Praxeology: My Reflexions on India

In the zeal of controlling everything that either walks or doesn’t walk, the present Narendra Modi government of India is shooting in its own foot. It is giving one shock after another to the society and economy in the form of mob lynching of innocent people in the name of “cow protection”, beef and myriad of other bans, attacks on minority communities, compulsory use of Aadhar card, demonetization of 86% of total currency supply, GST etc. Why am I terming these policies as government shooting in its own feet? The reason can be understood with the aid of the laws of human action. Any individual needs freedom to achieve his full potential and flourish e.g., if I chain you in one room or throttle you then you cannot act to do something progressive and you will most probably die. The same is true for the body economy and society. Freedom is the precondition of any growth or development process. If people and businesses are strangulated by myriad of controls and regulat...

The on-going stand-off between the armies of the Indian and Chinese nation states on the Sikkim border has created quite a bit of ruckus in the, now very nationalistic, Indian public. People in India are calling for a total boycott of Chinese goods . This demand for boycott of Chinese goods is nothing new. Economics of Boycott The relevant question here is that, what consequences will follow if India’s nationalistic public actually decide to boycott Chinese goods? Without going into the details of numbers of what is the volume of trade between India and China etc., let us carry out a theoretical analysis of the consequences that will necessarily follow this action of boycott. What will happen in India after the boycott? The first thing that will happen in India is that the consumers will be at a loss immediately because they will not be able buy and consume the cheap Chinese goods now. They will have to spend more on acquiring the same product because similar I...

The finance minister of Narendra Modi government Mr. Arun Jaitley recently, in the Institute of Chartered Accountants while celebrating Chartered Accountants  Day (sic), said that India should have a “new normal” with citizens ready to pay the taxes they need to pay and a new mindset to move from a developing nation to a developed one … During the time of demonetisation I have said that India now needs to define the new normal. And the normal is whatever taxes I have to pay, I need to pay” . Is this true? Will paying taxes make India developed as a nation? Not at all. Quite the contrary. It will make India and Indians poor. Let us see why. Any society, at a given time, has a limited amount of resources which it can use to fulfill various unending present and future consumption needs of its citizens. The first stage of any development process requires the fulfillment of basic material needs of people. A nation of hungry people can never develop. Now, a socie...

Recently a woman named Tailin Lyngdoh from Meghalaya was removed from the Delhi gold club premises by staff officials because she was wearing a traditional dress ‘Khasi’ and was apparently looking like a ‘maid’. The union government minister Mr. Kiren Rijiju has protested against this incident by saying that it is a clear case of racial discrimination and is wrong. He is asking the Delhi police to investigate this matter and punish the club owners. Now, instead of making noise like the minster, let us analyze this case logically. The real question here is: is there anything wrong in such discrimination? Not really. Discrimination per se is not wrong or bad. In fact, it is a right of every individual. Let us see why. Right to discrimination is a human right which in turn, fundamentally, is a right to private property. As Murray  Rothbard said, all human rights are basically property rights.  As property owners we all decide everyday to whom we are going...

Farmers from various states of India like Madhya Pradesh, Maharashtra, Punjab, Gujarat etc., are right now agitating against their local state governments demanding, mainly, cancellation of their debts as well as better minimum support prices of their products. In the on-going agitation already six farmers have been killed by police firing. This agitation is a sign of total dependency of Indian farmers on the state. The reason why they have to demand cancellation of their huge debt burden today is because in past they were given easy loans by the government’s central bank RBI and its commercial, mostly state run, banks. Specifically, these protests and killings of farmers are a making of RBI’s cheap money and credit policy. Overall, this uprising is yet another making of the failures of the state’s central planning socialist policies. In the absence of these policies of cheap money and credit and central planning, farmers would be careful in borrowing money from...

Since coming to power in 2014 one of the aims of the Narendra Modi government’s welfare state is to make healthcare more affordable in India by, mainly, trying to curb prices of drugs used to treat critical ailments such as cancer, HIV/AIDS and diabetes. In their efforts to do so they have declared some 350 drugs as essential drugs and imposed a price ceiling on them. Not only this, in February this year they also cut the price of some heart stents by 75 percent. Now a letter from Modi government’s drug price regulatory bureaucracy The National Pharmaceutical Pricing Authority (NPPA) shows that they intend to add four more medical devices to a list of products eligible for price controls to reduce costs to patients . Making healthcare affordable is a noble objective, but the real question is whether the method of using government price control measure will achieve this objective? Only sound economic theory can shed light on this issue. Economic science tells us that,...

Since the Narendra Modi’s BJP government came to power in 2014 the dreaded military industrial complex is taking its firm roots in India e.g., recently the present defense minister of India Mr. Arun Jatiley held consultations with representatives of Chambers of Commerce and Industry (CII) on the proposed Strategic Partnership (SP) model meant to promote the private sector in defense manufacturing . Not only this, already many Indian private companies are diverting their manufacturing businesses from consumer goods to war machines e.g., Tata Advanced Systems won a contract of surface surveillance radar project for Navy from the Ministry of Defense; Reliance defense also bagged a contract of 916 crore from the defense ministry; Mahindra group also signed a deal with Airbus to manufacture parts of its Panther helicopters in India.  These are all the worrying signs of the dangerous military industrial complex taking its deep root in the Indian economy and society. Alre...