Did we miss out on opportunities and commit mistakes? Indeed, success has been marked with errors, missed opportunities and securing only default options. For instance, it is inexplicable how we continued a central planning model with excessive controls. The jury is still out on whether the 19991 economic reforms were compulsions of the time or acts of free choice. Options are meaningful if there are choices. In 1991, we had little to choose from.

As we begin our journey for the next 25 years, what is our quest for India at 100? The Prime Minister’s (PM’s) Independence Day address encapsulates our goals, involving social reforms and reconstruction. Each component of the “Panch Pran (five pledges)” entails far-reaching changes, the most prominent being the determination to make India a developed country. So, we must ask ourselves: What will make us a developed country? What are the changes needed to reach that aim?

In an overarching sense, it implies a rewriting of the social contract. The original social contract, articulated by Jean-Jacques Rousseau in 1762, implied the consent of citizens to the governance structure and their obligations. While its broad template has withstood the test of time, the nature and pace of change over the next 25 years could be radically different from anything experienced before. This would indicate a new social contract and rewriting the template not only of rights, but equally also of duties of citizens. Kartavya (duty) and Apeksha (expectations) embed the deeper philosophy between rights and duties.

What key ingredients would enable us to move to a high-income country?

First, achieving rates of economic growth which enable an approximation of per capita income in terms of the definition of either the International Monetary Fund (IMF) with a reference point of $20,000 nominal Gross Domestic Product (GDP) or the World Bank with a reference point of $12,696. We are currently a middle-income country at the lower end. At the First Arun Jaitley Memorial Lecture delivered by T Shanmugaratnam, senior minister, government of Singapore, he mentioned that India must grow at 8-10% in the next 25 years to lift the average income of people and create more jobs. It is estimated that this would entail a Compounded Annual Growth Rate of 9.36% for IMF levels and 7.39% for World Bank levels. Moreover, given the importance of capex, the average incremental capital-output ratio of the last decade of 5.8 to the current 4.1 needs significant productivity enhancement.

Clearly, trade will be a key driver of growth. We need a trade policy regime that goes beyond realistic exchange rates, but significantly improves trade, logistics, transportation, and a regulatory framework for making the economy more competitive. A narrow interpretation of import duties is inconsistent with the broader philosophy of Atmanirbhar Bharat (self-reliant India). Unless imports are available at competitive prices, export capability cannot be competitive. The virtue of aatmanibharta in the long run, implies diversification in distressed times and ushering innovation to buttress competitiveness. Moreover, growing geopolitical uncertainties and unpredictability, including the rise of China, need a different script for trade strategies.

The global value-added chain with geopolitical compulsions needs diversifying and improved access to newer trading patterns, including regional trading agreements. All these will compel us to improve the competitive efficiency and productivity of the economy to sustain higher thresholds of trade.

Second, our record on the Human Development Index (HDI), the metric compiled by the United Nations (UN) to quantify a country’s average achievement in health, education and income. We need to improve the critical parameters of life expectancy, rural population’s access to electricity, internet availability, security of life and property and bridging income inequality, implying an improvement in the Multidimensional Poverty Index. We need to move our HDI score, from the current medium tier of 0.645 closer to 0.8 to be in the high tier. Renewed emphasis on education and health care needs innovative implementation of the 2020 New Education Policy and adhering to the commitments made in the 2017 National Health Policy, besides the experience and recommendations of several recognised export bodies.

Third, the battle against the climate crisis and transiting from fossil fuel to renewable energy implies a restructuring of our lives in fundamental ways. Undoubtedly, the quest for net-zero entails curtailing our carbon footprint. This means massive changes in agricultural practices, usage of fertilisers and insecticides, and our modes of travel. Undoubtedly, producing green hydrogen, solar panels, battery storage and transportation entail far-reaching regulatory changes. Incentivising private sector investment will imply risk mitigation, garnering the resources of multilateral institutions and incentivising small and medium industries. We are yet to make significant investments in the social sector and infrastructure, which offers us the advantage of making informed technological choices. A combination of adaptation and mitigation will need participative and proactive action by stakeholders, which includes the Centre, state governments and the social sector.

Becoming a developed country to wipe out the whiffs of colonial legacy of servitude with pride and a sense of duty, combined with expectations, is the new social contract. Albert Einstein had rightly said, “Learn from yesterday, live for today, hope for tomorrow.”

The best way to predict the future is to create it.

NK Singh is chairman, 15th finance commission

The views expressed are personal.