Few of us might have knowledge of the keynesian economics. What I understand of it in layman terms, is that it a dig and fill policy, where in the government pays someone to dig a hole and pays someone else to fill the hole. Nothing productive comes out f it, but John Maynard Keynes theorises that this can help to stimulate a stalled economy. I am not an economist, so wouldn’t venture to analyse this. But the way our infrastructure projects work in India, it seems that the keynesian economics is embeded deeply in to our economic policies.
If you are anywhere in India, just look around you. Observe any of the government infrastructure project which is underway. It will be noted that, all of these projects have generated large amount of employment. Much more than that required for the project.
Point in case 1 : Very recently, a railway platform at Dadar(a suburban railway station in Mumbai) was extended to accomodate the longer trains. It was inaugurated a few months back by a union minister. Just today I saw the platform being dug up at one end to accomodate something under it. We have very good brains working on all the projects in India, but by not preplanning this underground accomodation, our government succeeds in generating more employment to the poor labourers( and more dough to the contractors, I am sure).
Point in Case 2 : A few months back, one fine morning, I saw that huge holes were dug up on a road that I frequent. I later learnt that they were for the upcoming skywalk project in that area. The road stayed dug for couple of months. Then on another fine morning I saw that they were filled up overnight. I later learnt that the project had been scrapped along with many other in the entire city. Here again employment was generated twice( and the promised moolah to the contractors). Its a different thing that the road has not yet been repaired after filling.
Point in case 3 : These same skywalks. They have crawled all over the city. Lots of public money has been utilised to create this ugly crawling metal structures, glorified with a futuristic name. But the utilisation is at the very least. People find it inconvienent to walk for long distances. First thing that comes to their mind is about climbing such a height, without any elevator facility. No consideration has been given to the disables while constructing the skywalks(anyway, no consideration is ever give to the disabled in India). And these skywalks being built right in the middle of the road at some places, have resulted in more congestion. So I guess, the government has some future plans of creating employment for dismantling this bridges.
Though these are typical examples, this kind of policy is adapted in almost all the government projects. Prove me wrong!!
Its very heartening to see the economy reviving so fast, and the dig and fill policy playing a good part in it. I would advise stock investors to invest in infrastructure companies. They are sure to give you good returns.