Indian business—perhaps even society at large—is currently buoyed by the expectation that we are entering a period of sustained economic growth that might finally make poverty a problem of the past. In this context, it might seem counter-intuitive to draw attention to the possibility of a decelerating global economy and projections about reversals in human well-being.
However, there is mounting evidence to show that the prevailing models of economic growth cannot continue unchecked to the end of the 21st century. Apart from the truism that infinite growth is not possible on a finite planet, the accelerating impacts of climate change are set to play havoc with a reliable supply of many natural resources—including food. Unless growth is redefined, degrowth will be forced upon the global economy, as a consequence of chaotic instability in eco-systems and due to the brittleness of political, social, and economic systems.
There are now broadly two choices before nations and the global private sector:
- Make a gradual but radical transition to a sustainable economy—that is, an economy that is not dependant on indefinite growth, or
- Slip into a period of unplanned non-growth that would be chaotic and will destroy much of the comforts and lifestyles that the rich and the middle classes across the world take for granted
But this looming crisis is also an opportunity to expand our imagination and open new vistas. For India, therefore, “re-growth” might be a more meaningful descriptor than the “degrowth” scenario being articulated by West European academics and activists. Its essence would be similar to what Mahatma Gandhi called “sarvodaya”—or an equitable and ecologically and socially sustainable spread of prosperity, instead of GDP-related growth that only measures the total of money-based transactions and/or the total exchange of materials and services.
Degrowth or re-growth as a choice broadly has five dimensions:
- Development as actual well-being, not just throughput of materials
- Steady-state economics, instead of systems in which growth is a survival imperative
- Fostering a solidarity economy through sharing and cooperation so that the same resources can serve far more people
- Reconfiguring consumption so that the judicious use of resources is a popular aspiration—and manufacturers foster it by abandoning business models based on planned obsolescence and instead design products to last and be reused.
- Redefining value so that the value of anything is not just what it is worth to a potential buyer in monetary terms, but rather in terms of the actual well-being it generates immediately as well as in the long term.
The related challenges and opportunities for businesses and policy makers in India are:
- Think long term, in a frame of at least decades if not a century
- Adopt holistic metrics, replacing GDP with a metric that reflects actual well-being
- Invest in research on steady-state economic policies and business models
- Make a structural shift towards triple bottom-line valuation for private sector and government programmes
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Rajni Bakshi is Gandhi Peace Fellow, Gateway House.
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