Between growth & protecting people at the bottom, Indian economy more balanced than US: J. Stiglitz

May 31, 2015

In The Great Divide you have argued that it's the responsibility of governments to work towards reducing inequality. In the Indian context, what would you expect the Modi government to do to reduce inequality?

The Modi government has addressed the issue in some ways, such as through the manufacturing sector. However, inequality is the result of a whole gamut of government rules, regulations and laws and the entire legal framework. It covers tax and other government policy may lead to more inequality. An important example here is the issue of intellectual property rights and in the past India has led the emerging markets with a legal framework that gave the generic drugs industry access to affordable medicine.

There have been court decisions in India, in this respect, that have won admiration and respect around the world. However, there is now discussion that the legal framework will be changed and the laws reversed by the government, making it tougher for the generics industry. Prices of life-saving drug going up would lead to the worst case of inequality in India — there would be less money in the hands of the poor.

Almost 25 years after economic reforms, how would you assess India''s tryst with free markets?

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