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THE ECONOMIC WEEKLY SPECIAL NUMBER JULY 1964

Economic Ideology of Jawaharlal NehruM. L. Dantwala

If  a straight question were asked whether Pandit Nehru had a well-defined economic ideology which could begiven one of the known labels, the answer would perhaps be in the negative,

While some would consider this as unfortunate, others like this writer would consider it a saving grace.

The strategy of accomplishing a rapid enough transition of the economy from the state of underdevelopmentto self-sustaining growth is still in the stage of experimentation. Under the circumstances, any rigid doctrinaireapproach on the part of the leader of the nation, far from being an asset, would have proved quite hazarduous. Thisdoes not mean that the right strategy would be to let the economy take its free and wayward course, tossed byspasmodic national and international, economic and political currents.

I N D I A ' S economic policy, since In -dependence, has a fa ir ly clear

vision of the ultimate goal, its socialand economic colour and content, andthe broad path to be followed in reaching it, though every street is not named. It is well-kno wn that it was mainly because of Nehru's insistence tha t

the ultimate goal of the Socialist Pattern of Society has been adopted. Itmay be contended that this itself is aproof of Pandit Nehru's doctr inair epredilection. Such a view would, however, be unfair and quite erroneous. Itwould be tiresome to hunt out a stringof apposite quotations to justify thisverd ict. But there is enough evidencein Pandit Nehru's speeches and writingsto show that his image of socialism wasanything but doctrinaire. In fact, hehas often been chided by petty criticsfor the vagueness of his ideas. PanditNehru's socialism was born out of a

deep attachment to the values ofethics and social j ustice. He had nointel lectu al commitm ent whatsoeverto its mechanics as prescribed in theMarxist text-books. While PanditNehru had great respect for many ofthe abiding insights of Marxistthought, he did not subscribe uncritical ly to any of its dogmas. The people around Neh ru had perhaps astronger attachment to the ortho doxMar xist remedy. Tha t their influencewas not greater than what was occasionally reflected in his th in ki ng ,clearly shows that Nehru had an ima

ginative and not an imitative approachto socialism.

Divergence within CabinetNehru has been often accused of

harbouring in his Cabinet men withnot only divergent but conflictingviews and also those whose faith insocialism was at best lukewarm. Wasthis an evidence of economic indecision or of political sagacity? Perhapshe was compensating for the lack ofeffective outside opposition by providing for it from within his own party!Mor e seriously, was there. at each

stage in the course of development,an economic consensus about the oneand the only right line of action,

which Nehru and his well-knit Cabinetought to have followed? Assumingthere was, can we name the team-retrospectively since 1947—whichcould have been selected or rejected—for doing the job and see whetherwe succeed, where Nehru failed? Inspite of his tolerance of doubtful so

cialists and transparent free-enterprisers perhaps as a countervailing forceto disguised fellow -trave llers at thehighest level of policy -makin g, oncertain basic aspect of the policy hewas quite firm.

Biggest Contribution — Planning

Nehru's biggest contribution to economic strategy was in commiting thenation to a policy of planned economicdevelopment. Th is was by no meansthe easiest thing to do. Wi th in thecountry, he had to contend w it h hisGandhian colleagues who saw in this

imposition of Centralised Statism,while they were emotionally committed to village self-sufficiency. Planning was equally an anathema to Western Democracies whose financial aidwas a critical factor in the task of development. (Sovie t Russia was yet toadopt economic aid as an instrumentof foreign policy). Whatever one'sopinion may be on the functioning ofthe Planning Commission, there is nodoubt that its very constitution, withthe Prime Mini ster as its Chairman,was an imp orta nt landmark in theeconomic policy and development of

the country.

Another equally important, thoughsomewhat contro versia l, element ofour economic poli cy, whi ch but forNehru's support would not have passed muster, is the launching of the modern type of industrialization with itsemphasis on heavy industri es. Thiswas interpreted by interested politicalgroups as leading the country on theSoviet path, and by implication, towards totalitaria nism. There was another section—well-meaning and sincere—in the country which felt that

such a pattern of industrialization waswholly contrary to what Gandhijiwou ld have wished. The emphasis on

heavy indus tries has been variouslypresented as tantamount to neglect ofagriculture, death-knell of Khadi andVillage Industries and callousness towards the problem of unemployment.This is not the place to controv ertthis contention . Not only such interpretation is not true of Pandit Nehru's

concept of economic development, support for it cannot be derived evenfrom the Planning Commission's documents on Five-Year Plans. As is beingincreasingly realised, the antithesissought to be drawn between the development of industries and that ofagriculture is totally false.

Flexibility, the Saving Grace

It has been said that Nehru had afascination—to which many politicalleaders arc prone—for the big andthe grandiose: the steel mills and thegiant multi-purp ose river-v alley pro

 jects . Perhaps he had. It can also besaid that he rarely went beyond thebroad idea and did not bother to examine its manifold implications. Howmuch of this blame should attach tohim or to his advisers and administrators is perhaps a debatable issue. Butthen , there was always the savinggrace of non-insistence and flexibility.

A classic example is the Nagpur Resolution on the future pattern of theagrarian structure. The Resolution hadcategorically stated that the future agrarian pattern should be that of cooperative joint farming, in which land

will be pooled for joint farming. Thereference was presumably to  all  landand not to the land only of the smalluneconomic cultivator. At that moment, and for a considerable timethereafter, Nehru was convinced thatthis was the right stand. Later, partlybecause of the successful misrepresentati on of this policy as confiscatoryand anti-peasant and partly because ofthe practical difficulties in implementing it. the Nagpur Resolution was allowed to fade away.

There is another notable example in

whic h he did not shirk the odi umand embarrassment of reversing an accepted policy. This was in respect of

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the policy on the character and composition of Primary Co-operative Societies. The Committee of Direction ofthe Reserve Bank's Rural Credit Survey had recommended the formationof State-sponsored, large-sized, viable

units of Primary Co-operative CreditSocieties; and this was accepted bythe Government of India. While, byand large, the recommendation wassound, in its implementation, severaldisto rtions took place. The idea ofState-partnership led, in some places,to the dominance of Government officials; and in launching large-sized societies, the element of mutual co-operatio n was relegated to the backgroun d. The Prime Minis ter reactedrather sharply. While inaugurating theTh ird India n Co-operative Congresshe said:  "The Government was quite

wrong in accepting some of the decisions of the Rural Credit Survey Committee—not all. There was a tendencyon the part of that Committee to thinkthat they (the people) arc not competent enough, they cannot do a job bythemselves; therefore, Government of

 ficials must come in and help. Government money should push them up. IfGovernment money comes, that money

is followed by Government officials"

Later, when the National Development Council considered this question,the indisc rimin ate establishment oflarge-sized societies was stopped andrenewed emphasis was placed on the

co-operative element in the formationof Primary Societies. Apart from whether such a sharp reaction was justifiedor not, the episode illustrates howaverse Pandit Nehru was to unnecessary extension of Slate interference ineconomic activities.

Basic Economic Policies Sound

The one significant test of thesoundness of the basic economic policies adopted by the country underNehru's leadership is their almost universal acceptance within the countryas "well as outside by all those who

have taken an intelligent interest inthe question. To quote a fairly recentand competent testim ony, ProfessorJohn Lewis in his "Quiet Crisis in India", states:  "As a piece of macro-economic calculus, the strategy that is incorporated in the Second and theThird Five-Year Plans (and presumably will be also in their successors) isbasically sound and fairly well spelled

out in its details"

He has also observed tha t amongall the Indian groups concernedwith national policy issues, thereare only two that are fundamentallyopposed to the kind of developmental

effort the Government is try ing tolead: the neo-Gandhians and the ultra-laissez faireists. I shall not menti onhis characterisation of these twogroups. But unless some sort of Gold-waterian retrogression takes place, theeconomic philosophy of neither groupis likely to enlist any significant fol-lowing.

Whether this country is thrust tothe brink of the Most Dangerous Decade and the Quiet Crisis or gathersspeed on the runaway for a graceful'take-off' will depend not on the adop

tion of any brand new economic strategy, but on the success or failure inthe implementation of the strategy towhich Pandit Nehru got the countrycomm itted , and whic h has come tostay. Marginal adjustments wi ll nodoubt be necessary, but the very factthat these would have to be only marginal, speaks a great deal of Nehru'seconomic statesmanship.

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SPECIAL NUMBER JULY 1964 THE ECONOMIC WEEKLY