Unless otherwise specified, the per diem locality is defined as "all locations within, or entirely surrounded by, the corporate limits of the key city, including independent entities located within those boundaries." If that happens, India will be condemned to another generation or two of underachievement.Traveler reimbursement is based on the location of the work activities and not the accommodations, unless lodging is not available at the work activity, then the agency may authorize the rate where lodging is obtained. His efforts at reform, like all previous reformers’ efforts, may be overwhelmed by a combination of politics, bureaucracy and corruption. But while he has already worshipped at the Ganges since his victory, promising to clean up the river sacred to Hindus, he has not brought himself to mention Muslims, who make up 15% of the population.Ī second danger is that he is defeated by the country’s complexity. He has spoken of “bringing everyone along”. One is that Mr Modi turns out to be more of a Hindu nationalist than an economic reformer. The initial signs are good: Mr Modi has invited Pakistan’s prime minister, Nawaz Sharif, to his inauguration. As a leader from the nationalist right, Mr Modi is well placed to bring about a rapprochement, rather as Menachem Begin could make peace between Israel and Egypt. Trade between Pakistan and India is currently negligible, and there is huge scope for growth. Reaching out to Pakistan would bring economic as well as security benefits. Such relatively straightforward steps could make a powerful difference, raising the Indian growth rate by two or even three percentage points from its current 4-5%. A national sales tax would help here, replacing myriad local levies. Mr Modi must launch sweeping land reforms, crack heads in the misfiring coal and electricity industries and make India more of a single market not just by improving roads, ports and the like, but also by cutting the red tape that Balkanises the economy. Labour laws are rigid, land for factories often impossible to acquire at any price, and electricity patchy. He must clean out the banks (bad loans are preventing a recovery), sort out the government’s own finances (chronic deficits are at the root of India’s inflation), cut subsidies, widen the tax base and allow the central bank to pursue a tougher anti-inflation policy. His first task is to stabilise a fragile economy. They want the chance of self-advancement that Mr Modi, a tea-seller’s son, both represents and promises. They were turned off by Congress’s drift and venality, and its preference for welfare handouts over fostering opportunity. Although his core supporters are religious nationalists, steeped in the glories of a Hindu past, it was the votes of the young, urban and educated that won him the election. Much power is devolved to the states the fissiparous nature of its polity means that deals have constantly to be done with a vast array of regional and caste-based parties and a colonial and socialist past has bequeathed India a bureaucracy whose direction is hard to change.Ĭompare Indian state electorate and voter numbers to entire nations with our interactive mapMr Modi has a mandate for economic reform. That is partly because India is an extraordinarily hard place to govern. Reformist politicians-like the outgoing prime minister, Manmohan Singh-have lacked the clout to implement their policies. The few strong governments India has had-always dominated by the Congress party, a Nehru-Gandhi family fief-have had rotten economic agendas. Government is at the heart of India’s failure. Although we did not endorse him, because we believe that he has not atoned sufficiently for the massacre of Muslims that took place in Gujarat while he was chief minister, we wish him every success: an Indian growth miracle would be a great thing not just for Indians, but also for the world. Narendra Modi, who leads the Bharatiya Janata Party (BJP), has won a tremendous victory on the strength of promising to make India’s economy work. Now, for the first time ever, India has a strong government whose priority is growth. The human cost, in terms of frustrated, underemployed, ill-educated, unhealthy, hungry people, has been immense. Despite a couple of bouts of reform and spurts of growth, India’s economy has never achieved the momentum that has dragged much of East Asia out of poverty. It is now less than a quarter of the size. India’s GDP per head was the same as China’s three decades ago. The increase in its average annual GDP per head from around $300 to $6,750 over the period has not just brought previously unimagined prosperity to hundreds of millions of people, but has also remade the world economy and geopolitics. THE most important change in the world over the past 30 years has been the rise of China.
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