Centuries of systemic exploitation by the British have made Indians a shadow of their former selves. They now readily subject themselves to the chains of governmental authority and restrictive ideals. And worse, the current political class has found a safe harbour in this social phenomenon to foment and glorify failed policies in their discourse.
The roots of socialist policies in India
The nascent Indian republic, under the guardianship of a few influential freedom-fighters, adopted socialism as one of its guiding principles. The political discourse in the early days of the freedom struggle had been to rail against the profit motive of the East India Company and the imperial British Raj it engendered. The new leaders shone the light towards an India that would rise out of poverty and inequality, with the obvious exception that “some will be more equal than the rest”.
Decades of aggrandization of governmental power in the name of welfare followed. The first Prime Minister, Nehru, laid the seeds for a statist society, taking deep inspiration from the British economist Harold Laski and the Fabian school of socialism. With political power being the primary driver, the government and bureaucracy worked hand in glove pursuing policies such as a centrally planned economy and weakened property rights. The government had a near carte blanche on what could or could not be produced.
It was not uncommon to see the common man in long queues for essential goods. Enterprising industrialists fared no better as they too anxiously waited to be granted licenses, subject to numerous conditions, for producing goods and creating wealth. The nation’s economy sank slowly in the background as one poor policy after another was implemented in the Five Year Plans that promised a lot, but delivered little. Successive governments also followed similar policies, such as the nationalisation of industries and banks and attenuated individual, political and civil rights. This only ran the economy into a deeper abyss as the foreign reserves nearly dried up, and the International Monetary Fund bailout in 1991 prompted liberalisation.
During the same period, Lee Kuan Yew, another student of Laski, set up a nation that now rules the waves in maritime Southeast Asia. One of the poorest nations back in the 1960s, today, Singapore is well on its way to becoming one of the most prosperous economies in the world. India, on the other hand, had its first taste of economic growth and freedom after nearly 40 years of independence; years which should have driven home the point that socialist policies do not work.
The appeal of socialism
Why are then socialist ideas still on the prime manifesto of India’s politicians today? One can say that they are united in their track record of unfulfilled promises, perhaps?
Socialism has a deep-rooted appeal for intellectuals and common-folk alike. It paints vivid and emotionally-charged narratives of an equal society that will eliminate differences in wealth, prosperity and well-being and work for collective welfare instead. This rosy promise, meant to be achieved through a system of force and government interference in individual liberties, breathes a sense of hope into the masses who aspire for a better life. It also, unfortunately, tends to indulge academics and scholars whose sensitivity to injustice draws them to the idea that the world’s problems can be solved in one sweep.
However, only a system that promotes and sustains individual action can lead to wealth and prosperity in society. History has shown that capitalism, combined with individual rights and rule of law, has led to greater human flourishing than any other system. The free-market system and liberty-oriented ethics were endemic to success in advancing human civilization to the level it is today.
Wealthy nations of North America and Western Europe have reached their position today through markets and capitalism. On the other hand, Venezuela, once amongst the richest countries in Latin America, stands at the brink of economic and political collapse today as a result of the ‘21st-century socialist’ policies implemented by late President Hugo Chavez.
India too benefited from the liberalization reforms that it undertook in 1991. India’s GDP grew an astounding 2216% in just 25 years after liberalisation in 1991. Presently, it is inching closer to the $5 trillion mark and remains one of the fastest-growing economies in the world. As per a recent survey conducted by the Confederation of Indian Industries, India is also considered as one of the top investment destinations in the post-pandemic world.
Roadblocks to reform
So why are Indian politicians trying to turn the clock back? Why is labh (profit) equated with lobh (greed) even today? Why is there such a blind repetition of this rhetoric despite plenty of evidence to the contrary?
Firstly, the Indian government bears a close resemblance to its colonial past. Its structure was framed along the lines of the British Government of India Act, 1935 and its forerunner legislations, that were enacted to consolidate control and resources in the aftermath of the First World War. For the political class, there is a definite draw to the power and control that such a government offers.
In the minds of the citizens too, big government is seen as normal and heightened importance is given to its role in society. Driven by a strong messiah complex, politicians and bureaucrats have ample scope to hide behind their ‘well-intentioned’ machinations, which mostly end up stifling individual freedom and initiative, and promote a sense of dependence.
Secondly, the Preamble to the Indian Constitution was amended in 1976 to include the word ‘socialist’. Many today believe that socialism was the intended goal of the Constitution but few realise it was inserted by the Indira Gandhi government in pursuit of gaining more political power.
This is contrary to the prescient statement issued by B.R. Ambedkar when K.T. Shah proposed a similar inclusion during the Constituent Assembly Debates in 1948. Warning against subscribing to a particular ideology, he proclaimed, “What should be the policy of the State, how the Society should be organised in its social and economic side, are matters which must be decided by the people themselves according to time and circumstances. It cannot be laid down in the Constitution itself, because that is destroying democracy altogether.”
Lastly, there exists a rather misplaced rule in the Representation of Peoples Act, 1951 which governs elections in the country. According to Section 29-A of the Act, every political party before getting registered, needs to take an oath that it will adhere to socialist principles in practice and conduct.
The unfortunate result is that the path to reform stands closed, both in the minds of people and the system itself. It is no surprise that even after three decades of economic liberalization, and the material prosperity that it has brought forward, politicians veer towards regressive and failed socialist policies such as state-controlled prices, heavy subsidies and protectionary tariffs.
It is about time the minds of voters are opened to the falsehoods of yesterday and nudged towards a prosperous tomorrow. As rightly mentioned by the Finance Minister back in 1991, “no power on Earth can stop an idea whose time has come”. It is time to lift the anchors and move away from the safe harbours; the ship to progress and prosperity has to sail freely in the open minds of the new generation.
The author is a part of Students for Liberty’s first cohort of Fellowship for Freedom in India.
The opinions expressed in this essay are those of the authors. They do not purport to reflect the opinions or views of CCS.