Breaking the Mould: Reimagining India's Economic Future Hardcover – 7 December 2023

Hindsight provides excellent insights and helps build our foresight. This book is about India’s future, and policy prescriptions for inclusive economic growth.There are three core aspects in this book. First and foremost is the SMILE curve that describes the global value chains. At the beginning of this curve are high value added, intellectual property intensive activities like R&D, core technologies, patents, design and the like in conceptualizing products and solutions. The next stage is mass manufacturing which typically involves high labor (brawn and not brain) which is done at locations with low labor costs. The next phase again has high value addition in activities like branding, distribution, financing and product management. At this juncture, India seems to be focusing on the manufacturing phase to provide jobs to our millions, through aggressive policies to attract foreign firms and policies like PLI. While we have been quite successful in the services sector, especially in software service-related exports, India has lagged behind in manufacturing, an area ceded to China and other far eastern countries.The second area of focus in this book is on creating human capital for innovation led growth, through creative thinking. This calls for improving child nutrition, health care and excellent quality of higher education. In addition, it demands training in skills that are employable rather than college degrees that aim at clerical or white-collar government jobs that are few and far between.Pioneer innovators like ID dosa batter and other startups in diverse sectors including eye-care (Lenskart), Space (AgniKul), Tejas Networks (5G) and Tilfi (selling Banarasi saris to the world) are great examples which have combined innovation with disruptive business models. (These are case studies apt for classrooms at WIMWI mentioned in the book; which is actually IIM-A, fond memories of Prof Rajan’s alma mater, and so are mine!).The authors contend that we need thousands of such companies, as the model to create jobs and leveraging on India’s core strength: human capital. Hence the current initiatives like PLI, subsidies and tariff protection are in fact counterproductive for India’s sustained economic growth, contend the authors. To cite an example, the foreign chip manufacturing company in Gujarat is given a subsidy of $2 billion to create 5000 jobs, which is $400,000 or Rs 3.2 Cr per job. This semiconductor plant is meant just for assembly and testing, and not high R&D. It is pointed out that this subsidy equals a third of the Rs 44,000 Cr that the central government spends on higher education. Subsidies in agriculture (that distorts the entire value chain, creating sub-optimal outcomes) and other government schemes that are meant for the poor ‘with poor outcomes’ make interesting reading. These arguments are supported by data, sound economic principles and a passionate call for change.The third aspect of this book falls in the territory of politics and governance. This refers to ‘divisive majoritarianism’ that is not open to new ideas and hampers free thinking and innovation. If India needs to capture the higher end of the SMILE curve, through its own unique model, we need an ‘irreverent, diverse and argumentative society, at harmony with its energetic chaos, one from which creative ideas will emerge and change the world’.While I commend great ideas in the book, I expected much more from the authors in the form of an economic blueprint (like the Vision 2020 document) rather than mere arguments and policy prescriptions.Secondly, though the approach of winning through human capital and high-end innovation is highly appealing, the book is silent about what needs to be done in the short term, especially for the millions seeking employment. Economists usually focus on ‘the long run’ and as John Maynard Keynes said ‘In the long run, we are all dead’.Finally, it is time to bury our political ideologies and personal prejudices. It is time when national unity and single-minded devotion to build India of our dreams should be our clarion call that ignites our imagination. This calls for hard work, commitment and sacrifice. The best is yet to come. SMILE!

"Breaking the Mould offers a captivating exploration of India, skillfully painted by the authors who unveil the authentic essence of the country. The dynamic collaboration between the writers makes for an engaging read, providing readers with a profound understanding of India's diverse landscapes and cultures.The book delves into the intricate web of India's societal fabric, shedding light on the challenges and triumphs that shape the nation. With a keen eye for detail, the authors present a realistic portrayal of India, offering readers a nuanced perspective on the intricacies of its people and policies.One of the book's strengths lies in its insightful analysis of how government policies can be crafted to yield tangible results for the populace. The authors not only diagnose the issues plaguing India but also prescribe thoughtful solutions, making a compelling case for strategic policy-making. The narrative seamlessly weaves together anecdotes, data, and policy recommendations, creating a comprehensive guide for policymakers and anyone keen on understanding the dynamics of governance.What sets Breaking the Mould apart is its ability to transcend mere criticism and provide a constructive blueprint for a more prosperous future. The prose is eloquent, yet accessible, making complex policy discussions approachable for a wide audience. As the authors navigate through the intricacies of India's socio-political landscape, readers are treated to a literary journey that is both enlightening and thought-provoking.In a world hungry for solutions, Breaking the Mould emerges as a beacon of insight, urging governments to rethink their approaches and inspiring readers to envision a better, more equitable future for India. A must-read for those passionate about policy, governance, and the intricacies of one of the world's most dynamic nations." At last I would suggest every Indian should read this book and get insight.

Not yet ready.

Unlike many popular books on India's economy, this book stands out by blending impactful statistics and compelling arguments with inspiring success stories. The writing is extremely accessible to just about anyone (concerned citizens or even non-resident Indians) who loves reading and is interested in learning more about India. The authors humbly and rigorously explain economic trends, India's complex history, and the challenging road ahead. They systematically break down economic choices and decisions, exploring manufacturing, services, healthcare, education, building a creative economy, concerns related to battling malnutrition, optimizing resources, employment, and other vital parameters. In an age, when the world closely watches India's growth story, the coming decade could be a defining era for the nation. So as dedicated citizens and esteemed academics, they offer great recommendations on fostering further growth, and an alternative vision on manufacturing, but also make the reader reflect on the nation’s priorities and strengths. The authors slowly push the readers to consider what a mature democracy and economy should be concerned about. In talks and the book, the authors use some catchy phrases like 'focus on brain and not brawn' and 'engage with ideas and not identity'. Finally, look out for chapter 13 in the book, which pays homage to Mahatma Gandhi's Hind Swaraj, presenting a dialogue between the concerned citizen (reader) and the writers (editor), creating an engaging and thought-provoking segment.