Expect nothing, live frugally on surprise.

Tuesday, December 2, 2008

Road to recovery

No nation in the world could have wished more for a rewrite of last week’s events than India when its financial capital, the city of dreams, was brought to its knees by a handful of terrorists driven by a methodical irrationality to inflict the greatest harm on the innocent. By the weekend, the drama at the two hotels and a building complex was over and the agony of the death count had begun.
As a new month begins, India has to travel the road to healing itself when its citizens will have to reckon with their psyche, traumatised by death and destruction. That will not be easy but it will be accomplished because the country has a long history of self-recovery by an assertion of its essential truths — tolerance, the willingness to live and let live. But it will also have to reckon with the effects of the horror on its economy that has already taken some beating from the trauma of the Wall Street crash. In the coming months, the two shocks, one financial and the other more horrifically physical, will blend in a potent mix: India is liable to be perceived as weak and vulnerable, an unstable island of declining prosperity racked by violent storms. Yet the nation must stay the course; Indians have built a vibrant economy on their skills and capital just as they have built a society of a million tongues speaking one language; they must not stop or withdraw into a shell. Despite the slowdown the Gross Domestic Product numbers indicate, the economic fundamentals are strong. Despite the wanton attacks on their self-esteem, Indians must aggressively believe in the expansion of their capital and in the expansiveness of their tolerance.
Policymakers have to lead from the front. On Sunday a somnolent government awoke to the sound of the nation’s frightened rage to change guard at the Home Ministry and promise long overdue internal security systems. With Mr Chidambaram at Home and the North Block under the PM’s stewardship, some innovative policy play can be expected. Setting aside rhetoric, policy players must in these traumatic times, engage seriously in contra-cyclical expenditure so that every rupee spent — productively, let it be emphasised — will morph into someone’s income, thereby setting the economy on the road to its former expansionary levels. Time is running out for Dr Manmohan Singh’s team but in the next three months or so, it has to set in motion those changes that the next government will be able to carry forward to make this nation safer and more productive.


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