India After Gandhi (37 page)

These variations notwithstanding, everywhere in India agriculture was largely empirical, based on knowledge and traditions passed down over the generations, rather than on ideas from books. Everywhere it was chiefly based on local inputs. The water, the fuel, the fodder, the fertilizer; these were all gathered in the vicinity of the village. The land was tilled with a plough pulled by a pair of bullocks. The homes were built of wood and thatch fetched by hand from the nearby forests.

Everywhere, those who worked on the land lived cheek-by-jowl with those who didn’t. The agriculturists who made up perhaps two-thirds of the rural population depended crucially on the service and artisanal castes: on blacksmiths, barbers, scavengers and the like. In many parts there were vibrant communities of weavers. In some parts there were large populations of nomadic pastoralists.

On the social side, too, there were similarities in the way in which life was lived across the subcontinent. Levels of literacy were very low. Caste feelings were very strong, with villages divided into half a dozen or more endogamous
jatis
. And religious sentiments ran deep.

Rural India was pervaded by an air of timelessness. Peasants, shepherds, carpenters, weavers, all lived and worked as their forefathers had done. As a survey of the 1940s putit, ‘there is the same plainness of life, the same wrestling with uncertainties of climate (except in favoured areas), the same love of simple games, sport and songs, the same neighbourly helpfulness, and the same financial indebtedness’.
¹

To the Indian nationalist, however, continuity was merely a euphemism for stagnation. Agricultural productivity was low; hence also levels of nutrition and health. About the only thing that was rising was population growth. From the late nineteenth century, as medical services expanded, the death rate rapidly fell. Consequently, since the birth rate remained constant, there was a steady rise in population. Between 1881 and 1941 the population of British India rose from 257 to 389 million. But (or hence) the per capita availability of food grains declined from an already low level of200 kilograms per person per year to a mere 150.

Almost from the time the Congress was founded in 1885, Indian
nationalists had charged the British with exploitation of the peasantry. They resolved that when power came to them, agrarian reform would be at the top of their agenda. Three programmes seemed critical. The first was the abolition of land revenue. The second was the massive expansion of irrigation, both to augment productivity and reduce dependence on the monsoon. The third was the reform of the system of land tenure. Particularly in north and east India, the British had encouraged a system of absentee landlordism. In many other districts too, those who tilled the land usually did not own it.

While tenants did not have security of tenure, agricultural labourers had no land to till in the first place. Inequalities in the agrarian economy could be very sharp indeed. The forms of exploitation were manifold and highly innovative. Thus, apart from land tax, zamindars (landowners) in the United Provinces levied an array of additional cesses on their peasants such as
motorana
(to pay for the zamindar’s new car) and
hathiana
(to pay for his elephants).
²
The landlord was prone to treat his animals and his vehicles far better than he did his labourers. Two weeks before Independence a progressive weekly from Madras ran a story about distress in rural Malabar. This profiled a large landlord who owned seven elephants, for which he needed some 25,000 kilograms of paddy. His own tenants, meanwhile, were given three days’ ration for the whole week.
³

The socialist elements in the Indian National Congress pushed the organization to commit itself to thoroughgoing land reform, as in the abolition of large holdings, the promotion of the security of tenants and the redistribution of surplus land. They also advocated an expansion in the provision of credit to overcome the widespread problem of rural indebtedness.
⁴

But, as the nationalists also recognized, agrarian reform had to be accompanied by a spurt in industrial growth. The nation needed more factories to absorb the surplus of underemployed labourers in the countryside. It also needed factories to prove to itself that it was modern. To enter the comity of nations, India had to be educated, united, outward looking and, above all, industrialized.

In colonial times there had existed a sharp divide between factories owned by British firms and those owned by Indians. Jute, for instance, was largely in the hands of the foreigner; cotton textiles in the hands of the native. The Raj was frequently (and for the most part, justly) accused of deliberately discouraging Indian enterprise, and of distorting the tariff
and trade structure to favour British firms. While some Indian capitalists were studiously apolitical, others had been vigorous supporters of the Congress. They naturally hoped that when freedom came, the biases would be reversed, placing foreign capitalists at a disadvantage.
⁵

If India had to be industrialized, which model should it follow? To the leaders of the national movement, ‘imperialism’ and ‘capitalism’ were both dirty words. As John Kenneth Galbraith pointed out, ‘until recent times a good deal of capitalist enterprise in India was an extension of the arm of the imperial power – indeed, in part its confessed
raison d’être
. As a result, free enterprise in Asia bears the added stigmata of colonialism, and this is a formidable burden.’
⁶

What, then, were the alternatives? Some nationalists wrote admiringly of the Soviet Union, and of ‘the extraordinary use they have made of modern scientific knowledge in solving their problems of poverty and want’, thus passing in a mere two decades ‘from a community of half-starved peasants to well-fed and well-clad industrial workers’. This had been accomplished by ‘eliminating the profit motive from her industries which belong to and are being developed in the interest of the nation’; by feats of engineering that had made rivers into ‘mighty sources of electric power’; and by a system of planning by disinterested experts which had increased production nine-fold and where ‘unemployment and anarchy of production are unknown’.
⁷

Another much admired model was Japan. Visiting that country during the First World War, the prominent Congress politician Lala Lajpat Rai marvelled at the transformation it had undergone, moving from (agrarian) primitivism to (industrial) civilization in a mere fifty years. Japan, he found, had built its factories and banks by schooling its workers and keeping out foreign competition. The role of the state was crucial – thus ‘Japan owes its present and industrial prosperity to the foresight, sagacity and patriotism of her Government’. Once as backward as India, Japan had ‘grown into a teacher of the Orient and a supplier of all the necessaries and luxuries of life which the latter used to get from the Occident’.
⁸

In 1938 the Congress setup a National Planning Committee (NPC), charged with prescribing a policy for economic development in a soon-
to-be-free India. Chaired by Jawaharlal Nehru, the committee had some thirty members in all – these divided almost equally between the worlds of science, industry and politics. Sub-committees were allotted specific subjects: such as agriculture, industry, power and fuel, finance, social services and even ‘women’s role in planned economy’. The NPC outlined ‘national self-sufficiency’ and the doubling of living standards in ten years as the main goals. Planning itself was defined as ‘the technical co-ordination, by disinterested experts, of consumption, production, investment, trade, and income distribution, in accordance with social objectives set by bodies representative of the nation’.
⁹

From Japan and Russia the NPC took the lesson that countries that industrialized late had to depend crucially on state intervention. This applied with even more force to India, whose economy had been distorted by two centuries of colonial rule. As one NPC report put it, planned development upheld the principle of ‘service before profit’. There were large areas of the economy where the private sector could not be trusted, where the aims of planning could be realized only ‘if the matter is handled as a collective Public Enterprise’.
¹⁰

Notably, the private sector concurred. In 1944 a group of leading industrialists issued what they called
A Plan of Economic Development for India
(more commonly known as the Bombay Plan). This conceded that ‘the existing economic organization, based on private enterprise and ownership, has failed to bring about a satisfactory distribution of the national income’. Only the state could help ‘diminish inequalities of income’. But the state was necessary for augmenting production too. Energy, infrastructure and transport were sectors where the Indian capitalists themselves felt the need for a government monopoly. In the early stages of industrialization, they argued, it was necessary that ‘the State should exercise in the interests of the community a considerable measure of intervention and control’. Indeed, ‘an
enlargement
of the positive as well as preventative functions of the State is
essential
to any large-scale economic planning’.
¹¹

Now largely forgotten, the Bombay Plan gives the lie to the claim that Jawaharlal Nehru imposed a model of centralized economic development on an unwilling capitalist class. One wonders what free-market pundits would make of it now. They would probably see it as a
dirigiste
tract, unworthy of capitalism and capitalists. In truth, it should be seen simply as symptomatic of the
Zeitgeist
, of the spirit of the times.
¹²

That spirit was all in favour of centralized planning, of the state
occupying what was called the ‘commanding heights’ of the economy. Thus the Constitution of India directed the government to ensure that ‘the ownership and control of the material resources of the community are so distributed as best to subserve the common good’; and that ‘the operation of the economic system does not result in the concentration of wealth and means of production to the common predicament’. Within a month of the adoption of the constitution, the government set up a Planning Commission to carry out these ‘directive principles’. Chaired by Nehru, the Commission included high Cabinet ministers as well as experienced members of the Indian Civil Service.

In the summer of 1951 the Planning Commission issued a draft of the first five-year plan. This focused on agriculture, the sector hardest hit by Partition. Besides increasing food production, the other major emphases of the plan were on the development of transport and communications, and the provision of social services. Introducing the proposals in Parliament, Jawaharla Nehru praised the plan as the first of its kind to ‘bring the whole of India – agricultural, industrial, social and economic – into one framework of thinking’. The work of the Commission, he said, had ‘made the whole country “planning conscious”’.
¹³

The expectations of the Planning Commission ran high. As one columnist wrote, ‘one drawback of democracy is that it works slower than other political systems. But the people of India will not tolerate undue delay in their economic advancement.’
¹⁴
After the first general election the urgency intensified. Critics from left and right lambasted the first five-year plan as lacking in vision and ambition. True, food-grain production increased substantially, but output in other sectors failed to reach their targets.
¹⁵

While introducing the first plan, Nehru had said that ‘it was obvious to me that we have to industrialise India, and as rapidly as possible’. That objective was given pride of place in the second five-year plan. Its drafting was the handiwork of Prasanta Chandra Mahalanobis, a Cambridge-trained physicist and statistician who was steeped in Sanskrit philosophy and Bengali literature – in sum, ‘an awesome polyglot, the kind of man for whom Nehru was guaranteed to fall’.
¹⁶

Mahalanobis was, among other things, the man who brought modern statistics to India. In 1931 he setup the Indian Statistical Institute (ISI) in Calcutta. Within a decade, he had made the ISI a world-class centre of training and research. He was also a pioneer of
inter-disciplinary research, innovatively applying his statistical techniques in the fields of anthropology, agronomy and meteorology.

In February 1949, Mahalanobis was appointed honorary statistical adviser to the Union Cabinet. The next year he helped establish the National Sample Survey (NSS) and the year following, the Central Statistical Organization (CSO). These were setup to collect reliable data on changing living standards in India – on wages, employment, consumption and the like. The NSS and the CSO are two reasons why India has a set of official statistics more reliable than those found anywhere else in the non-Western world.
¹⁷

Such are the uncontentious aspects of Mahalanobis’s legacy. Perhaps more important, and certainly more controversial, are his contributions to the theory and practice of planning. In 1954 Nehru committed his party, and by extension his country, to the creation of a ‘socialistic pattern of society’. The same year, the ISI was asked by the government to study the problem of unemployment. Mahalanobis wrote a note on the subject, which seems to have impressed Nehru enough for him to assign the ISI responsibility for drafting the second five-year plan itself.