India After Independence: 1947-2000 (2 page)

India’s survival and growth as a nation and a democratic polity, as also the achievement of the national objectives set by the freedom struggle depended on the configuration and development of long-term socio-economic and political forces. But the quality, skills and approach of the political leaders would inevitably play a significant role.

An asset for India’s early efforts at progress, starting in 1947, was the personal calibre of her leaders. They were dedicated, imaginative and idealistic. They enjoyed tremendous popular support among the people and had the capacity to communicate with them, to enthuse them around a national programme and national goals, to reflect their urges and aspirations, and to provide them strong leadership. The leaders had tremendous confidence and faith in the people and therefore in democratic institutions and depended for their power and legitimacy on them. During the national movement the leaders had also acquired the vast capacity to negotiate and accommodate diverse interests and approaches and to work within a consensual framework. They could take a long-term and all-India view and work through state and local leaders.

This high quality of leadership was not confined only to the Congress party. The conservative Swatantra was headed by C. Rajagopalachari, the dissident Congressmen by J.B. Kripalani, the Hindu communalists by Shyama Prasad Mookerjee, the non-Congress dalits by B.R. Ambedkar, the Socialists by Acharya Narendra Dev and Jayaprakash Narayan, and the Communists by P.C. Joshi, Ajoy Ghosh and E.M.S. Namboodiripad.

In contrast, it can be asserted that a serious problem in the last few decades has been the paucity of political leaders with the qualities and skills of the founders of the Republic. Indira Gandhi did possess some of their qualities. But after her and even during the period that she dominated—and perhaps to some extent because of it—a gradual decline occurred in the stature of leadership, with few having the wide appeal or acceptability or the larger vision. Most political leaders increasingly appealed to a region or a religion or a caste, or a conglomerate of castes. The outcome of this has been that while many Indians have looked for wider, all-India leadership to the descendants of Nehru and Indira Gandhi, others have given allegiance to leaders and parties following populist or opportunist or communal and casteist politics.

This work is the story of a people on the move, of a ‘gradual revolution’, of the efforts of the Indian people to realize the vision of the freedom struggle. For us, writers, it has also been a journey into our personal past, involving an effort at cool and dispassionate analysis though, perhaps, failing at times to avoid the passion, which informs all those who are deeply involved in the effort to raise the social conditions of their people, and the biases acquired when living through the events. As the readers will see, we have adopted a critical approach to our recent past and contemporary events but within a broadly optimistic framework.

The year 1947 ushered in a period of change and development. Inevitably, new problems, often engendered by the change itself, were added to the old ones, requiring fresh solutions. The questions needing to be addressed were of the nature of the problems and how, when and with what consequences were they tackled. After all, had not Gandhiji predicted on the eve of independence that ‘with the end of slavery and the dawn of freedom, all the weaknesses of society are bound to come to the surface’. He, however, also saw ‘no reason to be unnecessarily upset about it. If we keep our balance at such a time, every tangle will be solved.’
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Historians will have to evaluate in the coming years, how far the aspirations aroused by the freedom struggle’s legacy, in terms of national unity, democracy, secularism, independent economic development, equality, and removal of poverty have been fulfilled in a substantive manner.

In the early years, during much of the Nehru era, there was an air of optimism and a sense of achievement. This was reflected in Nehru’s letter to the chief ministers, written with self-confidence and satisfaction just after watching the Republic Day parade at Delhi in 1955: ‘My heart was filled with pride and joy at this sight of our nation on the march realizing its goals one by one. There was a sense of fulfilment in the air and of confidence in our future destiny.’
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And he repeated a few months later: ‘There is the breath of the dawn, the feeling of the beginning of a new era in the long and chequered history of India. I feel so and in this matter at least I think I represent innumerable others in our country.’
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And what made Nehru so optimistic? To quote Nehru’s biographer, S. Gopal: ‘Individual freedom, social justice, popular participation, planned development, national self-reliance, a posture of self-respect in international affairs—all high and noble goals, yet all being steadily achieved under the guidance of the Prime Minister . . .’
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It is true that Nehru and the generation that witnessed the coming of independence had hoped for far more progress than the country was able to make. Still, the people and the intelligentsia remained optimistic, not only during the Nehru era but even under Indira Gandhi, at least till 1973-74. But gradually the euphoria and the self-confidence, the enthusiasm and the pride in achievement began to disappear and give way to frustration, cynicism and a sense of despair.

Yet, as this work would bring out, while much more was needed and
could have been achieved, but was not, especially in terms of the quality of life of the people, (and which would justify a great deal of criticism and even despair), there was considerable gain. Our hope and confidence in the future of the country and its people is justified by this achievement.

We believe what Verrier Elwin, the British scholar-missionary who made India his home and took up its citizenship, wrote in 1963 largely expresses our views and sentiments: ‘All the same I am incurably optimistic about India. Her angry young men and disillusioned old men are full of criticism and resentment. It is true that there is some corruption and a good deal of inefficiency; there is hypocrisy, too much of it. But how much there is on the credit side! It is a thrilling experience to be part of a nation that is trying, against enormous odds, to reshape itself.’
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Perhaps the attitude for us to take towards our many failures is the one adopted by Gopal Krishna Gokhale towards those of the Moderate nationalists, at the tail end of his life: ‘Let us not forget that we are at a stage of the country’s progress when our achievements are bound to be small, and our disappointments frequent and trying. That is the place which it has pleased Providence to assign to us in this struggle, and our responsibility is ended when we have done the work which belongs to that place. It will, no doubt, be given to our countrymen of future generations to serve India by their successes; we, of the present generation, must be content to serve her mainly by our failures: For, hard though it be, out of those failures the strength will come which in the end will accomplish great tasks.’
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India’s colonial past has weighed heavily in her development since 1947. In the economic sphere, as in others, British rule drastically transformed India. But the changes that took place led only to what has been aptly described by A. Gunder Frank as the ‘development of underdevelopment’. These changes—in agriculture, industry, transport and communication, finance, administration, education, and so on—were in themselves often positive, as for example the development of the railways. But operating within and as part of the colonial framework, they became inseparable from the process of underdevelopment. Further, they led to the crystallization of the colonial economic structure which generated poverty, a dependence on and subordination to Britain.

There were four basic features of the colonial structure in India. First, colonialism led to the complete but complex integration of India’s economy with the world capitalist system but in a subservient position. Since the 1750s, India’s economic interests were wholly subordinated to those of Britain. This is a crucial aspect, for integration with the world economy was inevitable and was a characteristic also of independent economies.

Second, to suit British industry, a peculiar structure of production and international division of labour was forced upon India. It produced and exported foodstuffs and raw materials—cotton, jute, oilseeds, minerals—and imported manufactured products of British industry from biscuits and shoes to machinery, cars and railway engines.

This feature of colonialism continued even when India developed a few labour-intensive industries such as jute and cotton textiles. This was because of the existing, peculiar pattern of international division of labour by which Britain produced high technology, high productivity and capital-intensive goods while India did the opposite. The pattern of India’s foreign trade was an indication of the economy’s colonial character. As late as 1935-39, food, drink, tobacco and raw materials constituted 68.5 per cent
of India’s exports while manufactured goods were 64.4 per cent of her imports.

Third, basic to the process of economic development is the size and utilization of the economic surplus or savings generated in the economy for investment and therefore expansion of the economy. The net savings in the Indian economy from 1914 to 1946 was only 2.75 per cent of Gross National Product (i.e., national income). The small size may be contrasted with the net savings in 1971-75 when they constituted 12 per cent of GNP. The paltry total capital formation, 6.75 per cent of GNP during 1914-46 as against 20.14 per cent of GNP during 1971-75, reflects this jump. Moreover, the share of industry in this low level of capital formation was abysmally low, machinery forming only 1.78 per cent of GNP during 1914-46. (This figure was 6.53 for 1971-75).

Furthermore, a large part of India’s social surplus or savings was appropriated by the colonial state and misspent. Another large part was appropriated by the indigenous landlords and moneylenders. It has been calculated that by the end of the colonial period, the rent and interest paid by the peasantry amounted to Rs 1400 million per year. By 1937, the total rural debt amounted to Rs 18,000 million. According to another estimate, princes, landlords and other intermediaries appropriated nearly 20 per cent of the national income. Only a very small part of this large surplus was invested in the development of agriculture and industry. Most of it was squandered on conspicuous consumption or used for further intensifying landlordism and usury.

Then there was the ‘Drain’, that is the unilateral transfer to Britain of social surplus and potential investable capital by the colonial state and its officials and foreign merchants through excess of exports over imports. India got back no equivalent economic, commercial or material returns for it in any form. It has been estimated that 5 to 10 per cent of the total national income of India was thus unilaterally exported out of the country. How could any country develop while undergoing such a drain of its financial resources and potential capital?

The fourth feature of colonialism in India was the crucial role played by the state in constructing, determining and maintaining other aspects of the colonial structure. India’s policies were determined in Britain and in the interests of the British economy and the British capitalist class. An important aspect of the underdevelopment of India was the denial of state support to industry and agriculture. This was contrary to what happened in nearly all the capitalist countries, including Britain, which enjoyed active state support in the early stages of development. The colonial state imposed free trade in India and refused to give tariff protection to Indian industries as Britain, western Europe and the United States had done.

After 1918, under the pressure of the national movement, the Government of India was forced to grant some tariff protection to a few industries. But this was inadequate and ineffective. Moreover, since the 1880s, the currency policy was manipulated by the government to favour British industry and which was to the detriment of Indian industry.

As pointed out earlier, a very large part of India’s social surplus was appropriated by the colonial state, but a very small part of it was spent by it on the development of agriculture or industry or on social infrastructure or nation-building activities such education, sanitation and health services.

The colonial state devoted almost its entire income to meeting the needs of British-Indian administration, making payments of direct and indirect tribute to Britain and in serving the needs of British trade and industry. The bulk of public revenue was absorbed by military expenditure and civil administration which was geared to maintenance of law and order and tax collection. After 1890, military expenditure absorbed nearly 50 per cent of the central government’s income. In 1947-48, this figure stood at nearly 47 per cent.

Besides, the Indian tax structure was highly inequitable. While the peasants were burdened with paying a heavy land revenue for most of the colonial period and the poor with the salt tax, etc., the upper income groups—highly paid bureaucrats, landlords, merchants and traders—paid hardly any taxes. The level of direct taxes was quite low. The number of income-tax payers was only 360,000 in 1946-47. It was only under the pressure from the national and peasant movements that the land revenue and salt tax started coming down in the twentieth century. As late as 1900-01 land revenue and salt tax formed 53 per cent and 16 per cent of the total tax revenue of the government.

Colonialism became a fetter on India’s agricultural and industrial development. Agriculture stagnated in most parts of the country and even deteriorated over the years, resulting in extremely low yields per acre, and sometimes even reaching zero. There was a decline in per capita agricultural production which fell by 14 per cent between 1901 and 1941. The fall in per capita foodgrains was even greater, being over 24 per cent.

Over the years, an agrarian structure evolved which was dominated by landlords, moneylenders, merchants and the colonial state. Subinfeudation, tenancy and share-cropping increasingly dominated both the zamindari and ryotwari areas. By the forties, the landlords controlled over 70 per cent of the land and along with the moneylenders and the colonial state appropriated more than half of the total agricultural production.

The colonial state’s interest in agriculture was primarily confined to collecting land revenue and it spent very little on improving agriculture. Similarly, landlords and moneylenders found rack-renting of tenants and sharecroppers and usury far more profitable and safe than making productive investment in the land they owned or controlled. All this was hardly conducive to agricultural development.

In many areas, a class of rich peasants developed as a result of
commercialization and tenancy legislation, but most of them too preferred to buy land and become landlords or to turn to moneylending. As a result capitalist farming was slow to develop except in a few pockets. On the other hand, the impoverished cultivators, most of them small peasants, tenants-at-will and sharecroppers, had no resources or incentive to invest in the improvement of agriculture by using better cattle and seeds, more manure and fertilizers and improved techniques of production. For most of the colonial period, landlessness had been rising, so that the number of landless agricultural labourers grew from 13 per cent of the agricultural population in 1871 to 28 per cent in 1951. The increase in tenant-farming and share-cropping and overcrowding of agriculture was followed by an extreme subdivision of land into small holdings and fragmentation. Further, these holdings were scattered into non-contiguous parcels and which led to cultivation becoming uneconomic and incapable of maintaining the cultivator even at a subsistence level.

Of course, the linkage with the world market and development of roads and railways did lead to a large part of rural produce entering the urban and world markets and to the production of commercial crops. However, commercialization of agriculture did not lead to capitalist farming or improved technology. Its chief result was that better soil. available water and other resources were diverted from food crops to commercial crops.

At a time when agriculture in the developed countries was being modernized and revolutionized, there was near absence of change in the technological or production base of Indian agriculture. Indian peasants continued to use the primitive implements they had used for centuries. For example, in 1951, there were only 930,000 iron ploughs in use while wooden ploughs numbered 31.3 million. The use of inorganic fertilizers was virtually unknown, while a large part of animal manure—cow dung, night soil and cattle bones—was wasted. In 1938-39, only 11 per cent of all cropped land was under improved seeds, their use being largely confined to non-food cash crops.

Agricultural education was completely neglected. In 1946, there were only 9 agricultural colleges with 3,110 students. There was hardly any investment in terracing, flood-control, drainage, and de-salienation of soil. Irrigation was the only field in which some progress was made so that by the forties nearly 27 per cent of the total cultivated area was irrigated. But, then, India had always been quite advanced in irrigation cultivation.

Another central aspect of India’s economic backwardness was the state of its industry. During the nineteenth century, there was a quick collapse of Indian handicraft and artisanal industries largely because of the competition from the cheaper imported manufactures from Britain together with the policy of free trade imposed on India. The ruined artisans failed to find alternative employment. The only choice open to them was to crowd into agriculture as tenants, sharecroppers and agricultural labourers.

Modern industries did develop in India from the second half of the nineteenth century. But, both in terms of production and employment, the
level of industrial development was stunted and paltry compared with that of the developed countries. It did not compensate even for the handicraft industries it displaced. Industrial development was mainly confined to cotton and jute and tea in the nineteenth century and to sugar, cement and paper in the nineteen thirties. There had been some development of the iron and steel industry after 1907, but as late as 1946, cotton and jute textiles accounted for nearly 30 per cent of all workers employed in factories and more than 55 per cent of the total value added by manufacturing. The share of modern industries in national income at the end of British rule was only 7.5 per cent. India also lagged in the development of electric power. Similarly, modern banking and insurance were grossly underdeveloped.

An important index of India’s industrial backwardness and economic dependence on the metropolis was the virtual absence of capital goods and machine industries. In 1950, India met about 90 per cent of its needs of machine tools through imports. The underdeveloped character of this modern part of the economy can be seen by comparing certain economic statistics for 1950 and 1984 (the figures for 1984 are given within brackets). In 1950 India produced 1.04 million tons of steel (6.9 million tons), 32.8 million tons of coal (155.2 million tons), 2.7 million tons of cement (29.9 million tons), 3 million rupees worth of machine tools and portable tools (3,28 million rupees), 7 locomotives (200), 99,000 bicycles (5,944,000), 14 million electrical lamps (317.8 million), 33,000 sewing machines (338,000), and it generated 14 kwh electricity per capita (160 kwh). In 1950, the number of bank offices and branches was 5,072; in 1983 the figure had risen to 33,055. In 1950, out of a population of 357 million only 2.3 million were employed in modern industries.

Another index of economic backwardness was the high rural-urban ratio of India’s population because of growing dependence on agriculture. In 1951, nearly 82.3 per cent of the population was rural. While in 1901, 63.7 per cent of Indians had depended on agriculture, by 1941 this figure had gone up to 70. On the other hand the number of persons engaged in processing and manufacturing fell from 10.3 million in 1901 to 8.8 million in 1951 even though the population increased by nearly 40 per cent.

Till the late thirties, foreign capital dominated the industrial and financial fields and controlled foreign trade as also part of the internal trade that fed into exports. British firms dominated coal mining, the jute industry, shipping, banking and insurance, and tea and coffee plantations. Moreover, through their managing agencies, the British capitalists controlled many of the Indian-owned companies. It may be added that many of the negative effects of foreign capital arose out of the state power being under alien control.

Lopsided industrial development was yet another striking feature. Industries were concentrated only in a few regions and cities of the country. This not only led to wide regional disparities in income but also affected the level of regional integration.

But there were some major changes that occurred in the Indian
economy, especially during the thirties and forties that did impart a certain strength to it and provided a base for post-independence economic development.