Mixing ethereal quotes on the passage of time from poet and essayist TS Eliot with earthy Bollywood lyrics that touched climate problems in India, the Economic Survey 2017-18 is as much of an evolved work of literature as it is about insightful economic analyses.
The 19 chapters and two Prefaces spread across two volumes of the Economic Survey, authored by Chief Economic Adviser Arvind Subramanian and his team, is punctuated with a liberal dose of literary flourish, using words of wisdom from saints, politicians, economists, poet laureates and contemporary litterateurs to reinforce economic arguments.
In a signed Preface to Volume I, Subramanian says that like last year, Big Data has been mined to shed light on the economy, and, for the Survey’s authors, there have been some truly “wow” moments of epiphanic understanding.
The Survey strives to combine rigour with readability, a challenge that increases in the same proportion as attention spans shrink (from absorbing op-eds to scrolling down tweets). Tiredness among authors is one attribute that often catches the attention of the discerning reader.
The survey’s authors, it appears, were acutely aware of this, with the CEA striking a note of caution that all writers of the Survey must guard against the dangers of staleness expressed by TS Eliot: ““For last year’s words belong to last year’s language. And next year’s words await another voice.”
The Economic Survey has been tabled in Parliament by Finance Minister Arun Jaitley. The Survey pegs FY19 GDP growth at 7-7.5%. What are the key highlights of the survey, Sakshi Batra speaks to Gaurav Choudhury, Economy Editor, Moneycontrol to find out.
No work of economic analysis can be complete without borrowing from the wisdom of the discipline’s most famous practitioner, John Maynard Keynes. The Economic Survey 2017-18 is no exception. “The inevitable never happens. It’s the unexpected always,” it quotes Keynes in the chapter on “State of the Economy: An Analytical Overview and Outlook for Policy”.
Goods and Services Tax (GST)’s implementation was like a leap into the unknown. The discovery has been positively fascinating, the Survey concludes without saying so. Instead, the authors take recourse to John Keats, who explains the sheer joy of discovering Iliad and Odyssey after reading Chapman's translation of Homer's work.
The survey quotes “And then felt I like some watcher of the skies, When a new planet swims into his ken,” a line from Keats’s famous poem “On First Reading Chapman’s Homer”
Generations of Indian policy makers have battled with the challenge to spread the financialisation of Indian savings. Higher savings, inevitably, feed into growth through greater investment. The survey’s authors took recourse to American economist Hyman Minsky to buttress the point.
“Investment calls the tune, and profits dance accordingly,” the survey quotes Minsky, who held that, over a prolonged period of prosperity, investors take on more risk. Eventually, over-indebted investors are forced to sell even their less-speculative positions to make good on their loans. The markets then spiral, creating a severe demand for cash—an event that has come to be known as a "Minsky moment."
Taxation is not just a vehicle for raising state revenue. It can also be critically important for economic and political development. “The village of which the people come together to earn for themselves their food, their health, their education, to gain for themselves the joy of so doing, shall have lighted a lamp on the way to swaraj,” the survey quotes Rabindranath Tagore to bolster the point.
In another chapter on global economic development entitled, “Is there a “Late Converger Stall” in Economic Development? Can India Escape it?” the survey quotes Lewis Carol’s Alice in Wonderland: “My dear, here we must run as fast as we can, just to stay in place. And if you wish to go anywhere you must run twice as fast as that.”
The world is battling climate change, an ugly byproduct of rapid industrialization. How does one contain toxic air quality from deteriorating further? The survey relies on metaphors from Bollywood and poetry to drive home the urgency. It quotes Manoj Kumar’s famous on screen track from yesteryear Bollywood blockbuster Upkaar: Mere desh ki dharti sona ugle ugle heerey moti (My country’s soil where crops grow like gold, diamonds, and pearls). In the same chapter it quotes Tulsidas’s Ram Charit Maanas: Kaa barakhaa, jab krishi sukhaanee (What’s the use of that untimely rain after the crop has dried up)
In another instance, while seeking to answer the difficult question turning India into an hub of innovation and scientific excellence, the Survey quotes Nobel laureate CV Raman: “We need a spirit of victory, a spirit that will carry us to our rightful place under the sun, a spirit which can recognize that we, as inheritors of a proud civilization, are entitled to our rightful place on this planet. If that indomitable spirit were to arise, nothing can hold us from achieving our rightful destiny.”
India may have jumped 30 rungs in the World Bank’s Ease of Doing Business ranks, but a way is needed to be found, urgently, to deal with prolonged judicial dispute settlement procedures. In a chapter entitled “Ease of Doing Business’ Next Frontier: Timely Justice,” Subramanian uses Shakespearean analogy to bolster the argument. He quotes the Bard of Avon’s Hamlet: “For who would bear the Whips and Scorns of time, The Oppressor’s wrong …the Law’s delay”
Indian agriculture is a now caught in a peculiar flux. Output is rising, but pricing are in a deflationary trend, implying farmers, despite record output, have seen incomes fall or remain flat. The survey’s author quotes Allan Savory, the famous Zimbabwean ecologist, livestock farmer, environmentalist. “Agriculture is not crop production as popular belief holds - it’s the production of food and fibre from the world’s land and waters. Without agriculture it is not possible to have a city, stock market, banks, university, church or army. Agriculture is the foundation of civilization and any stable economy”.
Promoting inclusive employment-intensive industry, and building resilient infrastructure are vital factors for economic growth and development. The survey quotes American politician Larry Hogan who is known for propounding industry-friendly policies to push overall growth. The survey quotes Logan: “Supporting iconic, growth-oriented industries, combined with tax policies that encourage small business growth and investment, represents a potent combination and is the basis of our entire administration”.
In the same chapter it quotes Roger McNamee, American businessman, investor, venture capitalist and musician who has argued in favour of investment in infrastructure as a primary growth vehicle, given the sector’s multiplier benefits.
“We need to stop thinking about infrastructure as an economic stimulant and start thinking about it as a strategy. Economic stimulants produce Bridges to Nowhere. Strategic investment in infrastructure produces a foundation for long-term growth,” it quotes McNamee.
A productive job is the best form of inclusion. To engineer an inclusive and sustainable growth for India, the social infrastructure like education, health and social protection are top government priorities. Appropriately, in the chapter on “Social Infrastructure, Employment and Human Development”, the survey quotes Theodore William "Ted" Schultz, American economist, Nobel Laureate, and chairman of the Chicago School of Economics. Schultz, who won the Nobel prize for economics in 1979, had famously written: “Economists have long known that people are an important part of the wealth of nations”.