The Gandhian Economy Today | The financial express


Mahatma Gandhi continues to be an Indian icon, with his name and ideas continually invoked or evoked for several purposes. He was a complex person with complex ideas that can still bear exploration and analysis. Earlier this year, addressing more than 100,000 representatives of Gujarat’s Panchayati Raj institutions at a statewide rally, the Prime Minister invoked Gandhi in calling for self-reliant and strong villages as as facilitators of rural development. It was a natural message for the occasion, but one could reflect on what these ideas might mean in practice and how one might reinvent Gandhi’s economics for the 21st century, nearly 75 years after his death and 30 after the constitutional amendments inspired by his vision of village democracy.

India has more than a quarter of a million village-level governments and three million elected representatives for them. There are also higher-level rural governments as well as those of towns and cities, but the village, with only a few thousand inhabitants, is central to the Gandhian idea of ​​the rural idyll. Village-level governments have played an important role in giving some experience of the workings of democratic institutions to many more Indians than before the constitutional amendments, but real change is lacking on the economic front. They still lack adequate authority to manage local public assets and the independent funds needed to fulfill even their too limited responsibilities. No doubt most village governments are too small to scale effectively anyway, but the same problem of lack of funds and authority exists at the top two levels of rural local government. Part of the problem has come from resistance from state governments, as they still have constitutional authority over local governments within their borders. The Finance Committees have partly solved this problem with direct subsidies.

India now has a government that has shown a willingness to change ideas about nationhood and citizenship and to shake up long-standing economic structures. Gandhi was also someone who was willing to adapt and change his views to some extent as the world changed. His economic thinking was shaped by a time when colonialism and unequal access to markets and technology had disrupted India’s economic structures and impoverished many Indians. This is why he opposed imports and promoted his vision of self-reliance. This term, of course, had many other implications beyond insularity in economic structures. What could Gandhi support now, in terms of economic policies for the average Indian? Affordable access to high-quality internet infrastructure and services would be an obvious priority, not just for government services or through government facilities, but for something far more empowering for average Indians, including opportunities for learning and economic improvement. In his time, Gandhi promoted hand spinning and weaving, but he most likely would have supported access to 3D printers for additive manufacturing. Creating productive entrepreneurial jobs near his home would have appealed to his ideals of decentralization and community. He would have understood that local governments need the authority and resources to provide local public goods such as lighting, transportation and especially sanitation. He would support greater fiscal authority for local governments to make them more self-sufficient. But he would also have understood the benefits of untied subsidies from higher-level governments, leveraging their superior taxing powers and redistributive capacity. He might be wary of large factories, global production networks and the growth of megacities. But if he had observed the last 75 years of the evolution of the world economy, he would undoubtedly have understood their role, especially in a less unequal and colonial international order. Rather than obsessing over the idealized villages of the past, he would advocate for sustainable and inclusive development, including decentralized renewable energy systems. It would promote the local management of natural resources and the ecosystem as a whole.

If Gandhi returned today, autonomy would not mean self-sufficient, island villages where existing inequalities and power structures would remain entrenched. Rural development would not mean obsolete technologies for the poor, but inclusive access to high quality infrastructure, public services, learning and training opportunities, and national or global markets for local production. Gandhi would also recognize the limitations of agriculture as a source of employment, the need to reduce pressure on the land, and the changing nature of rural India. He would probably advocate a proactive recognition of urbanization, the creation of strong cities as well as strong villages by requalifying peri-urban areas as municipalities, giving them the necessary powers to manage their infrastructures.

Gandhi’s evolution from Gujarat to London to South Africa and back to India has been remarkable, as has his continued evolution as a leader of India’s freedom struggle. He was far from perfect, but he was creative and adaptable as well as relatively inclusive. India should implement a Gandhi economy for this century, not the last.

Nirvikar Singh, Professor of Economics, University of California, Santa Cruz


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