Old ideas for a new India, amid the churn |
In many ways, 2025 can be called a watershed year. Several long-held orthodoxies have collapsed. A rule-based global order — governing trade, war, alliances, and policy predictability — has weakened sharply. In its place has emerged a world driven by naked military and economic power: Transactional, narrowly self-interested, and fundamentally zero-sum in outlook.
This shift has been rapid. It is unfolding alongside dramatic advances in artificial intelligence and technology, intensifying sustainability challenges, and accelerating demographic change. These forces together compel all countries to reassess their economic strategies, institutional frameworks, and global alliances. India is no exception.
I ask that we revisit four old but powerful ideas — not ideological novelties, but pragmatic reforms rooted in efficiency, governance, and basic morality. These are: Converting all subsidies into direct benefit transfers (DBT), consolidating public sector ownership under a government holding company, decisively fixing power distribution companies, and ensuring the pending cases in our judiciary are cleared rapidly.
Convert all subsidies into DBT: India operates a maze of inefficient and distortionary subsidies. These include fertiliser subsidies, minimum support prices (MSP), free power, free water, and various forms of job guarantees. Officially, subsidies account for around 3.5% of GDP. But if we did honest accounting the true cost likely approaches 7% of GDP.
The fertiliser, or rather urea subsidy, has encouraged urea overuse and degraded soil quality. Free power and water for agriculture have contributed to severe groundwater depletion. Together........