Abandon myopic policies for the common global good

Policies of the US, China and India should prioritize long-term gains and their people

- PRASANNA KARTHIK

In the evolving landscape of global economics, the world's three largest economies (by purchasing power parity) confront distinct yet interconnected challenges. India is plagued by electoral populism, China with excessive government interference and the US is embracing protectionism. Eschewing these positions is crucial for sustainable growth and the stability of these nations as well as the global economy.

India's vibrant democracy faces challenges such as excessive populism, policy stagnation and reforms inertia. About 44% of India's labour force still works in agriculture, which contributes only 17% to gross domestic product (GDP). For inclusive growth, it's essential to shift the bulk of India's agricultural labour to manufacturing. This requires land reforms to enable industrial and infrastructural development, labour reforms to promote easy hiring of labour, alongside improving the ease of doing business. These changes would position India as a credible manufacturing alternative to China, create jobs, and boost productivity, preventing it from falling into a middle-income trap.

For sustained growth, India needs a new political and social consensus on labour and land reforms, apart from freebie rationalization and fiscal discipline. Policymakers should engage businesses, civil society and the political opposition to promote them. India's democracy must evolve to focus on long-term development over short-term political gains. Citizens must demand policies that secure the future and hold leaders accountable for ensuring lasting progress.