Wall Street Journal

Why the Subcontinent Is Subpar

By Tunku Varadarajan

Published on: March 19, 2001
By Gurcharan Das
(Knopf, 406 pages, $27.50)

WHEN MY MOTHER, some 15 years ago in Delhi, started her own factory -- an initially modest place, now grown impressive, that produces home furnishings for export –hers was the first instance in the history of my family when someone, anyone, went into business.

Being Brahmins, we had disdained the making of money. Until the 20th century, and for as long back as there are records, the men in the family had been priests, serving in Hindutemples or in private arrangements with landed or moneyed families. In the early 1900s,having imbibed a British education, they flocked to the civil service, the new priesthood of modern India.

I mention this because Gurcharan Das, the author of "India Unbound," shares myexperience of a high-caste family detached from the creation of wealth. "Like many Indians," he writes, "our family did not accord a high place to the making of money. Thus, I grew up with a low opinion of commerce and merchants."

Mr. Das is eager to see India freed (or "unbound") from the trammels of suchpresumptions, as well as from the heavy statism that has been their result. And indeed, he sees some hope in the high-tech revolution of recent years. But in the main, he prefers totrace the evolution of India's economic misery, for which, he believes, its governing classes bear most blame.

Independent India's first prime minister, Jawaharlal Nehru, had, like the young Mr. Das, alow opinion of anything commercial. "Never talk to me about profit," he once scolded J.R.D. Tata, India's foremost industrialist. "It is a dirty word." This aversion to free enterprise can be attributed, in part, to a Brahmin's sense that money sullies the soul. Yet it was the product, largely, of a destructive fascination with Fabian socialism -- that is, the nonrevolutionary, British-born variety -- and of a blind admiration for the Soviet system of centralized economic planning.

Nehru, a sanctimonious snob who was never entirely able to treat his fellow Indians asequals, dragged his country down in the years after the British left. He imposed on India acomplex of malfunctioning, state-run, industrial white elephants, all the while denyingprivate entrepreneurs the right to seek investment from abroad, or to export withoutoppressive controls, or to import at will the materials and technology needed to establishcompetitive industries in India. Meanwhile, he neglected India's agriculture, forcing thecountry to rely on American food aid to feed itself while he blithely charted a pro-Soviet,anti-American foreign policy under the flimsy guise of nonalignment.

Mr. Das's book seeks to explain why India, a country once rich-or, at least, once a country of riches-is today largely impoverished. He ascribes some blame to the British colonizers -- and who would not? -- for the manner in which wealth was extracted from India but seldom, if ever, plowed back. But the strength of his inquiry lies in its castigation of those who inherited the running of India from the British. He is commendably scathing about Nehru and his daughter Indira Gandhi, who had her father's hubris and contempt for businessmen but not a trace of his erudition.

The period of emergency she presided over from 1975-77, during which many civil rightswere suspended and political opponents jailed, is generally regarded as the ugliestchapter of postcolonial India. Yet Mr. Das, who ran Procter & Gamble India until his recent retirement, puts even that two-year phase in cold perspective: "Most people remember the Emergency because it represented a generalized loss of liberty. They do not understand that by suppressing economic liberty for forty years, we destroyed growth and the future of two generations."

In most developed democracies, someone like Mr. Das would be a legislator or a cabinet minister. Not so in India, where men like him – educated abroad, dressed in well-cut suitsand convinced of the private sector's magic touch – are excluded from the political process. Indian politics is now riddled with castemanship, regional factionalism, personality cults and politicians solely intent on personal enrichment. (Mr. Das, a patriot in the best sense of the word, did indeed try to enter politics after he left P&G, but was given the cold shoulder by the major parties.)

The author regards economic growth as the only way to strengthen Indian democracy. One of his unsung men of mettle is Lal Bahadur Shastri, who succeeded Nehru and set in train the Green Revolution, by which India became a net exporter of food. Shastri's untimely death in 1966 paved the way for the ghastly Mrs. Gandhi. Another Das hero is Narasimha Rao, the prime minister who, in 1991, brought India its first truly meaningful package of economic reforms.

His other heroes are the Indian people themselves, who have flourished abroad in climesmore favorable to free enterprise and who, in India, battle cheerfully against a system that, in spite of some reforms in the last decade, still does more to stifle enterprise than toencourage it. Mr. Das believes that the "information age" will be India's salvation. He is aware that nearly half of the country is illiterate. But his optimism is potent: "We have good reasons to expect that the lives of the majority of Indians in the 21stcentury will be freer and more prosperous than their parents'. Never before in recorded history have so many people been in a position to rise so quickly." If he is right, India will soar with them. If he is wrong, it's back to the devil's own drawing board.

Mr. Varadarajan is the Journal's deputy editorial features editor.

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