Chief Justice of India S.H. Kapadia on Saturday rejected the notion that the rule of law was an impediment to economic growth, terming it instead the “single largest” stimulant factor.
Further, a “minimum standard of fairness” was being ensured only through the rule of law, he said at an international conference here.
In an apparent reference to the Comptroller and Auditor-General’s report on loss in coal blocks allocation, Justice Kapadia said: “The basic fact is that loss is a matter of fact, whereas profit or gain is a matter of opinion.” In the absence of economic literacy, coupled with legal literacy, “government institutions will suffer… in terms of democracy, and the economy will be in peril.”
The Constitution, he said, had mandated that the government to “… strive for economic democracy,” and without it “political democracy will be at peril.”
Quoting economic data, the Chief Justice said that even an eight per cent GDP growth would generate only 12 million jobs a year, while the country needed 10 million new jobs every year, given that 30 per cent of the population would be looking for employment in the coming years. If the growth slipped to 5.5 per cent for some reasons, a mere 8.25 million jobs would be created a year. Promoting investment, therefore, was crucial to stimulate growth.
Benchmark
He suggested that India align its tax, corporate and commercial laws with the models suggested by the United Nations and the Organisation for Economic Cooperation and Development. “Our benchmark becomes what is stated in the electronic media and the print media. We don’t go into deep studies.”
