Nehruvian model
Nehru was a very clear-sighted political leader, developing very clear ideas with regard to the
basic policies that India should pursue for the overall good of its people. A staunch
democrat, and a firm believer in democracy as a form of government and as a way of life. For Nehru,
democracy was not just about the right to vote, but also having the
economic means to leverage your democratic rights. He believed that, Political democracy would be
meaningless without economic democracy.
Nehru always considered the economic problem the most important one that India
faced, and was convinced all other potential problems would be sorted by the installation of
the perfect economic system- which, to him, lay in the acceptance of socialism. He
repeatedly stated during the thirties of this century that “…democracy in a capitalist setup
was not the rule of the people, but the rule of the capitalist class for its own benefit.”
Economic Policies of Nehru :
Nehru’s economic policies have often been considered to be Socialist in nature. He wanted a practical
approach in framing the Indian economy, which would suit best the country’s needs. On the one hand,
as a devoted Gandhian, he had a strong belief in the betterment of the rural economy. On the other
hand, he was of the view that heavy industrial development would be the best way to serve India’s
economic interests.
Nehru was a firm believer in state control over the economic sectors, his introduction of laws for land
redistribution, curtailing the economic disparity in India among the landed and
the land-less classes are a key example of this.
He advocated for the abolition of the zamindari system and the rapid acceleration of
industrialization through central planning. Nehru visualized the nation as on par with the West
in terms of economic growth and development, and his plans reflected the aim to
increase the industrial efficacy of the economy and bridge the technological gap between the
home nation and the West.
It is undisputed that he wanted a practical approach in framing the Indian economy, which
would suit best the country’s needs.
To him, if the country was on par with the West in terms of economic development,
social and other development would come naturally. He denied the age-old city
versus village controversy, at least in the Indian scenario, and focused on harnessing and fully
exploit the natural resources of India for the benefit of his countrymen, the main sector he
identified was hydroelectricity, and he constructed a number of dams to achieve that
end. He believed that it would not only harness energy but would also support
irrigation to a great degree, thus developing the agricultural sector.
In an offshoot of Gandhian notions of Swadeshi, Nehru had strict reservations on the
question of foreign investment, he was of the view
that India was self-sufficient to bolster her own growth. He didn’t
officially mentioned the possibility of foreign investment directly, however, he did stress that the
sectors of foreign investment would be regularized, and the terms and conditions of
the investment would be strictly controlled by the Government.
The most distinctive and often debated feature of Nehru’s economic policies was the
high level of state and central control, which was exercised on the
industrial and business sectors of the country. Nehru emphasized that the state would
control almost all key areas of the country’s economy, either centrally or on a state-wise
basis. However, his Socialist emphasis on state control undermined his stress on
industrial policies. The rigorous state laws and licensing rules put a great degree of
strain on the free execution of industrial policies.
Poverty and unemployment were widespread throughout Nehru’s
governance- perhaps because of his need to harmonize the Gandhian method with his own
need for a huge scale Industrial stimulus.
His policy towards the rural economy of India was also significant,
the self-development towards which he felt very strongly. He tried to boost India’s
cottage industries, and on the lines of Gandhian economics, Nehru believed that the rural
and cottage industries of India played a major role in the economic fabric of
the country. He was also of the belief that small scale industries and cottage industries were effective
solutions to the massive employment problems that remained a perpetual issue of concern
throughout his tenure. Though he aimed at building cottage industry and developing the small scale
sector in India, his own vision of large-scale industrialization was the biggest hurdle in doing so.
Conclusion
the economic policies of Nehru are often blamed for the poor economic and social condition of India
in the subsequent years. However, it cannot be denied that his decisions were necessitated by
the needs of the times. India needed to effectively harness its domestic means as well as
strengthen its governmental control to lay the base for future privatization. It is often
speculated that Nehru would have embraced the economic reforms and economic
liberalization of the late twentieth century if he was alive; yet, again, one wonders whether
his need for the Gandhian method would allow him to do so, and perhaps it is this inner
the conflict that allowed for a ‘mixed economy’.
