By ET Bureau | 28 Feb, 2015, 04.00AM IST
Beating China and making JAM – those are among many unusual features that made Chief Economic Advisor Arvind Subramanian's first Economic Survey a fairly bold reform in how government talks.
Equally unusually, there were a few sharp political messages between the lines of economic analysis in the Survey - a clear expression of geopolitical confidence and a clear case for placing efficient welfare delivery and incremental systemic reform over headline-making "big bang reforms".
But sarkari inefficiencies still found a toehold - around six pages were repeated in the crucial first chapter. Subramanian departed from decades of sarkari norm and broke the survey in two parts. Volume 1, as the CEA explained, concentrated on "ideas generation to inform economic policy-making". Tons of economic facts and data as well as technical analysis were shifted to Volume 2. This made for far better reading but that was just the beginning of the Subramanian impact. Volume 1's cover visual send out a message far bolder and dramatic than North Block documents do.
The visual plots India's and China's real GDP growth from 1978 to 2015 - and shows India's growth rate took over China's sometime in 2014 and that the gap will widen this year. India overtaking China in growth rate was reported widely after the new GDP series upped India's growth rates. But Indian government's official annual assessment of the economy choosing to highlight India beating China in the growth rate game signaled a different order of significance. It indicates government confidence in the near economic future and also confidence that India can be again seen as a competitor to China.
t's therefore as much a broad geopolitical statement as it is an economic one. From that cover, that the Survey tone would be upbeat would have been an easy guess. What would not have been an easy guess is that Subramanian's Survey Volume 1 would make several interesting points that go against conventional liberal economic wisdom. Having celebrated the Modi victory as a call for change ("political mandate for reform"), Subaramanian makes an unusually frank point "big bang reforms". The Survey's honest admission of the limits to Central policy freedom as well as its argument that incremental changes over time can deliver far bigger results than pundits expect was in sharp contrast to many earlier Surveys.
This, too, was a political message in that it made the case for economic reform that takes account of India's "realities". And that message was even sharper in Subramanian's coinage of the term 'JAM' - Jan Dhan Yojana, Aadhaar and Mobiles. In a chapter titled "Wiping Every Tear From Every Eye: The JAM Number Trinity Solution", the Survey argued that delivering subsidies to the truly deserving was a crucial government responsibility and that a combination of financial inclusion (Jan Dhan Yojana), identification system (Aadhaar) and technology (mobile phone delivery platforms) .. will get money to those who need it.
The catchy acronym JAM also encapsulated a political message - Modi Sarkar won't be unmindful of welfare recipients. The one blemish in an otherwise well-written and well-produced Survey was that pages 19-20, 20-21, 21-22 and 23-24 were all repeated in Volume-1. But overall, the Survey lives up to the promise made by the CEA in his preface, that it "places a premium on new ideas and new perspectives".
