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A Multi-disciplinary Approach


Siddhartha Mukerji

POLITICAL ECONOMY OF REFORMS IN INDIA
By Rahul Mukherji
Oxford University Press, New Delhi, 2014, pp. 204, Rs. 275.00

VOLUME XXXIX NUMBER 9 September 2015

Part of the Oxford Series of short introductions Political Economy of Reforms in India by Rahul Mukherji runs over 200 pages. The book’s four compact chapters addressing the major themes of economic reforms and social change in a chaotic democracy delineates both the success of India’s growth model in the post-liberalization period as well as the predicaments of poor infrastructure, inefficient public delivery system and low literacy levels that it produces. The forces maintaining status quo and the forerunners of change are found to exist simultaneously. The political economy perspective in this book envisages that the pace of policy change is determined by the relative strength of the economic actors illustrating that the slow pace of economic change in 1980s could be explained by the unwillingness of the industrialists and middle class professionals. It also posits the critical importance of ideological propensities of the governing authorities especially when the government is required to respond to economic crisis. But, more importantly the author establishes a causal link between the growth model and public welfare in his political economy approach and rightly cites the process of economic growth as only a necessary condition for welfare of the underprivileged and poor. This argument stands particularly relevant in view of the emerging public concerns like displacement, poverty, undernourishment, environmental degradation associated with the developmental policies of the government. To cite an example, the relaxation of land acquisition norms by the present government has resulted in a political uproar particularly challenging the elimination of the social impact assessment requirement in the amended law and inadequate compensation that the displaced poor would get. The first chapter explains economic change after 1991 in the framework of the ‘tipping point transformation model’, a model of gradual change that develops over a period of time and ends up in radical transformation primarily for endogenous reasons. The tectonic shifts after the emergency and especially since the early-1980s are observed, to demonstrate the ideational change in favour of liberalization and globalization. The author argues that the government recognized the deleterious effects of import substitution on India’s industrialization and therefore felt it necessary to liberalize by removing undue restrictions on private trade and investment, not because there were pressures from private business. The tipping point model appears to provide a half-hearted explanation of the nature of ideational change. The perspective of the PMO may not hold true for all departments ...


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