Blunders at Birth: 1

No, I am not talking about the blunders which I, You or We made at the time of our birth, (any way, we did not have any cognitive sense to decide at that moment and most of them is committed in full consciousness :-P) rather the blunders which our politicians and policy makers did before, during and after the birth of India as Nation State. To call it a blunder may also subject to a contentious debate, but still I am not shying away to call it some of the decisions as “Blunder”.

If time will permit me, I will be writing a series of articles on the same topic “Blunders at Birth”, varied in different spheres be it economic, geo-strategic, defence or even cultural. Today I am limiting to only a single aspect of a economic decision, which was taken by the policymakers at the time of independence, which crippled our development and we became underachiever in economic realm.

When we became Independent, we chose “Industry” as a “Prime Moving Force” for development. What does it mean? It means that industry will play a significant role in the development of the nation and government’s focus and heavy investment will be in the Manufacturing or Industrial Sector, which in turn, will eradicate poverty, will make us self reliant, enhance our economic might, would give us the prestige so on and so forth.

Pandit Nehru was a votary of this idea and many termed him visionary for this.

A reality check:

With the hindsight, we, now after seventy years of Independence, can asses that decision, to make Industry as “Prime Moving Force” for economy and to give “over emphasis and significant budgetary allocation at the cost of other sector” (agricultural sector per se) was not a wise decision and rather a debilitating impact on our economy.

Why making “Industrial Sector” as “Prime Moving Force” was not a wise move?

  1. We did not have the infrastructure to support: Industrial Growth is highly depended on the infrastructure of the Nation. Mainly three infrastructures are must to develop a cluster of Industrial Belt and i.e. Electricity, Transport and Communication. Even after 70 years of Independence we don’t have comparable infrastructure with many developed countries and some developing countries, what to speak of at the time of Independence. If infrastructure was not there how one can expect to grow industries.
  2. Insignificant presence of Infrastructure making Industry: Infra making industries are iron and steel, cement, crude oil, refineries industries etc. All these industries was almost absent baring few such as Tata Iron and Steel Company, in Jamshedpur.
  3. No capital to invest: Industry demands huge sum of money for thriving. Our economic condition was in great disarray, because of the severe exploitation and drain on wealth by British. Private capital was not enough; neither the government has enough to spend.
  4. Lack of Technology: Industry needs sophisticated technology which we hardly had any, at the dawn of independence.
  5. No Skilled Manpower: To get employment in technical industry, first human resource needs to be trained, because of the technical nature of the Job. But even today less than 10% of the people in India are technically trained and even those who are trained such as huge chunk of engineers, majority of them are unfit to be called as technical. Imagine the India of 1947!
  6. Market was unavailable: For working of economics one prime criterion is the availability of market. Majority of the people were very poor at that time. Do you expect them to consume the products which were made up in industries?

So I have listed out some of the reasons which suggest that  we should not have focused on “Industry” too much during the nascent stage, but rather we should have focused more on agriculture at that time. When we would have become self sufficient in it and could have developed infrastructure, investible surplus capital, market then we could have focused on making industry as the driver of economy.

Many would argue that why Pandit Nehru would have given so much preference to industry. At that time it was a wide belief that if a nation has to grow, industry has to be given preference and adopting agriculture as chief source of economic progress was considered backward looking. Many nations of Europe, erstwhile USSR and US have replicated the model successfully. So he copied the idea from there.

But mere coping is not enough and one should always be aware of the ground realities. Even though it was considered backward looking, China has made agriculture, their prime moving force after 1949 and became a cash surplus nation. When it had sufficient wealth it started focusing on infrastructure, skill development and now we can see how much that idea is successful. From the threads of kites, to smart phones, from colour in Holi to lights in Depawali all belongs to China.

We failed as manufacturer and even till today our Farmers commit suicides in thousands. This means our agriculture policy is also is failed. We neither became and industrial state nor developed a sound agriculture base

Wasn’t it a “Blunder at Birth”?

Hope this post was informative. Don’t forget to let me know about your views…