Reflections on Toppers’ Conclave

Recently concluded inaugural round of Toppers’ Conclave ( 3-7 August, 2015 ), arguably one of the few innovative initiatives that have been spawned by the various Governors of this state, provided all the active participants some food for thought. This writer having been involved in the capacity building of the civil servants of the country, as a Director of the State Training Academies in Lucknow and Naini Tal for quite some time, could not help reflecting on its significance, particularly its long term import. He was asked to open the innings, so to say, soon after the Inaugural address by the prime mover, Dr K.K. Paul, the Governor himself. Of all the Governors, that this state has had the privilege of being headed by so far, Governor Agarwal, was the only one who believed in leading from the front. His abiding contributions to the state are a Blood Bank, a second one as far he was concerned, with the active help of the Uttarakhand Branch of IMA and of course, the ONGC, the Oil & Gas behemoth. Him Jyoti School was Governor Agarwal’s most innovative contribution, if one looks at its central philosophy, namely providing to the children of the most deprived sections of Uttarakhand state, a level of education which could be as high as any charity could possibly muster. Besides education Governor Agarwal bequeathed the Scottish Raj Bhawan at Naini Tal an illustrated account of its history and he brought SMILE to the faces of dozens of hapless children born with a split-lip, with free plastic-surgery.

Toppers Conclave 2015

From Governor Barnala, the first one to adorn this high public office and whose swearing in ceremony happened to be this writer’s official mandate when he was suddenly directed to take over the charge of In Charge Capital Formation way back in October, 2000; to the present incumbent, Dr K.K. Paul, this writer has had occasion to know, and interact with, all of them. One passion has been common to all of them without a single exception – each wished to do something worthwhile for this emerging mountain state. If there has been a failure it has been on the part of those who could not match their desire and fervour, while they were here. Even Governor Dr. Qureshi, the predecessor to Dr Paul, expressed his keen desire to be of any help in getting a modern version of the entire compendium of 22 volumes of Uttarakhand Ka Itihas, by the doyen among historians, Dr Shiv Prasad Dabral. It is only us, the students of history, who are to be blamed if the project could not see the light of the day – no one knew how to obtain concurrence of the family members of the late lamented historian of this state to re-print these out-of-print volumes ! Such examples can be multiplied by this author, in the case of almost each of them. The ‘public spirit’ has surely taken a nose-dive.

Convening a Toppers’ Conclave, getting two toppers each from of the ten state Universities, all the ten Vice Chancellors and a few selected speakers to speak on a few identified topics, for full five days, and exposing them to a conferencing and interactive culture, in the Raj Bhawan premises, is arguably an intervention only a Governor of the state can think both think about and then execute. As is the personal experience of this maiden speaker and going by the reports that appeared in various news-papers the prime mover, Governor Dr. KK Paul, was himself present, almost throughout ! It is one act that only a personal commitment to what one intends to achieve can make happen. Of all the take –aways, that can be assumed that the young-scholars took home with them, unmistakably the one they all must have taken back was – Lead personally and from the front ! Was it Peter Drucker who said- ‘ Be a good Leader first and then a good Manager’ ? Doing Right Things is more important than Doing Things Rightly – Leaders are those who do Right Things ! Holding Toppers’ Conclave, looking from any angle one chooses, certainly has been a Right Thing to do, that too so soon after taking charge of this state.     

Nations’ Wealth and Capitals

‘Sustainable development’, the buzz word of development discourse these days, has added a far more rigorous application of measures that have been applied so far to track the resource endowment of nations. Further, there is improved understanding about the various resources that can be deployed for improving the well-being of the citizens. As we know the policy – makers and economists have hitherto relied primarily on gross domestic products ( GDP ) as a proxy indicator for gauzing countries’ welfare. Contrary to hopes the pursuit of GDP growth has failed to delivers the gains in over all human welfare. It is now well accepted that the GDP is a limited unidimensional measure of market activity.

There has been a demand, including from this forest-endowed state, for appropriate valuation of the various services rendered by the unique mountain ecosystem and demands from some of the mountain states has even resulted in acceptance of what has come to be popularly known as the ‘Green Bonus’, that these states have now been demanding, quite rightly so, for some years now. Post Rio+20, as enshrined in the Final Outcome Document, “The Future We Want”, the current universal consensus now expressly recognizes a need for a broader measure of progress to complement the GDP. This short piece is no place to recount various indicators like the Bhutan’s Gross Domestic Happiness or our own Indian Green National Account Report. Thus, there are now a number of beyond GDP indicators available e.g. Human Development Index ( UNDP), Happiness Index etc. This writer drew the attention of the participants of the TC 2015 towards the efforts being made via the Inclusive Wealth Report ( IWR ).What is particularly significant in the process being followed under IWR, here the wealth accounting attempts to internalize ‘sustainability’ by tracking the changes in the value of a nation’s capital assets stock –its productive base – so as to understand how its activities and policies now will impact its future opportunity to generate well-being. This concept of opportunity is central to inclusive wealth.

Rather than measure the constituents of well-being –the specific outcomes and circumstances that make up quality of life for us now –inclusive wealth measures the determinants of well being –the capital stock upon which nations rely to bring about those outcomes. This is the key pillar of intergenerational sustainability, and should be included in any assessment of a nation’s economic performance. Inclusive wealth accounting also allows for analysis and understanding of trade-offs and other relationships among the various capital stock trajectories as an economy evolves, linking macroeconomic variable such as consumption and investment in several assets, including environmental capital stocks.

Model of Wealth Creation

The accompanying diagram illustrates, in simple terms, the three capital model of wealth creation.

 

 

 

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As stated, the IWR tracks changes in three categories of capital assets: human capital, produced capital, and natural capital. The System of National Accounts ( SNA ), followed by all countries, while extensively accounts for some of the components of these capital assets, such as manufactured capital, some of the other important assets, including natural capital, human capital and health capital, have either been very poorly or not at all assessed. At this stage of development, it is to be noted, that while the SNA recognizes the importance of these capital assets and recommends accounting not only of produced capital but also of some aspects of natural capital e.g. fossil fuel and mineral deposits, it also considers quantification of human capital of relevance, as well.

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Measuring Real Wealth of Countries

Some States, including Uttarakhand, have been for some time past demanding “green national accounts” as the current national accounts have been found unsatisfactory for economic evaluation. Inaugural publication of  inclusive wealth ( the IWR 2012 ) is indeed an answer to such a request, which was jointly brought out by UNI-IHDP and UNEP. This procedure was worked to estimate changes in inclusive wealth per capita during 1990-2008 in only 20 countries. This IWR 2012 for the first time covered three types of assets, ( i ) manufactured capital ( roads , buildings, machines and equipments ), ( ii ) Human capital ( skills, education, health ), and (iii) natural capital ( sub-soil resources, ecosystems, the atmosphere ). Such other durable assets as knowledge, institutions, culture, religion – broadly social capital –were taken to be enabling assets; that is assets that enable the production and allocation of assets in categories ( i ) to ( iii ).

This writer, asked to speak on ‘Role of Good Governance and Ethics in public services’, shared how holding of Toppers’ Conclave, in the presence of the Vice Chancellors and various other academics, has to be perceived, in context of this new global awareness about the role of educational institutions in enhancing the durable wealth via human capital and how impact of human capital in any country’s wealth formation is far more critical. The second edition of IWR 2014 improves upon the inaugural IWR 2012 in three waysL a ) coverage increased from just 20 to 140 countries, ( b ) the basis for the estimates of education as a capital asset is a more sophisticated approach; and ( c ) health as a form of capital asset also receives attention for the first time. This piece is no place to go further than this and all that deserves to be re-iterated are the main findings of IWR 2014 which indicate that the efforts like the Toppers’ Conclave are to be perceived far beyond just acknowledgement of an individuals’ talent and how its cascading effect could lead to emergence of states like Uttarakhand as the pace setter in a far more complex world, that one sees as fast emerging. Some policy lessons that clearly need policy makers attention need to be captured here, to underscore holding of an educational event like the Topper’ Conclave 2015.

Major Policy Lessons

‘ Governance has been defined, ’ it was pointed out by this writer, ‘ as the exercise of political, economic and administrative authority to manage a nation’s affairs. It is the complex mechanisms, processes, relationships and institutions through which the citizens and groups articulate their interests, exercise their rights and obligations and mediate their differences. Good governance is a sub-set of governance wherein public resources and problems are managed efficiently and in response to the critical needs of society’. IWR 2014 provides some major policy lessons which Uttarakhand can ill afford to ignore. Some of these are:

  • Countries striving to improve their citizen’s well-being –and do so sustainably-should reorient economic policy planning and evaluation away from targeting GDP growth as a primary objective toward incorporating inclusive wealth accounting as part of  a sustainable development agenda.
  • Investment in human capital – in particular human education –would generate higher returns for IW growth, as compared to investments in other capital asset groups, in countries with high rates of population growth.
  • Investment in natural capital, in particular agricultural land and forest, can produce a two fold dividend : First, they can increase IW directly ( see the diagram ); and second, they can improve agricultural resiliency and food security to accommodate anticipated population growth,
  • Human capital is critical to individual and societal well-being.
  • The educational attainment of a country’s younger cohort is frequently higher than the educational attainment of older cohort; high levels of youth educational attainment correlate to higher potential for improved well-being and economic growth in future.
  • Human capital indicators which depend solely on educational attainment information fail to capture the full potential of a country’s population.

Finally, if one were to consider Key Messages that have come out from IWR 2014 it unmistakably states that “ Human Capital is the foremost contributor to growth rates in inclusive wealth in 101 out of 140 countries. In 27 countries produced capital was the primary contributor. On average, human capital contributed 55 per cent of over all  gains in inclusive wealth, while produced capital contributed 32 per cent and natural capital 13 per cent.”

In Conclusion:

Media coverage that covered this major initiative emanating from the Governor of Uttarakhand, Dr KK Paul  himself, thus by and large fell short of appreciating the long term import of this initiative and the state government will do well to quickly re-evaluate its human development strategy in context of the latest findings that are being debated in the informed circles of this country and beyond. Uttarakhand, already well known as an educational –hub, has to leverage its well established USP to further bolster its socio-economic standing in the comity of nations and devote more attention and energy to development of its human capital than it has been able to do hitherto. Governor Dr KK Paul has shown a lead and that needs to be taken to its logical end.

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R S Tolia

R S Tolia

Late Dr. R.S. Tolia, Ph.D., was former Chief Secretary ( 2003-05 ) and Chief Information Commissioner ( 2005-10) of Uttarakhand. He also served in various voluntary positions after retirement and devoted his time for Mountain Development Agenda.

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