Page 15 - India Insurance Report 2023- BIMTECH

India Insurance Report - Series II 3

1.2. Political

Politics is the prisoner of society because society decides the form of governance. Politics is but a
form of governance of society. Rising returns on capital and stagnating rewards on labour over decades
have structured the inequality of opportunity, life and living; in effect, disparity. The Gini-coefficient
has been reflecting increasing adverse trends even in developing economies. The inequality is fashioning
right wing politics, ‘encouraging Competitive Populism’ and scripting ‘Economic Nationalism’. Uni-
polarity has carved into multi-polarity and led to the rise of regional SATRAPS. The arms race has
intensified, and muscle flexing is discernible. Identifying and exploiting opportunities in the national
interest is the geo-political order, ‘Real Politick’. The tremors of shifting economic axis are seething the
partnerships.

1.3. Economics

The interdependence of economics, sociology, politics and technology creates a fusion and emerging
economic trends often become capricious. A matrix of factors from divergent origins like the Covid-19,
Russia-Ukraine War, weaponization of energy, rampant inflation, and rising labour costs have caused
supply chain disruptions and an uncertain economic environment. Mainstream economics has transited
from a monolith to studying the psychology and behaviour of individuals and groups, the impact of
technology, the power of institutions, cultures and even shadows of history. It has moved from Macro
to Micro and from mere theories to applied work. The aggregate behaviour no longer delivers useful
outcomes. The economic analyses of region, city or cross-border supply chain data have become essential.
Further, inequality is compelling the policymakers to weave distributional justice and desired social
outcomes along with the “value effects” in approaches to new policy frames. Hence, market design and
institutional framework of interventions have now become more relevant in the role of markets in price
discovery and coordination. This signifies the changing market structures and compulsions of deepening
technology interventions.

1.4. Technology

The technological developments are on a flight of fancy. The world has transited from Web 1, Web
2 to Web 3 with user driven control. Web 3 has given rise to DIFI (Decentralised Finance), which
operates on BLOCKCHAIN Technology (Decentralised ledger). Changes in the ecosystem of microchips,
bandwidth, sensors, application software, A.I. (LLM) are becoming ever faster. The tools for the use of
technology have traversed from mainframe, desktop, laptop, palmtop to smart phones, smart watches,
smart earphones and now smart eye wear. It is becoming increasingly difficult to fathom where will
technology drive activity, productivity, customer connectivity, and market interventions while integrating
with the larger world. Customers’ impatience for deeper and faster digital solutions at convenience and
agreeable cost, warrants enthusiasm to embrace change.