A special invitation was extended to the President of Society for Policy Studies for a seminar on “Which development model for Morocco’s accession to the emerging country status?”, organized by The Morocco Ministry of Economy and Finance and the Members Association of the General Inspectorate of Finance (AMIF), at Skhirat, Morocco, June 2-3, 2016.
EVENT SUMMARY
The President of the Society for Policy Studies, Tarun Basu was a special invitee to the seminar on “Which development model for Morocco’s accession to the emerging country status?” organised at Skhirat, Morocco by The Morocco Ministry of Economy and Finance and the Members Association of the General Inspectorate of Finance (AMIF) from June 2-3, 2016, Mr. Basu was asked to speak on “Indian Developmental Experience”
Mr. Basu, in his submission, stated that India’s economic path has been quite unique. Rather than adopting the classic Asian strategy – exporting labour-intensive, low-priced manufactured goods to the West – India has relied more on its large domestic market than on exports; on consumption more than investment; on services more than industry, and on high-tech more than low-tech manufacturing.
He said the topic was timely since it was exactly 25 years ago that India undertook path-breaking economic reforms and liberalised its trade and license regime that unleashed the entrepreneurial energy of its people and enabled its transformation from a developing to an emerging economy.
Unlike in the west where market capitalism came first followed by liberal democracy, in India the opposite happened. Radical policy implementation became slower because public opinion needed to be moulded before difficult policy measures could be implemented.
India’s initial approach was of ‘state-directed’ development with a strong inward-looking bias in its development strategy. India had to satisfy itself with what was derisively called a “Hindu rate of growth” — at 3.5 % for much of the first decades after independence, after 1-1.5% at the turn of the century and till independence
Once the economy opened up, freed of the licensing system in the manufacturing sector and sharp lowering of import tariffs, and easing of computer imports to facilitate the present IT revolution, two things happened — growth shot up and foreign exchange reserves rose exponentially.
India, due to its democracy and conservative politics, did not experience very sharp growth over the years, but neither it did have to endure sharp crashes like many other economies did when there was global recession.
With growth came geopolitical interest and investment. Also, the steady flow of professional Indians to the US — Indian Diaspora — positively influenced the US thinking on India and led to the surge in US interest in a “fellow democracy”.
India also emerged as the outsourcing capital or the world. Result was the first decade of the 21st century saw India clocking a consistent growth rate of over 9% per annum. Both savings and investment rate rose by over 35%. The middle class was growing, and along with that the retail market was booming
India’s economic policy can be broadly termed as a mixture of market capitalism and state-tempered social equity — simply because while having some of the largest number of billionaires and also the largest middle class, it has also has the largest concentration of poor people anywhere in the world for whom the trickle-down effect would take decades to materialise, if at all.
Both Morocco and India have a lot to learn from each other – and seem to be rediscovering each other. What better time to re-invent their ties and go beyond the food-security matrix than during the 50th year of their diplomatic ties for a new Africa-Asia partnership as both continents re-discover each other?
Morocco, from New Delhi’s perspective, is a regional success story, seen in the context of the simmering discontent and bloody conflict in the Arab world. The seminar – from an Indian perspective – also needs be seen in the context of the very important visit by King Mohammed VI, to India last October – he came with the largest delegation to the India Africa Forum Summit, was the first to come and last to leave – and the visit June 1-2 of the Indian Vice President Hamid Ansari to Morocco – the first of the high-level visits from India to Africa this year following the summit in New Delhi that was attended by a record 54 African countries.