First Governor-General of Independent India - A Champion of Free Enterprises
by N. S. Venkataraman
The birthday of Rajaji on 9 th December,2021 has gone unnoticed for all practical purposes in India and even in his own state of Tamil Nadu. This is in sharp contrast to the way that India celebrates the birth anniversary of eminent persons like Mahatma Gandhi, Jawaharlal Nehru, Sardar Vallabhai Patel . This is also in sharp contrast to the way in which Tamil Nadu celebrates the birth anniversary of eminent persons like Periyar, Annadurai, Kamaraj, Bharathiar. V.O.Chidambaram Pillai . The above persons are all eminent personalities and it is appropriate that India remember them , Rajaji is no less an eminent person than the above stalwarts. Rajaji was described as his conscience keeper by Mahatma Gandhi.
Unique role in post independent India :
While Rajaji’s public life can be divided into two parts namely pre independent India and post independent India , the younger generation who have not seen Rajaji and only read his life history must be wondering as to which part of his public life was more noteworthy, whether pre independent days (before the year 1947) or post independent days ( after the year 1947)
In the pre independent days, there were galaxy of great leaders and personalities crisscrossing across India under the leadership of Mahatma Gandhi and Rajaji was one amongst them. However, in the post independent days, the role and contribution of Rajaji was unique, as he spoke about several socio economic subjects with high level of clarity and understanding and courage of conviction, even when they would be different from the popular perspectives prevailing then. There were many such views and concepts that formed part of his speeches and writings.
Advocacy of free enterprise
One of the important policies that Rajaji recommended and advocated was about the need for promoting free enterprise that would enable rapid industrial and economic growth in the country. These views were different from that of state capitalism that the then Prime Minister Jawaharlal Nehru advocated and practiced.
At that time, Rajaji was severely criticised by the so called socialists, leftists and communists who castigated him for what they termed as taking the side of affluent and rich people and businessmen. According to his critics, the investment for growth have to be necessarily, fully or mostly with the government , to ensure ploughing of national resources and investments in the most appropriate areas that were relevant to the need of the country. According to them, such state capitalism was necessary to achieve equi distribution of income and opportunities and to prevent exploitation of deprived persons by the rich and affluent people. These critics of Rajaji including Jawaharlal Nehru had strong faith in the public sector enterprises, somewhat as reflected largely by Soviet form of governance in those days . Such advocates of state capitalism took care to make a distinction between communism and socialism.
In other words, the advocates of state capitalism were striving to implement the communist philosophy in a democratic society. Initially, this experiment caught the imagination of the country men . Massive projects like steel plants, power plants were set up under public sector and later on, the then Prime Minister Indira Gandhi went to the extent of nationalising the banks. Such steps appeared to take the country ahead when viewed from short term perspective. However, after the initial euphoria, they later on proved to be counter productive in the long run , as inefficiency, political interference and other negative elements crept into the management of these public sector institutions in a big way and retarded their progress. They proved to be counter productive in the long run ,as several public sector enterprises became sick and white elephants and governments having to pump money continuously into them to sustain their operations. While there are many such examples, Air India is an example in the recent memory.
Collapse of communism in Soviet Union :
To cut the long story short, the inadequacy of Nehruvian policy of state capitalism has been more than proven by the collapse of Soviet government and virtual elimination of communism from the erstwhile Soviet Union.
Dilution of communism in China
Now, the other big communist country China has considerably diluted the concept of state capitalism by encouraging private ownership in a big way and allowing multinational companies to play a big role in China’s industrial and economic sphere. This policy of Chinese government is predominantly responsible for leap frogging Chinese economy and China to a position of world leadership. Today, Chinese form of governance is only communism in namesake and all observers agree that China is atleast, in part, a free enterprise economy. As a matter of fact, by conceding that China is a democratic society, ( whatever it may mean in China’s parlance ) Chinese government has virtually confessed that it has moved towards a capitalist economy.
Rajaji’s advocacy of free enterprise proved to be correct :
In recent time, by a process of broad national consensus ,a number of public sector enterprises have been privatised in India by earlier UPA government and the present Modi government. Modi government is continuing the process and is also closing down the unviable and sick public sector units. Special incentives are being offered to promote greater participation of private sector in industrial and economic growth and one of such recent impressive incentive is PLI ( production linked incentive) scheme
All these developments clearly show that Rajaji’s opposition to state capitalism has been proved to be appropriate and his views have stood the test of time.
Let the country remember Rajaji :
Perhaps, it would be appropriate to celebrate the birthday of Rajaji atleast next year as a day of free enterprise.
While Rajaji’s birthday in December has largely gone unnoticed for whatever reasons, it is hoped that the country would remember him on his forthcoming death anniversary in the same month of December and pay the tributes to the memory of Rajaji , that this visionary and thinker par excellence richly deserves.
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