Sacrificing growth is a price worth paying for activism, says Anshu Jain

For Indian politicians who fret that activism is resulting in loss of confidence among various governmental departments and rendering them inactive, here is a piece of advice from Anshu Jain, co-CEO of Deutsche Bank: sacrificing some growth is a price worth paying for activism.

Over the last two years, India has witnessed a flurry of protests and activism right from anti-corruption protests to Comptroller and Auditor General’s engagement with the government’s functions.

All these resulted in public engagement in policy issues as never seen before. This had prompted various politicians and bureaucrats to put the blame for inaction and policy paralysis on activism.

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In an interview to the Economic Times, Jain has concedes that India is growing slower than it could.

[caption id=“attachment_601308” align=“alignleft” width=“380”] Anshu Jain. Reuters[/caption]

“With respect to governance, public opinion does not want to see excessive bureaucracy or policymakers misallocating resources. India is growing far slower than it could be for a variety of reasons related to politics and governance as opposed to redistribution. But I think sacrificing some growth in the near-term is a price worth paying for the higher level of public engagement and activism,” he has said.

He, however, does not think Indian public is that concerned about rich getting richer as long as common men are getting a share of the benefits of the prosperity. And because of this there is no strong push for greater redistribution in India.

Jain prefers India’s supply constraints to the West’s demand-side problems that are structural in nature, but cautions that for the country to realise its true potential the government here needs to address this issue.

The enormity of the supply-side bottlenecks is such that it eclipses the enormous advantages from the country’s “expanding demand, vast amounts of cheap deployable land and a one-time demographic boom with the population getting younger and more literate”.

He also supports subsidies as in the near term they have a role to play because “capitalism operates with a time lag that could otherwise see entire generations of people missing out on prosperity”.

Read the full interview here.