Why India's biggest problem isn't Narendra Modi.
In a speech to Mumbai college students in November 2010, while on a state visit to India, U.S. President Barack Obama declared, "The United States does not just believe, as some people say, that India is a rising power; we believe that India has already risen." He was not alone in expressing such gusto about the country's prospects. A spate of books, both popular and academic, had been highlighting the country's imminent economic success.
Indeed, India seemed on the verge of genuine great-power status, due in no small part to liberalization of the country's economy. Market reforms begun in the 1990s had soon led to an average growth of about 8 percent annually. India was held aloft with China as an emerging economic powerhouse. And if the rising tide did not lift all boats, it did create a viable middle class in a country long divided between a small elite and a desperately poor majority.
Then, starting about three years ago, this remarkable transformation slowed to a relative standstill almost as quickly as it had begun, and the search for scapegoats began. India's slowdown has been blamed on everything from the global financial crisis, to corruption scandals that have racked the Indian National Congress party and its allies, to misguided economic policies. These factors, however, are merely manifestations of a far deeper malaise that has afflicted the country for a long time.
Over some 40 years, the founding ideas that made India a stable, democratic, and secular nation have been eroding -- an erosion accelerated by the government's utter failure to explain the need to move from the country's early socialist guarantees to the promises of free market prosperity. To explain, that is, the need for ideological change. Whenever the public's expectations, whether of government care or free market prosperity, have not been met by reality, national discontent has increased. And whenever discontent has increased, there have long been opposition politicians willing to nurture base ethnic nationalism to further their own aims. The result has been a cycle of increasingly aggressive populism that does much to undermine India's national identity and little to rectify its foundational problems. Amid a lack of real ideas, a play to the electorate's base instincts has been the path of least resistance to power.
In May, these trends culminated in the national election that gave the Bharatiya Janata Party (BJP) and Prime Minister Narendra Modi a sweeping victory with both a mandate and the power to execute their agenda for India. To many observers, the dramatic ouster of the once-dominant Congress party was nothing short of a revolution. But the truth is that the BJP's win was merely the latest swing of a pendulum between competing populisms that long ago took the place of substantive debate in India.
India retains significant national and international potential. Over 100 million of its citizens speak English, the established language of diplomacy and commerce; it has a youth bulge around the corner (in 2020 the average age will be 29); and its entrepreneurial class has demonstrated that it can compete with its global peers. Nor is India lacking in hard, material capabilities: It is a nuclear-capable state with a professional, million-man army.
But if India's leaders insist on hewing to these lowest-common-denominator politics, the country will prove unable to address endemic problems of rural and urban poverty, it will not succeed in sustaining steady economic growth, and it will be unable to be counted on to shoulder the burdens of various forms of global collective action on issues ranging from trade to climate change. India's problem is not Modi -- it is decades of political and intellectual deterioration that made his election possible.
To grasp what ails India today, we need a small dose of historical perspective.
Quickly after assuming independence in 1947, India developed a strong, unifying set of ideas that were ratified through vigorous and public ideological debate. Jawaharlal Nehru, the country's first prime minister, and his nationalist colleagues espoused a form of secular socialism at home and nonalignment abroad -- a foreign policy aimed at keeping the new nation out of the budding Cold War between the United States and the Soviet Union. Many of Nehru's policies, though not all, proved successful. Under his leadership, India built an industrial base, sought to forge a distinct national identity, and solidified its commitment to liberal democracy -- a commitment incorporated into the fabric of his Congress party.
In contrast, some of Nehru's opponents had argued for alignment with the West and a free enterprise system domestically. The predecessor to today's BJP, Bharatiya Jana Sangh, had promoted Hindu nationalism at home and a muscular foreign policy. But Nehru prevailed in every national election from 1952 onward and created and nurtured a range of political institutions that enshrined his national vision and laid the foundation for modern India.
Nehru's socialistic approach had its limits, though. It did succeed in preventing vast disparities in wealth and income, but it also led to a slothful bureaucracy that guaranteed lifetime employment to a substantial number of Indian citizens. In this variant of democratic socialism -- what the noted American economist (and onetime ambassador to India) John Kenneth Galbraith sardonically described as "post office socialism" -- the central government inevitably assumed a paternalistic role. Although Nehru was popular with many, his system's structural inefficiencies did not reduce poverty, as he had promised, nor deliver economic growth. At the same time, his emphasis on heavy industry came at the cost of agricultural investments, inadequate attention was paid to burgeoning population growth, and there was a colossal neglect of primary education. As a result, India remained a poor nation unable to realize its vast economic and human potential.
By the time Nehru's daughter, Indira Gandhi, took office in 1966, India was in dire economic straits. Within the year, under pressure from global multilateral banks and the United States, it had to devalue its currency by about 37 percent. These problems worsened under Gandhi because she lacked the intellectual wherewithal to fix them, she pursued ill-considered economic policies, and she ignored relevant policy advice. Instead, she seemed interested chiefly in increasing her own power, which she did by disregarding institutional procedures her father had established in favor of personal loyalty. She ended the practice of holding internal elections for the governing structure of the Congress party. As a consequence, political representation suffered because regional leaders who commanded grassroots support did not necessarily rise within the party's hierarchy. She steadily politicized the civil service and she eroded the independence of the higher judiciary.
None of this benefited Indian democracy, but the country's continued economic straits opened the door for Gandhi to develop a politically effective, but substantively hollow, form of populism. Although a small segment of the electorate, especially the intellectual class, protested, most were swayed by her rhetoric. This strategy dramatically raised the expectations of many voters and led them to put their faith in her slogans. In 1971, for example, her campaign mantra was garibi hatao ("abolish poverty"). In a country besieged with abject need, Gandhi's opponents had difficulty combatting this exhortation on the campaign trail. Unsurprisingly, they began to cast about for similar slick appeals.
Their answer came in the form of crude ethnic nationalism that sought to scapegoat minorities for the country's many ills. The most prominent party to embrace this tactic was the BJP, which in the 1980s seized upon a virulent Hindu nationalism that resonated among much of the electorate. Thus, at the same time that India's democratic socialism was turning into an autocratic populism, the robust commitment to secularism Nehru had established was also beginning to erode.
In her final years in office, as regional parties rose to challenge Gandhi and support for Congress declined, she resorted to striking political bargains that worsened this problem considerably. Perhaps the most egregious was her tacit partnership with a radical Sikh preacher, Jarnail Singh Bhindranwale, who was promoting violent separatism in the border state of Punjab. This alliance of convenience was designed to undermine the Shiromani Akali Dal, another political party in the state. When Bhindranwale eventually turned against her, Gandhi was compelled to use force against him at the Golden Temple in the city of Amritsar. This action not only resulted in the deaths of several hundred hapless pilgrims, but it also ultimately led to her assassination in 1984 at the hands of her Sikh bodyguards.
Her son and successor, Rajiv Gandhi, continued to erode India's secular edifice and strengthen the appeal of Hindu zealots by cozying up to the most anti-modernist segments of the Muslim community in a crude attempt to bolster his electoral fortunes. In October 1988, for example, even before Iran issued its infamous fatwa against Salman Rushdie, Gandhi's government banned The Satanic Verses in order to garner Muslim votes. This, however, was not its most egregious decision. Two years earlier, in an attempt to court India's vocal, traditionalist Muslim orthodoxy, it had used its parliamentary majority to overturn an Indian Supreme Court judgment granting alimony to an indigent and illiterate Muslim woman.
The BJP, unsurprisingly, seized upon both episodes as evidence of the Congress party's "appeasement" of the Muslim minority and branded its actions as "pseudo-secularism." The BJP deftly portrayed the Muslim minority as retrograde and Congress as a threat to India's majority Hindus. While promising to restore "genuine secularism," the BJP really sought to dismantle the entire edifice of secularism in India by depicting Hindus as a besieged community.
This message was popular, but the BJP nevertheless failed to win national elections in the late 1980s. Instead, a series of weak, rudderless coalition governments provided neither governance nor growth. Against this gloomy backdrop, the Cold War drew to a close, India's warm relationship with the Soviet Union ended, and the namby-pamby socialist model of economic development began to disintegrate. To compound matters, an unprecedented fiscal crisis hit India -- it was triggered in part by the Gulf War, which cost India considerably in lost remittances from expatriate workers in the Persian Gulf region, forced the government to pay for the workers' swift repatriation, and led to a dramatic rise in global oil prices.
Seeking a modicum of stability, the electorate returned Congress to power in 1991. Veteran politician Narasimha Rao became prime minister and, together with then-Finance Minister Manmohan Singh, seized the crisis as an opportunity to dramatically change the country's economic direction. They moved India away from its decades-old state-led model of economic development. They implemented more market-friendly policies that reduced regulatory barriers, opened India to foreign investment, and gingerly sought to sell off state-owned firms. The reforms worked, growth steadily increased, and, for once, the country started to make a real dent in reducing rampant poverty.
However, the leadership made practically no effort to provide an explicit intellectual rationale for the drastic shift in the country's economic policies. The process of liberalization, for the most part, was accomplished through stealth and subterfuge. Even as the government shed many of its regulatory functions, large sections of the electorate remained wedded to the socialistic order that provided numerous public-sector jobs, offered a range of subsidies in areas ranging from food to transportation, and bailed out unprofitable government firms.
Beyond its failure to justify economic liberalization, India's leadership did not swiftly create new institutions to ensure sufficient transparency, surveillance, and oversight of a more market-oriented economy. The lack of such neutral institutional supervision enabled a small number of well-connected players to corner important segments of the market, most notably when the government auctioned state resources ranging from the electromagnetic spectrum to coalfields.
As a small coterie of elites cornered markets and reaped windfall gains, Congress and its parliamentary coalition, the United Progressive Alliance, could only proffer the poor and the disenfranchised anemic, leaky welfare programs. An electorate that had witnessed the creation and waylaying of vast wealth was left deeply dissatisfied with the crumbs of the government's dole, especially as the public sector, a mainstay of employment, failed to expand. Unsurprisingly, voters turned their electoral wrath on the ruling coalition. Simultaneously weary of Congress's blatant (yet insincere) electoral pandering to the Muslim minority, they finally turned to the BJP and its siren call of ethnic scapegoating.
When the BJP assumed office in 1998, it expanded Congress's partial opening of the Indian economy. However, it too avoided the nettlesome task of providing the electorate an explicit logic for market reforms. Instead, during its term, it sought to move the country away from secularism toward ethnic nationalism. To that end it attempted to alter history textbooks, showed scant regard for minority rights, and did not upbraid Modi when, under his tenure as governor, a full-fledged pogrom erupted in the state of Gujarat. It did, however, promote significant economic growth while opening the doors to crony capitalism. The electorate tolerated this for six years, at which point it kicked out the BJP and returned Congress to power in 2004.
It was partway through the Congress-led coalition's second term that the economy began to stagnate, with growth beginning to fall off in 2011. The government's rampant venality and gross ineptitude, combined with fire sales of national assets and stagnated infrastructure projects, increasingly forced the public to question whether the benefits of liberalization really outweighed the damage that had been done to the social safety net. The move from socialism was never well articulated, and the benefits of liberalization were never evenly distributed -- thus, the door was flung open for a campaign that, even more than in 2004, became less about solving India's problems and more about blaming minorities.
True, the BJP did highlight India's difficulties -- and blamed Congress for them -- but it did little to explain how it would better manage the country. All it did was tout Modi's putative economic achievements in his home state of Gujarat and his reputation for administrative efficiency. Congress, unable to respond substantively to the charges, sought to shift attention to the BJP's checkered record on minorities and especially on Modi's albatross: the February 2002 pogrom in Gujarat, which he has been accused of fueling. In return, a BJP campaign manager and a close associate of Modi, Amit Shah, while campaigning in a riot-torn town in the populous state of Uttar Pradesh, called on the crowd to seek "revenge for the insult" that they had putatively suffered during recent Hindu-Muslim riots. Worse still, he claimed that the predominantly Muslim town in the same state, Azamgarh, was a base for terrorists. A country in dire need of leadership was thus treated less to a political campaign than to a contest of ethnic chauvinism.
Given the Congress party's abject record over the past five years, it is hardly surprising that a significant segment of the Indian electorate fell under Modi's spell despite his failure to articulate a viable alternative political vision. Now that he is ensconced in office, will he be able to sketch a blueprint for tackling India's myriad domestic woes as well as delineate a possible pathway for its conduct of foreign affairs? If the quality of the debates during the campaign was a harbinger of the future, the room for optimism is quite limited.
What India desperately needs is the forging and articulation of a novel ideological consensus, the revitalization of its denuded institutions, and an end to sectarian appeals. A significant segment of the Indian electorate has pinned its hopes on Modi's Janus-faced promises: Some within his flock have reposed their hopes in the resurgence of Hindu cultural nationalism, while others have taken solace in his technocratic economic promises. But neither of these two appeals can enable the country to address and resolve its underlying debilities.
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