Today’s rich countries are democratic government. In fact, it is presumed that democratic governments and economic prosperity go hands in hands. But is this hypothesis true for our country, India? Or is it possible that our democratic government actually hurts us?
If we compare China and India, we can see a clear effect of the government in the economy. In China, the government is authoritarian and can essentially do what they like without worrying about voters or any opposition. When it comes to supporting the economy, they are very efficient as a result and it is evident from their growth. For example, particularly from infrastructure front, if the Chinese government needs to buyout land for a big infrastructure development, they can do this this quickly because the residents can’t object. In contrast, whenever the Indian government has to do something like this, there are protests, the opposition, remember not responsible opposition, gets in the way of the government, and it ends up taking years before anything gets done. While reading this few corporation names popout like Posco, Lakshmi Mittal & many more which have broken their head with Indian government babus.
Unfortunately, our democracy is bad for efficiency in the economy. The democratic process gives everyone a say and is more fair and just, but all this comes with a price. So, our economic development is too slow. Does this mean, we should pitch for authoritarian government like china? Not necessarily. Democracy has its benefits like freedom of expression, and individual rights. Instead, we need to find a way to give individuals a say, but also ensure that we have a strong government and a responsible opposition. We need a strong government that can pursue policies without excessive burdens. And we need a smooth regulatory environment that ensures businesses are run efficiently. Like when it comes to building factories, the Chinese government has no problem clearing land. In India, there are marquees of protest and most of them doesn’t know why are they protesting, and we’d have a long delay before the factory ever gets built. This is one of the reasons we lag so far behind China when it comes to manufacturing.
Democracy in general doesn’t hurt economic progress. As mentioned, all rich countries have democracies so they must be doing something right. But, our democracy in India holds up economic progress and is bad for the economy. Our politicians spend too much time talking, planning and discussing what they would like to do, all with the taxpayer’s money. If we want to one day become a developed country, then this needs to change.