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Manmohan Singh, India’s 79-year-old prime minister, has long been a man of far too few words. If this weren’t enough of a handicap for an economist-bureaucrat turned politician, he also has a tendency to speak far too softly in a rather plaintive tone. With foreign investors’ faith in the Indian economy plummeting this year, Mr Singh took charge of the finance ministry in June exactly 21 years after he was originally appointed finance minister in the midst of a balance of payments crisis.
Tweets from the prime minister’s office have increased in frequency – and verbosity. The tweets, however, befit a PhD in economics and former central bank governor. One reads: “In the short run we need to revive investor sentiment, both domestic and international.”
Mr Singh was in fractionally pithier form last week when he told the Hindustan Times that one of India’s biggest problems was that many in its “political class [wish to] revert to a state-controlled system”. Even communist China, he said, saw the need for an open economy.
Trouble is, this bit of plain speaking aside, Mr Singh’s diffidence was as in evidence as ever. He did the interview by email, an odd choice given he was speaking to a paper supportive of the Congress party coalition he leads.
I interviewed Mr Singh after his second budget in 1992 and was disarmed by his sincerity and his soft-spoken ways. Now, some Indian newspapers predict his taking charge of the finance ministry will trigger a second wave of the rapid economic reforms that characterised his tenure in the early 1990s.
Don’t bet on it. Whipping India’s complacent bureaucrats and politicians into working order requires the forcefulness and political savvy of Margaret Thatcher, Lee Kuan Yew and Deng Xiaoping combined. There is not a politician in the world up to the challenge.
Ikea plans to invest €1.5bn in India, which would do wonders to turn around sentiment on the country. The big “Only in India” question is whether the Indian government will allow it in. Ikea has been saddled, for example. with requirements on how it must source 30 per cent of its products from local manufacturers from day one – an impossible task. Not only that, but the company’s Indian suppliers must be small – an effort by the government to support so-called small scale industry.
Ikea has reportedly asked that it be given a decade to meet its sourcing target and argues that the companies that it sources from will inevitably grow larger than the threshold the government has arbitrarily set. It all smacks of the industrial licensing regime India erected in the 1970s, where manufacturers had to seek permission for increasing capacity. Once a socialist, always a socialist is the credo of the Indian government.
Yet the real surprise for Ikea, says a witty Indian politician, is not how pedantic India’s bureaucrats are but how inept Indians are likely to prove at putting furniture together. India is a country where every middle class family appears to have a maid or two and cars seem to come attached with chauffeurs much as palanquins required bearers in medieval times. Given this comfy lifestyle, the number of people who can actually turn a screwdriver is likely to prove very small indeed. As the Indian government proves daily, it takes an awful lot of Indians to screw on a lightbulb.
Ikea ought to quit while it’s ahead and invest in another developing country with fewer servants – as well as fewer bureaucrats.
The perks of power
Edwin Lutyens built an incomparably grand fantasy in sandstone for the last viceroys of India when the capital was moved to New Delhi. Completed about eight decades ago, the Viceroy’s residence makes even the White House look like an ordinary suburban home. I am not a fan of the trappings of Lutyens’ Delhi. Its vast ministerial bungalows have lawns large enough to play a Wimbledon warm-up tournament on and are all the more incongruous in such a desperately poor country. But I am partial to the genius with which Lutyens melded Indian and western architecture.
In the past people suggested it be turned into a public hospital. It is now the palace for the Indian president instead. In this forever imperial city, serving the people comes with some very nice perks.