Indian Economic Thinkers

Alongside these Western schools of thought, a number of Indian economists and public figures developed their own analysis of India's economic conditions, often applying classical or Marshallian tools to specifically Indian problems such as colonial exploitation, poverty and planning for industrial development. The GSHSEB Std 11 Economics curriculum introduces a few of these thinkers briefly, as a bridge to the later chapters on the Indian economy and economic reforms.

Dadabhai Naoroji (1825–1917), often called the 'Grand Old Man of India,' was among the first to use economic data — rather than only political argument — to indict British colonial rule. In his 1901 book Poverty and Un-British Rule in India, he developed the 'Drain of Wealth' theory: the argument, backed by his own estimates of national income, that a substantial part of India's wealth was being systematically transferred to Britain every year — through home charges, salaries and pensions paid to British officials, profits repatriated by British-owned companies, and unequal terms of trade — without India receiving an adequate economic return, and that this continuous drain was a root cause of India's poverty under colonial rule.

Mahadev Govind Ranade (1842–1901), often called the 'Father of Indian Economics,' argued — against the purely laissez-faire classical view — that a country still industrialising, like India, needed active state support (protective tariffs, government promotion of industry and infrastructure) rather than pure free trade, because free trade principles developed for an already-industrialised Britain did not automatically suit an agrarian, colonised economy at an earlier stage of development. His Essays on Indian Economics argued for constructive state intervention adapted to India's actual conditions.

Sir M. Visvesvaraya (1861–1962), an engineer as much as an economist, argued in his 1934 book Planned Economy for India for a deliberate, centrally planned strategy of industrialisation to raise India's low per-capita income — proposing specific targets for shifting workers out of low-productivity agriculture into industry over a fixed number of years. His ideas anticipated, and directly influenced, the Five-Year Plan approach India adopted after independence. …