|Demand of the question |
Introduction. Contextual Introduction.
Body. Why Independence of institutions matters?
Conclusion. Way forward.
For the prosperity of a country, independence of its institutions like RBI, SEBI etc is important. Together, the legal and administrative organisations underpin every economy through an enabling environment for the creation of wealth. When they fail, trust is eroded and economies can become damaged. Collaboration between public and private sectors is particularly important when it comes to boosting productivity. But in the absence of strong institutions the alliance can become dysfunctional, with both sectors colluding in the pursuit of profit at the expense of the consumer.
Independence of institutions matter:
- A healthy relationship between business organisations and government should be a priority for an economy at any stage of its development for which independence is important.
- Independent institutions are key in establishing a long-term agenda, allowing for public-private collaboration in the public interest, free from the vagaries of the legislative cycle.
- Independence of institutions is important on which such a successful symbiotic relationship depends.
- Institutions play an important role in maintaining economic health and keeping public-private collaboration on track, whether it is through the encouragement of industry clusters or better collaboration between universities and businesses.
- It is for institutions to be independent in order to decide freely and without any political interference for the economic progress of the country.
- Often political interference for their vested interests and votes tilt policies towards certain sections of the society. Thus, independence matters for inclusive growth of the nation.
- Independence of institutions like RBI is important to formulate biased free monetary policies and also to access the economic data objectively.
Public and private institutions lay a central role in economic progress. Without them long-term economic growth remains out of reach. Thus, it is important to ensure independence of institutions and keep them free from political influences.