'Intermediate Regime' and 'Intermediate Classes' Revisited: A Critical Political Economy of Indian Economic Development from 1980 to Hindutva

The theory of Intermediate Classes and Regimes was originally developed by Kalecki in a general way as being relevant to many developing countries, recognised as relevant to India by K.N. Raj, fiercely and critically contested by Namboodiripad and Byres, but also refined and applied to conditions of stagnation by Jha. In this paper we re-evaluate this theory, first for the period for which it was intended and then for a period in which it predicts its own irrelevance. First, we examine the disappearance of class based political economy since liberalisation. We rediscover it tracing the genealogy of the concepts of intermediate classes and the intermediate regime, by criticising their theoretical and empirical weaknesses and flaws, and examining their strengths, mainly from a comparison with the New Political Economy. We use predictions derived from Kalecki-Jha to show how these notions fare in a period of growth and to trace the development of the 'crisis' of 1991 in terms of the factors central to the Kaleckian model. These factors, we argue, account for the differential stickiness of the economic reforms. Finally, we track the fate of the intermediate classes during the course of liberalisation in which their power should be comprehensively challenged and we speculate on the political and ideological responses (Hindutva and Swadeshi).