Explained Books: Second coming of India’s economic might | Explained News,The Indian Express
Sanjay Baru’s book, 75 Years of Indian Economy, doesn’t restrict itself to that time frame alone. He sees India’s current economic resurgence as part of a long history.
Sanjaya Baru’s 75 Years of Indian Economy is part of a series that looks back at the past 75 years of independent India. But Baru’s book doesn’t restrict itself to that time frame alone. He sees India’s current economic resurgence as part of a long history.
The book starts with a reference to British historian Angus Maddison and his book The World Economy: A Millennial Perspective (2001), which estimated that in 1700, China and India together accounted for half of the world’s national income and that, by 1950, their combined share was down to less than 10 per cent. Seen from such a historical perspective, India is not like any other “emerging” economy — it is, as Baru calls it, an economy that is “re-emerging” at the world stage.
There are 14 chapters in the book, but they are, on purpose, not written in chronological order. Baru starts by explaining the different strands of economic thinking that drove our freedom fighters. This is important because independent India’s initial economic outlook was heavily influenced by these thoughts. The two grand ideas at the time of independence were the preservation and promotion of gram swaraj or cottage and village industry, and small-scale industry, and the push towards large-scale and modern industrialisation that mimicked the Soviet model.
The script started going awry during the 1960s and 1970s when wars with China and Pakistan, failed monsoons and political upheavals made the economy more insular. Government regulation and control became more pervasive, and undermined the growth of Indian enterprise. Although India started making some changes to open up the economy and move away from “bureaucratic socialism” in the 1980s, it took a severe Balance of Payments crisis to force India to reset its economic policy framework. The reforms of 1991 were the turning point for India’s economy and, justifiably, Baru devotes a full chapter detailing the changes and how they came about.
Since then, the Indian economy has gone from strength to strength. “Over the 30 years from 1950 to 1980, India’s gross domestic product (GDP) or national income, grew at an annual average of 3.5 per cent; and in the following two decades, 1980-2000, it grew at 5.5 per cent… (Between) 2000 and 2015, the economy grew at an annual average of 7.5 per cent, with the so-called ‘golden years of growth’, 2003-2008, recording close to 9 per cent growth,” writes Baru.
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