Policy Wise

In a hard-hitting article, Devesh Kapoor argues that the World Bank should stop bankrolling countries like India which consistently perform low on education and public health,

In India’s case, the state’s inability to discharge this most basic obligation to its citizens in education and health, even as it seeks to be a global power, is a troubling portent of the country’s future. While India is not a failing state, it is, to evoke economist Lant Pritchett, a “flailing” state. While the implementation capacity of the Indian state has always been its Achilles heel, these weaknesses become more glaring as the private-sector economy powers ahead. Malnutrition in India is higher than in Sub-Saharan Africa. More than half of children aged 7 to 14 in rural India cannot read a simple paragraph of second-grade difficulty. Infant and maternal-mortality rates are awful even as the nation proudly exports more doctors abroad than any other country and promotes a thriving medical-tourism industry.

The reasons for these failures are manifold, but ultimately have to do with the troubling condition of the Indian state at all levels. The failures are not just due to poor incentives but to weak abilities in the quality of the human capital of public officials. Compared to the past, fewer people with talent join state institutions, and there’s no sign that the state can or will do much about it.[link]

It’s a fair argument but it begets the question: What will the World Bank do then?