'India's economy marked by excessive govt intervention,' Singapore former Dy PM said at NITI lecture in 2016
economic development. Ultimately, India aims to emulate China's success in moving a substantial portion of its population from lower-income status to the middle-income bracket. Also Read: Indian-origin Tharman Shanmugaratnam wins Singapore's presidential election In essence, Tharman Shanmugaratnam pointed out that India's approach to its economy has been characterized by excessive government intervention and inadequate investment in social and human development.
The government has been too involved in regulating economic activities while not giving enough attention to building social and human capital. “It has to withdraw from the old roles of the State – economic regulation, and ownership and management of enterprise. Those roles restrain private investment and job creation.
They also preserve incumbents, the existing players, at the cost of allowing new players to grow," he added. He emphasized that achieving a growth rate exceeding 8% over two decades is not a luxury but a necessity. In the mid-1970s, India and China had similar per capita incomes, but today India lags significantly behind, with less than half the per capita income of China.
Shanmugaratnam stressed that even with consistent growth between 8% and 10%, as India catches up while China's growth slows down, India would still only achieve approximately 70% of China's per capita income in two decades. Also Read: Macroeconomic stability is back in India: Tharman Shanmugaratnam He further added that there is no fundamental reason why India cannot address the social and economic disparities of its past. India possesses one of the largest untapped potentials among all countries.
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