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India Unbound – Gurcharan DasIn Book Reviews on September 7, 2009 at 10:23 am
Gurcharan Das is an Indian author, consultant and public intellectual. He is a regular columnist for Times of India and in several other newspapers. Born on June 9 at Lyallapur in 1946, he has authored many books. visit him at his blog
India is now a vibrant free market democracy after the 1991 economic reforms, and it has begun to flex its muscles in the global information economy. This change has not been overnight. It took 50 years after our political freedom in 1947, for our rulers to realize the path we were treading since independence. This book India Unbound is an account of what all good and bad happened in India from pre independence period to after 1991. Basically Gurcharan das has divided the book into three periods viz. pre independence days, Post independence to 1991 and post 1991. India burst into independence with high hopes and a clean slate. Led by erudite statesmen and men and women of impeccable political backgrounds, the country was all set to sail the seas to wealth and modernity. These soon became distant goals. India’s slide into the mire of backwardness has been the topic of countless heated and unresolved after-dinner discussions in every household across the country. Given our infinite advantages why did the country not progress? What caused the ever-spiraling poverty that has now reached unmanageable proportions? What led an honest, dignified people to the door of rampant corruption? How did we earn the epithet that keeps poor countries firmly in their place: The Third World? When will we be rich again? Every Indian and, perhaps, everyone who has loved India, has his or her own answer to these questions.
Gurcharan das tries to answer some of these questions in India Unbound. He talks about various policies of British and post independence Indian rulers and how they affected the masses in general and Indian Economy in particular. It is a riveting story of a nations rise from the poverty to prosperity and the clash of ideas that occurred along the way. The economic and social transformation of the lower castes is another major theme of the book. The struggle of the one-sixth of the humanity for the dignity and prosperity had a great consequence for the future of the world. Author mentions that whenever the name India is spelled out, two things generally come to the mind of foreigners-spirituality and poverty. The significance of this quiet social and economic transformation eludes them. In the end ‘silent revolution’ is more significant historically than the constantly changing fortunes of political leaders and parties.
when India became Independent, Nehru had become world hero. When Nehru addressed nation in the midnight of 15th August, people were ecstatic.
“Long years ago we made a tryst with destiny, and now the time comes when we shall redeem our pledge… At the stroke of the midnight hour while the world sleeps, India will awake to life and freedom. A moment comes, which comes but rarely in history, when we step out of from the old to new, when an age ends, and when the soul of a nation, long suppressed find utterance…”
People of that generation were just enchanted with Nehru. They believed that whatever steps he would take would lead India to its golden future. But Nehru like many people of that age, had a bias towards business community. He believed that business community’s sole purpose is to earn profit. They hardly care for the welfare of the people.
Gandhi and Nehru had many things in common except the way they perceive the Business men in India. While Gandhi believed that bazzar is an essential for the overall development of a nation while Nehru believed business men as a threat to the common people. He believed that state should be the entrepreneur on the lines of USSR and China. That’s the reason when India became politically independent Nehru took it as a state responsibility to set up industries. In the second five year plan according to Mahalanobis model a huge amount of capital was invested to set up heavy industries.
Mahalnobis was great statistician of that time and like Nehru he too believed that science and reason can be used to find solution to most of the problems existing in the period. Mahalnobis had profound effect on Nehru’s thinking. His draft plan for the second five year plan was possibly the single most important document in 1950s and possibly the most important document in the world. At the same time there was an alternative theory by vakil and brahmanand, renowned economists from Bombay, who emphasized on the employment generation through production of wage goods. But the theory was not much noticed and eventually fell flat. Besides, Nehru never understood the importance of competition in Bazaar. He framed policies which curbed any and all kind of competition. This crippled the scope of development of companies. It has been noted that India’s failure on the world economic stage is in part due to the lack of competition in the domestic marketplace.
The other most dreaded thing that Nehru instigated was the Licensing system. It began with the Industries Act of 1951, which required an entrepreneur to procure license to set up new industries, to expand it, or to change the product mix. This draconian system further crushed our industries. Industrialist Like GD Birla, Kasturbhai Lalbhai who were major traders before independence could not even technologically upgrade their units due to the bureaucratic red tapism in the post- independence era. TATAs 119 proposals during the period fell to deaf years. Aditya Birla, grandson of GD Birla had to expand outside India due to this red tapism. Public sectors whom Nehru called “Temples of Modern India” were bleeding the country to death. Bureaucrats who usually controlled these public sectors had hardly any experience in the government of how industry was actually run.
The fact that our fundamental ideology about the mixed economy was flawed is now widely accepted by many of us. Mixed economy, according to Nehru contained both superior features of capitalism and socialism. But eventually it ended up combining the worst features of socialism and capitalism- the ‘controls’ of socialism and the monopolies and lobbies of capitalism. The short-sightedness of our leaders led to bias towards heavy industry and against agriculture and light consumer goods.
Gurcharan Das has discussed some social aspect of Indians which has been largely instrumental in keeping the tendencies within check. The theme of poor team work has been responsible for large number of defeats, Indians had in the hands of foreign invaders be it Puru in the hands of Alexander or1962 war against china. Das admits that this tendency is still found in the young bloods in the boardrooms of corporate houses. Poor team work is all pervasive in India and it affects national competitiveness.
Das has suggested some very nice conclusions which he had during many of his field vists during his tenure in P&G. Some of which are :
Firstly learn things from observation. Ekagrata, concept of one pointedness which means to direct one’s energy at a point forms the basis of development of core competencies of an individual or an organization. Consumer is supreme. It is usually better to build on your strength than to try and correct a weakness.It’s important to know who and what you are.In consumer product companies” if local managers believe a product is theirs, then the local consumers will believe it too”. Great businesses are built through discontinuous ideas, and a good manager who is one-pointed knows when to seize them. If only results matter then ordinary employees will surprise managers by doing extraordinary things. It is important not to direct people too much and find their way. It might bring out their creative urges so on and so forth.
After death of Nehru, Sashtri came to power. He was a descent man who tried to rectify some of the wrong doings of Nehru. He emphasized nations energy on agriculture. It was due to shastri ji that Green revolution was successful in India. After his death, Indira Gandhi came to power. And the economic policies of the nation further grim. Indira took India back on the lines of Nehruvian Model and the period between 1965 to 1980s were the saddest period in the Indian history for the Business and economy in particular. The first breather came in 1990 when Narshinha Rao headed the first minority government and along with Manmohan singh, P Chidambram and Montek singh took some bold steps to liberalize economy. Those three years were most eventful in Indian history. It omitted license raj. The act like MRTP and FERA were scrapped and foreign investment was encouraged.
This period saw the emergence of middle class who were fearless and risk taking in attitude. They did not consider making money as sin. Power and prestige was seen in the terms of money you have. More and more people and mostly from middle class went for higher studies. India has become the knowledge power and is a force to reckon with in the entire world. Companies find more talented brain here in India at one-sixth of the cost. The world’s perspective has taken a paradigm shift. Indian companies have grown in character. This is evident from the number of mergers and acquisition Indian companies have undergone in the recent past. Tata’s acquisition of Chorus and clinching of Jaguar deal speaks volumes of the capability of an Indian company. The annual GDP growth rate which is 7-8% if continues to be same until 2020 then there is no doubt India will emerge as third largest economy in the world after US and China.