The Political Economy of Development in India

This paper seeks to review the political economy of the low level equilibrium trap of slow growth in the Indian economy. Written in the context of Professor Bardhan's 1983 Radhakrishnan lectures, the review makes three sets of observations. First, within the limits of his own analysis, Bardhan has left out a major pressure group, namely, the unionized labour. Secondly, he has underestimated the economic and political role played by the small-scale industrialists and middle peasants in the political economy of Indian growth. Finally, his analysis in terms of the coalition of the dominant proprietary classes is a static relationship and lacks the historical dimension as to how and why the low level, slow growth equilibrium come about. It is argued that the economic system Bardhan talks about is not viable any more because it can no longer manage the old way the pressures and compulsions it has generated.