Development needs to be big bang, not incremental

For India to catch up with other advanced nations of the world in terms of per capita GDP (Gross Domestic Product), it needs development that is transformative, rather than incremental, which can help the country leapfrog in the global pecking order.

This was the overarching message conveyed by two senior members of the central government–Chaudhary Birender Singh, minister of steel, and Jayant Sinha, minister of state for civil aviation, at the Fortune India Next 500 Summit held in Gurugram on July 27.

“Prime Minister Narendra Modi has made it very clear that the country’s development cannot be of a slow kind, it has to happen at full speed to quickly transform the lives of people,” Singh said during a fireside chat with Fortune India’s editor, Sourav Majumdar, and Sinha.

Sinha pointed out that even if India, with a per capita GDP of $1700, had to catch up with China, which had a per capita GDP of about$8000, it wouldn’t be possible even after growing at 7% for the next two decades. “It is therefore important for us to leapfrog and transform through development,” he added.

Singh outlined various ways in which the government has tried to bring in such rapid development. He cited the example of the Jan Dhan Yojana, under which the unbanked portion of India’s population, residing in far-flung rural areas, have been integrated with the mainstream financial system. In around two years, 300 million new bank accounts have been added. Singh, who has been in electoral politics for over four decades, also pointed out that the government’s plan to double farm income by 2022 would ensure that the country’s GDP grows consistently at a double-digit rate post 2022.

Speaking of his own ministry, Singh pointed out that India’s steel sector was in doldrums four years back. But by taking timely measures such as imposing anti-dumping duties on cheap imports from China, the tide has reversed. Singh said that the government’s aim was to create a steelmaking capacity of 300 million tonnes per annum by 2030-31, which would make India the second largest steel producer in the world. A sizeable portion of the new capacity would be in the secondary steel sector, which would encourage the creation of several new small and medium enterprises, leading to large-scale job creation.

For a country as large and diverse as India to grow equitably, it needs development to unfold at the base and top of the pyramid, Sinha said. “Today when I go to villages in Hazaribagh (Jharkhand), I can confidently tell them that they will have access to electricity, proper roads,, gas cylinders and even financial services, under various government schemes,” Sinha said. “Similarly, at the top of the pyramid, the government is doing its bit to bring in market and industry reforms.”

Highlighting the pace at which India’s civil aviation industry has developed, Sinha pointed out that only 72 operational airports had come up in the country since India’s independence in 1947 till date. But 30 new airports have sprung up across the country, including in many small towns and cities, over the last four years alone.

Both the ministers stated that the government was quite confident that Indians will hand the current National Democratic Alliance (NDA) government at the centre another mandate to carry on the developmental work that it initiated in its first term, which commenced on 2014.

The next general elections are a little less than a year away, and some bye-elections held in some parts of India haven’t returned favourable results for the Bharatiya Janata Party, which is the principal party in the NDA. “Bye-elections aren’t a referendum on Narendra Modi,” Sinhasaid unflinchingly. “When the next general elections take place, people will vote for Modi since this government has performed.”