2021 — The Dawn of New Indian Economic Policy Dichotomy — Capitalist Vs Socialist
The budget of 2021, has been landmark for various reasons, apart from a pro-growth stand, it also marks a shift to a capitalist and growth oriented economic policy. This is a radical shift from a default socialist economic policies pursued by political parties, differentiating among each other on their estend and purity of socialism.
The recent agitations over harm laws, which intend to connect agriculture to the markets, in similar lines as diary and animal husbandry, are a testament to the deep rooted socialist economic mindset, etched deeply, primarily to woo poor Indian voters.
The economic journey of India has had a socialist bend from the very beginning. The intimacy with the USSR had its socialist roots. Inspired by the success of the Bolshevik revolution, the surge of socialist thought was bolder. Under Nehru, the INC, adopted the socio-economic policy and ideology of socialism in 1936.
Indira Gandhi during her time in power, purged the rival economic thought, and with the 42nd constitutional amendment, 1976, India became a sovereign socialist secular republic. Since then the main economic dialogue had revolved around socialism. Socialism/ communism failed with the fall of the USSR in 1991, around the same time India found itself in its gravest economic crisis.
The reforms ushered in the 1990s lost steam quickly as most, including the top leadership had not embraced the idea completely. Since then the reforms that have been done have all been cautious of not giving a hint of capitalism, even privatization was called dis-investment.
The Watershed Moment
2021 budget by Ms. Sitaraman is a watershed moment in Indian politics. The speech of the prime minister the following day, put a strong case to bolster its move towards capitalism, he gave the example of who the entire world will benefit out of Indian COVID vaccine, which is an outcome of India’s entrepreneurial vigor.
The government has no business of being in business. The mega privatization plan that will help the Indian government to amass financial resources, is a bold step in this direction. The farm laws against which there have been mass agitations are of equal gravitas as that of green revolutions. The laws are designed to transform agriculture in India, to the benefit of all, and the government has not taken a u-turn on them, showing their zealous commitment and clear preference to entrepreneurship and the efficiency and profitability it entails.
The Way Forward
It seems that in 2021, the sides are clear, the ruling NDA has shown its policy stand and INC also, by various comments and reactions has proved that they still stand with the age old policy of Socialism. The political-economic battles would become easier and interesting to follow from now on.
