New year, new government and a vision transforming Kerala into the finest place to live and work

As we welcome the New Year and prepare for a newly elected government in 2026, it is an appropriate moment to ask a fundamental question: what should be Kerala's path over the next quarter-century?

India has transformed dramatically since the turn of the millennium. Since 2000, the national GDP has grown over eightfold, the population has increased by over 38%, and India now stands as the world's third-largest economy (PPP adjusted). The scale and momentum of this journey are truly inspiring.

Kerala, too, has progressed—but not to the extent it could, or should, have. Despite early advantages in literacy and healthcare, the state has struggled to convert social capital into sustained economic dynamism. Today, the prognosis is concerning: we face "unhealthy" migration of our best talent, low capital inflows, and a growing reliance on imported goods - an economy sustained by remittances rather than domestic value creation.

As a new government prepares to take office, the choices we make now will shape Kerala for decades. Our collective aspiration should be clear: "Kerala — the finest place to live and work."

To achieve this, the state must undergo a fundamental shift. The era of government as a business operator must end; the era of government as an enabler must begin. If the state focuses on four strategic pillars, enterprising Keralites will do the rest.

1. Infrastructure: Clean and safe
Infrastructure must be viewed through two specific lenses:

Clean Kerala: This means scientific waste management, clean surroundings, clean rivers and backwaters and cities planned for healthy living.

Safe Kerala: This refers to safe and efficient roads, fast inter-city transport, safe to drink water, safe to eat food, and robust disaster preparedness.

2. Talent: Creation, retention and deployment
Talent is Kerala's greatest opportunity, yet currently its greatest vulnerability. Our educational institutions need a fundamental reset; they must be liberated from political control and governed with academic and research excellence as the sole priority.

Furthermore, India's future sovereignty depends on technology autonomy. Currently, we are consumers of technology rather than creators. Kerala must seize the upcoming R&D momentum by investing in world-class research centers in domains where we can achieve global relevance.

3. Policy reforms: The fastest enabler
Policy reform is the most cost-effective intervention available for government. Many of our laws are outdated and counterproductive. Reform should aim squarely at enabling enterprises to thrive and creating high-quality, well-paying jobs that convince our youth to stay.

4. Welfare: Strengthening our foundation
While Kerala leads the nation in welfare, a civilized society is judged by how it treats its most vulnerable. We must ensure our support systems for senior citizens and the differently-abled remain strong, targeted, and fiscally sustainable.

The financial imperative
Executing this vision requires financial strength, which is currently Kerala's most serious challenge. We must enforce strict fiscal discipline, increase state revenue, and end wasteful expenditure. This includes the difficult but necessary reform of loss-making PSUs and corporations that deliver no public value. Political compulsions can no longer be allowed to override fiscal prudence.

A call for statesmanship
In many ways, Kerala has become a victim of its own political processes. Too much public debate is driven by electoral tactics rather than long-term societal progress—benefiting neither the state nor political parties in the long run.

The moment calls for bold leadership willing to challenge the status quo. Such leadership will find support—not only among the public, but also within political parties themselves. Keralites recognise merit and earnest intentions.

These are defining times. Kerala needs statesmen who can govern with clarity, conviction, and the determination to make our state the finest place on earth to live and work.
(The writer is the Executive Chairman of the IBS Group)