The Exchanges

Q So your book, uh, 10 trillion dollar dream, the state of Indian economy and the policy reform agenda was widely received, appreciated. And your next book, which is coming is that a 10 trillion dream dented, right? Which shows that, right? Why the dream has, will take more amount of time to reach there.

A So, uh, see, um, I was, uh, Secretary of Economic Affairs in charge of Budget in 2019, 20, um, when, uh, the then Finance Minister Piyush Goel, Uh, in the interim budget, 2019, 20, it was presented on first of February, 2019, uh, laid down the, uh, vision of the dollar 10 trillion dollar economy. Uh, in that budget, uh, the government did say that we are on course to be a five trillion dollar economy by 24, 25 or so. And after eight years therefrom, so sometime in the middle of the twenty-thirties, the government would like India to become a dollar-ten trillion economy. That was the, and since I was quite deeply involved in that process, in fact, those were to some extent my own words, which the government Led by Mr. Modi, sort of blessed, so to say, and adopted that as the policy of the government. So this became, in a way, the national, uh, sort of dream, uh, the dollar, 10 trillion dollar economy by, uh, by 20 thirties, middle 20 thirties. So, uh, uh, I wrote that book, which you referred, uh, that came out in, uh, early February, 20, 22. Uh, and that, uh, in a way, but it was set in the context of 2019, 20. That was the first year of, uh, Mr. Modi's, uh, second term. So, I have always thought, and the Penguin also believed in that particular way, That, uh, when a particular government completes about five years of its term, it would be a best time, it would be most appropri…

AI assessment note: “most appropriate time for making an assessment. That have you made the due progress”

Q And how much did we cover in the first term of Modi government from 2014 to?

A See, first term the Modi government had not laid down this dream. So, um, it cannot be related to the dream at that time. But broadly speaking, if you want to take it, uh, I have given, I think, these data in the, in the book as well. So, uh, when the UPA government, um, uh, sort of assumed the office in 2003, four, Uh, I think India's GDP was in dollar term somewhere close to 6.6 seven or .7 trillion, right? And when they demoted office in 2013, 14, uh, remember that was a period of very high growth and the dollar term's still higher. So in 2013, 14, Uh, the GDP in dollar terms had reached, uh, about 1.8 trillion dollars. So it had virtually tripled. I think the, uh, the growth was about 10% in that, uh, period. But the 10 year period of, uh, Narendra Modi from 2014 15 to 2023 24, it has gone up from 1.8 trillion To something close to 3.6 trillion. So it's, it's little less than doubled. So while it was three times in those 10 years in dollar terms, it is about two times. So it has been little slower. Of course, this has been higher in the first term. I think it was about seven percent in dollar terms, then about 5.6% in the second, second term.

AI assessment note: “Of course, this has been higher in the first term. I think it was about seven percent”

Q And, and what if impeding the government right now Let's say to bring people in agriculture to services based economy, or is there no agenda for, for that?

A See, this is a tough question. Uh, India still has close to 48, 49% of its labor in farms, both as farmers and the, uh, landless agricultural labor. Uh, that is a predominantly, uh, predominant occupation. Of course, it's not a paying proposition. So you find the agriculture contributing about 15% of GDP, but occupying 40, 45% or 50% of the labor. Look at their families and all. So this makes a normal agriculture guy about six to seven times Poorer than the other person who is working outside agriculture. Uh, and, uh, if you want to get the people out of this poverty trap, then you to get people out of agriculture and employ them somewhere else. So, uh, which will also pave the way for more or rapid industrialization, mechanization of agriculture will raise its productivity And, uh, will raise the income per person from the agriculture. And those who move away from agriculture will be able to sort of earn additional income, better income, hopefully, and get out of the poverty. So to my mind, this is an eminently sensible thing to do. But why is it not being done? Why this is a difficult thing, if at all, for, for, for the politicians and the policy makers? Here you have two broad explanations why. Number one, We don't have a very good sense where to go, right? Uh, we spoke about manufacturing in the old last 50, 60 years. There was opportunity where low skill manufacturing is w…

AI assessment note: “why is it not being done? ... For services, we have not explored”

Q And, and there is another, uh, very interesting example, right? Which you said that, uh, India's manufacturing sector refuses to leapfrog. Right. Can, can you put more light on that?

A See, um, the manufacturing sector, uh, for certain reasons, uh, is, is not Sort of investing in the high technology and, um, investment into taking further risk. One of the reason is that India's, still we have a very sort of dominant, powerful public sector, right? That public sector invest, look at railways, for example. So the government invest, Lacks of crores rupees in building railways, doing other capital expenditure and all. But what is happening? Still the railways doesn't have more passability. The, uh, railways do not have, do not provide services. You still see India's, um, not only the rails getting overcrowded, go to the stations. You'll find many of those stations where people are sleeping, sitting, What kind of situation we have? The biggest reason why besides the, the fact that still the government is in a big way into the, the, the industry is that we, we have not been actually innovating much. We have not been able to create technology. All the technologies are mostly created abroad. We at some stage decide to buy, but many times we take a very long time to take decisions to even buy the technologies. For example, look at the semiconductors, which is all involved outside. Look at the solar The sales and the modules, it is all evolved outside. Uh, we, uh, we don't have, most of our automobiles and other machinery, um, are, are evolved outside. Even in services…

AI assessment note: “we, we have not been actually innovating much. We have not been able to create technology.”