On Wednesday, just two days before the release of India's election results, AEI's Sadanand Dhume hosted a Google Hangout discussion with three experts from India to discuss whether Narendra Modi, India's frontrunner for prime minister, could bring about an economic turnaround like that of Great Britain's Margaret Thatcher.
Economist Vivek Dehejia of Carleton University argued that economic reforms in the vein of Thatcher would be too much to expect from Modi. Rather, in a socialist country like India, it is perhaps good for Modi to be vague about reforms to first test the waters, and a Modi government should also be careful to avoid populist ideas and signal India's openness to business.
Mihir Sharma of Business Standard spoke to Modi and Thatcher's similar backgrounds and mutual care for small business. However, Sharma said they differ in that Modi has not yet built the constituency for reform — privatization, deregulation, and breaking unions — that Thatcher did, and likely will not do so in the near future.
James Crabtree of the Financial Times argued that, like Thatcher, Modi has a large challenge to start with: a messy economy. In a leftist country like India, Modi may start out moderately but may become more radical as he shows signs of political capital to change the country. His success will depend largely on picking the right players for his team, especially the right finance minister.
So what would the first 100 days look like? Dehejia reckoned Modi will jumpstart infrastructure, foreign investment in multibrand retail, and a positive investment cycle. Sharma predicted that the Modi government would question the numbers the previous government left behind. Crabtree concluded that, overall, Modi will first tackle the easier challenges to make his first 100 days look impressive.
With results of India’s national election just two days away, this Google Hangout will answer a hotly debated question: Can Narenda Modi, India’s front-runner for prime minister, revive the country’s moribund economy? Against a backdrop of sharply slowed economic growth, massive corruption scandals, and loss of investor confidence, it remains to be seen whether Modi’s “Gujarat model”— symbolizing double-digit economic growth, ease in doing business, and high-quality infrastructure — can solve India’s problems.
Like Great Britain’s Margaret Thatcher, Modi is attempting to use economic messaging about decentralization, small government, and development to restore India’s economic standing and to court foreign investment. During this Google Hangout, three experts will discuss whether comparisons between Modi and Thatcher are sensible or overblown. Moderator Sadanand Dhume will be participating live from India, where he is observing the elections.
James Crabtree, Financial Times
Vivek Dehejia, Carleton University
Mihir Sharma, Business Standard
Sadanand Dhume, AEI
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James Crabtree heads the Mumbai bureau of the Financial Times, leading coverage of corporate India, having previously worked on the paper's op-ed page as comments editor. Previously, he was deputy editor of Prospect, Britain's leading monthly magazine of politics and ideas, and has written for a range of global publications including The Economist and WIRED. Before returning to journalism, he worked as a policy adviser in the UK prime minister’s strategy unit and for various think tanks in Great Britain and America. He also spent a number of years living in the US, initially as a Fulbright Scholar at Harvard's Kennedy School of Government.
Vivek Dehejia is associate professor of economics at Carleton University in Ottawa, Canada. Dehejia's fields of specialization include international trade, economic development, and international macroeconomics. His research areas include the study of globalization and development and the economic development of India. His recent work has focused on the political economy of reform in India, and he has published in numerous academic journals and is a frequent commentator in print and on TV in India. He is likewise a columnist for Business Standard, a leading business daily in India. Dehejia is coauthor of “Indianomix: Making Sense of Modern India” (Random House India, 2012).
Sadanand Dhume is a resident fellow at AEI. He writes about South Asian political economy, foreign policy, business, and society, with a focus on India and Pakistan. He is also a South Asia columnist for the Wall Street Journal. He has worked as a foreign correspondent for the Far Eastern Economic Review in India and Indonesia and was a Bernard Schwartz Fellow at the Asia Society in Washington, DC. His political travelogue about the rise of radical Islam in Indonesia, “My Friend the Fanatic: Travels with a Radical Islamist” (Skyhorse Publishing, 2009) has been published in four countries. He has twice been selected by Foreign Policy magazine as one of the world's top 100 Twitterati. Follow him on Twitter @dhume.
Mihir Sharma was trained as an economist and political scientist in Delhi and Boston. He works as opinion editor for the Business Standard newspaper in New Delhi. He is writing a book on the Indian economy, to be published by Random House India later this year.