India yet to get economic independence

By K P Fabian & M H Ahsan

In the midst of the celebration of sixty years of political independence there should be introspection too. Could we have done better? In the process, we should exaggerate neither our failures nor our successes. Let us illustrate the point about exaggeration. Our GDP grew at the rate of 3.4% a year between 1951 and 1966, corresponding roughly to the Jawaharlal Nehru years. A smart Wordsmith christened it as the ‘Hindu rate of growth.’

The implication is that till the economic reforms started in the mid-1980s and gathered momentum in 1990-91, mainly because of severe foreign exchange shortages, India was not on the right track.The irresistible tide of globalisation imposes on us the imperative to open up our economy, invite foreign investment and technology. There is much merit in such an argument. Yet, the argument is wrong and it lacks, above all, historical depth.

Those who pejoratively refer to the ‘Hindu growth of rate’ do fail to mention that between 1900 and 1947, the annual GDP growth was 0.8%. To put it differently, the growth rate quadrupled during the Nehru years whereas since then, it has grown less than three times, if we take the latest growth figures. As we all know, it takes much more energy to get the engine started than to keep it running.It is not being argued here that the ‘permit-license raj’ and the exaggerated focus on ‘import-substitution’ were perfect policy instruments.

The point being made is that we need to have a historical perspective. It was not possible to move straight to 8 or 9 % growth after 50 years of 0.8% growth. We shall understand the progress made since 1947, only if we can see, with an effort of imagination, what India was like at the time of independence. In 1951, life expectancy at birth was 32 years. Literacy rate was 17%. All that is part of what the economists call the initial conditions. The initial conditions have another dimension to them and that is the global situation, or the initial conditions (global). There was a time when the West was unwilling to part with industrial technology to India. One example will make our point clear: the steel technology.

We should review the progress made under three headings: political, economic, and social. The three sectors are interconnected. There cannot be sustained progress in one field without corresponding progress in the other two. Politically, we have preserved and deepened the democratic foundations of our polity. But even though we have a higher level of voter participation in our elections than the Western democracies in general our democracy needs much improvement. The quality of those who get elected, at times, leaves much to be desired.There is no excuse whatsoever for the Indian electorate to elect those who are proclaimed criminals and known to be corrupt. Corruption is spreading like cancer into the system.

The quality of governance is unacceptably low in many areas. Government schemes for the poverty-stricken do not deliver. The bureaucracy, with some exceptions, has not proved itself to be capable of carrying out the tasks assigned to it. A democracy that does not deliver good and effective governance to the advantage of those who are at the bottom of the income pyramid has a long way to go.Economically, the progress we have made is writ large and clear and it cannot be denied. But, other countries that were at the same level of per capita income as us, say South Korea, is way ahead of us. GDP growth is, of course, important. But it is not enough unless the growth is inclusive and the sad truth about India is that our economic growth has been far from inclusive. A third of us live on Rs 20 a day.

Do they have anything to celebrate? About 400 million workers have no social security. Social progress that we have accumulated cannot be denied. The Dalits are better off today than they were in 1947. It is true that atrocities against them do take place. The Dalits have occupied some of the highest offices, starting from the presidency of the Republic. They have become chief ministers.It will be naive to dismiss all this as tokenism.

It is unconscionable that we have failed successively to meet universal elementary education targets and that the largest number of the illiterates for any country. Here it is not a question of lack of resources, financial or human, it is purely a question of lack of will on the part of the government and the rest of the society, especially on the part of those of us who are literate. According to a recent UNESCO report India has the highest rate of teacher absenteeism.We are yet to gain our economic independence. We can truly say that we are economically free only when no Indian goes to sleep hungry; when every Indian can lead a life of dignity free from poverty, ignorance, and ill- health.

We live in an age dominated by the West. We speak of an interconnected, interdependent, shrinking world. But, there is a distressing asymmetry about the interdependence we are talking about. The North is able to dominate and shape the course of the countries in the South whereas the latter have hardly any power or means to influence the North. Much of what goes under the name of interdependence or even globalisation is dependence in one direction and domination in the opposite direction.