Recap

Chapter recap

• A mixed economy by choice. After independence India envisaged a system combining the best features of socialism and capitalism, which culminated in the mixed economy model — a strong public sector alongside private property and democracy.
• Planning through five year plans. All economic planning was carried out through five year plans, borrowed from the Soviet model and set in motion by the Planning Commission created in 1950.
• Four goals. The common goals of the plans were growth, modernisation, self-reliance (self-sufficiency) and equity, with different plans emphasising different goals because resources were limited.
• Agriculture. The major initiatives were land reforms (abolishing intermediaries, land ceilings) and the Green Revolution (HYV seeds with fertiliser, pesticide and irrigation). Together they made India self-sufficient in food grains, though land reforms fully succeeded only in Kerala and West Bengal.
• A jobs failure. Despite rising farm output, the proportion of people depending on agriculture did not decline as expected, because industry and services failed to absorb the surplus workforce.
• Industry and trade. Import substitution and the licensing regime, with the public sector controlling the commanding heights, raised industry's share of GDP and diversified the industrial base. …