India Needs Gandhi's Economic Vision

 Gandhi’s economic thinking was centralized on the human being. He wanted all economic policies to revolve around the individual to ensure the benefits. He was opposed to the concentration of wealth in a few hands. Gandhi wanted the country to think in terms of providing for all. The present policy which gives importance to the large units has failed to look after the needs of all. Jobs are in short supply causing the government much discomfort. A way out of the present economic mess is to look towards the small scale units to make the ease of doing business better for them.

 

In the midst of a collapsing economy India needs the vision of Mahatma Gandhi to revive the economy and to provide succor to the millions who continue to suffer the impacts of the pandemic. The Rama Rajya promised in 2014 now looks like a cruel joke played on the gullible Indian population.

 

The promise of a 5 trillion economy has been lost on the wayside as the country struggles to revive a fast sliding economy. India has been struck by two viruses. The worldwide coronavirus, and the Made in India virus of greed among its lawmakers and captains of industry. The Mahatma had cautioned against these while suggesting that in all policy matters concerning the economy the common man needs to be kept in mind.

 

India voted Narendra Modi to power because the people thought he was talking of Rama Rajya. They gave him a massive positive mandate. The Prime Minister, who feels he is very ‘popular and competent’, has misread the message given by the people. That message was not for the mere construction of a Ram temple, and certainly not for helping his friends to amass wealth, but for the creation of a Rama Rajya.

 

The economy of over-production and excess profit and growth which he created and presides over is collapsing. Some wishfully think it will revive. People who know and understand say it will not. You can’t simply go about helping crony capitalists to amass wealth ignoring the majority which is struggling to make ends meet.  It is neither decent nor is it helping in creating a Rama Rajya.

 

Rich in Their Greed

Mahatma Gandhi seems to have visualized what India is going through at present. He had visualized that the rich in their greed would create an economic environment that will gratify their greed and help them amass wealth at the expense of the poor. He strongly felt that economics sans morality is wrong.

Mahatma Gandhi was not a professor of economics but an economic reformer.  In his view, the non-economic components of economic policy are perhaps more important than strictly economic concepts. He was not against industrialization or the use of machinery. He was however critical of excessive dependence on machines. According to him the priority of any system which doesn’t want to thwart growth should be ‘man’ and not ‘machines’

In 1946, Gandhi wrote: "I am not opposed to machinery as such. I am opposed to machinery which displaces labour and leaves it idle." He was not against machinery but welcomed such instruments and machinery that saved individual labour. But he was wary of technology-induced unemployment Mechanisation, he said, was good till it did not render people idle and unemployed. According to him, large-scale production was meant to be profit-oriented and therefore, harmful for society as it could lead to a concentration of wealth and power in a few hands.

 

Ahmisa and Service to Society

The Mahatma propounded a total philosophy of life from which economics cannot be divorced. His philosophy was based on truth, ahmisa and service to society, particularly the poor and downtrodden. The basis of his economic philosophy was individual dignity and welfare of the poorest of the poor. He said a man earns his dignity by working and earning his bread and livelihood. Therefore the economic system should be organised to provide employment for everyone. He was against mass production and industrialisation which reduced man to a cog in the machine.

Repeatedly throughout his life, Gandhi spoke against the concentration of wealth in the hands of a few. He said “I wish that money is not centered in the hands of few rich people but is accessible to all. The reason why Capitalists want to use money is not to save human labour and to ensure the welfare of all, but to maximize their own gain. I am against this concept. I am not against machines but wish to define their limits.”

The Mahatma was not opposed to private ownership of industries and businesses. He advocated social control of business so that the profits generated are equitably distributed so as to prevent the concentration of wealth in the hands of a few people, which lead to exploitation. The proposed theory of Trusteeship under which the wealthy act as custodian of the created wealth part of which was to be used to the welfare of the people.

He emphasized that the voluntary reduction of wants was an indication of development and not the desire to satisfy unlimited wants. He said every person wishes that he/she gets enough to save for a rainy day after meeting the day to day requirements. 

It is easy to discard his views as old-fashioned, impractical, and anti-progress. However, across the world, several eminent writers and economic thinkers have lauded his views. Prof Gunnar Myrdal in “Asian Drama” has said that India and other SE Asian Countries must not imitate western countries blindly. What Mahatma Gandhi had realized through intuition, many world-famous thinkers later advocated after being a witness to the process of how Capitalism unfolds itself.

Independent India’s ruling class does not have either the conviction or courage to walk on the path shown by Gandhi. Though India initially followed the principle of a mixed economy, after the eighties, India embraced capitalism and is now engulfed by forces of Globalization. This has helped the rich to become richer and the poor have become poorer.

 “Is Gandhi relevant, even now?” The answer is,  yes and more so. His economic thought centers on sustainable growth, with the focus on man against machine and reducing economic inequality. These are answers to the problems facing the country today. 

India has come a long way along the path of economic development to revert back completely to Gandhian economics. Yet our present dilemma, where the economy is sliding and the poor are struggling to make ends meet, calls for a more serious look at the issues raised by the Mahatma and the solutions he offered.

It is true that modern society will not be able to adopt the simple solutions he had offered. What needs to be considered is the Mahatma’s thoughts behind these suggestions. We are all aware that in everything he spoke of or wrote about or did, the central character in his mind was the human being. His entire life rotated around the need to do good for the human being.

I Will Give You a Talisman

To those who are responsible for the development of the country the Mahatma said "I will give you a talisman. Whenever you are in doubt, or when the self becomes too much with you, apply the following test. Recall the face of the poorest and the weakest man [woman] whom you may have seen, and ask yourself, if the step you contemplate is going to be of any use to him [her].

“Will, he [she] gain anything by it? Will it restore him [her] to control over his [her]own life and destiny? In other words, will it lead to swaraj [freedom] for the hungry and spiritually starving millions? Then you will find your doubts and your self melt away.”

India's economic planning has concentrated on creating wealth for a few in the hope that some of it will trickle down to those in need. We have undertaken top-down development when it should have been the other way round. We have not cared to look at the face of the poorest of the poor to understand whether he or she will gain from the project or programme.

Today we need to devise a new model of economic development based on Gandhian ideology. This would mean a shift from the present, leaning towards capitalists, to the needs of the common man. It is necessary to draft a new economic policy, in which progress is measured in terms of the development of human capacity, dignified employment for everyone, equitable distribution of income and wealth, ecological sustainability, and social wellbeing of the community.

 

The most serious issue facing the country today is growing unemployment. The promised Two crore jobs are nowhere in sight and worse still more joblessness is being added very day. The Ambanis and Adanis do not have a solution to this problem because in an effort to jack up their profit margin they have installed labour-saving machinery and so cannot create the required jobs.

 

Gandhi said think small. Think about how the small entrepreneur can be supported to set up units so that he can provide jobs. It is a known fact that small scale units have more job potentials at lower costs. The government and its agencies need to actively engage the youth in setting up small units that carter to the needs of the people.

 

What is needed now is leadership with a vision to steer the country out of this situation. A vision that speaks to small and medium-sized businesses and at the same time one that attends to the pressing requirements of our community. India, fortunately, has an active and growing social enterprise sector which is engaged in delivering the much-required services to the community.

 

Social Entrepreneurs Can Help

Many of these social entrepreneurs have earned distinction and awards for the good work they have done and continue to do in the service of the people. Among these is Dr Harish Hande whose company SELCO, using Solar Technology, has lit up hundreds of thousands of households with ‘clean’ lighting.

 

About 65 to 75 percent of the beneficiaries are small farmers who earn between Rs 100 to 200 a day After reaching 80,000 clients across Karnataka and Kerala SELCO moved into Gujarat.

 

In Ahmedabad Rajendra Joshi’s Saath works with the Ahmedabad Municipal Corporation to ensure that slum residents receive basic sanitation, water and drainage services at the household level and paved roads and street lights at a community level. It has created mechanisms through which the urban poor can save and pay the user charges.

 

In Bihar, Jharkhand, Delhi, and Rajasthan. Arbind Singh’s Social Enterprise, Nidan is helping to build profitable businesses and ‘people’s organizations’ which are led by asset less, informal workers. Nidan, over the past years, has launched a range of cooperatives, Self Help Groups (SHGs), trade unions, and individual and community businesses

 

These have positioned unorganized workers as legitimate competitors in globalizing markets of India. In 12 years, Nidan has launched and promoted 20 independent businesses and organizations that are governed and owned through shares by 60,000 urban and rural poor members.

 

The enterprises include 4618 SHGS, 75 market committees, 19 co-operatives, two societies, and one company—all envisioned and led by a complex of waste workers, rag pickers, vegetable vendors, construction laborers, domestic helpers, micro-farmers, street traders and other marginalized occupation groups.

 

The job creation potentials of the small and medium scale sector is higher than that of heavy industry. Promoting this sector will not only help in creating jobs but will also help youth to create and set up small enterprises, apart from pakoda making, for self-employment.

 

In an opinion piece printed in Business Line in February 20,2019 Subir Roy, senior journalist and an eminent financial writer pointed out that the only sector capable of creating adequate jobs was the small and medium scale sector. He says that job creation would be best in businesses at the bottom of the pyramid and the place to begin in the small units.

 

Roy points out that the Government’s Demonetization and GST policies have hit this sector hard because it relies largely on a monetary economy. He says that maximum policy focus should be on improving the ease of doing business for the small and medium units. He says there is an urgent need to shift the focus from the corporate sector which has immense lobby power, to the small units.

 

The government needs to take serious steps to shift attention from the Ambanis and Adanis to the small players who have the potential to solve the problem to a large extent. Creating new jobs and in particular “good jobs”, meaning jobs in high productivity sectors and offering decent working conditions this could be fulfilled to a large extent by the small players.