Background – Excerpts of speech delivered by the President on the occasion of the 6TH K.S. Rajamony Memorial Lecture March 2, 2017 Kochi.
*Contains important datasets and statements which can be used to enrich your answers.
For 50 years before Independence, the economic growth rate of India was 0% to 1%. In the fifties, our growth rate rose to 1 – 2%, the sixties 3 – 4% and in the 90s, with economic reforms, to 6 to 7%. In the last decade, our growth rate has averaged around 8%, making us the fastest growing large economy of the world.
India’s population in 1950 was 360 million. Today, we are a 1.3 billion strong nation. Our annual per capita income has gone up from Rs. 7,500 at the time of independence to over Rs. 77,000. GDP growth rate has risen from 2.3 percent to 7.9 percent in 2015-16. Poverty ratio has declined from over 60 percent to less than 25 percent. Average life expectancy has gone up from 31.4 to 68.4 years.
Literacy rate has gone up from 18 to 74 percent. Food grains production has gone up from 45 million to an estimated 272 million tonnes in 2016-17
India led a ship to mouth existence in the early days of independence. We had to survive on import of food grains from abroad. Today, we not only produce enough food grains to feed ourselves but are also exporting the same.
In 1947, we had no industry worth its name. In contrast, today we are the 10th largest industrialized nation in the world. Our technological base as well as network of research laboratories and higher education institutions are looked upon by the world with admiration.
India’s space, IT, bio-tech and pharma industries are of a global standard. Only two weeks back, ISRO set a world record launching 104 satellites into space at one go, a feat no other country has achieved. We not only reached the Mars in our very first attempt but also achieved it at a cost far lower than anyone else in the world.
In the last 70 years, tangible change can be seen in every aspect of our lives. India has transformed itself from a poor under-developed nation into the third largest economy in the world in PPP terms within a short span of seven decades.
Equally important is our success in consolidating the unity of our nation and our democracy in the midst of extraordinary challenges and tremendous diversity. We have firmly established within our country the rule of law, an independent judiciary and vibrant media as well as civil society. We have also created strong institutions like the Election Commission and the CAG who stand as pillars of our political system. Every known religion in the world, over hundred different languages used in everyday life, 1600 dialects and multiple cultures are united under one flag and one Constitution.
Around 553 million people voted in the 2014 General Elections, an exercise matched in scale and scope by none else in the world.
A Constitution is a charter for the governance of a nation. The notion of what is good governance must be defined by the need of the times and enriched by the experience of the decades. Yet, the Constitution enshrines certain timeless values that should never be compromised. It is against the touchstone of these values that we must constantly measure our performance.
The Preamble records the resolve of the people of India to secure to all citizens justice – social, economic and political as well as liberty, equality and fraternity. It also establishes the principle of secularism.
Justice – social, economic and political – is in the life of any nation a journey more than a destination. To achieve social justice requires not mere governance but a recasting of mindsets and the transformation of social ethos. That is the job not just of the legislature, the executive or the courts, but of each one of us.
The ultimate goal of any democracy is the empowerment of the individual, irrespective of his economic, religious or social standing. This may appear to be a utopian dream for many, but the strength of a system lies in its capacity to ceaselessly work for its accomplishment. The goal of political justice requires the continuous empowerment of marginalised sections of our society. We owe ourselves to create a system in which access to politics is not limited to a privileged few but an average Indian also feels empowered enough to contribute.
Economic development is vital to good governance. We cannot distribute wealth which we do not possess. Therefore, production of wealth must necessarily be one of the predominant objectives of state policy. However, this must be imbued with the principle of equality on which there can be no compromise.
An egalitarian society can only be created when growth is inclusive. It is important to ensure that there is justice and equality of opportunity and the state does not create conditions in which the privileged few gain at the cost of the multitudes who suffer endemic poverty. A sustainable society can only be based on the principles of equity and justice. The Indian Constitution has been rightly described as a Magna Carta of socio economic transformation.
When India became independent, many in the world thought our democratic experiment would never succeed. They looked at our diversity, poverty as well as the lack of education of our people and predicted that India would lapse into authoritarian rule or military dictatorship. But, the people of India proved these prophets of doomsday wrong.
Yet, we must be conscious of the fact that our democracy requires constant nurturing. At no cost should we allow the exploitation of the fault lines. Those who spread violence must remember that Buddha, Ashoka and Akbar are remembered as heroes in history; not Hitler or Genghis Khan.
It is wrong to consider a society or State to be civilised if its citizens’ behaviour towards women is uncivilised. When we brutalize a woman, we wound the soul of our civilisation. Not only does our Constitution guarantee equal rights to women but our culture and tradition also celebrate the feminine as divine. Protection and safety of our women and children must be a nationwide priority. The acid test of any society is its attitude towards women and children. India should not fail this test
There should be no room in India for the intolerant Indian. India has been since ancient times a bastion of free thought, speech and expression. Our society has always been characterized by the open contestation of diverse schools of thought and debate as well as discussion. Freedom of speech and expression is one of the most important fundamental rights guaranteed by our Constitution. There must be space for legitimate criticism and dissent
India was a world leader in the field of education when our Universities like Nalanda and Takshshila were at the height of their glory. Nalanda and Takshshila are not mere geographical expressions but representations of the idea for free thought which flourished in these great Universities of the past. Our premier institutions of higher education are the vehicles on which India has to propel itself into a knowledge society. These temples of learning must resound with creativity and free thinking. Those in Universities must engage in reasoned discussion and debate rather than propagate a culture of unrest. It is tragic to see them caught in the vortex of violence and disquiet.
The Parliament of India and our Legislative Assemblies are central pillars on which the edifice of our democracy rests. They are the supreme institutions comprising of members directly elected by our people. It is through them that governments are held accountable by the people. If they become dysfunctional, it results in not just paralysis of those institutions but creates an adverse impact across the system. The debate and discussions which ought to take place in the open in the House of Parliament and Assemblies cannot be replicated elsewhere. When they cease to function effectively, issues spill out onto the streets. The very basis of our democracy gets undermined.
A well known speech made to a Constituent Assembly on November 25, 1949 by Dr. B.R. Ambedkar. He said –“……however good a Constitution may be, it is sure to turn out bad because those who are called to work it, happen to be a bad lot. However bad a Constitution may be, it may turn out to be good if those who are called to work it, happen to be a good lot. The working of a Constitution does not depend wholly upon the nature of the Constitution. The Constitution can provide only the organs of State such as the Legislature, the Executive and the Judiciary. The factors on which the working of those organs of the State depend are the people and the political parties they will set up as their instruments to carry out their wishes and their politics.”“Will Indians place the country above their creed or will they place creed above country? I do not know. But this much is certain that if the parties place creed above country, our independence will be put in jeopardy a second time and probably be lost forever. This eventuality we must all resolutely guard against.”
“…..If we wish to maintain democracy not merely in form, but also in fact, what must we do? The first thing in my judgement we must do is to hold fast to constitutional methods of achieving our social and economic objectives. It means we must abandon the bloody methods of revolution. ……But where constitutional methods are open, there can be no justification for these unconstitutional methods. These methods are nothing but the Grammar of Anarchy and the sooner they are abandoned, the better for us.”
A famous story of Benjamin Franklin, one of the founding fathers of the United States. Walking out after conclusion of deliberations of the Constitution Convention of 1787, a lady, Ms. Pomel of Philadelphia asked him “Doctor, what have we got, a Republic or Monarchy?” With no hesitation whatsoever, Benjamin Franklin responded “A Republic, if you can keep it.”
The time has come for collective efforts to re-discover the sense of national purpose and patriotism that alone can lift our nation on to the road of sustained progress and prosperity. The nation and the people must always come first. Let us strive to arrest the moral decline in our society and ensure that our core civilisational values find firm root. Let us exert ourselves to strengthen India’s pluralism and diversity. Let us be uncompromising in rooting out violence, prejudice and hatred.
Our Constitutional values, young population and entrepreneurial abilities as well as capacity for hard work provide us the fundamentals required for rapid progress as well as the building of a caring and compassionate society. India has changed dramatically in the last 70 years. In the next ten years, we will see even greater progress as we steer our nation, focused on further strengthening our open, democratic and inclusive society
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.
Globally, around 80% of wastewater flows back into the ecosystem without being treated or reused, according to the United Nations.
This can pose a significant environmental and health threat.
In the absence of cost-effective, sustainable, disruptive water management solutions, about 70% of sewage is discharged untreated into India’s water bodies.
A staggering 21% of diseases are caused by contaminated water in India, according to the World Bank, and one in five children die before their fifth birthday because of poor sanitation and hygiene conditions, according to Startup India.
As we confront these public health challenges emerging out of environmental concerns, expanding the scope of public health/environmental engineering science becomes pivotal.
For India to achieve its sustainable development goals of clean water and sanitation and to address the growing demands for water consumption and preservation of both surface water bodies and groundwater resources, it is essential to find and implement innovative ways of treating wastewater.
It is in this context why the specialised cadre of public health engineers, also known as sanitation engineers or environmental engineers, is best suited to provide the growing urban and rural water supply and to manage solid waste and wastewater.
Traditionally, engineering and public health have been understood as different fields.
Currently in India, civil engineering incorporates a course or two on environmental engineering for students to learn about wastewater management as a part of their pre-service and in-service training.
Most often, civil engineers do not have adequate skills to address public health problems. And public health professionals do not have adequate engineering skills.
India aims to supply 55 litres of water per person per day by 2024 under its Jal Jeevan Mission to install functional household tap connections.
The goal of reaching every rural household with functional tap water can be achieved in a sustainable and resilient manner only if the cadre of public health engineers is expanded and strengthened.
In India, public health engineering is executed by the Public Works Department or by health officials.
This differs from international trends. To manage a wastewater treatment plant in Europe, for example, a candidate must specialise in wastewater engineering.
Furthermore, public health engineering should be developed as an interdisciplinary field. Engineers can significantly contribute to public health in defining what is possible, identifying limitations, and shaping workable solutions with a problem-solving approach.
Similarly, public health professionals can contribute to engineering through well-researched understanding of health issues, measured risks and how course correction can be initiated.
Once both meet, a public health engineer can identify a health risk, work on developing concrete solutions such as new health and safety practices or specialised equipment, in order to correct the safety concern..
There is no doubt that the majority of diseases are water-related, transmitted through consumption of contaminated water, vectors breeding in stagnated water, or lack of adequate quantity of good quality water for proper personal hygiene.
Diseases cannot be contained unless we provide good quality and adequate quantity of water. Most of the world’s diseases can be prevented by considering this.
Training our young minds towards creating sustainable water management systems would be the first step.
Currently, institutions like the Indian Institute of Technology, Madras (IIT-M) are considering initiating public health engineering as a separate discipline.
To leverage this opportunity even further, India needs to scale up in the same direction.
Consider this hypothetical situation: Rajalakshmi, from a remote Karnataka village spots a business opportunity.
She knows that flowers, discarded in the thousands by temples can be handcrafted into incense sticks.
She wants to find a market for the product and hopefully, employ some people to help her. Soon enough though, she discovers that starting a business is a herculean task for a person like her.
There is a laborious process of rules and regulations to go through, bribes to pay on the way and no actual means to transport her product to its market.
After making her first batch of agarbathis and taking it to Bengaluru by bus, she decides the venture is not easy and gives up.
On the flipside of this is a young entrepreneur in Bengaluru. Let’s call him Deepak. He wants to start an internet-based business selling sustainably made agarbathis.
He has no trouble getting investors and to mobilise supply chains. His paperwork is over in a matter of days and his business is set up quickly and ready to grow.
Never mind that the business is built on aggregation of small sellers who will not see half the profit .
Is this scenario really all that hypothetical or emblematic of how we think about entrepreneurship in India?
Between our national obsession with unicorns on one side and glorifying the person running a pakora stall for survival as an example of viable entrepreneurship on the other, is the middle ground in entrepreneurship—a space that should have seen millions of thriving small and medium businesses, but remains so sparsely occupied that you could almost miss it.
If we are to achieve meaningful economic growth in our country, we need to incorporate, in our national conversation on entrepreneurship, ways of addressing the missing middle.
Spread out across India’s small towns and cities, this is a class of entrepreneurs that have been hit by a triple wave over the last five years, buffeted first by the inadvertent fallout of demonetization, being unprepared for GST, and then by the endless pain of the covid-19 pandemic.
As we finally appear to be reaching some level of normality, now is the opportune time to identify the kind of industries that make up this layer, the opportunities they should be afforded, and the best ways to scale up their functioning in the shortest time frame.
But, why pay so much attention to these industries when we should be celebrating, as we do, our booming startup space?
It is indeed true that India has the third largest number of unicorns in the world now, adding 42 in 2021 alone. Braving all the disruptions of the pandemic, it was a year in which Indian startups raised $24.1 billion in equity investments, according to a NASSCOM-Zinnov report last year.
However, this is a story of lopsided growth.
The cities of Bengaluru, Delhi/NCR, and Mumbai together claim three-fourths of these startup deals while emerging hubs like Ahmedabad, Coimbatore, and Jaipur account for the rest.
This leap in the startup space has created 6.6 lakh direct jobs and a few million indirect jobs. Is that good enough for a country that sends 12 million fresh graduates to its workforce every year?
It doesn’t even make a dent on arguably our biggest unemployment in recent history—in April 2020 when the country shutdown to battle covid-19.
Technology-intensive start-ups are constrained in their ability to create jobs—and hybrid work models and artificial intelligence (AI) have further accelerated unemployment.
What we need to focus on, therefore, is the labour-intensive micro, small and medium enterprise (MSME). Here, we begin to get to a definitional notion of what we called the mundane middle and the problems it currently faces.
India has an estimated 63 million enterprises. But, out of 100 companies, 95 are micro enterprises—employing less than five people, four are small to medium and barely one is large.
The questions to ask are: why are Indian MSMEs failing to grow from micro to small and medium and then be spurred on to make the leap into large companies?
At the Global Alliance for Mass Entrepreneurship (GAME), we have advocated for a National Mission for Mass Entrepreneurship, the need for which is more pronounced now than ever before.
Whenever India has worked to achieve a significant economic milestone in a limited span of time, it has worked best in mission mode. Think of the Green Revolution or Operation Flood.
From across various states, there are enough examples of approaches that work to catalyse mass entrepreneurship.
The introduction of entrepreneurship mindset curriculum (EMC) in schools through alliance mode of working by a number of agencies has shown significant improvement in academic and life outcomes.
Through creative teaching methods, students are encouraged to inculcate 21st century skills like creativity, problem solving, critical thinking and leadership which are not only foundational for entrepreneurship but essential to thrive in our complex world.
Udhyam Learning Foundation has been involved with the Government of Delhi since 2018 to help young people across over 1,000 schools to develop an entrepreneurial mindset.
One pilot programme introduced the concept of ‘seed money’ and saw 41 students turn their ideas into profit-making ventures. Other programmes teach qualities like grit and resourcefulness.
If you think these are isolated examples, consider some larger data trends.
The Observer Research Foundation and The World Economic Forum released the Young India and Work: A Survey of Youth Aspirations in 2018.
When asked which type of work arrangement they prefer, 49% of the youth surveyed said they prefer a job in the public sector.
However, 38% selected self-employment as an entrepreneur as their ideal type of job. The spirit of entrepreneurship is latent and waiting to be unleashed.
The same can be said for building networks of successful women entrepreneurs—so crucial when the participation of women in the Indian economy has declined to an abysmal 20%.
The majority of India’s 63 million firms are informal —fewer than 20% are registered for GST.
Research shows that companies that start out as formal enterprises become two-three times more productive than a similar informal business.
So why do firms prefer to be informal? In most cases, it’s because of the sheer cost and difficulty of complying with the different regulations.
We have academia and non-profits working as ecosystem enablers providing insights and evidence-based models for growth. We have large private corporations and philanthropic and funding agencies ready to invest.
It should be in the scope of a National Mass Entrepreneurship Mission to bring all of them together to work in mission mode so that the gap between thought leadership and action can finally be bridged.