Guest Lecture On ‘New Economics For A New India’ By Mr. Sanjeev Sanyal, Principal Economic Advisor, Ministry Of Finance, Govt. Of India
The Vinod Gupta School of Management, IIT Kharagpur was glad to host Mr. Sanjeev Sanyal, Principal Economic Advisor, Ministry of Finance, Government of India for a guest lecture to the budding managers of the Institute on the 12th of March, 2018. Mr. Sanyal carries the reputation of being one of the leading economists of the world and is highly decorated with numerous awards and accolades to his name. He is a Rhodes Scholar, an Eisenhower Fellow and was named as ‘Young Global Leader 2010’ by the World Economic Forum at Davos.
Furthermore, Mr. Sanyal is also the author of four bestselling books – ‘The Indian Renaissance : India’s Rise After a Thousand Years of Decline’, ‘Land of the Seven Rivers : A Brief History of India’s Geography’, ‘The Incredible History of India’s Geography’, and ‘The Ocean of Churn : How Human History Was Shaped By the Indian Ocean’. All of these rich credentials combined to spark a great deal of interest amongst the students of VGSoM and many others from different departments of IIT Kharagpur for the highly anticipated lecture by Mr. Sanyal on the topic ‘New Economics for a New India’. Aptly so, Mr. Sanyal took the audience through many unexplored and unimagined vistas of understanding and awareness about the economy, history, and public policy through his lecture. He commenced his session by talking about economics, the various dynamics at play in the economy, and most significantly – the general perception about it.
Mr. Sanyal highlighted that for long, people across our planet have looked at the economy through the lens of the Newtonian Principles as if it were strictly guided by the principles of liquidity, equilibrium, buoyancy and the likes. Contrary to this public perception, he viewed it in an entirely different light – the ever-evolving biological ecosystem. He believed that akin to the biological ecosystem which is relentlessly mutating with every global shock and aftershock, the economy if analyzed deeply can be seen to exhibit the butterfly effect. This entails that, small impulses can cause large impacts, beyond the horizon of the thought of most. Going by the same line of thought, it can be said that even large impulses can cause small impacts. Through his very engaging words, Mr. Sanyal essentially built a strong case for economies to be treated under an alternate framework – ‘Complex Adaptive Systems’. These systems are made up of a large number of independent agents that are constantly interacting with each other and evolving. These systems do not have the tendency to move towards an equilibrium point and hence do not play by the rules of Classic Newtonian Principles. These systems, as pointed out by Mr. Sanyal can be very unpredictable in their functioning, more often than not. They can respond to the same stimulus in very different ways or more alarmingly, can choose to not respond at all to something that appears substantial enough to evoke a huge response.
Thus, the key to dealing with such systems which resemble ‘Complex Adaptive Systems’ is trying not to find the most optimal solution. Rather it is to find a promising solution and tweak it with time to make it as perfect as possible. A heuristics based approach where feedback loops are implemented to get clues from past results in order to supply modified inputs and refine the output can serve well. Mr. Sanyal drew strong parallelisms between the CAS model and the models of cities, businesses, governments, and economies. To the audience’s amazement, such a framework although borne out of a lateral thought process actually appeared to be a plausible one. Hence in matters of designing business strategies, public policies, or other significant decisions it is important that individuals and organizations possess not the quality of knowing where to go but the quality of being able to adjust along the way. Plans and strategies must be designed with enough room surrounding them to accommodate expansions and contractions along any suitable direction. This according to him is especially true in matters of governance and policy making for a country as diverse and complex as India.
Talking about the growth trajectory of Indian cities, Mr. Sanyal spoke about how Singapore evolved from a place characterized by the chaos that it abounded with during the 1960s to a modern metropolis today, that stands at the pinnacle of urbanization and development. In the same breath, he enlisted some of the steps that the administration of Singapore had taken over the years to make sure this development saw the light of the day. He essentially pointed towards the heuristics based approach that Singapore followed, changing its direction and speed at frequent intervals to make sure it was doing justice to its aim of becoming a city worth rivalling. Talking about the subject of reforms in India, Mr. Sanyal spoke about initiatives such as the GST and the demonetization that have dominated headlines in the recent past in the nation. He highlighted that these were strategic programs designed to function on a very large scale. Hence they promise to work best if, after their initial roll out in a fair enough form, they are fixed along the way to achieve higher levels of perfection. Pointing towards our nation’s education system, he commented on its need to be revamped as technology, society, and the industry had all undergone a sea-change in the past couple of years. People today live longer and work for long too. Therefore, it is necessary that education empowers people in a different way to lead their lives better and add more value to humanity.
This highly enriching session by Mr. Sanyal was a great opportunity for the future managers of VGSoM to explore many fresh perspectives and ideas that they are sure to be benefitted with. Mr. Sanyal’s take on the state of our nation, its economy, business, in general, was not only engaging but also insightful. Finally, the much-anticipated session came to a conclusion with a question and answer round, that received a great deal of enthusiasm. Students asked Mr. Sanyal questions on a wide range of topics – some from history, some from economics, a few from his books, and many from the perspective of management. Thus, the Vinod Gupta School of Management, IIT Kharagpur would like to sincerely thank Mr. Sanjeev Sanyal for his invaluable contribution to the Vaarta series of Guest Lectures organized by the Institute for its students that plays a major role in their journey to the corporate world. The Institute would be honoured to host such an eminent person as Mr. Sanyal often again in the times to come.