The following text is Aditya Mukherjee’s Sukhamoy Chakravarty Chair Lecture at the Centre for Economic and Social Progress (CESP), Jawaharlal Nehru University on ‘The Historical Roots of India’s Development Strategy,’ delivered on September 23, 2025. §I would like to first thank the CESP, the leading Centre for Economic Studies and Planning in the country for decades. I would also like to thank Professor Praveen Jha for giving me the honour of delivering the Sukhamoy Chakravarty Chair Lecture. We have all been beneficiaries of Professor Sukhamoy Chakravarty and his great scholarship. He was in fact, as Praveen would know, often compared with Amartya Sen for his brilliance. The difference was that Chakravarty gave up a purely academic career and chose to play an important role in the shaping of India’s development strategy. He advised the government over a very long period of time. He played a very important role in the evolution of India’s development strategy over time, apart from writing about it very brilliantly. I’ll have occasion to mention both of these aspects of Chakravarty later. While delivering my talk on the historical roots of India’s development strategy, I would therefore like to pay my tribute to him and acknowledge his guidance which I was privileged to occasionally receive. I’m humbled to speak before an audience of eminent economists and very bright young students, which CESP has been always very fortunate with attracting. From them I’ve learned a lot. In fact, over the years, and as Praveen referred to it, I’ve been around Jawaharlal Nehru University for more than 53 years. So, over the years, one has had the occasion to learn from and interact with the range of very illustrious scholars who were of the faculty at the CESP. So, I am delighted to be able to speak at the CESP and very grateful to see a large number of colleagues and friends who have come to listen to this talk. What was unique about India’s development strategy since independence, unlike most other post-colonial countries, was that it occurred in a democratic and independent context, as opposed to a strategy pushed through by an authoritarian regime or by a regime willing to be a junior partner to some superpower. The question is why was it so? Why did India adopt such a strategy? It’s certainly not because, as our current top leaders tell us, because we were the ‘mother of democracy’, or because we were the vishwa guru, or because we knew everything including nuclear technology and plastic surgery in ancient India. You may remember the former vice president, stating that Arjun in the Mahabharat had a nuclear tipped arrow or our prime minister boasting about the knowledge of plastic surgery in our ancient past through which the Hindu god Ganesha got his elephant trunk on a human body. Obviously, it is not our ancient knowledge that dictated our development strategy. At a serious level, the answer to the question lies in the nature of the state that was born at independence. Here is where history comes in, and the discipline of history as you know, is at the moment the victim of a great amount of distortion and misuse, but nevertheless, we cannot answer the question that I have raised without going back into history.A very obvious fact that is often overlooked by a range of scholars is that the nature of a state is a function of or is critically determined by the nature of the movement that led to the creation of the state. For example, you cannot have a Bolshevik revolution and at the end of it say let’s have a bourgeois democratic society, or you cannot have a movement led by Muhammad Ali Jinnah in the name of Islam and then give a speech saying now that we have Pakistan we will be a secular country. Jinnah’s words were not only drowned in blood, but for quoting him, as you know, L.K. Advani lost his position in the Rashtriya Swayamsevak Sangh (RSS). You can’t do it; you can’t ride a tiger and just get off whenever you like. So, the point I’m making is that the nature of the movement is critical in determining the nature of the state.Economists have unfortunately ignored this historical link. By and large, most economists that you will read talking about India’s development strategy tend to begin with 1950 as if the world began with the first plan. Occasionally a mention is made of the National Planning Committee and the Bombay plan of the late thirties and forties, but basically there is no linkage drawn. I want to give you a very telling example.One of the most quoted economists for the study of India’s land reforms after independence is Professor A.M. Khusro. He makes this astounding statement which I want to quote to you. He said : “The elaborately conceived and many sided programme of land reforms launched in the country during the 1950s could be said in a considerable degree to be a gift of the administration to the peasantry.” 1 There is no link drawn with the national movement, no link with the fact that since the 19th century the Indian intelligentsia had been arguing for the necessity of land reform with people like justice Ranade even drawing out a possible blueprint and no reference to the fact that there were powerful peasant movements for nearly a century including the powerful Kisan Sabha movements of the 1920s and 1930s fighting for changes in the agrarian conditions.2 In fact, the success or failure of land reforms in various parts of the country were often determined by the nature of the peasant movements that preceded them in those parts. They were determined by what kind of class balance had emerged in those parts as a result of those movements. Undoubtedly, some bright, committed bureaucrats like P.S. Appu and D. Bandyopadhyay were involved in India’s land reforms, however you cannot even begin to talk of land reform if you do not go back into history. You cannot begin to understand how this historically unique effort at transformation of agrarian relations could happen within a democratic framework in India. There was no General MacArthur’s army overlooking land reforms as in Japan, there was no forced collectivisation. It was done within a democratic framework and it could only be done because of the background that I mentioned, because of decades of sacrifices and activities of the peasantry before that.Let me very quickly go over specific features of the Indian national movement which not only created the post-colonial state but which I think were critical in determining the nature of the state and what strategies it could adopt. I will just mention a few. Firstly, the Indian national movement was a prolonged mass movement, a movement over nearly a century which involved vast masses of the Indian people. It was not a coup, not a mere capture of power, not a guerrilla movement led by professional revolutionaries, not an insurrection, not a Red Army marching through and capturing power. It was a movement built upon the mass of people over a long period of time. So, the ideas of the movement went deep down into the masses and they could not be easily reversed. You cannot suddenly change direction in a democratic society. If a certain idea has gone deep into the minds of the people, changing that is a very prolonged process.Second, what were these core ideas that went deep into the minds of the people and are relevant to the strategy of development that India adopted. First, that India would be a sovereign country, independent, anti-imperialist, and supportive of anti-imperialist movements globally. As Professor Irfan Habib recently said in the First Sitaram Yechury Memorial Lecture, that the ideas of anti-imperialism, democracy, and so on did not have to wait for communism or Marxism to catch up in India.3One of the most comprehensive critiques of imperialism emerged from India by the early nationalists simultaneously with Marx, decades before Lenin and Rosa Luxemburg. The writings of early nationalists like Dadabhai Naoroji and Ranade were seminal in understanding the economic framework of imperialism, including complex ideas like unequal exchange, which we often think were developed only by Marxists in recent years.4The second core idea was that India would be a democracy. In the 1980s, Tilak was already talking of adult franchise, decades before it was practiced widely in the world. Europe got voting rights for women decades later well into the 20th century and the USA in the 1960s was still witnessing civil rights movements demanding equal treatment for the black people! In India, democracy was a very foundational idea critical to the imagination of the Indian nation since the 19th century.Third, India would be a secular country. Secularism and democracy were inseparable, they were used as conjoint terms, ‘secular-democracy’. The way it was understood was that you cannot have one without the other. You cannot claim to be democratic while excluding certain religious or other communities. If you are democratic, you must also be secular.Fourth, the future India would be pro-poor. Not necessarily socialist or communist, though those strands were strong during the freedom struggle, but there was broad agreement on a pro-poor orientation. The early nationalists like Naoroji, whose work on poverty highlighted the central issue, (his major work was titled Poverty and Un-British Rule in India) and writings of Ranade, R.C. Dutt etc. all saw poverty as a core consequence of imperialism and it was given as a basic reason to oppose it. Later leaders carried this idea forward further with Gandhiji’s focus on the poorest, the last man and his formulation of Daridranarayan, god residing in the poor and Nehru, the socialists, and communists making the demands of the poor central to their concerns.Fifth, there was the idea that India would not remain an obscurantist, superstitious, ritual-driven society but would move toward a modern and scientific approach, which Jawaharlal Nehru called the scientific temper.The key point is that there was a consensus across the wide spectrum of the Indian national movement, from Moderates to Extremists, from Gandhians to Nehruvians, from socialists to communists, from revolutionaries like Bhagat Singh to even large sections of the capitalists, on all these five elements of the vision of India discussed above. The only groups that did not share this vision were those who were opposed to the freedom struggle, such as the communalists and the loyalists. For the rest, these ideas formed the shared foundation of their politics. The Indian state was therefore born carrying these core ideas of the freedom struggle, what Tagore called the “Idea of India.” These ideas were later embodied in the Constitution of India, where each of these principles finds expression, including the emphasis on scientific temper.5At the time of independence, there was an attempt by the communal forces to alter the nature of the new born Indian state. Utilising the holocaust like situation of the late 1940s with communal violence and upheaval caused by the partition and the planned murder of the Father of the Nation, Mahatma Gandhi, creating an extreme increase in communal feelings, the communal forces in India tried to create a ‘Hindu Rashtra’ a mirror image of ‘Muslim Pakistan’. However, these efforts were pushed back strongly by the leadership of the national movement. Within a few years, the first general election of 1951-52 was like a referendum on whether India would be a Hindu Rashtra or secular inclusive India. The Indian people overwhelming supported a secular vision of India. Only 6% of the electorate voted for the all the Hindu communal parties put together Hindu Mahasabha, Ram Rajya Parishad, etc. they secured only 10 out of 486 seats in the Lok Sabha! This demonstrated how deeply the ideas of the freedom struggle were rooted among the people. It also illustrates that the ideas of a prolonged mass movement are not easily reversed. They are deeply embedded in society.6Returning to the main theme, any development strategy adopted at independence had to operate within the framework set by these core ideas. No one argued for a model of growth without democracy or for one in subordination to a superpower. Even the plan chalked out by the capitalists, the Bombay Plan,7 assumed a democratic framework, welfare orientation, land reforms, and independence from foreign domination.8 No one argued for the models witnessed in East Asia, of an authoritarian state in partnership with an industrial bourgeoisie pushing though development, or of a semi-sovereign state under the umbrella of a super power ensuring rapid growth, postponing the issue of democracy and sovereignty to the future. Anyone who did that in India at independence would have been in the dustbin of history, such was the popular mood. At independence, therefore, multiple development plans existed, including Gandhian, socialist, and capitalist approaches, but all remained within the broad parameters of the ‘Idea of India’. However the path chosen – combining industrialisation with democracy and sovereignty – was unprecedented. As Jawaharlal Nehru noted, there was no historical precedent for this uncharted path which was therefore “unique in history.”9 The process of primitive accumulation which precedes the rise of industrial capitalism involved the raising of surplus for investment, on the backs of the working class or the peasantry, or from colonial surplus appropriation. The path of extracting surplus out of agriculture through ‘expropriatory’ land tax or forced collectivisation; of forcing surplus out of labour though slavery, indentured labour and in the absence of organized trade union rights or of forcing surplus out of the people of other countries through collection of tribute from colonies, was not open to India. While, during colonial rule, the Indian peasant often ended up handing over more than half of his gross produce as land tax and rent, after independence a democratic regime based on popular will meant that not only was there no tax, or surplus extraction through other forms from agriculture (on which an overwhelming majority of the Indian people were dependent), but a net transfer of income to agriculture occurred through state subsidies. Also, trade union rights to the working class were guaranteed from the very beginning and were exercised vigorously. Of course, the question of appropriating colonial tribute from other countries did not even arise. India was committed, in fact, to doing the opposite, fighting with the United States on the issue of Vietnam and Korea and in every other situation of imperialist domination.This raises the fundamental question of how such a transition could be achieved without following those historical patterns adopted traditionally, i.e., capital accumulation based on extraction of surplus from within society or through exploitation of people of other countries. France, England, Germany, Italy, USA, Spain, Portugal, Japan, all had their colonies. To give you just one figure, since this calculation was made by one of the stalwarts of the CESP itself, the unrequited transfer, or the ‘tribute’ or ‘drain’ to Britain from Asia and West Indies put together was calculated by Utsa Patnaik to be 84.06% of British capital formation out of domestic savings in 1801, i.e., during a critical phase of British industrialisation.10So, another way of putting it is that Britain could actually invest, to become the first industrialised country in the world, almost twice as much as what it had raised from within its own economy. The rest came from the colonies. To the extent the investible surplus came from the colonies, the working class and peasantry in the home country were spared. That is why colonialism is said to be supra-class on both sides. Every class in the colony loses, and in the metropolis every class benefits from colonialism, though differentially.None of the paths chosen historically were open to India at independence. Therefore, it must be recognised that the path chosen by India was unique and very difficult and any evaluation of the development strategy adopted by India must be done keeping this in mind. The strategy of development adopted by India was arrived at through a consensus, which I describe as the Nehruvian consensus. It was not just a Nehruvian strategy, it was a consensus arrived at among most sections of Indian political opinion. No civil war occurred after the Indian Revolution because of following this consensual path. Give it a thought. After every revolution, the French Revolution, the Russian Revolution, even the Chinese Revolution, millions had to die. Here you witnessed as big a revolution, probably one of the biggest in the 20th century. India’s independence changed the face of colonialism globally, and yet there is no civil war following it, simply because of the insistence on staying within the democratic framework, not pushing through any strategy, even if objectively it looked very good, by force. Nehru was at that time hugely criticized by the socialists, particularly people like Jayaprakash and other socialists and even by the communists for not pushing through radical socialist measures using his majority and personal prestige. Nehru’s response was that he may be a socialist, but there is no socialism without democracy. He was not going to push through any measure unless he could carry the bulk of people with him on the question. That is why the foundations of democracy could be laid in India and we did not witness a civil war following independence. It is something worth remembering. This aspect is often ignored by scholars who constantly contrast India with South Korea and Japan. You are actually comparing apples and oranges when you do that. Vivek Chibber, for example, does this repeatedly in his quite influential book called Locked in Place11 where he compares India with South Korea, paying no attention to the fact that there was no democracy in South Korea. In South Korea you could have a 60-hour week for the working class with no trade union rights. You could not only discipline labour you could discipline your capital in a manner which would be unthinkable in a democracy like India.12 Also, South Korea under the Japanese umbrella, had entry into the American market, because of Japan and South Korea being virtually the American base for its entire geopolitical strategy in that region. As I argued earlier this path was ruled out for India. India was not going to be a semi-sovereign country dancing to the dictates of the United States, neither was it going to choose the authoritarian path. Also often ignored when comparisons are made is what the economists call the ‘initial conditions’ from which independent India starts. When you compare two runners in a race and one starts 300 yards behind the other one, then you cannot say how come the one who started 300 yards behind is not coming first. What does Nehru inherit in independent India? In the words of Tagore, shortly before he passed away, he said that the British will one day have to leave India, but when they do actually leave, what “mud and filth” will they leave behind.13 And what did they leave behind. A deeply colonially structured economy, dominated by a very low efficiency agriculture and hardly any industry. Average life expectancy in 1950 was less than 30. So, the poor must have been dying in their teens or even before that. 84% of the population was illiterate and 94% women were illiterate. A famine ridden country, where a famine conditions would occur almost annually at one part of the country or other under British rule and three million people died of famine just four years before independence. Such was the condition of agriculture that after independence, millions of tons of food had to be imported just to prevent famines in the country. Above all, the British left a deeply divided country where lakhs of people were killed in communal riots and millions made homeless. It is from this “mud and filth” that was inherited that the country had to be lifted to make a transition to modernity. So while evaluating the Nehruvian period these factors must be kept in mind.Nehru during a meeting of the Interim Government in September 1946, Photo: nehruarchive.in. What I will do however, is a very quick evaluation of what happened in the Nehruvian period, of what I think are the successes of the Nehruvian consensus, despite all the limitations of the initial conditions. After that I will try to refute, what I think is a ridiculous rubbishing of the Nehruvian experiment that has now become popular among the neo-colonialists and the communalists.At independence, India was as Nehru described, in a neo-colonial situation. Political independence was achieved but the Indian economy was totally dependent on the advanced capitalist world. To grow you need to invest. To invest you need capital goods. India produced no capital goods. From as early as 1945 there were industrial delegations going out of India, all over the world, trying to find out where the machinery required to replenish the overused machinery during the war, and more important, to materialise India’s planned development after independence could be got. In 1947, more than 90% of the capital goods requirements of India had to be imported to make any investment in India. More than 95% of even machine tools, your pliers and wrenches, also had to be imported, leave alone major machines. The Nehru Mahalanobis strategy between 1951 and 1965 led to a 7.1% annual rate of growth of industry. This was a far cry from the de-industrialisation process of the 19th century and the slow industrial growth between 1914-47. More importantly, “the three-fold increase in aggregate index of industrial production between 1951 and 1969 was the result of a 70% increase in consumer goods industries, a quadrupling of the intermediate goods production and a ten-fold increase in the output of capital goods”. This pattern of industrial development led to a structural transformation of the colonial legacy. From a situation where, to make any capital investment in India, virtually the entire equipment had to be imported, the share of imported equipment in the total fixed investment in the form of equipment had come down to 43% in 1960 and a mere 9% in 1974, whereas the value of the fixed investment in India increased by about two and a half times over the period (1960-74). In other words, by the 1970s, over 90% of India’s investment requirements could be met from within internal resources. That was the source of India’s independent foreign policy. That is why India could have the non-aligned movement and Nehru and Indira Gandhi could lead nearly 100 countries into this movement. They could cock a snook at both the United States and the Soviet Union saying that we will not join either of you. Just translating self-reliance into Atmanirbhar and calling yourself a Vishwaguru could not achieve this. It required an amazing amount of effort to un-structure the colonial structure which made this possible.This transformation in a very short period was made possible to a very large extent by the use of the public sector which got strewn all over the country. The Hindustan Machine Tools, the Bharat Heavy Electrical Limited (BHEL), the Heavy Engineering Corporation, the Bharat Earth Movers, a number of Steel Plants, etc., came up all over the country. I do not want to give you a list. You are aware of them. I must highlight that these public sector units were not white elephants as it is made out today. You must remember that the public sector savings between 1950-65 were considerably higher than the private corporate sector savings.14 So, this notion that public sector was eating up national resources was not true at that time. When the second HMT factory was built, Nehru very proudly inaugurated it, saying that it was built entirely out of the profits of the first HMT.15 So that this is the industrial side.Second is the canard spread that Nehru neglected agriculture. Since the industrial growth could not be denied, the allegation became that he neglected agriculture. Again complete rubbish. With the launching of the Land reforms, the back of the nearly 150-year-old zamindari system was broken within seven years after independence. Land reforms, with all their defects, brought about a fundamental change in agrarian relations in the country and between 1950 and 1964, Indian agriculture grew at about 3% per annum, which was about eight times faster than the rate of growth in Indian agriculture from 1891 to 1946. I have written about it in detail elsewhere16, but I just want to quote to you Daniel Thorner, who along with Wolf Ladejinsky was perhaps the closest observer of Indian agriculture at that time. He said:“It is sometimes said that the (initial) five-year plans neglected agriculture. This charge cannot be taken seriously. The facts are that in India’s first twenty one years of independence more has been done to foster change in agriculture and more change has actually taken place than in the preceding 200 years.”17Third, an extremely important aspect, often not taken into account, Nehru in the period 1950s and 1960s anticipated the knowledge revolution. India had missed the bus several times, the first industrial revolution, the second industrial revolution, the opportunity of the Second World War, all of them were lost to us because we were under colonial domination, and Nehru was not going to allow lndia to lose the next opportunity. So, the 1950s and 1960s were not only about building the so-called temples of modern India, the dams and the steel plants and the bridges and things like that, but it was all about building up the knowledge sector. From the very beginning the focus was on setting up institution that will promote scientific, technical knowledge, an area left virtually barren by the British. The IITs, the IIMs, the Council of Scientific and Industrial Research, the Bhabha Atomic Research Centre (by 1956 the first atomic reactor is critical and the first rocket was tested from Thumba in 1963), the National Physical Laboratory, the National Chemical Laboratory, the All-India Institute of Medical Sciences, the Defence Research and Development Organisation, the National Institute of Virology all came up because Nehru did not think that tali, thali-banging, shining mobile torches and shouting Corona-go, consuming gobar and gomutra will take care of eventualities like COVID-19. Cultivating of ‘knowledge’ for Nehru was not to be limited to the scientific area. The National Council of Applied Economic Research, the Indian Statistical Institute, the National School of Drama, the Sahitya Academy, the Lalit Kala Academy, the Sangeet Natak Academy, the National Institute of Design, the Film Institute of India, believe you me, were all set up in the 1950s and 1960s, in Nehru’s time.It is because Nehru anticipated the knowledge revolution that India is able to participate in the global knowledge/information revolution. Nearly half of India’s gross domestic product (GDP) is generated by the service sector, a significant part of it is based on the knowledge revolution. A large part of our balance of payments is met by the remittances that we receive by exporting the products of our knowledge sector. India’s current successes are not despite Nehru but because of Nehru.I have elsewhere shown how the achievements of the Nehru era when compared to the colonial past or when compared to other countries at a similar stage of development were very impressive by all major criteria such as overall growth rate and per capita growth rate of GDP, savings, domestic capital formation, investments, the growth of infrastructure, etc.18The neo-colonial, neo-liberal scholars (some of them turning increasingly pro-communal) who are unfortunately widely read and taught in Indian universities and, take a completely different position. They are people like Tirthankar Roy, Lord Meghnad Desai and more recently Arvind Panagariya and Gurcharan Das. Tirthankar Roy actually says that if the British had not come it is unimaginable that India would have achieved the various targets that it has achieved, in other words colonial rule was necessary, believe you me, and it is taught in many universities including Delhi University. Such is the colonisation of the mind!19The neo-colonial scholars argue that the colonial period was very good and then the shift in 1991, the neoliberal turn, was very good. These were the good periods and the bad period was the Nehruvian, as they say, the first forty years of India’s independence were wasted years. They said if only Nehru had adopted the Manmohan Singh strategy, the 1991 strategy in 1950s, see where we would have gone. If we did indeed bring in the 1991 strategy in the 1950s, India would have been a ‘banana republic.’ It would be equally inadequate to argue that in the 1990s that we should have continued to have the 1950s strategy. Only economists with no sense of history can say things like that. They are not taking into account the global geo-political situation during the 1950s and how the nature of world capitalism and India’s own position had significantly altered by the 1990s.20One must remember that almost all colonial societies that made a transition to modernity needed 30-40 years of first un-structuring colonialism. As Daniel Thorner is said to have described in a beautiful way the structural constraints colonialism builds into the colonised country, he said that colonialism creates built in depressors, something tied around you which pulls you down. You have to first undo that before you begin to think of flying. So, these years were needed. Mao’s 30-40 years had to precede before Deng could come in and open up China. Post-colonial countries needed their Nasser, Sukarno, Nehru or Mao!The context is critical. As Dr. Manmohan Singh pointed out, “In 1960, if you asked anybody which country would be on top of the league of the third world in 1996 or 1997, India was considered to be the front runner.”21The common sense, the wisdom of the time of the 1950s and 1960s was that the Indian strategy of development was the correct path to take. All the names of eminent economists you will recognise, W. W. Rostow, Rosenstein Rodan, Wilfred Mandelbaum, George Rosen, Ian Little Brian Reddaway, all of them looked at the Nehruvian experiment positively and contrasted it to the totalitarian path followed by many countries in making the transition to modernity. And as Sukhamoy Chakravarty again put it very beautifully, he said contemporary economic development theory and the economic development in India which was actually taking place greatly influenced each other, one led to the evolution of the other.22A few more points which brings us closer to today’s India. If all was so good in the Nehruvian period Why did the Nehruvian consensus shift to what I call a consensus on economic reforms? I underline the fact that economic reforms were not pushed through by a ‘right wing’ force, it was again a consensus just as there was a Nehruvian consensus earlier. Do remember, it was a minority government of Narasimha Rao which saw through the biggest economic reform since Nehru. Also, every section of India’s political spectrum that held power since 1991, including the United Front government with support of the Communists, continued with the reform process and none tried to reverse it.Why did the shift happen? Very briefly, I have written about it elsewhere.23 There were some internal and external factors. The internal factors were obviously the license quota raj as it is called, the over protection of the Indian industry through license and quotas and heavy duties etc., led to major inefficiencies. Also, the increasing politicisation of the public sector (mostly after Nehru) contributed to the falling efficiency rate or rising incremental capital-output ratio (ICOR), which rose from about 2 during the first plan to 3.6 in the third plan and by one estimate between 1971 and 1976 it had reached 5.7!This is one reason why you needed to change; something had to happen and one easy way of forcing efficiency in democratic country, a measure used by many countries, was to expose the economy to the world market. This would force the economy to be efficient. Globalisation needs to be seen in this context. Second, there was the external factor, best described by an economic historian, a Marxist, probably one of the best, Eric Hobsbawm in his book The Age of Extremes, the Short 20th Century.24 He argued that a fundamental change had occurred in the nature of world capitalism in decades following the end of the Second World War. There were massive capital transfers occurring, almost reminding you of the first phase of globalisation that you saw in the last quarter of the 19th century when there were massive capital transfers, but then they were occurring in a colonial context. This he argued was occurring in a different context of independent nation states where foreign capital was internationalising production, that is the multiplier effect was retained within the destination country, which was completely different from the nature of foreign capital in the colonial period where the entire multipliers went back to the country which actually gave out the foreign capital. This new aspect of the nature of foreign capital explains why from the right to the left, from China to Communist Party of India (Marxist) government in West Bengal, everybody was trying to get more foreign capital in. Please imagine, a few years ago it would be unthinkable, it would be seen as the route to colonialism, obviously something had changed in the nature of foreign capital.Sukhamoy Chakravarty Chair Lecture at the Centre for Economic and Social Progress, Jawaharlal Nehru University, Photo: Aditya Mukherjee.Hobsbawm pointed out that there was a huge explosion in world trade in manufacture, it increases by about 10 times between 1950-70. World trade in manufacture increased by 10 times but the share of the third world doubled. In other words, the former export pessimism of the third world being able to enter the world market in manufactures was seen to be no longer as true as it was earlier, and the obvious cases cited was that of the so called East Asian miracle, where the ‘Asian Tigers’, Singapore, Taiwan, South Korea and Hong Kong, rapidly increased their footprint in the manufacturing trade in the world.All this combined to press for a need in a shift of strategy. The need was voiced since the 1960s itself. Manmohan Singh’s Oxford thesis argued that perhaps the time to shift from an import substituting industrialisation strategy based on export pessimism needs to be re-examined. You see it in Bhagwati and Desai’s influential book on planning in India at that time and so on.25 However, the political and economic situation in India would not allow a shift so easily. China shifted its strategy in 1978, we shift in 1991 because as I like to say, “in India you cannot do a Deng on Mao.” In a democracy a shift means creating another consensus, which takes time. Apart from that there were external and internal reasons why India could not shift strategy in the 1960s and 70s. The 1960s is the time when the United States wants to play big brother. It tried to pressurise India using its vulnerable situation by adopting what is called a ‘ship to mouth’ strategy where food aid was being sought to be tied to India shifting its economic and political stance. The US really meant business, as President Lyndon B. Johnson was famously said to be pursuing a policy of keeping ‘India on a short leash’. You keep a leash tight around a dog’s neck so that the dog does not take too much liberty and wander about. I could tell you many stories about how the Americans looked upon India in this period, but maybe later, in any case this is a very telling description of how they were looking on India.This was the external situation, not ideal for opening up. The internal situation was political. After the 1969 split in the Congress party Indira Gandhi was able to retain power in 1971 in alliance with the communists, so the question of now going in for a liberalisation strategy did not arise until the consensus had shifted. It is in shifting that consensus people like Sukhamoy Chakravarty played an important role. A large number of left economists, Sukhamoy Chakravarty, Amartya Sen, K N Raj, Hanumantha Rao, Arjun Sengupta, Meghnad Desai in his earlier Left avatar, and later Jyoti Basu, Buddhadeb Bhattacharya all agreed and shifted toward the consensus toward reform. The United Front government (1996-1998) formed with support from the communist parties actually wanted a 10 times increase in foreign direct investment! Clearly the consensus had shifted.But the consensus did not shift to what, a caricature of economic reforms and globalisation that is often made. Globalisation and economic reforms is often presented as the full acceptance of a neoliberal model, state pulling out totally and surrendering to the ‘Washington Consensus’, accepting full capital convertibility etc.. In fact, none of this was envisaged, and again Sukhamoy Chakravarty played an important role when he was among the first to analyse the situation in East Asia and argue that it is not to be seen as a binary between free market and state intervention, East Asia was an example of utilising the free market while retaining a great amount of state intervention.26 The shift was in strategy, not in the goals set out at independence. The 1991 reforms were not a shift from the goals of the Nehruvian consensus, the goals being self-reliance and equity. I argue, on the basis of what I read from a lot of the faculty in the CESP, some may not agree, that both actually increased, both self-reliance and equity increased after the economic reforms. It was not true that India was becoming more and more dependent; it was perhaps becoming more independent. If I could just quote you one indicator, the debt service ratio, which measures the capacity of a country to service its debts without falling into the debt trap. The debt service ratio, that is the debt servicing required as a proportion of the external earnings in the current account, fell from a high of 35.3% in 1990-91 to 17.1% in 2000-01 to a mere 6.1% in 2004-05.27 Now, this is not an indication of a country becoming more and more dependent on the external world.While self-reliance did not get sacrificed at the altar of ‘economic reforms’ neither did the goal of equity. The consensus among economists was that while inequality increased after the economic reforms poverty levels began to decline after the initial year or two and the decline was substantial in the new millennium.28In this context, I want to share a very interesting formulation from which I learned a lot in the early phase of the economic reforms in India in the 1990s. In January 1996, the Brazilian President F. H. Cardoso visited India and gave a talk called ‘The Social Consequences of Globalisation.’ As you know, Cardoso was Marxist. He was a Left dependency thinker, a professor like Manmohan Singh, but with a clear left understanding. Cardoso led Brazil from military dictatorship into democracy and into economic reforms and participation in the globalisation process. So, when he came to talk, some intellectuals of the Left asked him, how he could as a Marxist, a Leftist, bring Brazil into this path of globalisation and economic reform? His answer was extremely educative to me. He said you are asking the wrong question. Globalisation, he said, has become a fact. Gone are the days of the Iron Curtain and the Bamboo Curtain. All countries are now part of the globalised process. If you do not participate, you become a Myanmar.The question, he said, that you should be asking me is not whether to globalise or not, but how to globalise. The question to ask is whether you globalise with your sovereignty intact or do you globalise by disappearing into the armpit of the United States? The second question he said you should ask is do you globalise with a safety net for the poor or do you do your structural adjustment and participation in the globalisation process by abandoning your poor? These are the questions you should be asking.And then he went on to say something which the audience, which was largely a left audience, was quite surprised by. He said that you have an advantage over Brazil in this. They asked what advantage can we have? He said your advantage is that you have a long tradition of popular mobilization, of community work, by which he meant civil society movements and resistance, led by Gandhiji, and the fact that you have a democracy since Nehruvian times..(It is very interesting that what Cardoso said was virtually the same thing that Hugo Chavez, the fiery communist from Venezuela, said when he visited JNU in March 2005. He started his lecture by saying that you have a tradition of resistance from Gandhi, Nehru and the socialist and the communist. He drew a straight line there, not a dichotomy. Since I am talking in JNU I thought I must bring this to your attention.)So, this is what Cardoso said, that your democracy will ensure, your spirit of resistance will ensure, that your people will not allow your governments to sell your sovereignty to any foreign power or to abandon your poor. These were to me like prophetic words. With 1990s, the moment that economic reforms were announced, civil society movements all over the country began to question what protection was being provided for the poor, what rights of the poor were being ensured, etc. All the rights-based movements emerged and spread in the country. And it was in the economic reform and globalisation era of Manmohan Singh that you got all the major rights-based legislations like the Right to Information, the Right to Education, the Right to Food, and most importantly probably the world’s largest social security measure, which is not a dole but which gives social security with dignity, the right to employment, with launching of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). All of them came in this period, proving what Cardoso was saying was right, that it is not necessary that economic reform will always be entirely on the backs of the poor. Similarly, democratic pressure ensured that India’s sovereignty was not compromised. Do you remember the days of the nuclear deal with the United States, the amount of pressure that was put, so much so that the left parties actually left the alliance to ensure that we did not go into a deal which compromised our autonomy.Alas, the situation today no longer fits this paradigm, largely because the advantage that Cardoso talked about, democracy, the right to resist, the right to assemble, the right to speech, has been taken away. We are no longer described as a democracy in the world; we are described as an electoral autocracy. Just winning an election does not give you democracy. (Hitler and Trump also came to power winning in elections.) The result is that our poor have been abandoned which was inconceivable in India since independence. We celebrate our number of billionaires when more than half our children are malnourished. There are obscene levels of inequality. Education, the only route to social mobility for the poor, is no longer treated as a public good. It is handed over to a rapacious sector and now more ominously to foreign partners. This is what we are doing to our education, this is what we are doing to our public health. Studies, like that of Nicholas Stern and Himangshu, of this Centre, have shown that lack of public health pushes even middle-class people into dire poverty if there is a health emergency. The trade union rights of the workers have been severely curtailed and the trend toward informalisation of labour has moved so rapidly that the overwhelming majority of the working people now belong to that category, with extremely low remuneration and virtually no protection from law. This applies even to teachers of schools and colleges today. Grotesque images reflecting the abandonment of the poor were seen with migrant workers walking hundreds of miles dragging their old, infirm and children at 45 degrees celsius temperatures because a lock down was announced suddenly during covid with no provisions made for the poor. Equally horrendous were the images during covid, of people throwing dead bodies into the river as they could not even afford to cremate and perform the last rites of their dear ones. Similarly, India’s sovereignty has also weakened. Increasingly, we are becoming a junior partner to the advanced world, particularly to the United States. We are selling our country in order to buy political acceptance. We do not stand up against imperialism anymore. We as a poor country in earlier decades stood up in the world and opposed imperialist tendencies wherever they occurred. We opposed the United States strategy on Vietnam, opposed the Korean War, and when it was said that who are you, a country with a begging bowl to advise the world on what to do? Nehru reportedly gave the answer that we may be poor, but who has told you that the poor do not have a voice. And in fact, Nehru did have a voice both in the Korean War, in preventing Belgian Congo from going back into a colony and in creating global opinion towards peaceful co-existence.. It was an important voice in the world in fighting imperialism at that time. And here we are, sloganeering ‘Abki bar Trump sarkar’, sending our unemployed, unhappy youth to Israel and to Ukraine to die, remaining silent if not complicit in the genocide in Gaza let loose by Israel under US protection!We permit open calls for the killing of Muslims in India, so why should we be worried about Benjamin Netanyahu doing exactly that in Gaza? And as I said earlier, it is a different world altogether. The new strategy is crony capitalism, crony capitalists supporting a ‘communal fascist’29 regime. With the hope that they will get whatever they want in return, they are making the same error that the big bourgeoisie made in Germany in the 1930s when they supported Hitler, thinking that they would be able to control him. Both Germany as a nation died and the economy was shattered, and this is what Nehru had warned against. He had said let India not go down that path of the Indian version of fascism, which is the communal fascist regime we are faced with.I do not want to end on a negative note; I want to end with a note of hope. The legacy of our freedom struggle that I started with, which is what I call the historical roots of our strategy, has ensured that we are still not a Hindu majoritarian communal fascist state. We have a government; we have a regime in power at the centre saying we are a Hindu Rashtra. We have a large number of states where the same regime rules saying we are a Hindu Rashtra, but we are still not a Hindu Rashtra.The reason why they are taking a turn towards fascism is precisely to now convert what the government wants into a reality, and for that you have to attack all the instruments of the state, the bureaucracy, the judiciary, the education system, and destroy the opposition in civil society. That is the reason that you are witnessing this turn towards violence and repression. In other words, the task for them is unfinished. However, resistance continues and it is linked to the historical roots that I started with. It is linked to the roots of our freedom struggle. That legacy is still alive. Look at any protest movement, whether it is the environment movement or the anti Citizenship Amendment Act (CAA) movement or the movement of the peasants of Punjab, Haryana and West Uttar Pradesh against the ‘black’ laws, they still come up with images of Gandhi, Nehru, Bhagat Singh, Ambedkar and the Constitution. The values of the freedom struggle and the tradition of resistance are still there, and the future of our development strategy will be determined by the strength of the resistance put up against it being severely mutilated. Thank you.A. M. Khusro, “Land Reforms Since Independence”, in V. B. Singh, ed., The Economic History of India, 1857-1956, Delhi, 1965, pp. 185-86, emphasis added. See my chapter, “Land reforms: Colonial Impact and the Legacy of the National and Peasant Movements”, in Bipan Chandra, Mridula Mukherjee and Aditya Mukherjee, India Since Independence, Penguin, New Delhi, 2008.HKS Surjeet Bhavan, New Delhi, 15 September 2025.See Bipan Chandra, “British Versus Indian Views of Development”, Review, (A Journal of Fernand Braudel Center) Vol. XIV, No. 1, Winter 1991.See Aditya Mukherjee, Nehru’s India: Past, Present and Future, Penguin, Gurugram, 2024, section 3 for a detailed discussion on the ‘Idea of India’.See ibid., and Aditya Mukherjee, “Colonialism and Communalism: A legacy Haunting India Today”, ch. 10 in Aditya Mukherjee, Political Economy of Colonial and Post-colonial India, Primus, Delhi, 2022, for a detailed discussion on this first communal challenge and how it was dealt with.Purshotamdas Thakurdas, et al., A Plan for Economic Development for India (Bombay Plan),Parts I and II, Penguin, Harmondsworth, 1945. The signatories to this Plan included the top Indian capitalists, G D Birla, J RD Tata, Kasturbhai Lalbhai, Sri Ram, John Mathai, Ardeshir Dalal and A D Shroff.See ch. 11 of Aditya Mukherjee, Imperialism, Nationalism and the Making of the Indian Capitalist Class, Sage New Delhi, 2002, a revised version forthcoming shortly with Penguin, Gurugram, and Aditya Mukherjee, Political Economy of Colonial and Post-colonial India, ch.6.Utsa Patnaik, ‘New Estimates of Eighteenth-Century British Trade and Their Relation to Transfers from Tropical Colonies’ in The Making of History: Essays Presented to Irfan Habib, New Delhi, 2000, pp. 386–90.See Alice H. Amsden, Asia’s Next Giant: South Korea and Late Indutrialization, Oxford University Press, New York, 1989.See Bipan Chandra, Mridula Mukherjee and Aditya Mukherjee, India Since Independence, Penguin. New Delhi, 2008, p. 23.A. Vaidyanathan, “The Indian Economy Since Independence (1947-70)”, in Dharma Kumar, ed., The Cambridge Economic History of India, Vol. II, Delhi, 1983, p. 961, emphasis added.See Aditya Mukherjee, “Planned Development in India 1947-65: The Nehruvian Legacy”, in Shigeru Akita, ed., South Asia in the 20th Century International Relations, Tokyo, 2000. Also in Bipan Chandra, Mridula Mukherjee, Aditya Mukherjee, India Since Independence, ch. 25. These figures are from an extremely persuasive piece by Vijay Kelkar, “India and the World Economy: A Search for Self-Reliance”, Economic and Political Weekly, Vol 15, No 5/7, February 1980.Pulapre Balakrishnan, “The Recovery of India: Economic Growth in the Nehru Era” Economic and Political Weekly, Vol. XLII, Nos. 45-46, 17 November 2007, Table 4, p. 62-63 and India’s Economy from Nehru to Modi: A Brief History, Permanent Black, Ranikhet, 2022.Ibid.See my chapters on land reforms in Bipan Chandra, Mridula Mukherjee and Aditya Mukherjee, India Since Independence.Daniel Thorner, The Shaping of Modern India, Allied, New Delhi, 1980, p. 245, addition in parenthesis mine. See Aditya Mukherjee, ‘Return of the Colonial in Indian Economic History: The Last Phase of Colonialism in India,’ Presidential Address, 68th session of the Indian History Congress, (Modern India), 2007 and Ch. 1 in Aditya Mukherjee, Political Economy of Colonial and Post-Colonial India.For a detailed critique of Tirthankar Roy and the neo-colonial position see Ch. 1 and 2 in Aditya Mukherjee, Political Economy of Colonial and Post-Colonial India.See Aditya Mukherjee “Indira Gandhi: Shaping the Indian Economy, from Increased Dirigisme to Economic Reform”, Ch 16 in Political Economy of Colonial and Post-colonial India, and my chapter, ‘Indian Economy 1965-1991’, in Bipan Chandra et. al., India Since Independence, for a discussion of the changes in the internal situation and the global situation and the nature of world capitalism requiring a shift in economic strategy.Business Standard, 9 January 1998.Chakravarty, Sukhamoy, Development Planning: The Indian Experience, Delhi, 1987, pp. 4, 81.See my chapter, “Indian Economy, 1965-1991” in Bipan Chandra et. al., India Since Independence.E. J. Hobsbawm, Age of Extremes: The Short Twentieth Century, Penguin, Harmondsworth, 1994.Jagdish Bhagwati and Padma Desai, Planning for Industrialisation , Oxford University Press, London, 1970.Sukhamoy Chakravarty, “Marxist Economics and Contemporary Developing Economies” Leftview, 10, December 1987.See Economic Survey 2006-07, Government of India and my chapter “The Indian Economy in the New Millennium, in Bipan Chandra, et.al., India Since Independence. Ibid.A phrase first used by Amartya Sen in the 1990s though Nehru had warned decades ago that majority communalism is the Indian version of Fascism.Aditya Mukherjee retired as Professor of Contemporary History, Jawaharlal Nehru University.