, not surprisingly both the BJP and the Congress wanted to take the credit. The BJP claimed that its policies were responsible for the past year's fine performance and the changed mood; the Congress argued that the economy grew faster under their man, Narasimha Rao. Both were right (and wrong). The truth is that India's economy has been shining for two decades, growing around 6 percent a year, making it the fifth fastest major economy in the world.

After stagnating for centuries, our economy did finally pick up after Independence. It grew 3.5 percent a year between 1950 and 1980; but our population also grew 2.2 percent; hence the net affect was 1.3 percent per capita income growth (3.5 minus 2.2)—this is what we mournfully called “the Hindu rate of growth.” Things began to change with modest liberalisation in the eighties when annual GDP growth rose to 5.8 percent while population growth remained at 2.1 percent; thus, income per capita moved up to a more respectable 3.7 percent. This happy trend continued in the reforms decade of the nineties when growth averaged 6.2 percent a year, and population, in fact, slowed to 1.8 percent average; thus, per capita income rose by a decent 4.4 percent a year.

What these numbers mean is that if our per capita GDP had continued growing at the pre-1980 level, then Indian incomes would have reached current American per capita income levels only by 2250. But if our economy continues to grow at the present 6 percent rate, and if population grows at 1.5 percent, then we will reach American income levels by 2066. This is a gain of 216 years, and this is what “India shining” really means. And it is worth dying for! It means that it is finally possible to believe that we shall soon be able to conquer India's age-old worry over want and hunger.

It is easier to explain why India was shining in the nineties. The brave reforms of Narasimha Rao's government opened our economy, dismantled controls, lowered tariffs and taxes and broke public sector monopolies. And the economy responded magnificently. But how does one explain the pick-up in the 1980s? And here I think we don't give enough credit to Rajiv Gandhi. He too opened the economy, albeit reticently and modestly—lowering marginal taxes and tariffs, removing the most irritating import restrictions, and liberalised industrial licensing through “broadbanding”. Although modest, these efforts seem to have had a bigger impact that even the sweeping reforms of the 1990s.   Bradford Delong, an American economist, wrestles with this puzzle in In Search of Prosperity: Analtytic Narratives on Economic Growth, edited by Dani Rodrik of Harvard. The real miracle, however, is that all the governments after Rao surprisingly continued the reforms, albeit in a frustratingly slow way. Yet this elephant-like pace has made India one of the fastest growing major economies in the world. So, the lesson is that if you consistently reform in one direction in a democracy, it adds up. Since we haven't had strong reformers at the top, like Thatcher or Deng, is it possible that the reform process has become institutionalised?

This “adding up” over time has enhanced our national confidence, and which to my mind is central to the notion of “India shining”. Thus, it is the Indian people who are shining as they have overcome all the obstacles put in their way by self-serving bureaucrats, politicians, monopolistic industrialists, left intellectuals and labour leaders—in short, all the vested interests of the Licence Raj. But for all Indians to shine, we must begin to seriously reform agriculture and education. This ought to be the agenda of this government.

This election has reminded us that left's historic role is to make the right sensitive to the needs of the poor and to humanize capitalism in the process. Unfortunately, our left is bankrupt in terms of ideas, and thinks that throwing good money at old problems will solve them. Moreover, the left has not ditched its naïve faith in state control when our nation is groaning under the weight of red tape. This statism makes the left look stupid. In the end, the problems of India's poor will not be solved by ideology but by good implementation. And this needs mental application. We have to focus on the “how”, not the “what”. It is easier to abuse the India's bourgeoisie, but more difficult to come up with real answers to real problems.

Dear Prime Minister,

Like it or not, India's general elections have become municipal elections. What matters to the rickshawala is that the cops not take away a sixth of his daily earnings. The farmer wants a clear title to his land without having to bribe the patwari. The sick villager wants the doctor to be there when she visits the primary health center. The housewife doesn't want the water tap to go dry while she is washing. This is how government touches ordinary people's lives, and in successful societies people take these things for granted. You might say that these are state and local subjects, but to ordinary citizens you are the face of the government and they expect this from you. Moreover, the Congress controls many states, municipalities and panchayats. You can, at least, hold them accountable.

Where does the illness of governance lie? Why don't employees of the central, state, and local governments do their jobs?   In the Far East, for example, citizens get far better service. Is it because we protect labour excessively in India, to the point that they no longer feel accountable? This was my experience in the private sector, at least--our labour laws have taken away accountability and diminished our companies' competitiveness. Thus, you may have to tackle labour laws despite your partners.  

If you buy my argument about governance then your focus will shift from policy to implementation. Hold your finance minister accountable for the behaviour of income tax officers, excise and custom inspectors. Judge you home minister, for example, for eliminating harassment of honest NGOs who get foreign donations. Reward your economic ministers for eliminating red tape--foreign investors repeatedly tell us that they prefer China over India because of our red tape. In the end, even if you make a small but perceivable difference, you will break the “anti-incumbency factor”, which is a code word for poor governance. If you do not, then you will be asking for the return of the BJP in 2009.