The government-private interface for India's rich and poor

A strong perception has been gaining ground in the mainstream debates that private sector in India has acquired enough strength to replace the government in many areas. However, this impression may not quite match up with the reality of life for the overwhelming majority of Indians.

The graphic below tries to summarize the respective roles of the government and the private sector in the lives of the three categories of Indians - those in the bottom half of the income ladder, the elites, and the remaining population.



As can be seen, the government interface for the corporate elites is limited to facilitating the regulatory and other clearances required to run their businesses. And even this role is receding as the economy becomes increasingly deregulated. In contrast, the government continues to play the overarching role in the lives of the poorer half of Indians (and even the others excluding the elites).