Dr Krishna Raj
India’s 78th Independence Day is celebrated on 15th August 2024 in memory of the hard struggles and sacrifices of many freedom fighters led by Mahatma Gandhi.
The freedom struggle united all Indians together and instilled a strong ideological commitment among the political leaders to make India a better place to live on this earth.
Government of India christened the theme for this year Independence Day as Viksit Bharat or Developed India with an ambition to transform the country into a developed nation by 2047.
This occasion provides an opportunity to review economic policies or economic factors that worked in favour or against India’s economic growth story since Independence.
Several ideologies influenced the developmental path that had to be followed right after Independence, but ultimately, the preamble embedded in the ‘Constitution of India’ written by Dr BR Ambedkar provided the right direction for India’s economic development that should be on socialist policies of mixed economy to realise social, economic and political justice, liberty, equality of opportunity and fraternity.
The scientific fervour of the Indian Constitution, among other macroeconomic variables interplayed simultaneously, viz, technology and infrastructure, undoubtedly had a formidable influence on the economic development of India.
Technology played an important role in the introduction of the Green Revolution that transformed Indian agriculture space from low productivity to high productivity growth and simultaneously irrigation infrastructure such as Big Dams aided the economic development of India, nevertheless, environmental impacts were highly negligible at that time.
The paradigm shift in technology policy aided the economic growth of India when Rajiv Gandhi was the PM who allowed import of computers that aided growth of space research, defence industries, growth of industrial sector, service sector, and telecommunication industries.
However, the policy for development of infrastructure had not received much importance that crippled the economic development with the “Hindu Rate of Growth” of economy around 4% of GDP.
Especially, inadequacy in provision of social infrastructure such as housing, land, water, sanitation, education (schools), health (hospitals) apart from economic infrastructure such as electricity, roads, transportation had severely affected human development in India and that resulted mass and absolute poverty, unemployment, malnutrition, illiteracy, rural to urban migration, bourgeoning of slums.
The macroeconomic crisis during 1990s forced India to adopt new economic policies that led to the present capitalistic form of economic growth and development.
The new economic policy promoted tremendous technological growth in transport and communication that reduced the costs of internet and transportation even though India’s lowest investment (0.64% of GDP) in research and development in the world.
While improvement in economic infrastructure such as road networks, railways, airports, ports, and energy pushed the GDP growth rate to 7 to 8%.
However, the technology has created the digital di- vide between rural and ur- ban areas, growth of arti- ficial intelligence reduced the employment in the un- organised sector and emis- sion of greenhouse gases caused climate change.
These have affected the economic growth prospects in India. India’s infrastruc- ture score improved to 47th place in 2023, however, widening the gap between social and economic infra- structure created income inequality and human development disparities in rural and urban areas. In the last 78 years even though the living condi- tions are improving but very frequent economic fluctuations are influenced by the markets, technology, and infrastructure causing impoverishment of basic livelihoods as India ranked 134 on global HDI.
Dr Krishna Raj is Professor, Institute for Social and Economic Change (ISEC), Bengaluru
The article was first published in News Trail as Role of tech, infra in economic development of independent India on August 15, 2024.
Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.
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Acknowledgment: This article was posted by Bhaktiba Jadeja, a research intern at IMPRI.
