Shaping India's Future: Democracy, Capitalism, Government

It is a great honor for me to deliver the A.D. Shroff Annual Public Lecture this year. I joined the Tata Administrative Service in 1965, and I did an assignment that year with Dr. Freddie Mehta, Chief Economic Advisor to the Tata Group. The Tata Group, and Dr. Mehta too, had a very close relationship with Mr. Shroff. So, when I entered as a rookie into the world of business and capitalism, I learned with awe of Mr. Shroff’s reputation. Mr. Shroff’s ideas are interwoven into my lecture today.

I will talk about India’s future. We were led to believe, by the BRICs’ projections, that by 2040 we are destined to be an economic power in the same league as China and the USA. But many are dismayed by what is going on in the country today. We are one of the worst countries to do business in according to international surveys. We have the largest number of mal-nourished children in the world. Our urban infrastructure is miserable. Our power system is limping, some say it is crippled. We must wonder, ‘How will we get from here—our current reality, to there—our great destiny’?  

Many big forces are shaping India’s future.

Demographics
One is demographics. India’s demographic profile is expected to provide its economy with a ‘dividend’ propelling it, according to the BRICS projections, by several economic think tanks, to become the third largest economy in the world, after China and the USA. India has a huge population and, within it, a swelling number of young people. In 2010, the working age population (that is persons over 15 years old) was 1,125 million in China. In India it was 850 million. But India’s population is much younger. Whereas the median age of China’s population was 34 years, in India it was only 25. (For comparison, the median age in Europe is 43 years). Therefore, over the next twenty years, India will have many more working age persons than any other country of the world.

Democracy, Capitalism, and Government
India’s demographic profile is a certainty. The babies who will grow into the youth forming India’s population bulge are already born.

However, the form of other forces that will shape India’s future is not fixed. Their forms can change over the next twenty years. These are the forces of democracy, capitalism, and government. And it is the condition of these forces that will determine whether or not India will realize its demographic dividend. Indeed, many fear that India’s demographics could produce a disaster, rather than a dividend, if India’s millions of youth do not have good jobs and confidence in the institutions of the country.

Institutions: humanity’s vehicles into its future
Good institutions are critical for our future. Humanity is not distinguishable from other animals in the design of the process of producing babies. After all the birds do it and the bees do it too.

What does distinguish the human species from other animal species is the development of ‘institutions’ by human beings, institutions with which humanity obtains ends it wants. Very powerful amongst these are the institutions of democracy, capitalism, and government. The way cave men and hunter-gatherers organized their affairs is not the way we organize our affairs now, though we reproduce in the same ways. Over centuries, human beings have evolved the institutions with which human society conducts its affairs, in economic and political spheres.

Institutions are like spaceships that we design to take us to the future we want for ourselves and our children and grandchildren. Economists acknowledge the critical role that institutions play in producing economic growth. Countries with very similar resource endowments have different economic growth trajectories because they have different institutional capabilities, in institutions of government, business, and politics.

The essence of humanity, in contrast to all other animal species, is a conscious evolution of the concept of justice and the development of the means to ensure it. Therefore humanity needs institutions not only to produce economic growth, but also for justice in society. In fact, humanity has applied the concept of the right to life of all living beings even to the right to life of animals. With its desire to defend the rights of animals to also procreate and live, it has to discover new policies and new institutional arrangements.

Thus, we must reconcile somehow the rights of the Ridley turtles on India’s East Coast versus the rights of business enterprises. And the right to survival of tigers in India’s heartlands with the right to livelihoods of the tribal communities who have lived there for centuries too.

Higher aspirations require better institutions
Institutions of politics, democracy, and government must evolve in line with our evolving concepts of human rights. At the same time, we need increasing efficiency in the use of resources to produce the materials and services that human beings expect. Because, not only are the natural resources available to us limited, but the pressure of numbers of people who depend on them is increasing.

Nowhere is the pressure more than in India. India had a population of 300 million when we got our Independence 65 years ago. We are now over 1.1 billion, on the same land with the same sources of water. Standards of what is a good life have also changed meanwhile. To have a bicycle was a luxury for many middle class Indians 65 years ago. Now, it must be a car.

Of course, the combination of increasing numbers and rising expectations creates a wonderful market for businesses. Which is what makes India attractive for capitalists from all over the world. However if the ways in which they produce, and what they produce and sell, does not change, the limits of the environment could become a serious constraint on business growth.

Spaceships for new journeys
Mankind is venturing further and further in its evolution, in search of ever higher standards of justice and higher standards of consumption too. Institutions, as I have suggested before, are the spaceships in which we soar to the destinations we aspire to reach. The institutions in which humanity is flying into the 21st century must be redesigned to meet rising standards of human rights as well as aspirations of what constitutes a good life in material terms. Signs of inadequacy of institutions are visible in many parts of the world, in revolts and revolutions, many peaceful fortunately, but several turning violent with impatience with the old order.

Institutions of democracy, capitalism, and government must be reformed and evolve. The shape in which they are now was evolved for the needs of previous times. And unless we change the design of these institutions and the way in which they function, we will not reach our goals.

India’s institutional crisis
India, with its special demographic situation, mentioned at the outset, is very vulnerable to the consequence of inadequate or inappropriate institutions of democracy, capitalism, and government. Indeed, there is growing mistrust in the country’s institutions of political parties, government, and big business too. In a recent debate on TV on whether India is ripe for a revolution, 60% of the audience, which was mostly middle class youth in the city of Mumbai, voted for the motion, that India was ripe for a revolution. The other 40% seemed confused over whether it would be a revolution or merely many revolts.

This growing mistrust is leading more people to protest and prevent changes in policies proposed by government and advocated by business. Thus we have a policy log jam, the root cause of which is public mistrust of our institutions. Therefore we must apply ourselves consciously to the condition of our institutions.

Capitalism is different
Institutional reform is necessary not only in government and political parties, but business too. Unfortunately, the evidence around the world is that the pace at which business institutions are reforming themselves to meet the 21st century requirements of society is not sufficient. The World Values Survey provides a reliable source of changing national values. Between 1989 and 2007, they have periodically sampled the views of Indians towards business. In recent years attitudes of Indians as a whole have moved in anti-business direction. This surprised me, as it would surprise others in the business world, because we mix with and listen to people like us and those channels and parts of the media that likes us. On the question of whether private or government ownership of industry is to be preferred, support for private ownership doubled between 1989 and 2007 (from 11.2 to 23.2 per cent). But it tripled for government ownership (from 11.4 to 33.1 per cent).  

Business institutions have great need to introspect and to change themselves voluntarily. Democracy and government belong to everybody, even to business. But by definition, in a capitalist system based on private property rights, capitalist enterprises belong only to their owners. Therefore others have no right to interfere in their conduct. Most of our laws and rules of “corporate governance” are designed to ensure that all the shareholders of the corporation get a fair deal, and protect the rights of minority owners vis-à-vis promoters and large shareholders. These are internal matters amongst capitalists.

Government regulation of corporate conduct in other matters that affect society has been strongly resisted by capitalists on ideological grounds. The ideology is that businesses must be left alone as much as possible, and their animal spirits must not be curbed. Well, if businesses must not be regulated from the outside, then they must take responsibility to regulate themselves and redesign their own institutions in a credible manner.

Mr. AD Shroff, in whose honor we have this annual lecture, had qualms about the way many businesses were conducting themselves. He tried very hard to get businesses to voluntarily adopt a code of conduct, but with little success.

Mr. A.D. Shroff and the History of India’s Planning Institutions
Mr. Shroff was steadfast in his belief that sound institutions of business as well as government are the foundations for a nation’s progress. And he was fearless in demanding that both government and businesses play their roles properly.

Mr. Shroff was a principal participant, during the run up to India’s Independence, in the collaborative processes between the Congress Party and India’s industrialists to shape the institutional architecture for India’s industrial development. He was a Member of the Planning Committee formed by the Indian National Congress in 1938 under the chairmanship of Jawaharlal Nehru. Later in 1944, he along with seven other leading industrialists, including Mr. JRD Tata and Mr. GD Birla, authored what came to be known as the ‘Bombay Plan’. This Plan recommended that Government must have a large role in India’s industrial development.

A reading of India’s economic history and Mr. Shroff’s own writings too, confirm that he was an advocate of a strong role for Government in shaping the course of India’s development. Government had to be the shaper of policy, an aggregator of resources for large projects, and an arbiter amongst forces, such as unions and industrialists.

Mr. Shroff was not an ideologue. He was a practical man. Throughout his life, he continued to advocate a role for government and even a role for central planning. But he had deep misgivings with the way government and central planning began to function in India in the 1950s. He became outspokenly critical of the stifling, rule-bound bureaucracy through which Government, while performing these roles, interfered with the functioning of industry. He wrote in Commerce magazine in 1956, “There is nothing inherently socialist about planning”. It should be done in the right way. And he quoted Milton Friedman who had said about Indian planning, “The whole paraphernalia (of a host of specialized and detailed controls) which in this country goes by the name of planning is in fact bad planning.”

Revisiting the role of India’s Planning Commission
When I joined the Planning Commission as a Member in 2009, one of the tasks the Prime Minister assigned to me was to determine what role the Planning Commission should play in 21st century India. I asked Montek Ahluwalia, the Deputy Chairman of the Planning Commission to give me a list of 20 persons to whom I should ask this question. He gave me a list of 20 respected citizens of the country. Some of them had worked in Government in very senior positions, in the Reserve Bank, in Parliament, some even in the Planning Commission in the past. And several others were respected industrialists of the country.

I asked each of these 20 leaders the following questions:

• Is the Planning Commission playing a useful role for the country?
• If not, is there another role that the Planning Commission could play in India’s progress?

The answer to the first question was unanimous. The Planning Commission was no longer making a significant contribution to the progress of the country. The country had changed. It was more decentralized politically and administratively. The private sector was playing an increasingly large role. The Indian economy was more connected with the international economy. For all these reasons, five year plans and budgets made by some experts in Delhi, which had then to be implemented by people all over the country, was an outmoded idea.

However everyone, including the industrialists, said that the dynamic nature of changes in India and outside required a strategic group that, like a radar, could sense the forces that were causing change to happen and that could provide governments in the center and in the states, and private industry too, with insights into the forces shaping the future.

A More than Perfect Storm
I will now give you a picture of the forces shaping our future. I will also explain their effects on institutions of democracy, capitalism and government. I will use two images for you to visualize these forces and their implications. One, an image of a storm. The other, an image of a globe in stress.

First the image of the storm. Many of you may recollect the ‘Perfect Storm’ that Sebastian Junger described in his book. Not two, but three storm systems converged in the North Atlantic. This was unprecedented. No ship had been designed for such conditions. And no captain had the skills to steer a ship in such a ‘perfect’ storm.

As the 21st century unfolds, there are four strong winds blowing across the world and converging to create a more than perfect storm which is challenging captains of business and government institutions that are not designed for these conditions.

Free Markets and Capitalism
The first strong wind is the idea of free markets and capitalism. This is not a new idea. Often attributed to Adam Smith, it has been around for at least 200 years.

With the spread of free markets everywhere, and into India too with the opening of our economy in the 1990s, economies of many countries have been growing faster. Most noteworthy is the growth of the two, billion-people plus countries—China and India. The growth in their economies is enabling many millions of people to escape poverty.

Economic growth in free markets follows the principle of cumulative causation. As the market is opened up, those who already have some assets---financial, educational, or access to political power—can take advantage of the opportunities available. And their incomes and wealth grows faster than that of those who do not have these assets.

Thus economic growth in freer markets is accompanied by increases in gaps of income and wealth. So it is no surprise that Gini coefficients are increasing in China, Russia, India, and in other countries that have embraced the free market and capitalism. In time, the benefits of economic growth trickle down to the poorer people when they begin to acquire access to education, finance, and employment opportunities.

In this model, one must be patient. And, in this model, to force redistribution is ‘socialist’ and wrong. Whereas, to induce the rich to accelerate growth of their assets, by giving them tax-breaks, so that the economy can become larger, is capitalist, and acceptable.

Democracy and Human Rights
The second wind that has been gaining strength across the world is respect for the rights of all human beings—white or black, male or female, rich or poor.

This is a more recent force than capitalism. Indeed, many countries, such as the USA, that have been stoutly capitalist for centuries, have only in the last fifty years addressed the rights of large sections of their populations, such as the blacks in the US.

This force, of respecting the rights of all, combines well with the idea of democracy. It has been gaining a lot of strength in the last two decades, with the collapse of the totalitarian governments in the Soviet Union and the revolutions of the Arab Spring.  

Blowing around deep within this second strong wind is the notion of justice, equity, and fairness. From the perspective of economists there may be nothing wrong with disparities increasing as economies grow. It is part of the game, they may say. But is it fair from a human perspective, ask others?

The Pain of our Planet
The third is a voice speaking loudly to us, literally out of the Earth.

There is concern everywhere with the state of the environment. Now we all agree that the paradigm of economic growth that has brought the rich countries their wealth is not sustainable. Mankind’s global footprint—which is a measure of the pressure human activity exerts on the resources of the earth—was 60% of the earth’s capacity to renew itself in 1960. It has reached 130% of the earth’s capacity now. We are no longer living off the revenue account. We are eating into our natural capital.

The USA’s footprint on the earth’s resources is as heavy as 9.7 hectares per person. Europe and Japan’s footprints are half of that—4.7 hectares per person. China’s is one-sixth of the USA—1.6 hectares per person. And India’s is half of China’s—0.8 hectares per person. So an Indian consumes one twelfth of the earth’s resources compared to an American.

Scientists project that if India and China, which will consume more of the earth’s resources as their economies grow, were to have a global footprint equal to Japan’s by 2030—which is half of the USA’s present footprint—then these two countries’ economies will require another whole planet earth to support them alone. But we have only one earth to share amongst the rich countries and the poorer ones.  

The Gale Force of Information
The fourth wind, of more recent origin, is the gale force of information. Within the last twenty years only, telecommunications and the internet have enabled people to reach out and be reached in a way unprecedented in human history. This wind has become a category six storm.

Now you can sit here and instantly call anywhere in the world on a cell-phone. Twenty years ago you could not do this. Not even in the USA. Now cell phones are in the hands of poor people and all over India, and other countries too. Now you can log onto the internet, and Google, and find information on almost anything. You could not do it fifteen years back.

Television, which picks up information from these ubiquitous sources of information, reaches almost everywhere. India has over one hundred and twenty 24X7 news channels today. Fifteen years ago, there were two. Thus people’s eyes and ears have been opened up to the condition of the world, and to the condition of their lives in relation to others, in ways they were not just a few years ago.

With these four storm winds converging a more than Perfect Storm has formed. With information flowing around and many more voices being heard, two major concerns can be heard more loudly in this storm, about the way the world is progressing.

One is, ‘Our pattern of economic growth is not sustainable’. The other is, ‘Our pattern of economic growth is not fair’.

These concerns are putting pressure on institutions of capitalism, government, and democracy to reform themselves, to make economic growth more sustainable, more inclusive, and more fair.

My first image was the more than Perfect Storm, with the four forces converging in the 21st century, putting pressure on institutions. My second image is a rumbling earthquake, with institutions of capitalism, democracy, and government, grating against each other like three tectonic plates. The misalignment amongst these plates is creating tremors in global governance.  

An Earthquake
Thomas Friedman said that the World has become Flat. It has been flattened, according to him, by the force of global trade and international businesses spreading across the world, fuelled by new technologies. Countries, competing for FDI from MNCs, are accelerating the spread of MNCs. Friedman writes, “Companies have never had more freedom and less friction in the way they operate. The biggest source of friction, of course, has always been the nation-state, with its clearly defined boundaries and laws. What this will mean for the long-term relationship between companies and the country in which they are headquartered is simply unclear”.

The second plate then, is the world of nations with their boundaries, and their governments. There are many tensions within national governments with demands to improve justice within their national boundaries. At the same time, attempts to create democratic forms of governance that cross national boundaries are under strain too. The European Union is greatly stressed. The WTO is spluttering along. International negotiations to create a global regime for governance of the environment have gone from Rio through Kyoto, Bali, Copenhagen, Durban, to Rio again twenty years later without having gone anywhere.     

MNCs and global finance float above the plate of national governments and cross national boundaries. A deeper tectonic plate within the earth, also cutting across national boundaries, is communities of identity. The roots of many communities go back into history and traditions, predating by centuries present national boundaries that have either divided such communities or sought to contain them. All over the world, there are communities divided by national boundaries, in Korea, China-Taiwan, India-Pakistan, Northern Ireland, Israel-Palestine, Sudan, and the Kurds in Iraq, Syria, and Turkey. At the same time, there are many communities within national boundaries whose historical roots require special attention—the Basques in Spain, the Tamils in Sri Lanka, communities within Nigeria, multiple communities within India—in the North-East, the tribal communities within the heartland. The list goes on.

Friedman’s earlier book, ‘The Lexus and the Olive Tree’, written prior to 9/11, described two forces in contention. The Lexus represented the forces of global business and global brands. The olive tree represented the ‘fundamentalist’ forces of tradition, religion, and identity. He was convinced then that it was a matter of time only and the force of the Lexus would wipe out the olive tree. However, he did not realize how deep-rooted the olive tree is. 9/11 was a wake-up call. The olive tree reacted to being smothered, using the same forces of technology that are supposedly flattening the world, to strike back at the Empire. The terrorists used the internet, cell phones, UPS, and commercial airliners in their strike that flattened the World Trade Center.

The Indian peepul tree is also very strong. Carelessly leave a seed in the water in which the concrete is mixed, and a peepul tree will break through the concrete after the house is built. Plaster over it again, yet the shoots will reappear, as I observed in my little rooftop apartment in Pune, where a peepul kept emerging no matter what technology I used to suppress it.  

The plate of Government sits in the fault line between the plate of capitalism above and the plate of democracy beneath. The world will keep shaking as these three tectonic plates grate against each other until a system of governance can be found to align them.

Capitalism and Democracy
Capitalism, democracy, (even environmentalism), have become ideologies. Francis Fukuyama, in his treatise, The End of History said that the history of ideological conflict had ended in 1989 with the fall of the Soviet Union. Western ideas of free-market capitalism and electoral democracy had triumphed over state run economies and totalitarian governments. It is ironic that the ideological conflicts that have emerged since 1989, with the arising of the more than Perfect Storm, are between institutions of capitalism and democracy, the two supposed victors in Fukuyama’s historical war.

In his book, False Dawn, John Gray, conservative political thinker and former advisor to Margaret Thatcher, warns, ‘Democracy and the free market are rivals, not allies.’ Benjamin Barber says, ‘Markets are simply not designed to do the things that democratic politics or free civil societies do. Markets give us private, not public modes of discourse: we pay as consumers in currencies of consumption, but we cannot use this currency when we deal with one another as citizens or neighbors about the social consequences of our private market choices.’ And Lester Thurow says in “The Future of Capitalism” that ‘Democracy and capitalism have very different beliefs about the proper distribution of power. One believes in a completely equal distribution of political power: one man, one vote, while the other believes that it is the duty of the economically fit to drive the unfit out of business and into economic extinction’. ‘Survival of the fittest is what capitalist efficiency is all about’, he says.

India embraced democracy at its birth sixty years ago. Then, twenty years ago, it also veered towards free market capitalism. The opening of markets and unleashing of capitalism in India has undoubtedly accelerated economic growth and wealth has begun to accumulate. Forbes magazine had forecasted a few years ago that before 2020, India will have the most billionaires in the world. But for India to realize the ‘demographic dividend’ from its children, which economists say will propel India to be the third largest economy in the world within three decades, India will have to take care of all its children, including the malnourished and undereducated children (who are more than half the total) and not just the better off.

The development of institutions that conform to both democratic principles as well as market-capitalist ideas is human history’s unfinished task.

An Indian monarch had taken up this task 2400 years ago. Kautilya, Emperor Chandragupta Maurya’s chief minister, who wrote the Arthasastra (‘the science of wealth’) in the 4th century BC, is considered the world’s first economist. He laid down detailed requirements for increasing the ‘GDP’ of the state and its administration. On this foundation, Chandragupta’s grandson, Emperor Asoka, wished to construct a state that would protect the rights of all living beings, human and animal, and also protect the forests and rivers. He was the world’s first environmentalist. He could not realize his vision to harmonize the science of wealth and power with the ethics of humanity and nature before he died.

Perhaps it has become modern India’s destiny to finish the task. The Indian political landscape is churning. Parties of left, right, and center, are maneuvering for elected space. ‘While the West often tries to discuss the world in black and white terms, the Indian mind is able to see the world in many different colors’, says Kishore Mahbubani in The New Asian Hemisphere. Therefore, I ask, ‘Could India provide the bridge between free-market capitalism and democracy?’

This system must meet two essential requirements. Firstly, a just system must be based on the ‘self-evident’ principle the US Founding Fathers laid down, that all peoples are ‘endowed by their creator with certain inalienable rights’ even if they are not equally rich or equally powerful. This principle is the heart of the democratic ideal to take civilization to a higher order.

Secondly, this system must be founded on the principle that business and the economy are not the be-all and end-all of life. Social and political aspirations are part of human reality too.

I was gifted a tie by a venerable capitalist journal in New York whose offices I visited with an Indian business delegation a few years ago when ‘India was Shining’. Emblazoned on it, in gold, are the words, “Capitalist Tool”. I have never worn the tie because, though I am OK with being called a capitalist, I am not OK with being anybody’s tool! The challenge before us as we march into the 21st century is to make capitalism and economics our tools, rather than human beings becoming their tools. Therefore let us first determine our aspirations and principles, and accordingly devise the form of capitalism and economics we want.

A Vision of our Future
What is our vision of our future? How will we shape our institutions of democracy and capitalism to create a just, inclusive, sustainable, and economically vibrant society? Let me offer you a vision of Inclusive, Democratic, Capitalism.

An Inclusive Democracy
In this vision, Democracy will become deep and will become inclusive. Democratic governments are expected to be Governments Of the People, For the People, and By the People.

We have the largest electoral democracy in the world. We conduct elections on a scale that no other country comes close to. Our governments are elected by the people. Therefore we have governments Of the people in our states and at the national level.

People want their governments to be For the people too. Indians are protesting that their governments are not accountable to the People. They are demanding transparency. They want to know was done with the money that was supposed to be spent to improve public services and public infrastructure? This is the core demand of the anti-corruption movements. Therefore governance reforms to make governments accountable to citizens have become imperative.

Deep democracy is Government By the People. A democracy where citizenship is not merely the right to vote members of assemblies. But a democracy in which citizenship is also the active management by people of their own affairs in their communities and local bodies. Not an election time democracy, but a deliberative democracy in which citizenship is the right to understand the rules, and to shape the rules by which society governs itself.

Here India has a long way to go. When our elected representatives say, ‘You have elected us, now keep quiet and leave it to us till we come back for your votes next time’, they kill the very concept of deliberative, deep democracy.

Moreover, deep democracy requires elected and accountable governments in our villages and in urban localities. We have passed the 73rd and 74th Constitutional Amendments twenty years ago. But we have not made much progress in implementing them.

An Inclusive Economy
India must become an Inclusive Economy. I humbly submit that genuine inclusion is not achieved by handouts and by redistribution. In fact, handing out and charity reinforce the idea of Exclusion. Some are In and others are Out, and it is the moral responsibility of the Ins to give to those who are Out.

Those who are excluded become genuinely included only when they have equal opportunities to earn and live dignified lives and to contribute by their efforts too to the creation of the wealth of the society.

Just as institutions of government must be reformed to create an inclusive democracy, institutions of business and capitalism must be reformed to create an inclusive economy.  Therefore businesses must be not only For the People. They must also be By the People, and Of the People.

For Inclusion, we need innovations to provide affordable and accessible goods and services, especially at the ‘bottom of the economic pyramid’. This is the business opportunity for ‘profit at the bottom of the pyramid’ that C.K. Prahalad wrote about, and that many entrepreneurs are pursuing. By producing products and services for poorer people, they can expand their customer base. For example, the shampoo sachet enables even poor people to buy a big company’s products. The people pay. The profit from the bottom of the pyramid goes to the shareholders of the capitalist enterprise.

But this does not address the root cause of poverty. People are poor, and cannot afford to pay much, because they do not have incomes. They need jobs and incomes to lift themselves out of poverty. Therefore they must be engaged in the processes of producing goods and services for themselves and others. And therefore we need innovations in production models that provide more jobs, so that Business is By the People too.

Employees in enterprises owned by others have incomes, but do not share in the creation of wealth, the fruits of which go entirely to the owners. For a fuller inclusion in the benefits of growth, we need more enterprises in which the producers and workers share the wealth creation too. This requires innovations in enterprise design and governance models to shape Businesses Of the People.

In my vision of India, India which is a country of over a billion democrats will also be a country of hundreds of millions of capitalists.

Indeed this was Mahatma Gandhi’s vision. His charkha was a symbol. In his vision for India, all people would be producers of goods and services that the community and the market need. They would be earners and also owners of their enterprises, even if tiny.

Finally, in my vision, India will also be what Gurudev Tagore envisioned: a country not divided into fragments by narrow domestic walls. Let us be less argumentative and more cooperative.    

Let us strive together towards the heaven of freedom: a country in which every citizen has all three freedoms: political, social, and economic freedom.

Each of us has work to do to reform the institutions we are in charge of, and in which we work. Some of us must lead and reform business corporations and other capitalist institutions. Others amongst us must lead and reform governments and government institutions. And many others must lead and reform institutions for democratic representation: political parties, civil society organizations, and labor unions.

Who will lead?
We need leaders who have the wisdom and the courage to reform the institutions they are given to lead. As Gandhi said, we do not own institutions. We are their trustees. We must build society’s trust in the institutions we lead.

I conclude with my definition of a leader. Leaders come in many shapes and they have many styles. Regardless of their shape, size, and style, a real leader is she or he who takes the first steps towards what she or he deeply cares about.  

Leaders are those who take the first steps. Not those who wait for others to lead. Great leaders have many followers because the steps they take are not towards selfish goals but towards goals that others aspire to too.

The heart of leadership is a deep caring for a cause. The awakening of leadership in each of us will arise when we look into ourselves and ask what we really care about deep down. Not what we are taught to care about by the manipulators of carrots dangled before us and wielders of sticks to prod us with—the ‘incentives’ that economists say make so-called ‘rational’ human beings do what they do. Carrots and sticks make us the tools of others. They are the means to make donkeys move, not humans.

The poet Robert Frost said, ‘When to the heart of man was it less than a treason, to go with the drift of things, to yield with a grace to reason.’

We must look inside our hearts for what we want to make our world and our country for not only our own sakes, but our children too. And we must stir our human aspirations to take steps now, together, to shape the future we want.

Arun Maira is member of Planning Commission