Indian Affairs

By Prof. K. V. RAO, M.A., M.Litt.
(S. C. College, Puri)

The period under survey is a period of budgets, annual meetings and a variety of celebrated occasions where speeches are made explaining Indian affairs. We have two budgets in the Centre–the Railway Budget and the General Budget–and 17 State budgets (of States A and B), and each of these is accompanied by explanatory notes and speeches which supply us with a plethora of details. Then we have the annual gatherings of the various Chambers of Commerce which give us the view-point of the commercial community on the economic development of the country. Then there was held the Kalyani session of the Indian National Congress which, to many people of the older generation, was an annual event of sacred importance. We have to wade through an ocean of details.

The presidential address of Pandit Nehru at Kalyani has put succinctly what is known to all of us but not fully realised–theend and aim of our national effort. “After the attainment of independence,” said Pandit Nehru, “our urgent task has been to devote ourselves to the economic betterment of our people, to raise their standard of living, to remove the curse of poverty and to promote equality and social justice. The extent to which we succeed or fail in this great task will be the measure of our achievement. That remains, therefore, and will remain, out first duty and concern.” That the Government of India as well as the Governments of all the other States are striving to achieve this end is well-known to all, and one can easily list a number of achievements which can do credit to any nation. What any critic can say is not that we have not achieved anything, but that we are not able to do what we have to and can do, taking into consideration our needs and resources. The question therefore arises why we are not able to do much.

If we search for an answer, Pandit Nehru himself gives us some clues. In the first place he says that “the world presses in upon us from all directions and we cannot remain unconcerned with what happens elsewhere...” At another place he wonders, “how far it (the voice raised in Kalyani Congress) has reached your ears and your hearts...” It is certainly not fair to take some stray sentences from here and there in a long speech and play upon them, but the two sentences open a great vista of thought which it is worthwhile to pursue.

We are trying to do our best to improve ourselves in our own way, but that does not mean that we can remain oblivious to what is happening elsewhere in the world. It is an Atomic age and no country can think itself isolated. It is all true, but the legitimate question to ask is whether we are not thinking ourselves closer to the world than what we actually are or need be. The complaint is that we in India not only think too much in terms of international politics–witness the large proportion of space devoted to foreign affairs in any Daily–but also, which is worse, adopt an economic policy that is best suited to a country which is the centre of an international system. Will it not be possible for us to devise ways and means whereby we can develop our resources according to our needs, irrespective of the economic trends in the rest of the world? Our economics and politics, our social and moral standards, are still those of England and America, and that is the one reason why our recovery is not as rapid as it ought to be. Take, for instance, the question of tourist traffic and all the fret and fume connected with it. For an island country like England or for Switzerland, that largely depend on imports for sustaining their economy, emphasis on tourist traffic that earns them some foreign exchange is understandable. But look at our economy, and how much we stretch and strain to attract it. We supply our guests with transport–air travel and air-conditioned travel–which we subsidise. We have to maintain roads and hotels for them and also supply them with motor transport, every bit of which requires imports from abroad. And that is the difference which I am trying to show. In order to entertain our guests according to their standards, we have to spend foreign exchange which is almost equal to what we earn from their visits to India. I have no statistics with me, but if anyone undertakes this task, he can show that probably the net gain from tourist traffic is almost negligible as far as India is concerned. This is an example of an economic palliative which is copied from another man’s prescription, though the disease is different.

The second point from Pandit Nehru’s speech is a more serious one. Is knowledge spreading in India? If an important idea emanates from Delhi, is there any guarantee that it is taken to every village, and does everyone understand it? One of the basic ideas underlying democracy is that the average man is an intelligent being with sufficient knowledge to think and vote in a particular rational way. Is that idea justified in this country? A more serious question presents itself. Our Constitution is based on the bedrock of unityof the country irrespective of caste, place of birth, etc. It implies notonly that all India thinks, but also thinks on the same problems and chooses alternatives and presents them to the Parties to work them. Is there an ‘all-India thought’ now? As it is, we do not know how the intelligentsia in Bombay are thinking or what they are doing in the Punjab. We must immediately do something to rectify this defect. We must devise some means for inter-provincial understanding among people living in various parts of India, I mean the intelligentsia: how different regions are thinking, so that ideas and knowledge can be exchanged on an inter-provincial basis and thus a synthesis could be attained. Two suggestions could be given. We must somehow develop the reading-habit. It is notmerely increasing the literate population of the country through adult education and other means, for, as a recent writer was pointing out, increased literacy has resulted in reading more and more of third-rate books on sex and crime. In this connection, we must welcome the recent move of the Government to encourage books of value to the villagers written in the Indian languages. This will go a long way to supply correct information to the villagers. But it does not solve our basic problem of creating an ‘all-India thought’. For this I can suggest that the Government could purchase say a thousand copies each of some of the cultural journals of the country–like Triveni and The Modern Review–andsupply them to all the colleges and libraries in India, so that, in all such places we will have on one table journals from various parts of the country and we could know how people from different parts are thinking. This will go a long way to create a sense of nationalism in us by mutual understanding and unity of thought.

THE INDIAN INDUSTRIALISTS

Even a cursory reading of the speeches made by various industrialists in recent times shows that there is a gradual change for the better in their outlook. They seem to realise now that they are misunderstood in this country and that something should be done to create a better impression of their role in Indian economy. There is no doubt that the Indian industrialist does not enjoy a good reputation now. On the other hand he is considered to be parasitic, anti-social and even anti-national. Even if this is not true of all the industrialists–and certainly it is not–yet the blame must be laid at the door of all for not disowning and condemning the black-sheep among them openly. It is in this light that we must all welcome the exhortation of M.R. Masani at Hyderabad: “In order to ensure that the voice of free enterprise which has a significant role to play in the mixed economy does not fall on deaf ears, it is essential that the accredited spokesmen of enlightened free enterprise create a congenial climate by coming forward with a Charter or a declaration of faith based on a policy of ‘clean hands’ and ‘nation first’ and expressing their readiness to live by it in the spirit of Gandhiji’s concept of trusteeship.”

The point to remember is that we want the private sector to play its part in our country’s Plans based upon mixed economy and, therefore, it is everybody’s business to see that the industrialist does not feel–as he feels today, as testified by D.M. Khatau of the Associated Cement Companies Ltd. –that “the morale of the industrialist is at a low ebb.” But at the same time it is asking for the impossible to expect the capitalist to become a trustee in the Gandhian concept under the present circumstances. There are two reasons for it. In the first place, a reasonable margin of profit is a sine qua non of industrial enterprise. Some economists put it even at 40 to 50 per cent for venturing on new projects. Secondly large-scale production and trade enable large profits to be made, and a little dishonesty somewhere will result in a gain of a few lakhs at the other end; and this, along with the present atmosphere of greed which induces people to make easy money within the shortest possible time, is constantly tempting all people–in all walks of life–to stretch their conscience a bit. To take an example, for a wholesaler dealing with a million maunds of wheat at controlled rates, mixing one seer of dust per maund would result in a large profit, while the whole deal may go undetected or some higher quarters may be purchased: almost every one has his own price. While we do not deny that there are some honest officers and honest merchants and industrialists, their honesty should not be constantly put to test, with ample- opportunities of making large, illegal profits. And while some people make large amounts of money, whether legal or not, we cannot prevent others from thinking of similar methods and similar ends. The remedy lies in first doing away with opportunities for making big money at one stroke, and secondly ‘institutionalising’ these sources of making big money. I will revert to it later on.

Taking for granted that the private sector is honest and that it is wanted, let us see what the industrialists say about what they want us to do to make them play their part. The most vital thing they want to know is where they stand in the India of today and tomorrow. There is too much of uncertainty in the air, especially with our policy of nationalisation. The second thing they want is that they should be left some discretion; there are too many controls, they say. Let us take two examples and examine their grievance. The first is the Government’s labour legislation. There is a view held by some that the Government is partial to labour, and that we are too much bothered about labour welfare. This has been silenced to some extent by Mr. V.V. Giri reminding the people in Bombay that ours is a ‘Welfare State’. True, but does it mean welfare of the industrial labour alone? What about the other kinds of labour and of the general consumer? While it is difficult to discuss it here in this short essay, it is worth our while to examine the truth of the complaint.

Following from the above is the second one about the Government’s policy of rationalisation. Kanpur and Ahmedabad mill-owners applied to the Government for permission to introduce rationalisation; and it raised a hue and cry from somequarters that it meant retrenchment. The Government took some time to make up their minds, and as I write this essay comes the announcement of Mr. T.T. Krishnamachari that ‘we will have rationalisation but at the same time, we will not allow any labour to be thrown out’. This is what he himself called–according to the newspaper reports–‘rationalisation without tears’, which amounts to saying that ‘we will have it but not now’.

WANTED A CLEAR POLICY

This hesitancy of having the cake and eating it too, clearly brings us to the real nature of the problem in our country, and it is time we are determined upon certain things and proceed along those lines without further hesitancy. Let us see some of the inconsistencies in our present policy. Rationalisation means retrenchment and therefore it has to wait; we do not want unemployment. At the same time, the standard of life should increase and more should be produced. How can we produce more unless more capital is employed, and how can the standard of life of labour increase unless the labourer is enabled to produce more, which means placing more capital at his disposal, which again means rationalisation? Again, while we do not want retrenchment and unemployment in industry, we are having the opposite policy with regard to land. We are trying to apply rationalisation here by reducing the number of people per acre, both by consolidation and by the introduction of machinery; and thus we are creating rural unemployment while we want to avoid urban unemployment. Is it because urban labour is more organised and more vocal than the rural mass?

And on it we superimpose plans to revitalise the villages by various means, including cottage industries. Does it occur to you that most of these villages in India are agricultural villages, and the only reason why they exist–i.e. people live together–is that they are all occupied on land? Once ‘rationalisation’ is introduced and man is divorced from the land in the village, he will no more be in the village; he will go to the nearest town for employment, thus adding to the unemployed. Then for whom are the cottage industries intended in the rural areas, if the rural areas are to be denuded of their surplus population, the few that remain having almost no spare time because they have more land now? What we have to understand is that, in our economy of old, cottage industry went along with small-scale farming. The village barber and the carpenter were all agriculturists as well as workers; and, if today, he is not an agriculturist, there is no reason why he should remain in the village.

Cottage industries are said to be essential to our economy. That is a settled policy with our Government today, but cottage industries imply that-people will have spare time and that they could expect a fair return for using that spare time in cottage industries. The ‘marginal cost’ of time will be high in towns so that we need to maintain the surplus labour only in the rural areas; while our ‘rationalisation’ of agriculture is giving us the opposite results. Some more careful thinking is required whereby we can rationalise and integrate all our plans; otherwise we are creating more problems than what we are solving today.

THE BUDGETS

The budgets are expected to be the means for financing the Plan and so, when the Plan itself is known, nothing spectacular or unexpected could be expected from them. To add to this, there is the Taxation Enquiry Commission at work and, until the Commission finish their task, it would not be proper to launch on new policies. But yet, no budget can be colourless because all public finance is but a transfer of purchasing power, and this transfer cannot take place without bringing about some socio-economic changes. Thus we get from the status quo budget an impression that the burden of taxation is being shifted slightly towards the middle-class. We also clearly see that deficit financing has come to stay. It is not only the Centre that has produced a deficit budget, but also as many as twelve States. Deficit is no more a nightmare. But there is a difference in kind between the policies of the Centre and the Units. In the Centre, it is a question of policy based on some theoretical considerations and the Finance Minister has explained that basis quite clearly. In the Units the reason is different. To a large extent, I personally believe, it is due to the feeling that the Centre has a responsibility to see that the States go on an even keel. The common devil seems to be the financial allocations in the Constitution–the Centre gets too much. I put the blame to some extent at the door of the Finance Commission which inter alia took the ‘needs’ of the Units into consideration while making their recommendations. In a memorandum I submitted to the Commission in 1952, I told them that deficit budgets might become the order of the day, unless the needs of the Unit are co-related to the efforts of the Unit to get the maximum revenues possible. While supporting the basis of ‘needs’, I suggested the formula that the Commission should distribute money among all the Units so as to make the per capita expenditure on social services the same all over India–that is the meaning of ‘equal protection’ of Art. 14 when applied to a Welfare State–after ensuring that the ratio of per capita taxation to the taxable capacity in each State is equal. If that had been done, we would not have heard of deficit budgets any longer. But there seems to be no actual danger of deficits materialising as–and this has happened before–the Units as well as the Centre may not be spending all the money they put down in the budget!

DEMOCRACY IN TRAVANCORE-COCHIN

The T.C. elections and the subsequent accession to power of the P.S.P. there give us a number of lessons in democracy if only we can learn them. If sceptics say that it does not conform to any of the precedents in England, we can only tell them that democracy is not the monopoly of England and nothing prevents us from evolving our own patterns to suit our needs and circumstances. But whoever can say that it does not conform to any fixed pattern? Parliamentary democracy means that a general election puts some people in the Legislature, and a Ministry ‘collectively responsible’ to it, i. e., supported by the majority, will be appointed by the titular Head; and that is what has happened in that State. No doubt it has resulted in putting in power a party of 19 members who could get only 19 per cent of the votes polled, but as long as the Congress supports the P.S.P. it is democracy and nothing but that.

Difficulty comes only when we extend the meaning of democracy–that it is a Government by the majority, chosen by the majority of the voters, and that the party in power has a mandate approved by the majority at the elections. The question now is: whose election programme shall be put into effect in that State? If it is that of the P.S.P., it is certainly a fraud on the electorate because only 19 per cent of the electorate are behind that policy. If it is that of the Congress, then it becomes P.S.P. in office but the Congress in power, and then there is no reason why the P.S.P. should not give the ‘gadi’ to the Congress instead of enacting a puppet show.

A more interesting question is how the Congress could support the P.S.P. policy when it opposed it in the elections. And a still more interesting question is: what next? The principle of parliamentary democracy as developed in England is based on a number of myths which now stand exploded. One such is that an average sector is a rational individual–something like ‘the economic man’ of Adam Smith–capable of taking an independent view on a rational basis qua individual, whereas the truth is–as old as Aristotle–man has always been a social animal and behaved as such, so that what he thinks and how he votes is always dictated by what group or caste he belongs to. Our Constitution has no doubt abolished caste and religion, but the elector so freed has entered into new and more rigid groups, such as Communism, etc. British democracy again works on the assumption that there are several ‘free’ voters–what they call ‘floating vote’–who would thinkand vote. But the recent elections in T.C. have revealed a great truth and a source of grave danger to our ideal of a democracy, namely, that electors belong to fixed groups. Thus the election has revealed that there are a fixed number of Leftist voters–about a million–who would always vote for the Left. There are a fixed number of Tamil voters who always vote for the T.N.C.C., and the P.S.P, and the Congress must share the rest. Thus it is clear that unless the P.S.P. and the Congress come to an understanding, no Government of the ‘Right’ on a stable basis is ever possible. In fact it shows that at no time is a stable Government possible at all, and so the conclusion is irresistible that another election–the essential prelude to a Parliamentary Executive–is useless, and never likely to improve matters at all unless the Leftists combine and the Rightists are split into more and more parties. If this happens, the Leftists can easily distribute their voting strength among various constituencies and get an absolute majority.

What is true of T.C. is also true of the other States, where it will become more and more difficult to form stable Ministries. As early as 1947 some of us were arguing that a Parliamentary Executive was unsuitable for the Units. It is time again to think about it, as we are now thinking of amending our Constitution.