Prime Minister Narendra Modi yesterday put matters in the right perspective when he wanted an end to the demonisation of the private sector. He articulated his views on the subject while defending the government’s budget initiative to go ahead with its privatisation programme.
There is more that can be done to foster a positive environment for private enterprise.
A part of the reason for the demonisation is on account of the way all political parties conduct themselves while in opposition and government. While in opposition, there is a tendency to be loose in alleging corruption. When in government, there is rarely a coherent effort to build a regulatory apparatus that will foster adequate competition. Vibrant competition in all sectors will do a lot to quell a lot of misgivings about the private sector.
Countries with a sophisticated market economy have depended on the state to create suitable conditions. In India, the state needs to move out of running airlines and banks. Instead, it needs to develop expertise which leads to a regulatory environment that allows for a vibrant market. This, in turn, will lead to the wealth creation Modi spoke about.
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