Setting the record straight: Nehru and his policies shaped modern India and its economy

With BJP leaders blaming Nehru and Nehruvian policies for almost everything under the Sun, it is worth reminding Millenials what Nehru achieved in the economic and industrial spheres

Setting the record straight: Nehru and his policies shaped modern India and its economy

Aditya Mukherjee

These are days of demonising Jawaharlal Nehru. Almost any problem that India faces today is placed at his door. From Kashmir, persistence of communal tensions, the crisis in agriculture, alleged slow growth in the early decades to the problems in the education system, all are attributed to wrong policies adopted by Nehru.

The highest representatives of the communal Hindutva brigade have been shouting from the rooftops, ‘if only Nehru had not been there’, things would have been so much better. Carrying this to the extreme, one Hindutva leader went to the extent of saying that the bullet fired at Mahatma Gandhi was aimed at the wrong person, it should have been Nehru!

This about a man who was critical in the putting into practice an Idea of India which the leaders of the Indian National Movement had imagined in the course of nearly a hundred years of struggle. An Idea of India in which sovereignty and anti-imperialism, democracy and secularism, and a pro-poor orientation were foundational principles.

Nehru through his inspired leadership of the country from independence till his death in 1964 was able to put India firmly on the path of a secular democracy, which stood with its head high in the comity of nations as a sovereign, humane and anti-imperialist country, even during the economically most vulnerable years faced by it immediately after Independence.

The economic sphere is one in which canards are spread about him not only by poorly-informed Hindutva know-alls but also by some scholars, albeit of the neo-colonial variety, such as Tirthankar Roy, currently at London School of Economics and even Lord Meghnad Desai.

These scholars see the Nehruvian years, indeed the ‘first forty years after Independence’ (the period seen as being under the influence of his ideas) as the wasted years. They conflate the globalisation in the colonial period with the globalisation India chose to go into in 1991 and argue that these were the periods when India made great progress with the Nehruvian period being the ‘fly in the ointment’.

This is a-historical apart from being totally factually incorrect. India did not benefit from globalisation in the colonial period. It was reduced from being the largest economy in the world, contributing nearly 25 per cent of the global GDP (its contribution being 8 times that of UK!) at the beginning of the 18th century to a contribution of less than 5 per cent (less than 2/3rd of UK’s share) in 1950 after 200 years of colonial globalisation.

Second, if, in 1950 when it was just beginning to mop up the “mud and filth….(and) stark misery” (Tagore’s words) left behind by the British India had opened up to the world, in the manner that it did in 1991, it would have soon become another banana republic. It is the monumental effort made under Nehru’s leadership to unravel the colonial structure imposed on us in the early decades after Independence, which created the conditions where India could enter the globalisation process in the 1990s with advantage to itself, without compromising on the goals of sovereignty and equity, and not as a victim, and as a source for surplus appropriation, as it did in the colonial period.

Other colonial countries too needed this gap after Independence, often spanning a few decades, before they could open up to the global economy. It is not an accident that China too opened up only in 1978, nearly three decades after its Independence.

It is not despite Nehru but because of Nehru that the potentialities for rapid development witnessed in the recent past opened up for India.


At Independence, because of the nature of colonialism she had been subjected to, India was almost completely dependent on the advanced world for capital goods and technology for making any investment. She produced virtually no capital goods.

In 1950, India met nearly 90 per cent of its needs of machines and even machine tools through imports. This meant that despite political Independence, she was completely dependent on the advanced countries for achieving any economic growth through investment.

This was a neo-colonial type situation, which needed immediate remedy. And this is what the famous Nehru-Mahalonobis strategy tried to reverse by adopting a path of industrialisation based on heavy industry or capital goods industry.

During the first three Five Year plans (1951-65), industry in India grew at 7.1 per cent per annum. This was a far cry from the de-industrialisation of the 19th century and the slow industrial growth between 1914-47. More important, “the three-fold increase in aggregate index of industrial production between 1951 and 1969 was the result of a 70 per cent 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 (90 per cent) had to be imported, the share of imported equipment in the total fixed investment in the form of equipment had come down to 43 per cent in 1960 and a mere 9 per cent in 1974.

This was a major achievement and, as it considerably increased India’s autonomy from the advanced countries in determining her own rate of capital accumulation or growth, it created the key condition for non-alignment or relative independence from both the power blocs.

No amount of diplomatic finesse could achieve and sustain the objective of non-alignment without the economic basis of relative autonomy having been created. It was this un-structuring of the colonial structure which was to later enable India to participate in the globalisation process with considerable advantage to itself.


As India at Independence did not have a sufficiently large indigenous private sector to take on the massive task of developing capital goods industries, the only other option was to develop it through the public sector. The option of basing the development of this sector on foreign capital did not arise as the Nehruvian consensus was that sovereignty would be achieved only if industrial development was primarily done indigenously and was not based on foreign capital. The public sector was clearly seen, by a wide spectrum of opinion, which included Indian businessmen and industrialists and the Left, as the alternative to foreign capital domination.

Another area of concern for the maintenance of India’s sovereignty and ability to stay non-aligned was India’s food security. Indian agriculture had stagnated and even declined under colonial rule and, at Independence, India was faced with acute food shortage and famine conditions in many areas. Fourteen million tonnes of food had to be imported between 1946 and 1953. There could be no sovereignty if India was dependent on food aid for its very survival. Indian agriculture needed to be revolutionised and Nehru took up the task on a war footing. It is often wrongly alleged that Nehru ignored agriculture with his focus on industrialisation.

The combination of institutional changes (land reforms) and massive state sponsored technological change transformed Indian agriculture rapidly. During the first three plans (leaving out 1965-66, a drought year), Indian agriculture grew at an annual rate of over 3 per cent, a growth rate more than eight times the annual growth rate of 0.37 per cent achieved during the half century (1891-1946) of the last phase of colonialism in India.

Nehru thus not only brought about major institutional reforms (land reforms) in Indian agriculture, he also laid the foundations for the technological reforms, the basis of the ‘Green Revolution’, which made India food surplus in a remarkably short period. No wonder, Daniel Thorner, one of the keenest observers of Indian agriculture since independence, noted:

“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 two hundred years.”


Finally, Nehru brilliantly anticipated the knowledge revolution, which was to define the ‘post-industrial’ phase of global capitalism where knowledge became the key factor of production. Nehru was determined to ensure that India did not miss this bus too as it did the industrial and agricultural revolutions under colonialism.

Acutely aware of India’s backwardness in science and technology, an area deliberately left barren in the colonial period, he made massive efforts to overcome this shortcoming. Apart from promoting a ‘scientific temper’ in society in general, a focus on scientific education at the highest level was seen as a necessary part of achieving and maintaining sovereignty by reducing dependence on the advanced world.

An unprecedented increase occurred in the educational opportunities in science and technology in the universities and institutes set up in the early years after independence. Almost all the major institutions in this area, from the IITs, the CSIR, the Bhabha Atomic Research Centre, the National Physical and Chemical Laboratories, the AIIMS and numerous other such institutions were all set up in the Nehruvian era.

National expenditure on scientific research and development kept growing rapidly with each plan. For example, it increased from Rs 10 million in 1949 to Rs 4.5 billion in 1977. Over roughly the same period, the stock of India’s scientific and technical manpower increased more than 12 times from 1,90,000 to 2.32 million. A spectacular growth by any standards, a growth whose benefits India reaps today as the world moved towards a ‘knowledge’ society.

Nor was this focus on scientific education counterpoised to primary education, as is often believed. Nehru’s commitment to primary education from the days of the 1931 Karachi Resolution drafted by him, which committed the state to providing free and compulsory basic education, remained steadfast. The government system of primary school education during the Nehruvian era is in stark contrast to the near destruction of that system in today’s India where even the poor are increasingly forced to access whatever little education they are able to from the rapacious private sector.

Rather than building on the public education system painstakingly built up in the Nehruvian era it is being allowed to die, if not active efforts made to dismantle it.

The paper tigers, who seek to denigrate Nehru, are busy destroying the pillars of the Idea of India. Not only India’s secular and democratic character but also its economic and political independence is being seriously compromised and a virtual war has been declared against the intelligentsia and the education system.

A return to Nehruvian objectives is the dire need of the day.

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