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Accelerating India’s Development - A State-led Roadmap for Effective Governance

Updated: 5 days ago

In the current period, effective governance remains the core handbook of all modern nation-states. Such a system guarantees that public institutions can deal with the problems with adequate resources and tools under their command. The same is true in the case of India, which aspires for a faster economic growth of 10% by surpassing its nearest rival, China, which once grew by more than double-digit figures following its economic reforms.


An Illustration on the book review of Accelerating India's Development

Illustration by The Geostrata


The book “Accelerating India’s Development: A State-led Roadmap For Effective Governance” by Professor (Dr) Karthik Muralidharan from the University of California San Diego emphasises the importance of effective governance in making economic advancements.


The eighteen-chapter-long book from Penguin Random House comprehensively analysed how India can lead economic change by facilitating effective governance.


By drawing his expertise from varied stakeholders, Professor Muralidharan suggested a roadmap to enhance the governance mechanism and accelerate India’s development. 

Effective governance remains the book’s core argument, making a case that despite having a large state apparatus, India can aim for effective service delivery by identifying the core issues surrounding poor delivery.


The book has described the importance of reforming the governance structure involving the politicians, bureaucrats across the Union and state government dealing with critical socio-economic functions of providing health, education, security, employment and overall employment opportunities not by limiting the state capacity but by increasing the contemporary peripheries of government for providing essential services.


The core thesis in this book departs from the arguments asking for a limitation of state power but calls for increasing state authority to guarantee effective governance with a combined package of welfare goods and services for most poor citizens who cannot afford private services. However, reforming the governance structure plagued by limited state capacity can guarantee the delivery of such essential services.


The author explains the weak performance in terms of state service delivery by taking the case of education, where the burgeoning 3% spending of the country’s GDP does not have a direct correlation with improved learning but with half the fifth-grade children of rural India who cannot read a second-grade level text, making 10 million Indian children finish their schooling without the basic skills to participate in a modern economy. 


The author has argued that India has to increase and invest in building state capacity to provide essential services and enhance its current functioning further. 

Professor Muralidharan argues that India has yet to invest significantly in improving and building its state capacity, turning it into a heavily centralised system with little role for the local bodies.


The centralised polity has limited the scope of local government bodies, receiving only 3% of the total budget, making the system lack its overall spending capacity to spend on welfare as the decision-making remains concentrated on the top. As per the author’s observations in several Indian states, centralised public spending measures result in limited local capacity and increased expenses.


Professor Muralidharan, in the book, has cited several studies done by him and others to show that the Return on Investment (RoI) in services closely monitored governmental projects government is ten times higher. As per the book, such services can be improved by including emerging technology to minimise supervision and corruption.


Muralidharan gives the example of Telangana, where spending on call centres has not only enhanced the disbursal services under the Rythu Bandhu scheme but also resulted in an additional delivery of 25 rupees to the farmers. 

The importance of state capacity and the necessity to improve by investing in it was well captured during the COVID-19 pandemic. Professor Muralidharan has argued that the pandemic revealed the lack of overall capabilities of the Indian state, which was marked by weak public health infrastructure and issues related to data quality, transparency, and coordination between the central and state governments. 


However, on a mission-based initiative, the government successfully administered over a billion doses within a year to respond to the crisis. Therefore, the current Indian state successfully encounters goals and objectives in a mission mode.

Muralidharan argues that such ‘mission-based initiatives’ by the Indian state come at the cost of longer-term priorities that can be pursued during normal times. In such instances, as argued in the book, further investments to increase state capacity have mainly happened during subsequent periods of national crisis against the normal period when the existing governmental capacity can be further strengthened. 


The book draws on the example of 1991 economic reforms as a case where financial advisors and senior officials conducted background studies for reforms for several years before being implemented by the will of the then-political leadership of Prime Minister P.V. Narasimha Rao. 


Overall, by providing an inclusive model of higher economic growth along with improvements in governance, the book has provided the core idea of how the Indian state is effective and weak at the same time by providing the overall services of average economic growth but has struggled to deliver well in guaranteeing education, health, jobs and safety from the prism of growing democratic aspirations of the people.


The book has further encouraged a relook at the Indian state interrelated with a ‘black box’ to an institution that needs inward systematic functioning changes to guide the nation to economic prosperity and efficient service delivery.  

In short, the book emphasises the urgency of building a more effective Indian state from a weak state by investing in state capacity. However, Professor Muralidharan warns that investing in a state with reduced capacity is similar to adding fuel to a car near a breakdown with minimal capability to take us far.


 

BY ANIRBAN DUTTA

TEAM GEOSTRATA

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