More than seven decades after gaining independence, India continues to grapple with persistent poverty and development challenges that have left millions behind. Countries that began their development journey at similar starting points have dramatically outpaced India in both economic growth and quality of life improvements, according to a critical new analysis.
Five Phases of India's Economic Journey
In their comprehensive new book A Sixth of Humanity, authors Devesh Kapur and Arvind Subramanian examine the political economy conditions that have shaped India's development trajectory over the past 75 years. The 760-page volume, published by HarperCollins India and priced at ₹1,299, traces India's economic evolution through five distinct ideological phases.
The authors identify these periods as: the planning phase from 1950 to 1980; partial liberalization during the 1980s; the neoliberal era from 1991 to 2010; the post-global financial crisis phase until the COVID-19 pandemic in 2020; and the current post-neoliberal phase characterized by protectionism and industrial policy reminiscent of strategies employed by South Korea and Japan in the 1960s.
Persistent Development Failures
Despite these ideological shifts in policy regimes, the book highlights several development failures that have stubbornly persisted across generations. Slow improvements in school-learning outcomes, inadequate gains in adult height as an indicator of well-being, and the inability to generate decent employment for the vast majority of Indians represent critical areas where progress has remained elusive.
The authors present striking data that reveals how these failures have resulted in rising economic disparities, widespread insecurities, and growing public discontent. However, the review suggests their explanations—pointing to regressive social structures, elite superficiality, weak state capacities, and democratic pressures—fail to provide fresh insights into these long-standing challenges.
The Democracy-Development Dilemma
Kapur and Subramanian provocatively question the conventional narrative of India as a successful democracy, arguing that while economic changes have been cumulatively positive, the same cannot be said for political transformations. They contend that the Indian state has become more illiberal, opaque, authoritarian, and majoritarian, with society sliding from transactional communalism toward institutionalized bigotry.
The book particularly struggles to explain why the end of socialism in 1991 hasn't translated into adequate job creation more than three decades later. While identifying constrained supplies of power, land, and freight as contributing factors, the authors acknowledge these represent symptoms rather than root causes of the underlying malaise.
The Political Economy of Reform
A crucial insight emerges from examining why India's neoliberal success remains incomplete. The review highlights how political parties failed to commit fully to ideological changes in policy regimes, even when opportunities presented themselves. The 1991 economic crisis created a window for substantial reform, but the political will proved insufficient to capitalize completely on this moment.
The Congress government under P.V. Narasimha Rao, despite initiating significant reforms, displayed what scholars have characterized as a half commitment, half exigency attitude toward systemic changes. When the immediate crisis passed, the momentum for deeper reforms dissipated, leaving many fundamental issues unaddressed.
Similarly, the BJP has demonstrated ideological resistance to certain economic reforms, particularly privatization. The current government's turn toward protectionism and industrial policy in 2018, coupled with the implementation of its social agenda, reflects ongoing tensions between economic imperatives and political ideologies.
Welfarism as Political Instrument
The authors describe fiscal spending for redistribution as welfarism, but the review suggests this approach also serves as a mechanism to secure political legitimacy for growth-oriented policies. Growth has proven essential for financing orderly redistribution and managing the temporary but real pain caused by structural adjustments and rising inequalities triggered by reforms.
Ultimately, Kapur and Subramanian refrain from offering facile prescriptions, acknowledging the deep-rooted, civilizationally encrusted nature of India's development pathologies. The tension between the immediate political costs of reform and their long-term economic benefits remains a central challenge that neither economists nor politicians have fully resolved in India's complex democratic framework.
