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Despite BJP win, India’s growth must include all
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THE victory of the Bharatiya Janata Party and its leader, Narendra Modi, in India’s general election has raised a question about the country’s future.
With the BJP sweeping to power on a platform of business-friendly corporatism, has the socioeconomic consensus dating to India’s first prime minister, the democratic socialist Jawaharlal Nehru, come to an end?
The “Nehruvian consensus” accommodated the country’s many diverse interests, without permitting any one group or section to dominate the nascent nation-state. It is fashionable today to decry Nehruvian socialism as a corrupt and inefficient system that condemned India to many years of slow economic growth. But at its core was the conviction that in a land of extreme poverty and inequality, the objective of government policy must be to improve the welfare of the poorest, most deprived, and most marginalized.
In Nehru’s day, the best way to accomplish that was by building up structures of public ownership and state control of resources, as well as by boosting economic capacity through government intervention.
Of course, Nehru’s economic vision had its flaws, giving rise, for example, to the so-called “license-permit-quota Raj,” under which government control stifled entrepreneurial activity, which in turn held growth rates below those of India’s Southeast Asian neighbors.
India slowly repealed many of these burdensome regulations in the 1980s, when Nehru’s grandson, Rajiv Gandhi, was in power. Then, following reforms initiated by his successors atop the Indian National Congress, Narasimha Rao and Manmohan Singh, India entered a confident new era of flourishing growth and socioeconomic dynamism.
Focusing on the poorest
So what went wrong?
Many attribute the astonishing scale of the BJP’s victory to Modi’s success in tapping into the restless (and rightful) aspirations of India’s youth after two years of a slowing economy. This is where critics deem the Congress Party to have failed, focusing as it did on the needs of India’s poorest.
Congress can justifiably argue that it helped build on the economic structures of Nehru’s day while liberating them from excessive restrictions. But it remains committed to an inclusive idea of development, based on social justice and greater opportunity for India’s deprived and marginalized — an idea that is not always easily marketable to a youthful electorate that wants change here and now.
Those who claim that the Nehruvian consensus has unraveled allege that Congress failed to read the country’s mood — that Indians want economic growth, not social legislation.
But, leaving aside the last two years, India witnessed record-high growth rates while Congress was in power. Our objective was to distribute the fruits of this growth more equitably. And, though the election results might suggest otherwise, most Indians’ lives and living standards have improved in the last ten years.
This was not because of “doles,” as critics call them, but because of more generous and effective government. In fact, it is precisely the social investment carried out by Congress governments that put more children in school and more people to work, while ensuring that their basic needs were met.
Some predict that Congress will move further to the left economically in order to distinguish itself from the BJP, and argue that this would be counterproductive, given that voters have seemingly rejected socialist policies.
But, in a country where most people in every electoral constituency live on less than US$2 a day, writing off “pro-poor” policies would be unwise. The Nehruvian emphasis on socially inclusive growth is not simple “leftism”; the Congress Party supports growth and led the liberalization that made growth possible. But we wish to see the benefits of that growth reach the weakest and poorest sections of Indian society.
Shashi Tharoor, a former UN under-secretary general and former Indian Minister of State for Human Resource Development and Minister of State for External Affairs, is currently an MP for the Indian National Congress. Copyright: Project Syndicate 1995-2014.
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