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  • Das — India Unbound: From Independence to the Global Information Age

    Posted by James McCormick on March 1st, 2007 (All posts by )

    Das, Gurcharan, India Unbound: The Social and Economic Revolution from Independence to the Global Information Age, Penguin, New Delhi, 2002. ppbk edition.

    [cross-posted on Albion’s Seedlings]

    Recently, a friend with Gujarati origins returned from visiting his relatives in northwest India and brought me several books on the Indian economic renaissance. This particular book is part biography, part business tutorial, while effectively illustrating the dramatic challenges faced by India over the last century. Gurcharan Das is a former CEO of Proctor & Gamble India, sometime columnist for the Times of India and frequent commentator on Indian economic affairs. Educated in India and the US, and spending his formative business years in many countries, he’s the perfect intermediary for the general reader. After taking early retirement, he switched his focus to business consulting. That varied background has made a big difference to the quality of India Unbound. His experience bridges the generations, bridges East and West, and reflects experience with many facets of the Indian economy. It is a well-written book, a bit dated by the very rapid change in both India and the global economy (his Foreign Affairs article is a wonderful update), but all-in-all this book is an excellent introduction to India’s past, present, and potential future.

    From an Anglosphere perspective, India is both a great conundrum and a great hope. With a vast and growing population of English-speakers, it would be no surprise if it bears a dominant role in the growth and use of the language by century’s end. It has supplied generations of brilliant academics, scientists, and writers to the Anglosphere. Its journalists and intellectuals draw upon the full range of debate across the Anglosphere, as a quick Google query will confirm. It has many reasons to want to leverage its strong ties to the English-speaking world, not the least of which is its democratic nature. Yet its national aspirations will no doubt lead it to arbitrage benefits from other large power blocs in Europe, Russia, and China. Unlike the other large English-speaking nations, it is a land of the colonized rather than colonizers. A century ago, proponents of Imperial Federalism went to great lengths to create exceptions for how India might be integrated with the rest of the English-speaking world. The appliqué of English common law and civil service in India (since the legislated demise of the East India Company in 1858) did not greatly affect the underlying cultures of the subcontinent, despite providing an inadvertent structure for the subsequent nation-state. India was not subject to the cultural clear-cutting of Russia, China, and Japan (plus the Japanese colonies). More than most nations in the 21st century, it must carry its past along with it.

    India’s role in the Anglosphere will be on its own terms, and based on the recent past, those terms will depend largely on the consensus created amongst its elite. Will that elite come from a small slice of India, or will it draw from a burgeoning middle class? Will it gravitate to rent-seeking (per the McKinsey evaluations in Lewis’s Powers of Productivity) or will it form market-dominant minorities (per Chua’s World On Fire) that strangle the rate of economic development for the benefit of a few?

    India Unbound discusses many of the same economic and political topics that have fascinated Europeans and North Americans during the 20th century. The author’s family was professional for several generations and had a chance to evaluate 20th century Indian economic development firsthand. The British could be blamed (in a multitude of ways, valid or not) for the stagnation of India in the first half of the 20th century. The legacy of colonialism, which carried forward until 1947, distorted Indian governance and economics in very different ways from the earlier British colonial nation-states of the 18th and 19th centuries. As Daniel Headrick has outlined in incredible detail in The Tentacles of Progress: Technology Transfer in the Age of Imperialism, 1850-1940, India’s infrastructure in areas like railways and manufacture was always subject to different pressures than mere market need.

    Through the years leading to self-determination, Indian intellectuals drew on British socialist (often Communist) traditions. Regrettably, India entered the mid-century with a set of economic ideas that were already about to take a tumble. As the US was about to depart from wartime era micromanagement (as exemplified by JFK’s ambassador to India – John Kenneth Galbraith), India began adopting Five Year Plans with a heavy-industry approach to economic development. In 1950, the issue of whether communism or capitalism had the advantage in creating wealth was still an open question. India’s choice was top-down economic administration. The result was a series of crises in each decade, culminating with the virtual collapse of external trade (and foreign reserves) in the early 90s. Even the much vaunted Green Revolution of the early Sixties, which allowed India to be self-sufficient in food, appears to have been in spite of much of the government rather than at its instigation. All this central planning, by very smart people, chopped overall annual economic growth in India in half between 1950 and 1980, when compared with the average (3% per annum) across the underdeveloped world.

    Das was educated from early adolescence onward in the US and his return to India as a young man to work for the Indian branch of Vicks (of VapoRub fame) is an ideal foil for Westerners to better grasp how India did business in the Sixties. The customer focus that the author learned as a boy, delivering the Washington Post of all things, is carried over into his discussion of retail marketing and sales to the vast countryside of India. The adventures of G. Das as he tries to grow his business highlights, more than anything else, the extraordinary persistence that is needed to conduct business outside G7 nations. That Mr. Das was also, from time to time, working in Europe and Latin America under vastly easier circumstances says a lot for his continued commitment to his country. This is a book that communicates emotion as much as economic and political fact. It is all the more readable for it.

    Perhaps most useful for readers who are unfamiliar with the personalities and details of Indian history since 1950, Das comments extensively on his view of the origins of change, and resistance to change, within the Indian government. All the bugbears of the Left which are perpetually raised in opposition to economic liberalization get full expression in India. Whether capitalism, business people, modernity, or democracy itself. All were tarred with being the cause of India’s slow growth. This is not a nation of the intellectually indifferent. But I think it’s fair to say that Das illustrates how the best of intentions, and the brightest of peoples, can lead a country astray — adhering to outdated models far after the Asian Tigers illustrated how export-driven economic growth, powered by foreign direct investment and intellectual capital, can raise the living standards of an entire population in just a generation or two.

    It’s unlikely that a population as large and diverse as India could have used the model of Taiwan or Korea to make the same gains in the last 50 years — but it certainly could have made greater progress and dramatically improved the lives of hundreds of millions of people. The author has created a very readable, frank, and compassionate book which works effectively as a thoughtful conversation with a senior businessman. More than any gift his book might offer to a Westerner, it is above an effective entrée to India’s 20th century economic history for Indians. Das’ personal success is notable, and he can speak with authority about the way it was, the way it is, and how that differs from what happens outside of India.

    There is effective use of anecdote and literary reference in India Unbound without it becoming burdensome. Das’ creative use of stories about his relationships with customers, vendors and government bureaucrats vividly illustrates the shifting economic realities through the years. The dramatic change in 1991, triggered by a foreign exchange crisis, resulted in the elimination of much of the so-called License Raj which had micro-managed the Indian economy for several generations. It is one of the most dramatic passages of the book.

    Gurcharan Das is fully aware of the price that each society pays for the particular way it grows its economy. He’s ideally suited to introduce to both Westerners and Indians to the tradeoffs in economic development. His personal tale is filled with determination, and ultimately optimism. And his book is highly recommended.