The impact of infrastructure on growth of GDP and employment My column in the Business Standard today is Does infrastructure now generate growth? The traditional argument on the importance of infrastructure was as follows. In the modern world, small steps of production take place at geographically dispersed low-cost production locations. Efficient transportation is essential for moving raw materials and sub-assembles across these production locations. Therefore, to make it possible for Indian workers to participate in globalised production, high quality infrastructure is a pre-requisite. In this chain of reasoning, there is a causal connection from better infrastructure to private investment and then jobs.
The importance of rule of law to economic and social development is increasingly ignored in India. I hope your future papers will address this.