The Economic Plan That Wasn’t

The Beginning 

            The Great Depression of 1929 and it’s subsequent impact on the world was a crucial factor in formulating the economic conception of future policy makers, businessmen, and ‘subjects’ of the British colony of India during her struggle for Independence.

           The context of a crippling world economy , mixed with nationalistic fervour rooted in the freedom movement , set the stage for ideation , plans, resolutions for the future of independent India.

            Post-independence, when policymakers had to make critical decisions about India’s economic model. They had multiple options ahead of them – The Bombay plan , The People’s Plan, The Gandhian model , so on and so forth. Many plans had tremendous ideological underpinnings, but,  the one that influenced India’s 5 Year Plan objectives deeply was the Bombay plan. 

Features

What made it unique?

             Let’s just say that if the ‘perfect’ kind of crony capitalism existed, this would make the cut. Produced by multiple industrial titans of the time, G.D Birla, J.R.D Tata , P. Thakurdas, A.D Shroff and even Mr John Mathai; though not representative of the entire industrial class, carried significant weight. 

            The planners were mindful of the limitations of the private sector regarding the lack of big capital to invest in core industries, basic infrastructure, and mainly the prevailing situation during independence -high poverty and illiteracy rates. Thus, in a nascent, battered nation like India, the role of the state seemed natural and necessary to lay it’s foundations. Thus , the key features of state control of critical and heavy industries, heavy investments in basic infrastructure like roads, dams, bridges, investments in scientific and technical institutions-opening of IITs , was adopted. 

            Therefore, Bombay Plan offered a comprehensive vision of development for India. It’s aim was to attain, in fifteen years’ time, a doubling of per capita income and ensure “a general standard of living which would leave a reasonable margin over the minimum requirements of human life”. This minimum requirement comprised food, clothing, shelter, healthcare, and basic education, considering an increasing population.

Limitations 

             Technical calculation, growth rates and jargon aside, the intent and the objectives of the plan seem to hit the nail on it’s head. But, the plan wasn’t adopted in it’s entirety due to the political and economic situation of the time. Thus, mass education and universal healthcare plans were neglected, which were and visibly, still are the critical issues India deals with today.

            Cut to the COVID-19 crisis in India, the decision to impose a strict  lockdown wasn’t really a choice, it was necessary to buy time to prepare for what’s coming; it was emblematic of the creaking system receiving only around 1.5% of India’s GDP for decades, it’s shortcomings compounded over time.  

          Other challenges like excessive state control over the economy ,overregulation and under-implementation of government schemes and programmes , the wanting state of physical infrastructure and human capital development, etc . are also visible today.

           Adding to this cocktail, is a new dimension-climate change; the consequences of which will have a severe impact on India. 

Way forward 

          Despite widely held beliefs of her sure shot “failure”,  India has made tremendous progress since her  independence in terms of providing basic literacy- 74% of our population is literate (2011 census) from 12% post independence;  poverty alleviation – the number of people living below the poverty line fell to 22% in  2011-2012 (Planning Commission data)  from  around 70% in 1947.  But we still have a very long way to go.

            Whenever India has put her weight and will behind something, she has achieved it. There are multiple instances to prove this – India’s first free and fair election in 1951 with an illiterate populace , the WHO-declared eradication of polio in 2014 , standing shoulder to shoulder with the countries in the ‘elite’ space club with India’s innovative  space missions, establishing Asia’s largest solar power plant in Madhya Pradesh , going from 1 COVID-19 testing lab to approximately 1300 labs within 5 months, the list goes on.       

             India always reinvents herself during a crisis, turning it into an opportunity. Thus, there is a need for political will and participation of all stakeholders for the translation of our aspirations into action.

 A united India is a prosperous India.

Preeti

Create your website at WordPress.com
Get started