View: The making of a caring economy


By N Venkatram

On first reading, the Economic Survey 2019-20 is an unlikely home for the caring citizen. Take a closer look, and passages evoke a gentler world. Here, pregnant women, first-time job-seekers and job-creators, and pensioners command rare attention. For those looking towards this more caring world, the last two surveys are a surprisingly enlightened guide into how India can begin to follow socially progressive nations such as New Zealand.

To be sure, the signposts in the Economic Surveys are quantitative — vast amounts of trends and statistics spanning social and economic topics. But three themes emerge which, if layered upon other wider secular trends, could remodel the working of India’s economy and society.


First, the citizen experience in our large and diverse economy needs to be designed around distinctive communities. The caring citizen experience must now be the pole around which all else spins, a pirouette away from a generation of focus on wealth-creation and entrepreneurialism. In practice, this means tax benefits to elevate distinct communities, such as startup entrepreneurs, owners of small and medium-size businesses, senior citizens, and women in work.

The starting point is defining where people need help. Progressive nations such as New Zealand, Britain and the US have identified personal life-events such as births and deaths, first-time workers, taking care of the less-fortunate, which trigger complex, often traumatising engagement with public administrators.

The citizen’s experiences can be simplified, enhancing the quality of life. New Zealand, whose prime minister gave birth while in office, recognises six life-events; the US recognises 12.

What are India’s life-events? Most are universal but, perhaps, a category could be added for ‘natural disasters’, an indiscriminate and material toll on the citizenry. In any case, India’s new demography and changes in work-life balance — gig, transient, project-based —and its impact on our ability to save, demands a redesign of the regime of savings and investment.

Data suggests that a single lifelong job is giving way to multiple jobs, probably interspersed by self-employment and unemployment, impacting savings.

Similarly, the increasing participation of women in the workforce needs a corresponding change in policies to ensure mothers see relative merit in both raising a family, as well as returning or remaining in the workforce.

Second, technology is a generational opportunity to create an efficient governance and taxpayer experience. India has deployed technology to automate and consolidate direct transfer of welfare payments, with notable success. The Unified Payments Interface (UPI) platform crossed a billion transactions a month in October 2019.

Welfare support and taxation constitute the material financial flows between the State and its citizens. India has made significant progress in terms of timely refund of taxes to citizens with the help of centralised processing centres. The country is the second highest digital adoptor as measured across 30 metrics in an analysis of 17 mature and emerging economies since 2014. India has more than 350 million smartphone and 300 million social media users, the second highest in the world. Only China has more app downloads and Internet subscribers.

The relationship between technology and the delivery of citizens’ experiences is arguably still at a nascent stage of mass impact. Together with our very own frugal innovation, these two forces can redefine India.

Third, taxation should be viewed as a behavioural science with taxpayers as customers. The Economic Survey of 2018-19 has a delightful elaboration on ‘Policy for Homo Sapiens, Not Homo Economicus: Leveraging the Behavioural Economics of “Nudge”,’ a great read on the influencing spectrum of public policy.

With only 3% of Indians paying income tax, India’s taxpayer community is often defined as a ‘super-minority’. Look at this in another way. With 55 million individual taxpayers, India has a larger absolute number of taxpayers than France (less than 38 million), Britain (31 million) and Japan (22 million). In absolute terms, India has an equivalent number of taxpayers who need to be respected and provided services just as in any other mature nation.

The cornerstone of this year’s budget proposals includes a dispute-resolution scheme, ‘Vivad Se Vishwas’ (From dispute to trust). The budget unveiled a charter of taxpayer rights, which will be embedded in laws to establish a system of trust between taxpayers and the administration. And the journey to enable technology to eliminate the physical interface for taxpayers moved up a notch with the announcement of an e-appeals system. These steps are aimed at collectively improving citizen experience and re-establishing trust.

The creation of a tech-enabled system to deliver citizen experience carries significant user advantages and a critical outcome — a society based on trust is a happier and more caring society.

The writer is CEO, Deloitte India

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