‘Challenges of Sustainable Development in India and the Union Budget’ an event organised by The Economics Club, Mumbai and Lala Lajpatrai College of Commerce & Economics on 22nd July 2014.

A seminar was organised by The Economics Club in association with Lala Lajpatrai College of Economics and Commerce.

Dr. Nirupam Bajpai addressed a gathering of economics and management students and faculty from Colleges across Mumbai on ‘Challenges of Sustainable Development in India and the Union Budget’ in an event organised by The Economics Club, Mumbai and Lala Lajpatrai College of Commerce & Economics on 22nd July 2014.

Sustainable development, Dr. Bajpai stated, has three components ‘Growth’ (attaining and sustaining growth), ‘Inclusion / Equity’ and ‘Environmental Sustainability’.

Dr. Bajpai reminded the audience that India is still largely dependent on agriculture and hence revival of agriculture is a top priority. We need to revitalise Indian agriculture especially in large states like Uttar Pradesh, whose dismal performance pulls down the national average. Various Government initiatives in this area include:

• Focus on Laggard states
• Identify crops that need support
• Soil Health Cards for farmers
• Investment in Irrigation

Certain challenges facing the government include how it deals with the Food Corporation and food inflation. How does one creatively think of challenges like surplus stocks, wastage and hunger, asked Dr. Bajpai.

The ability to create jobs on a large scale will be one of the parameters on which the success or failure of this government will be evaluated. In the next five years, there is a need to create around 60 million new jobs. While a lot of these jobs will come from the private sector, the government has to allow and enable the private sector to create these jobs. India needs to reform its archaic labour laws. Dr. Bajpai believes that action on labour reforms will be initiated by the government in the coming two months.

Dr. Bajpai emphasised that India jumped the gun by focussing on growth of the services sector before developing the manufacturing sector. Growth in the services sector does not necessarily create jobs and he hoped that structural changes in the economy will eventually happen.

Dr. Bajpai acknowledged that the current Finance Minister has inherited problems from his predecessor and that a budget created by the government in the first forty days of their rule can’t transform the country overnight. Controlling the fiscal deficit will be a big challenge for the finance minister. The fiscal deficit target is an ambitious target. India needs huge investment volumes to increase revenues. In this context managing expectations of different publics is critical for the government.

Some of the other points discussed:

ü In the area of taxation Dr. Bajpai felt that retrospective taxation should be scrapped as it sends out a negative signal to investors.

ü FDI in defence manufacturing is a positive step forward.

ü Urbanisation too should be seen as an opportunity and not a challenge.

ü The impact of climate change is been felt across the world. Climate change is disturbing hydrological cycles and patterns of rainfall. What can individuals do for climate change? He urged students to contribute towards conservation of energy by taking small steps like switching off unnecessary lights and fans.

While discussing aspects of the Budget not agreeable to him, Dr. Bajpai stated that investing in more IIMs and IITs in all states without adequate resources to ensure quality with respect to faulty, leadership and research was not a wise decision. Instead he feels that each state should create centres of excellence in medicine, engineering and management. Dr. Bajpai also felt that a bullet train is still a luxury and that the focus instead should have been on improving existing trains or on investing in important sectors like health or provision of safe drinking water.

Discussions during Q & A session:

ü Rising defence expenditure is an indicator of geo-political realities, stated Dr. Bajpai.

ü When asked about the cleaning of Ganga, Dr. Bajpai emphasised that what was needed above everything else was a change in mindset of the people.

ü Lack of political will is one of the key reasons for problems faced in the power sector. He appreciated innovative ideas like the use of solar panels over river Narmada to generate solar energy and prevent evaporation!

ü Addressing the need for a disaster management plan, Dr. Bajpai emphasised that we need to create a mindset that values human life.

ü He warned the audiences that increasing poverty could even lead to break down of a country. Hence the country needs to put in around 10 to 15 years of concerted efforts to fight poverty.

ü There is a need for investing in and improving basic health care especially in rural India. Based on his experience with health care projects across India, Dr. Bajpai believes that improvements in the health care system can be carried out through well-thought out plans and logistics.

ü Within manufacturing he emphasised that we should focus on agro-based industries. He also stressed the importance of investing in R&D in agriculture.

ü Creation of 100 smart cities was important.

ü What India needs is out of the box thinking, urged Dr. Bajpai.

Mr. A.K. Agarwala, Chairman, Business Review Council, Aditya Birla Group then addressed the youth and urged to come ahead to make a difference to society!

Mr. G. S. Panikar President of The Club ended the day by thanking Dr. Bajpai for a wonderful and inspiring session.