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Planning: Nehruvian Idea vs Aatmanirbhar Bharat

If poverty and low standards continue, then democracy, for all its fine institutions and ideals, ceases to be a liberating force. It must therefore aim continuously at the eradication of poverty (…) In other words, political democracy is not enough. It must develop into economic democracy as well. — Nehru, 1952

Introduction: Nehruvian

The Nehruvian model of development — based on the four pillars of Parliamentary democracy, secularism, economic planning for establishing a welfare estate and the policy of non-alignment — is still relevant today even after reforms and economic liberalisation. Nehru closely intertwined the concept of political independence with the concept of economic independence.

As a result, there was agreement on the importance of developing a self-sufficient economy through centralised planning and government intervention along Keynesian lines. Nationalist leaders, intellectuals, and businessmen all agreed that "laissez-faire “ was the root of all evil and central planning was the new panacea" (Lal 2005).

Nehru's goal after independence was to bring India into the modern world rather than to establish a socialist state per se, he was willing to compromise the "ideological consensus" on socialism for the sake of development. He did not completely commit to the ideology of socialism, he was pragmatic and practical enough to strike right balance between socialism and capitalism to fit to India’s need at that point in time.

Thus, the Nehruvian consensus advocated a ‘mixed’ economy model for India. It incorporated the elements of capitalism to solve the problem of production and the essentials of socialism to solve the problem of redistribution.

Nehru believed in protectionism as was believed the infant Indian industry was not ready and fit for global competition and hence close economy was need of the hour to enable development of these industries.

Modi's Aatmanirbharta is not Nehru's isolation.

While the concept of self-reliance does instil a sense of economic nationalism and assurance, its constant use by economists and politicians in contradictory contexts has perverted it. On the one hand, it is associated with Swadeshi, a movement that, in broad terms, has drawn an equivalence between Foreign Direct Investment and economic colonisation.

Nehru's decision to operate a closed economy is frequently justified as a step to protect political autonomy, for which the State needed to assume the role of an entrepreneur and strengthen its grip on strategic sectors.

The concept of a self-sufficient economy has always elicited a wide range of reactions from ideologies, social considerations, political organisations, and stakeholders.

Self-sufficiency does not seek to be an impenetrable barrier between India and the rest of the world. It is intended to broaden the export basket, which has previously faced stiff competition, and reduce trade imbalances, improve quality, and encourage rather than coerce consumption of indigenous products.

Unlike Nehru's industry policy, Aatma Nirbhar Bharat, 2020 have opened the door to private investment, research, innovation, and job creation in sectors such as atomic energy and defence manufacturing. Nehru's concept of self-reliance was heavily influenced by a variety of controls, such as licences, prices, ownership, capital, production, wages, and so on.


If we look closely we realise that both these ideas fit right well in their respective timelines. Economics is dynamic, And so the economic policies, they cannot sustain in a vacuum they need to fit to the needs of contemporary global economy with respect to India’s current role and it’s envisioned role. It was more about survival of the infant economy in Nehruvian times and Survival of the fittest is the order of the day today. The focus today has been put not only on mass production but quality production as well, we live in a consumer oriented society.

The free global economic order as it looks like is not so liberal especially for a developing economy like ours. Restrictive trade practices disguised as phyto-sanitary measures and numerous quality checks has made it complicated.

“Forces of protectionism are raising their head against globalisation. Their intention is not only to avoid globalisation themselves but also to reverse its natural flow. The result of all this is that we get to witness new types of tariff and non-tariff barriers...Many countries are becoming inward-focused and globalisation is shrinking and such tendencies can't be considered lesser risk than terrorism or climate change” Narendra Modi


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