A BOOK REVIEW ON

THE FUTURE OF INDIAPolitics, Economics and Governance by Bimal Jalan

Reviewer
Divya Prabhu P,
Asst. Professor- Dept of Business Administration
Sahyadri College of Engineering & Management,
Mangalore
Email: divyabantwal@gmail.com

A BOOK REVIEW ON
THE FUTURE OF INDIAPolitics, Economics and Governance by Bimal Jalan
The book that I have reviewed is The Future of India authored by eminent Economist
Mr Bimal Jalan. This book is an attempt to understand the causes of the swings in Indias
fortunes from time to time and explore the reasons for our failure to fully realize countrys
potential.
Bimal Jalan is an Indian writer and a former Governor of the RBI. He was also a
nominated member of the Upper house of Indias Parliament, the Rajya Sabha between 2003 and
2009. He has held several top positions in the ministries of Finance and industry and in the
Planning commission. He was also the Chairman of the Economic Advisory Council to the Prime
Minister and represented India on the boards of IMF and the World Bank.
Having read this book, a new and confident thought is certain to flow in the minds of the
readers. Here are a few excerpts from the authors writings.
Period from 1966-1980 was effectively the darkest for the Indian economy during the
post independence period. Against this dismal historical background, there has been a sea change
in Indias present economic position. It is now regarded as an emerging economic power, one of
the fastest growing countries. It is now a commonplace to project India as one of the 3 most
important Global economies by 2020 or 2025 (After US and China). But at the same time, there
is also a nagging doubt whether there will be a sufficient change in our political vision, economic
policy and administrative system to seize the opportunities that lie ahead.
There is strong emphasis on the political aspect in all the chapters. The first and the fifth
chapters deal exclusively with the evolution of democratic politics in India, its strengths and
weaknesses and the changes that are required to make the political system work better for the
benefit of the people as a whole and not only the interest of the leaders whom they elect. Second
chapter deals with the process of economic policy making in the country and the impact of the
colonial legacy and coalitions of special interests in keeping the pace of the economic reforms

slow and sub-optimal. The third and the fourth chapters are concerned with certain issues in the
areas of governance and widespread corruption in our society and suggest measures for reform.
The Epilogue is on A resurgent India- a reflection on what needs to be done to revitalize
Indias institutions in order to realize the countrys full potential and eliminate poverty once and
for all.
Elections are truly the hour of triumph for Indias democratic traditions. But there are
unavoidable feeling of disappointment and unease. After elections, when a new Govt. takes
power, peoples interests tend to be overtaken by the power of special interests. Ministers and
their bureaucrats become authoritarian, self centered and autocratic. The first chapter The
Triumph and Travails of Democracy examines the political forces involved in determining the
evolution of economic policy in the country. The author also discusses about the inadequacies in
the working of Indias important democratic institutions and their failures to deliver sufficient
benefits to which the people are entitled.
The next chapter on Economics of non performance deals with certain factors which
may impede Indias growth over the long run. One among them is the deadweight of the past.
The most conspicuous failure is the erosion in public savings and the inability of the public
sector to generate resources for investment or provision of public services. The author has quoted
the financing of loss making irrelevant units as an example for improper employment of national
savings that contributed to rising fiscal deficits. Another factor is the power of distributional coalitions. At the time of Independence Indias feudal past created doubts whether its unity and its
democratic experiment with adult franchise would last for very long. But it succeeded and won
worldwide admiration. Reason: the political decision making on economic issues is driven by
special interests rather than the common interests of the general public. There are special
regional interests even within the states. Economic policy making is further affected by the
occupational divide. As a result, economic benefits of these decision are likely to flow to a
special interest group called as Distributional co-alitions. It is the power of special interests
and dominant co-alitions which explains why India policies and programs that benefit only a
small proportion of the poor command such substantial support among all political parties. There
is increasing disjuncture between politics and economics which is yet another factor discussed in
the book.

Author speaks about Governance before and after independence. The chapter Crisis of
governance examines the role of civil service and that of ministers in administrative structure
and public delivery system. Though the economic performance of India is improving, there is
vicious circle of poverty. Programs launched by Govt. such as job creation, subsidized credit to
poor etc have benefitted the poor but leakages in Govt funded anti poverty programs are very
high. A substantial part of the funds are diverted to meet other revenue expenditure. This is the
crisis of Governance. Author opines that there is marked fiscal deterioration and inability to
provide essential services in the government sector. He has portrayed various problems that
bedevil the Public Delivery System (PDS). To avoid these problems, he also says that the
objective of better PDS can be achieved if quantitative annual targets are set to each minister
during annual budget and each one is made responsible to Parliament for achieving those targets.
If it is felt that making the minister alone responsible is unfair as there could be other factors
responsible for non performance, the solution lies in reforming the entire administrative system.
The need for PPP i.e. public private partnership model has also been highlighted, the need to
reform the procedure for launching vigilance inquiries and the number of agencies involved in
such investigations, etc are considered in the chapter The Supply and Demand of Corruption.
This chapter brings together the information on the ill effects of corruption on public welfare and
countrys economic potential. Corruption affects the ratio of investment to national income, due
to illegal transfer of funds from one to another, wrong choice of public projects and project
delays etc... it adversely affects more on small enterprises. Big firms can increase their profit as it
allows them to enjoy monopoly rents and scale economies. Thus, an effective anti-corruption
strategy would need to focus on institutional reforms, effective measures which reduce both its
Demand and Supply.
The last chapter is on the need for political reforms. Priority is to reduce the role of the
Govt. in the economy. Author says that India has the ability to undertake reforms with caution
and pragmatism, without falling into the trap of ideological certainty and making changes
advocated by experts and international institutions. Authors purpose here is to suggest only a
few core changes that are practical and pragmatic. He opines conversion of Indias
parliamentary form of Govt. into presidential one, elections by proportional representation,
reduction in the number of ministers to reduce unnecessary interferences & conflicts, cleaning up
of legislative mess, abolishing outdated laws, simplifying rules and so on. Author also suggests

some simple changes to improve the electoral process to the council of states. Persons with a
Charge sheet must not be allowed to sworn in, strong need for reform in the parliamentary
procedures etc were a few of his suggestions.
Finally in the epilogue the author questions the readers as to what can be done to
revitalize the functioning of political institutions and the economy to enable India to realize its
full economic potential and remove poverty by 2020. These decisions must be based on a
reasonable consensus across the political spectrum. There is also a need to differentiate between
objective and instruments. So far India has been exceedingly fortunate in having persons of
caliber, integrity and patriotism in the top leadership positions irrespective of the nature of the
co-alition to which they belong. But it cant be taken for granted that this situation will continue
in the future.
Through this book, the author has tried to identify and highlight it to the readers a few
strategic and instrumental issues in the areas of politics, economics and governance which are
overlapping but very crucial for Indias growth. The author also believes that if the men and
women of our country have the determination to realize the Indias vast potential, Indian
economy can become one of the strongest in the world, in the not-toodistant future.
Widespread poverty, illiteracy and disease would then largely disappear and democracy would
have given the people, their just rewards. Whether we have the necessary will is the real
question to be probed.
To conclude, the author has examined the nuts and bolts on the future of India. This book
is a thought provoking, clear sighted analysis which proves that it is the interface between
politics, economics and governance and their combined effect on the functioning of our
democracy which largely determines countrys future. The popular magazine India Today
commented on The Future of India as an essential SWOT analysis on the emerging India.
The central thesis of this book is that effective governance and responsible politics are of utmost
importance in shaping Indias economic future. It indeed is a great book to read to those who
want to get a feel of where India stands today and in what ways it can reach to where it should
be. Happy reading!!