Anniversaries are good opportunities to take stock of progress, celebrate successes, acknowledge setbacks, set a vision and a roadmap. Monday was the 75th anniversary of India’s independence. It’s a bittersweet tale of the glass being half full or half empty, depending on one’s predisposition to optimism or pessimism.
The upbeat take would be titled “Against All Odds.” Start with the vicious brutality of the partition itself, the greatest mass migration of people in a concentrated period of history. Between one and two million people were killed and 15 million crossed borders to escape mass atrocities and start over among co-religionists. Many also left, then and later, for the safety of Britain. Many of their stories are told in Kavita Puri’s poignant and sometimes heartbreaking account. Score Voice: Untold British Stories that I examined at http://www.internationalaffairs.org.au/australianoutlook/reading-room-partition-voices/
Despite this inauspicious start, widespread poverty and illiteracy, the independence leaders put their faith in liberal democracy. Experiencing the horrors of sectarian massacres deepened their belief in the virtue (in principle) and wisdom (out of political prudence) of secularism, so that tens of millions of Muslims continue to feel as at home as people of all other religion.
This is challenged today by the fusion of religion and nationalism by the Modi government. The territorial integrity and political independence of India are not seriously threatened. The tension between ethno-national identity and national integration has been reconciled in a complex but adaptable system of power sharing. The widening circle of democratic participation has brought many previously excluded social groups into mainstream politics.
The constitution adopted in 1950 borrowed ideas, organizing principles and institutions from American, British and French traditions and adapted them to India’s unique circumstances. It is a tribute to their remarkable foresight that although at any given moment Indian politics seem utterly chaotic, dangerously volatile and utterly unpredictable, the basic constitutional structure, with federalism added to democracy and secularism, is essentially intact. and flourishing. Indians, argumentative by nature as Nobel laureate Amartya Sen has argued, have embraced democratic protest with enthusiasm, as best summed up in the saying, “Give me four Indians and I’ll give you five political parties”. “.
Positive elements of British heritage include judicial, police, military and civilian services, underpinned by the rule of law. They introduced, inculcated, and gradually expanded the principles and institutions of representative government, including an enlarged circle of Indian inductees into public office. The most significant negative legacy was deindustrialization in the service of the colonial center. In the half century before independence, India’s GDP per capita grew at the miserable annual rate of 0.2%, compared to an average of 2.9% since 1950.
Yet Britain cannot be held responsible for the sad reality that 75 years after independence India has the largest pool of poor, illiterate and sick in the world. The social ills of malnutrition, hunger and child labor remain terribly common. In a pathology that has become sadly familiar in Western countries, the democratic process has accentuated the gap between the qualities needed to seize power and the skills required to wield it wisely for all. Public policy, captured by special interest groups, often loses sight of the national interest. Caste-based preferential policies, intended to reduce and eliminate social and economic disparities, have instead created and nurtured vested interests. As the government crafted public policy with caste in mind, every positive action produced an equal and opposite reaction. Identity politics based on caste and religion have become more deeply entrenched than ever. (Did you know that India was the first major government to ban satanic verses in 1988, although Salman Rushdie was born in India?). The politicized corruption of institutions accelerated with Modi, but began much earlier, including unleashing investigative and prosecuting agencies against him along the lines we saw against Donald Trump in the United States.
While colonization left India with an underdeveloped economy and market institutions, post-independence fascination with the Soviet model meant that imperfect markets were pushed aside in favor of less efficient public sector industries. The state told manufacturers what, where and how much to produce. Imports, currencies and many prices were controlled. Banks and insurance companies were nationalized. Shortages arose, quality suffered and prices rose. Policy failures have resulted in a decline in the share of world production and exports and a depreciation of the currency. Dirigisme has created and nurtured organized interests in an unholy alliance of politicians, bureaucrats, industrialists, trade unionists and big landowners seeking bribes and influence peddlers.
The impetus for economic reforms in 1991 was a major balance-of-payments crisis that became an opportunity to revamp politics. But its beneficial impact has eroded with the loss of reform momentum over the past decade. India’s GDP per capita is only one-half, one-fifth, one-sixth and one-twentieth of the averages of Indonesia, China, the world and industrialized countries, respectively. The public sector is still large, subject to bureaucratic and political interference, and infects many parts of the economy.
Cautious investors fear political paralysis, labor market rigidity, protracted litigation, land acquisition problems, layers of bureaucracy, the high economic cost of state subsidies and Third World infrastructure compared to East and Southeast Asia. Foreign investment is stuck well below the levels needed to fuel an efficient and internationally competitive economy, support rapid growth and absorb the millions of young people entering the labor market each year.
Prime Minister Modi gave in to domestic sectoral and bureaucratic protectionist resistance and withdrew from the Regional Comprehensive Economic Partnership in 2019, which would have imposed external disciplines to boost efficiency and productivity. Indians once again joke that the economy grows mainly at night when the machinery of government is asleep at the wheel. Yet India retains significant competitive advantages of political stability, a moderately sound financial system, a self-sufficient consumer base, a young population, a large professional class, an education system with established links to the English-speaking world, a property and commercial law, a largely independent judiciary and a relatively free press.