The Turn of the Tortoise (TOT) is an exhaustive and superbly written book that enagages the gamut of governance issues concerning growth, welfare and foreign policy with significant and unusual insights that derive from the author’s engagement with the real world. The book speaks to a wide range of issues ranging from entrepreneurship, corruption, governance, environment, poverty alleviation, foreign relations, and even compares the governance of growth in India and China and the implications of the rise of China for India. The author has generously thanked the reader for patience in his acknowledgements after having produced a remarkably lucid script.
The book is quite balanced, with a tilt though not an exclusive emphasis, on growth as the harbinger of most of India’s problems. The state, according to this view, should largely restrict itself to providing public goods like law and order and perhaps health. It is much better off withdrawing from activities that private sector is good at delivering. After all, private schools outperform public schools, and they are quite popular among the poor.
The Indian state, according to this view, has been forced to surrender economic space to the private sector not because politicians desired it but because the private sector is more efficient. Even public activities such as tax collection have been outsourced to private entities. At one point, the book praises the Reagan-Thatcher approach of privatization of public activities and bemoans the fact that the Indian political class is driven by an anti-market ideology. In another place, the author concedes that politicians now want to be in business to realize substantial regulatory rents.
The author takes an even-handed view of the private sector’s contribution. TOT praises entrepreneurs but does not take the view that India’s growth is primarily due to the private sector. The big bang reforms of 1991 were the handiwork of the government. Equally, it praises real life entrepreneurial legends ranging from the saga of Narayanamurthy of Infosys, Baba Kalyani’s globally renowned Bharat Forge which is now involved with the manufacture of defence equipment, and the more recent IIT graduates who have launched innovative companies like Flipkart and Snapdeal.
The most fascinating narrative on Indian business, however, details the saga of companies that invested billions of dollars abroad after 2007 only to lose large sums of money in the aftermath of the global financial crisis. Not many are aware that the Tata Group’s foray into multinational investment brought with it substantial bad luck. What was true of the Tata’s was also true of other Indian multinationals such as GMR, GVK, Mittal and DLF, among many others. Would India have been better off had Indian companies not invested abroad?
It is well known that de-regulation begets re-regulation. Earlier the state produced everything from telecommunications services to watches. Now that it has receded, regulators need to promote competition because restricting the monopolistic propensities of aggressive entrepreneurs is no mean task. To give just two examples, the WLL scam in telecommunications was averted around 2003, and, the 2G telecommunications scam unfolded after 2008. In these cases, regulators, technocrats and the courts played a significant role in averting crises. The book details these scams but is silent on the key questions regarding regulation.
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