All That Glitters Can Be Part of the Gold

Economic growth is often viewed through the familiar indicators of GDP, investment, employment, inflation, taxation and other officially measured parameters. These are essential for economic policy. Yet, there may be another part of the economic story that is visible all around us but not always adequately captured in the conventional framework.

The crowded markets, malls, hotels and restaurants, expanding travel and tourism, construction activity, transport services,  health and senior citizens services, small businesses, household enterprises of all kinds, and innumerable self-employed persons all represent economic activity. Much of this activity may lie outside the fully formal economy or somewhere between the formal and informal sectors. This raises a simple question: Are we seeing the entire economy, or only that part of it which our existing systems are able to measure and classify?

Recognising the economic activity that already exists

The informal economy should not automatically be regarded as an undesirable economy waiting to be formalised. A considerable part of it represents genuine production, services, employment, entrepreneurship, consumption and income generation. A street vendor, small trader, artisan, domestic service provider, repair worker, transport operator, small manufacturer or self-employed professional may be conducting a perfectly productive economic activity even though the activity may not fit neatly into the formal framework.

There is also a substantial space between the formal and informal economies. An individual or enterprise may have a bank account, use digital payments, pay some taxes, employ workers informally, operate partly in cash and partly through banking channels, and remain only partially visible to the formal system. The economic reality is therefore much more fluid than a simple formal-versus-informal classification suggests. The first requirement is consequently recognition. We should recognise productive economic activity wherever it takes place and understand its contribution to the economy before deciding how it should be brought within the formal framework.

Measuring what we actually see

Recognition must be followed by better measurement. Economic statistics are indispensable for policymaking. But if significant economic activity remains inadequately captured, policymakers may not obtain the complete picture of income generation, employment, purchasing power, savings, consumption and wealth distribution. For example, ordinary citizens can observe strong demand in markets, restaurants, hotels, transport and tourism, health services, even during periods when inflation is high. Such observations do not by themselves prove that official economic statistics are wrong. They do, however, raise legitimate questions about whether all dimensions of economic activity and purchasing power are being adequately captured.

There is therefore a case for continuously examining how economic data are compiled.The objective should be to understand:

• where income is being generated;
• where employment and self-employment are taking place;
• how money is circulating;
• how much economic activity remains outside formal reporting;
• what lies between the formal and informal sectors;
• why some activities remain outside the formal system; and
• how much of the apparent informality is legitimate economic activity and how much represents tax evasion or unlawful transactions.

Better information would lead to better policy.

From formalisation to integration

The answer need not be to force every informal activity immediately into a rigid formal structure.A more practical approach could be progressive integration. Productive informal enterprises and individuals should gradually be enabled to enter the mainstream through easier registration, affordable finance, digital tools, insurance, social security, skills, technology, market access and appropriate taxation. The formal economy, the informal economy and the space between them could progressively become part of one integrated economic system. The wide  inequality and the trickle down effect seen on a very large scale can perhaps be an area for deep thought to fix some of the gaps between formal and informal economy. The objective should be to make formalisation beneficial rather than merely compulsory.

When people see tangible benefits from becoming more visible—better access to credit, markets, technology, protection and opportunities—compliance is more likely to become voluntary and sustainable. The ultimate objective should be that the distinction between formal and informal gradually becomes less important because productive economic activity itself becomes increasingly integrated.

Informal does not mean illegal

This distinction is fundamental. Informal economic activity and illegal economic activity are not synonymous.  An activity may be informal because of its size, nature, documentation, registration status or operating practices. That does not automatically make it unlawful. At the same time, informal channels can be used for tax evasion, concealment of income, generation and circulation of black money and other illegal activities. These cannot be ignored. Recognising the economic contribution of the informal sector must therefore never be interpreted as legitimising black money or tax evasion.

The approach should be more intelligent: identify legitimate economic activity, bring it progressively into the mainstream, and simultaneously strengthen the ability of the State to identify and prevent unlawful activity. Black money and illegal activity cannot realistically be eliminated overnight. But neither can their existence be accepted as a permanent feature of the economy. The objective should be gradual capture, prevention and reduction through better information, technology, enforcement, simpler systems and greater voluntary compliance. The support of Artificial Intelligence would be of immense help in the matter. 

Taxation and compliance

Taxation is another important part of this transition. If taxation, compliance procedures and regulatory requirements become excessively burdensome, some economic activity may have an incentive to remain outside the formal framework. This does not justify evasion. It suggests that tax policy and compliance policy must work together. Decentralised approach  in taxation with centralised consolidation of information  using Technology and AI would perhaps make the system workable and effective.   A wider tax base, reasonable rates, simpler procedures, better services and effective enforcement can create an environment in which compliance becomes easier and more worthwhile. The objective should be to move progressively from a system that primarily seeks to detect non-compliance after it occurs to one that makes compliance simpler, more natural and more rewarding.

Digitalisation: opportunity, not the whole answer

The growth of digital payments and financial technology has greatly increased the visibility of economic transactions. But digitalisation alone cannot provide a complete picture of the economy. A transaction becoming digital does not automatically mean that the underlying economic activity has become fully formal. What matters is the entire economic chain—income, employment, production, ownership, taxation, savings, investment and consumption. Digitalisation should therefore be treated as an important instrument for integration and transparency, rather than as a substitute for understanding the economy itself.

Looking beyond the compartments

Perhaps the time has come to look at the economy less as three separate compartments—formal, informal and something in between—and more as a continuum of economic activity. The important question is not merely: “Is this formal or informal?” It should also be: "What economic value is being created, who is creating it, how is it being measured, and how can that productive activity be brought into the mainstream without destroying its viability?” Such an approach can help policymakers see economic reality more clearly with substantial increase in the GDP growth. It can also help millions of small entrepreneurs, workers and self-employed persons move gradually from vulnerability towards greater security, productivity and opportunity. 

From visibility to integration

The journey could therefore be: Recognition → Better Measurement → Integration → Greater Productivity → Wider Employment and Income → Larger Tax Base → Greater Compliance → Inclusive Growth At the same time, there should be a parallel journey: Better Information → Identification of Illegal Activity → Prevention of Tax Evasion and Black Money → Effective Enforcement → Greater Trust in the System

These two processes need not conflict. In fact, they can reinforce each other. A larger and more productive formal economy provides greater visibility. Greater visibility can improve compliance. Better compliance can support lower distortions and a broader tax base. Greater productivity and opportunity can, in turn, encourage more economic activity to enter the mainstream.

All that glitters can be part of the gold

The informal economy should therefore not be looked at merely as a problem to be solved. Some of what lies outside the formal framework may already be economic gold waiting to be recognised, measured and integrated. The idea  is not to glorify informality. Nor is it to legitimise black money, tax evasion or illegal activity. The objective is to distinguish between the two, understand the economic reality on the ground, protect productive activity and progressively bring it into the mainstream. India's aspiration for a developed economy requires not merely higher growth but a more complete understanding of the economic strength of its people. If the formal economy represents the visible structure, the informal economy and the space between the two may contain considerable productive strength that has yet to be fully recognised.

All that glitters may not be gold. But some of what glitters may indeed be part of the gold. The task before us is to identify it, measure it, integrate it and allow it to contribute openly and productively to the nation's growth. GDP growth cannot be at 7.8% . It should be far more than this if all the services and products from the informal sectors get reflected  and   the compilation of information is made fool proof    

That is not merely formalisation. It is economic integration to make  the dream of our   PM's Viksit Bharath a reality.  

Samastha Loka Sukhino Bhavanthu. 

T V G Krishnan 

(personal Views)

( This  article is vetted with the help of AI )

SIR exercise “Be uncompromising about the objective, but compassionate and flexible about the method.”

 

And Vote Goes to ........ SIR woes of VIPs Cleared at home itself. ( TOI 9/9/26)

Today's Times of  India (9/9//26) reported  this news along with some good examples showing how elderly voters , accident victims, skip office visit.  Good to hear and the efficiency of the administration is admirable. That is the essence of people-centric governance: achieving the objective of the State while making the life of the citizen easier, not harder.

The SIR exercise need not become a choice between administrative efficiency and citizens' convenience. It can—and should—be a win-win exercise in which the legitimate objectives of the administration are fully achieved while genuine citizens are spared avoidable hardship.

The task is therefore not merely to eliminate ineligible names from the electoral roll, but to do so through methods that are intelligent, flexible and sensitive to the circumstances of different categories of citizens. Greater use of available records, technology, local verification and doorstep assistance for those who genuinely need it could help achieve both objectives simultaneously.

The administration gets a cleaner and more credible electoral roll; the citizen gets the assurance that his or her democratic rights will not be compromised by an inconvenient procedure. A government may be technologically efficient, procedurally compliant and administratively impressive—and yet fail the common citizen if the citizen has to struggle to access the system. That is precisely the distinction between administrative efficiency and meaningful governance.

Administrative efficiency should first serve those citizens who face the greatest difficulty in accessing the administration.  The test of an efficient administration is not how efficiently it serves the powerful and privileged, but how sensitively it serves those who find it most difficult to reach the system. Updating the electoral roll is not an ordinary administrative exercise. It directly concerns the citizen's fundamental democratic participation. Therefore, the administration should arguably adopt a citizen-first approach for the elderly, persons with disabilities, the seriously ill, bedridden citizens, people in their eighties and nineties, and daily-wage or self-employed workers who cannot sacrifice a day's livelihood to visit a designated office. The constitutional principle is that every voter is equal;  those facing greater barriers deserve greater administrative accommodation, not preferential  treatment.

The ultimate measure of administrative efficiency should therefore be not merely how successfully a rule is implemented, but how successfully its objective is achieved without unnecessarily inconveniencing the people whom the administration exists to serve.

A good administration should not ask the citizen, “How can you comply with us?” It should also ask itself, “How can we make it easier for the citizen to comply?” That is where efficiency becomes empathy—and governance becomes truly meaningful.When an idea recognises the legitimate objective of the other side, understands the practical difficulties of the people affected, and then offers a way for both objectives to be achieved together, it becomes much harder to oppose.

“Be uncompromising about the objective, but compassionate and flexible about the method.” This  principle goes well beyond SIR. It is, in fact, a good foundation for meaningful governance." 

Samastha Loka Sukhino Bhavanthu.

T V G Krishnan

(personal Views)

 

 

Has India Protected—or Permanently Preserved—the Common Man?

“My Common Man has been around for decades. He hasn't changed. He represents the silent majority of India who tolerate everything, look at everything with a mix of bewilderment and amusement, but remain exactly where they were.”

— R.K. Laxman

The survival and well-being of the Common Man depend largely on the quality of governance. But the survival, credibility and legitimacy of the governance system itself ultimately depend on how effectively it addresses the most fundamental question confronting the ordinary citizen: Can he live with dignity, security and reasonable economic stability?

After nearly eight decades of Independence, India should not remain trapped in a system where the Common Man is repeatedly treated as a beneficiary of promises, schemes and temporary relief. The objective must be to transform him into an empowered, productive, informed and responsible citizen.

As India advances towards the vision of Viksit Bharat, this question deserves an honest examination. While a section of the population has achieved considerable economic and social progress, where does the Common Man stand today in terms of economic, financial, social and emotional security?

The welfare-oriented State has undoubtedly brought relief to millions. Social protection, food support, subsidies and access to essential services have reduced hardship and provided a vital safety net. Yet an uncomfortable question remains:Has the Common Man merely been protected—or has he, in some respects, been permanently preserved as a political and economic category defined by poverty, inadequate education, insecurity and dependence?

R.K. Laxman's legendary Common Man remains a powerful symbol of this reality. With his bewildered expression, he silently watched decades of political promises, administrative failures and social contradictions. That silence is symbolic. The Common Man is at the centre of political speeches, policy announcements and welfare programmes, yet often remains an outsider to his own development.

The Constitution, legislation, the judicial system and the administrative machinery are founded on lofty and benevolent intentions. Their purpose is to protect rights, ensure justice and promote welfare. Yet words and deeds often fail to match.The real issue is not merely the gap between promises and performance, but the inadequate accountability for closing that gap. Schemes are announced, resources allocated and benefits distributed. But the ultimate question remains:What tangible improvement has actually reached the ordinary citizen?

Welfare Must Be a Ladder, Not a Holding Pattern

Welfare is necessary. A civilised society cannot abandon those facing poverty, illness, unemployment or other forms of vulnerability. But relief cannot become the final destination.A welfare system should be a ladder for upward mobility, not a permanent holding pattern. Its purpose should be to reduce the vulnerability that makes welfare perpetually necessary.

This requires greater attention to the foundations of lasting progress: quality education, productive employment, skills, entrepreneurship, investment, infrastructure and genuine opportunities for economic mobility.True welfare should help people outgrow the conditions that made welfare necessary.

Poverty is not merely the absence of money. It is also the absence of capability, opportunity and the freedom to make meaningful choices. People must be empowered to think, decide, act, choose and judge for themselves.

Welfare can provide essential protection, but it cannot substitute for long-term economic empowerment.Employment must become productive and sustainable. Education must develop knowledge, skills, critical thinking and analytical ability. Investment must create opportunities for people to improve their lives through their own efforts.The Common Man should not be condemned to spend his entire life managing survival.

The Unfinished Struggle for Dignity

Inflation hurts the poor disproportionately. It erodes the purchasing power of limited incomes and makes food, housing, healthcare, education and transport increasingly difficult to afford.The Common Man does not necessarily seek luxury. His aspirations are modest: adequate food, a secure home, decent clothing, education for his children, healthcare, affordable transport and an opportunity to improve his life through honest work.These are not extravagant demands. They are the minimum requirements of a dignified life.Constant anxiety about the next meal, rent, school fees or medical expenses affects not only income but also peace of mind, emotional security and the ability to enjoy life.

The Common Man has shown extraordinary resilience. But it is a failure of governance when society celebrates that resilience while doing too little to remove the conditions that make it necessary.

Measure Governance by Outcomes

Governments and institutions should not be judged merely by the money allocated, the number of schemes announced or the volume of benefits distributed. They must be judged by outcomes.

How many families have permanently moved out of poverty?How many children have received genuinely quality education?How many young people have acquired productive skills and sustainable employment?

Has the purchasing power of ordinary households improved?

Are food, housing, healthcare, education and transport becoming more affordable?Are citizens becoming more economically independent?These are the questions that should determine the success of governance.

The Common Man does not need endless rhetoric. He needs visible results. He does not need to remain a permanent beneficiary. He needs an opportunity to become an independent contributor.

From Receivers to Contributors

India must move beyond the familiar cycle:

Problems → Promises → Schemes → Temporary Relief → Continuing Problems

It must create a more productive cycle:

Growth → Productive Investment → Employment → Higher Incomes → Greater Purchasing Power → Better Quality of Life → Further Growth

The task is not merely to redistribute the existing economic cake. We must also make it substantially bigger through productive investment, innovation, efficient use of resources, better governance and the full development of human potential.

Technology and intelligence should be used to generate dependable data, review policies, monitor performance, ensure accountability and measure whether national objectives are actually being achieved. Ultimately, governance must be reflected in measurable improvements in the quality of life of the people.

At the same time, the opportunities and benefits of growth must reach a much wider section of society. The objective should be to make every citizen a participant in development, not a permanent beneficiary waiting for relief.The required transformation is clear:

From Relief to Opportunity.

From Dependence to Empowerment.

From Receiving to Contributing.

From Survival to Progress.

From the Common Man to the Empowered Citizen.

From Silence to Accountability

Economic empowerment alone is not enough. A strong democracy also requires informed and responsible citizens.People must not remain passive recipients of what the Government provides. They must learn to observe, understand, question and participate. Public institutions exist to serve the people and must remain accountable for their performance.

Citizens should become constructive watchdogs and ask:Are institutions performing the functions for which they were created?Are public resources being properly utilised?Are policies producing the promised results? Who is accountable when institutions fail?Are the benefits of development actually reaching the people?

Democracy becomes stronger when the people who elect governments also evaluate the performance of the institutions created to serve them.The transformation we need is:

From Passive Citizens to Thinking Citizens.

From Beneficiaries to Participants.

From Silence to Constructive Questioning.

From Blind Acceptance to Informed Accountability.

The Real Meaning of Welfare

India certainly needs a welfare State. Compassion and protection of the vulnerable are essential responsibilities of a civilised society. But the ultimate purpose of welfare cannot be to maintain a permanent class of beneficiaries.It must transform:

Dependence into Capability.

Capability into Productivity.

Productivity into Dignity.

Dignity into Shared Prosperity.

The ultimate test of welfare is not how many people remain dependent on it, but how many it enables to outgrow the conditions that made welfare necessary.

After nearly eight decades of Independence, perhaps the most important transformation India can achieve is to enable the silent Common Man to step out of the frame—not as a permanently protected and managed citizen, but as an educated, economically secure, self-reliant, discerning and confident participant in India's future.

The Government may govern, institutions may administer and experts may advise—but an alert, informed and responsible people must continuously watch, question and contribute.That should be the next great transformation.

Not the preservation of the Common Man as a permanent beneficiary, but his emergence as an empowered citizen—capable of earning, aspiring, contributing, questioning and living with dignity.

That should be the true meaning of welfare.

That should be the ultimate test of governance.

An enlightened and concerned citizen is a performing and contributing asset to the nation. The need of the hour is to transform all Indians into conscious stakeholders in nation-building—committed, involved and willing to contribute their time, talent and effort towards realising the dream of Viksit Bharat, in letter and spirit.

India's greatest national asset is not merely its population, but an enlightened, responsible and participating citizenry. End this write up with a quote.

"Without leaps of imagination or dreaming, we lose the excitement of possibilities. Dreaming after all, is a form of planning." Gloria Steinem. 

Samastha Loka Sukhino Bhavanthu.

T V G Krishnan 

( personal views) 

• 
  

Life is worth living to Experience its Many Facets.

 

Life Is Worth Living to Experience Its Many Facets

“The purpose of religion and secular ethics is to make life more human. We are all members of one human family. Different faiths may serve different needs, but the health we seek is the same: a peaceful mind, a compassionate heart, and a life that brings less suffering and more happiness to others.”— His Holiness the XIV Dalai Lama

Life is a precious gift. To live is to experience its many facets—to see, feel, think, learn, create, love, struggle, achieve, share and grow. Every human being is born with the fundamental gift of life and the energy to live it. Nature does not discriminate. Air, water, light, heat, space and countless other resources sustain all living beings.

Yet our lives unfold differently. Family, circumstances, geography, education, opportunities and social surroundings influence the course of life. At the same time, human beings possess the ability to learn, think, innovate and act. Through knowledge,  rational thinking, effort and responsible action, we can shape much of our own destiny.

Over centuries, humanity has created science, technology, institutions, cultures, religions and systems of governance to meet its needs and improve the quality of life. We have conquered distances, expanded knowledge, created extraordinary progress and unprecedented comforts and connected people across continents by establishing an interconnected world. The whole universe has become borderless and  remain  well connected. Yet this progress has also created a striking paradox.Connection without attachment has led only to isolation, loneliness and desperation for no justifiable reason or logic . In the process , some avoidable contradictions have come to surface. 

Human beings have divided themselves in the name of faith, ideology, race, status, wealth, power and political identity. Politics, which should serve society, has too often become a struggle for dominance. Autocracy, democracy and competing political ideologies have all been shaped by human ambitions and conflicts. Extremism, intolerance, hatred and the desire for power have repeatedly produced violence, war and suffering.

Even education and technology, which should unite humanity through knowledge and understanding, can become instruments of division when they are used without wisdom and responsibility. Digital technology has connected the world as never before, yet human beings have not necessarily become more understanding, peaceful or compassionate.

The paradox is striking: the world has acquired enormous material wealth and knowledge, but has yet to discover the wisdom to live together. The tendency to  invade nature is on the increase though it continually reminds us of our limitations. Earthquakes, floods, storms, wildfires, changing climates and other natural forces demonstrate that human beings cannot permanently dominate the forces of nature. Nature provides the foundations of life, and when those foundations are disturbed, the consequences are ultimately felt by everyone. Human beings cannot ignore the natural foundations of life. We may transform nature, but we must also learn to live with nature.

 We continue to divide ourselves in the name of faith, ideology, race, status, wealth, power and political identity. Technology, education and politics, which can unite and uplift humanity, are often used for division, conflict and dominance. This leads us to a fundamental question: What do we really mean by progress? Is progress merely greater wealth, technology, infrastructure and material comfort? Or should it also mean peace, dignity, justice, security, happiness, harmony with nature and freedom from fear?

The Meaning of True Progress

The world today possesses much of what is needed for a better life—knowledge, science, technology, resources, infrastructure and global communication. What is still missing is the wisdom and collective will to use these achievements for the common good. Perhaps humanity must look beyond its divisions and rediscover a simple truth: life itself is common to us all.

The ancient Indian ideal of Vasudhaiva Kutumbakam—The World Is One Family expresses this interconnectedness. It reminds us that the well-being of one cannot ultimately be separated from the well-being of others or from the health of the planet we share. We have learnt how to accumulate wealth, but we must also learn to share opportunity. We have learnt to communicate instantly, but we must learn to understand one another. We have created powerful technologies; now we need the wisdom and responsibility to use them for the benefit of humanity.

The question before all of us—thinkers, scientists, educators, leaders, rulers, reformers, intellectuals, institutions and citizens—is simple but profound: What kind of world do we want to leave for future generations?

The answer cannot lie merely in greater competition for wealth, power and dominance. It must be found in cooperation, compassion, responsible freedom, mutual respect and the wise use of nature's resources.

The Responsibility of Institutions

This responsibility belongs not only to individuals but also to every institution, public or private.

Governments, legislatures, courts, educational institutions, hospitals, banks, businesses and all organisations engaged in public or private service have an important role in improving the quality of human life. They should function with integrity, accountability, fairness and, above all, a human touch.

Rules, technology, efficiency and profits have their place, but they should remain means, not ends. The ultimate purpose of every institution should be to serve human welfare and contribute to a better quality of life. When institutions function with ethical values, a spirit of service and genuine concern for people, they can transform civic, cultural and social life. Peace everywhere and happiness all around should become a conscious and practical objective in the delivery of every service. The misuse of power, technology, institutions and developmental activities must be prevented so that progress does not create new forms of exploitation, inequality or suffering.

The Wisdom to Live Better Together

Life is not meant merely to be survived or spent accumulating material possessions. It is meant to be lived, experienced and shared—with the simple attitude: Live well and let others also live well.

Nature gives us the air we breathe, the water we drink, the food we grow and countless other forces that sustain life. Its abundance is not something to be taken for granted or merely consumed. It must be respected, protected and shared. Perhaps this is the ultimate wisdom humanity needs: To enjoy life without destroying the conditions that make life possible; to seek prosperity without denying others their opportunities; and to live freely without forgetting our responsibility to one another and to nature. If humanity can combine knowledge with wisdom, freedom with responsibility, development with sustainability, and individual achievement with concern for the common good, the world can become a better place for everyone.

We have learnt much about how to live better. Perhaps it is now time to learn how to live better together.That is the real meaning of progress. And that is why life is worth living—as long as nature and its life forces permit us to experience, enjoy and share its many facets. “Balancing the inner and outer facets of life—while engaging meaningfully with politics, economics, social developments and technological advancement—is a real blessing that enables us to live with contentment, fulfilment and a fuller appreciation of life.”

Samastha Loka Sukhino Bhavantu

May all beings in all the worlds be happy.

T V G Krishnan

(personal Views). 

Banks write offs at whose Cost? Have the stakeholders of Banks thought about it?

 Bank of Baroda Writes Off ₹35,715 Crore of Loans above ₹100 Crore, Refuses To Disclose Big Defaulters’ Names under RTI Money Life 19th Aug 2026.

This sort of write offs of bad loans using other stake holders funds in the bank who include depositors , good borrowers, employees, share holders and government has no justification what so ever. The situations led to write offs and the details of borrowers whose accounts have been written off technically in banks books should be made transparent as depositors' and employees' sacrifice definitely be much more than their affordability . Depositors are paid less than 7% for their FDs and less than 3.5 %for their Savings Bank deposits and thus the money saved by banks are passed on to big borrowers and eventually written offs as disclosed now. With this background being a reality , banks and borrowers have no moral right to get subsidised for their inefficiencies and business losses to make it good from the poor stake holders of banks. The depositors even have to pay Income tax on this meagre savings without even adjusting for inflation which is always more than the int rate. This is something very pathetic. It is time to fully justify and make it transparent as to what has happened to these borrowers and how and why the accounts became bad and why the banks and borrowers cannot think of some inbuilt mechanism to make up for such bad debts losses without hurting the innocent stake holders.

Is it that banks generate bad loans only to loot the stakeholders hard earned money given to banks to develop the economy?  

T V Gopalakrishnan

( modified version of this comment  was given in response to the Article on Bank of Baroda's write offs referred to above)

The Need for a Rare Feat to fix inflation and save the masses from high cost of living.

 Dear Sir,

                         

Apropos your article "Fiscally Fit to Beat Inflation" (editorial page, ET 19th Aug), the economy's strength is reflected in the rupee's value, impressive GDP growth, a strong fiscal balance and stable inflation. Unstable inflation kills the poorest of the poor, takes away the joy of living and leaves them unhedged against the ever-increasing prices of food items and the rising cost of living fuelled by continuous and unstoppable increases in the prices of oil, transport, education, insurance, medical care, and more. Perhaps the only way to fight inflation is to hedge the economy against fuel, food, fertiliser, and fiscal deficit by establishing separate price stabilisation funds. These funds would manage essential, inherently inflationary items whose prices are unfortunately linked to exchange rates dependent not only on poorly managed national socio-economic conditions but also international ones. Geopolitical uncertainties and international price movements of oil and other sensitive commodities like gold and silver, which the poor seldom use for their day-to-day lives, need to be factored in and managed effectively by a meaningful governance system. This would spare people from inflationary price increases on all their consumption items. Taxes should be divided into inflationary and non-inflationary categories. Levies should become extra taxes on non-inflationary items, insulating the majority of the common masses, this should become the standard for fiscal discipline.It is time to revisit the tinkering approach to the taxation policies. Policy reforms should closely associate with inflation/non-inflation, equitable wealth distribution, and sensitive geopolitical conditions influencing exchange rate stability and the movement of goods and services linked to unpredictable tariffs.      

T.V.Gopalakrishnan

Bengaluru 

( Letter Sent to the Economic Times). 

Governance is a universal and people centric Principle..

 Governance is a Universal and People-Centric Principle

Reforms and Regulation PM Speech

"We created a clear road map for reforms and the main direction has been -reforms at level of Governance! For this, we are not just changing Regulations, we are changing the entire philosophy of regulation. The decisions that change the country are those whose impact is visible on the ground , and are taken both the present and future in mind. " (ET dated 24th Aug)   

Freedom → responsibility → good governance → institutional performance → welfare of all.

Good governance is ultimately responsible human living organised through institutions, guided by values, disciplined by accountability and protected by the rule of law. Its purpose is to ensure that democracy delivers not merely government, but justice, social order, sustainable progress and a better quality of life for all. 

Democracy provides the mandate; governance provides the mechanism; accountability provides the discipline; and the rule of law provides the foundation. Together, they should convert a nation's vision into action, mission into performance and policies into meaningful outcomes.

Governance Beyond Government

Governance is not limited to government. It is a universal principle that applies wherever people have responsibilities, exercise authority, use resources or affect the lives of others:

Individual → Family → Institution → Society → State → Nation → Humanity

Every institution—public or private, commercial or non-commercial—should therefore be judged by four simple questions:

Purpose: Why does it exist?
Conduct: How does it discharge its responsibilities?
Performance: How effectively does it achieve its objectives and use its resources?
Social Value: What legitimate benefit does it create for people and society?

Thus:

Vision and Mission tell us what we intend to achieve.
Governance determines whether we achieve it.
Values determine how we achieve it.
Outcomes determine whether society benefits from it.

Values, Duties and Responsibility

Responsible governance begins with responsible human conduct. Nature provides resources universally; their use and distribution therefore carry a responsibility to ensure equity, sustainability and social justice.

Development should consequently mean:

Progress with social justice
Freedom with responsibility
Rights with duties
Authority with accountability
Resources with stewardship
Governance with measurable outcomes

Economic growth alone cannot be the measure of progress. The true measure is whether development improves the lives of people and creates opportunities for all to participate in its benefits. It is time for every individual and every institution to perform to its full potential and contribute to making  Viksit Bharat a reality. Our collective endeavour must be to build an India that is prosperous, just, inclusive and a true welfare State in every respect.

 When Governance Fails

Good governance should identify weaknesses early, correct failures and preserve public trust. When failures accumulate without correction, the progression can become:

Weak governance → Unresolved failures → Loss of trust → Loss of institutional authority → Non-compliance → Disorder → Persistent disorder → Conditions approaching anarchy

Anarchy may arise from many causes. But prolonged or systemic disorder within a functioning democracy is a serious test of governance. The wiser question is therefore not merely how to control disorder after it appears, but how to prevent the institutional and social conditions that allow it to emerge.

The People-Centric Test

Institutions ultimately exist to serve legitimate human and social purposes. Their success should therefore be measured not simply by their size, power, profit or survival, but by the value they create for people and society.

The ultimate test of governance is simple:

Does the way we govern our individuals, families, institutions, society and State enable people to live with dignity, exercise freedom responsibly, fulfil their duties, receive fair opportunities and participate meaningfully in the benefits of progress?

If the answer is increasingly yes, governance is working.

If the answer is increasingly no, there is a governance problem—however impressive the laws, policies and institutions may appear on paper.

Good governance is therefore not merely the administration of laws. It is the continuous conversion of democratic authority, ethical values, institutional responsibility and the rule of law into justice, social order, sustainable progress and a better quality of life for all.The impact of the Governance every where and in every Institution should be visible at the ground level in the overall welfare of the people .

Good governance is ultimately about serving people, strengthening institutions and ensuring that progress benefits society fairly and responsibly. I conclude this write up with a quote from Whats ap message widely circulated on the eve of 80th year of independence celebrated on the 15th Aug 2026. 

               "Freedom is not a legacy to celebrate ;it is a responsibility to protect".  

Samastha Loka Sukhino Bhavanthu.

T V G Krishnan

(personal Views)