| Despite
six decades of independence, the development project
is nowhere near completion in India. In fact, some elements
of that project seem even less likely to be achieved
than in the past, despite fairly rapid economic growth.
This necessarily raises questions about the relationship
between the state and economic development, and requires
some assessment of the class character of the state
as well as the kinds of changes this has undergone over
this period.
Taking a long view, there are some clear achievements
of the Indian economy since Independence – most crucially
the emergence of a reasonably diversified economy with
an industrial base. The past twenty five years have
also witnessed rates of aggregate GDP growth that are
high compared to the past and also compared with several
other parts of the developing world. This higher aggregate
growth has thus far been accompanied by some degree
of macroeconomic stability, with the absence of extreme
volatility in the form of financial crises such as have
been evident in several other emerging markets.
However, there are also some clear failures of this
growth process even from a long run perspective. An
important failure is the worrying absence of structural
change, in terms of the ability to shift the labour
force out of low productivity activities, especially
in agriculture, to higher productivity and better remunerated
activities. Agriculture continues to account for around
60 per cent of the work force even though its share
of GDP is now less than 20 per cent. In the past decade,
agrarian crisis across many parts of the country has
impacted adversely on the livelihood of both cultivators
and rural workers, yet the generation of more productive
employment outside this sector remains woefully inadequate.
Other major failures are in many ways related to this
fundamental failure: the persistence of widespread poverty;
the absence of basic food security for a significant
proportion of the population; the inability to ensure
basic needs of housing, sanitation, adequate health
care to the population as a whole; the continuing inability
to ensure universal education; the sluggish enlargement
of access to education and employment across different
social groups and for women in particular. In addition
there are problems caused by the very pattern of growth:
aggravated regional imbalances; greater inequalities
in the control over assets and in access to incomes;
dispossession and displacement without adequate compensation
and rehabilitation.
Seen in this light, it becomes apparent that a basic
feature of the process of economic development thus
far has been exclusion: exclusion from control over
assets; exclusion from the benefits of growth; exclusion
from the impact of physical and social infrastructure
expansion; exclusion from education and from income-generating
opportunities. However, exclusion from these has not
meant exclusion from the system as such – rather, those
who are supposedly marginalised or excluded have been
affected precisely because they have been incorporated
into market systems.
Thus, peasants facing a crisis of viability of cultivation
have been integrated into a market system that has made
them more reliant on purchased inputs in deregulated
markets while becoming more dependent upon volatile
output markets in which state protection is completely
inadequate. The growing army of "self-employed" workers,
who now account for more than half of our work force,
have been excluded from paid employment because of the
sheer difficulty of finding jobs, but are nevertheless
heavily involved in commercial activity and exposed
to market uncertainties in the search for livelihood.
Those who have been displaced by developmental projects
or other processes and subsequently have not found adequate
livelihood in other activities, are victims of the process
of economic integration, though excluded from the benefits.
This then leads to the question: how is it that an apparently
democratic polity, where there is no question that electoral
participation and even other forms of political voice
are entrenched and growing, can continue to tolerate
and even encourage such processes of exclusion? The
issue of the class character of the Indian state is
one that has been widely debated for decades, although
in recent times the debate has become more muddy. One
reason for the greater muddiness may be that the simple
categorisations such as "bourgeois-landlord alliance"
which were earlier used with great abandon, are no longer
adequate to capture the complexity and change that characterise
these relations. The past two decades have been particularly
dramatic in changing both economic and political landscapes
in ways that reflect dynamic class configurations and
social changes.
Therefore, a consideration of the nature of the Indian
state must now incorporate a number of new elements:
the entry of finance capital and its complex relationship
with productive capital; the emergence of regional bourgeoisies
with national and even international aspirations; the
greater impact of a new category of capitalists – middlemen
in not just finance but also in trade, arms deals, government
procurement and sale of public assets; the significant
role of the middle classes, both urban and rural; the
political and economic impact of the diaspora; the more
vocal demands of social groups that still remain excluded
from various economic spoils of the system; and of course,
the essential requirement of legitimisation which is
even more incumbent upon a state subject to electoral
democracy.
The sheer complexity of the task of analysing the nature
of the current Indian state does not make it any less
urgent. Indeed, such an understanding is especially
important in the current conjuncture when the economy
is entering into a phase which may be characterised
as "rampant capitalism". This phase of rampant capitalism
is necessarily dynamic, that is to say it involves more
confident private capitalist activity and creates more
rapid and pervasive effects upon workers and citizens
in general. It is also a phase in which various new
forms of primitive accumulation emerge, as well as the
creation of new markets through various means ranging
from the privatisation of public services to the legal
enforcement of intellectual property rights.
To manage such dramatic changes, domestic and international
capital may well desire a more centralised and authoritarian
polity which can control dissent and prevent messy obstructions
to this process of rapid accumulation. Yet socio-economic
changes in India are typically too complex to allow
for such straightforward imposition of control. Responses
to this can range from the less desirable forms such
as divisive communally inspired tendencies, caste-based
identity politics and regional strife, to the more progressive
democratic movements that force the state to shift the
direction of economic policies and processes to a genuinely
more inclusive pattern of economic development.
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