An economic plan is intended to control the economy: the authorities in charge of the execution of the plan are also expected to have the will and the power to carry it through.
As regards the goals of India's plans, there is no dearth in them of pious and brave declarations. When the Planning Commission was set up in March 1950, it was declared that the Commission would take as its basic terms of reference the following Directive Principles of State Policy embodied in the Indian constitution:
"(a) that the citizens, men and women equally, have the right to an adequate means of livelihood;
"(b) that the ownership and control of the material resources of the community are so distributed as best to subserve the common good; and
"(c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment."[1]
When the Second Plan was at the stage of preparation, the building of a socialist pattern of society was proclaimed as the goal. On whom did fall the tasks of planning for a future socialist India? As noted before, Sir V.T. Krishnamachari, a senior I.C.S. Officer, who had held high administrative posts during direct British rule, was vice-chairman of the planning commission from 1953 to 1960. Sir N.R. Pillai, a member of the I.C.S. and secretary to the Cabinet, was secretary of the commission and Tarlok Singh, another member of the I.C.S., was his deputy. Gulzarilal Nanda, who had played an important role in organizing the Indian National Trade Union Congress (INTUC) in 1946 and in breaking the unity of the working class movement, was minister of planning from 1953 to 1960. About Nanda, G.D. Birla, who was likely to have an intimate knowledge of him, said: "There is Nandaji, who says that his mother did not give birth to him. She who gave birth to him is saffron-robed. She sends whatever you demand — be it rasgulla sweets or diamonds and pearls and does it just by raising her hand towards the sky."[2] Under such a minister of planning socialism was, indeed, easy of achievement.
Besides such Indian planners, Millikan, Rostow, Galbraith, etc, were entrusted with the task of planning for a socialist society in India.
The socialist goal has been declared from the house-tops from time to time while serving imperialist and comprador capital and landed interests, Nehru and his worthy daughter, Indira Gandhi never tired of proclaiming the socialist goal. In her "Foreword" to the Sixth Five Year Plan 1980-85, Indira Gandhi, then prime minister and Chairman of India's Planning Commission, asserted:
"Progress in a country of India's size and diversity depends on the participation and full involvement of all sections of the people. This is possible only in democracy. But for democracy to have meaning in our circumstances, it must be supported by socialism which promises economic justice and secularism which gives social equality. This is the frame of our planning."
She added
"We have come to a stage where we can confidently assert that development has contributed to strengthening our nation in spite of its regional, linguistic, social and communal diversities. It has consolidated our democracy and is guiding our society towards socialism."[3]
In the "Preface" to the Sixth Plan, the deputy chairman of the Planning Commission stated that "the essential goals of Indian planning have been growth, removal of poverty and achievement of self-reliance."[4]
No doubt, Indira Gandhi was best fitted to talk about the consolidation of democracy and the building of socialism in India. Besides other achievements to her credit in realizing these goals, it has she who had imposed a state of Emergency in India only a few years before, which liquidated even all semblance of democratic rights in this country, declared many political parties illegal, imposed pre-censorship of the press, stifled all voices of dissent, flung all dissenters — radical and conservative alike — into prison and suppressed the struggles of the toiling people with fire and sword. Fascist terror was let loose.
We have had some idea of how "development" has been leading India toward socialism, how the goals of "growth, removal of poverty and achievement of self-reliance" have been attained in the course of planning for more than four decades.
Paul Baran said that "no planning worth the name is possible in a society in which the means of production remain under the control of private interests which administer them with a view to their owners' maximum profits (for security or other private advantages). For it is of the very essence of comprehensive planning for economic development — what renders it, indeed, indispensable — that the pattern of allocation and utilization of resources which it must impose if it is to accomplish its purpose, is necessarily different from the pattern prevailing under the status quo."[5]
In India the means of production are mostly owned and controlled by private interests — native and foreign. They invest in areas which assure them of maximum profits: they are interested only in their own profits, in their own growth and expansion. Invariably there is contradiction between their interests and the interests of the society a whole. It is claimed that by operating a system of controls — over capital issues, licensing of new enterprises and of large extensions of existing ones, controls over allocations of foreign exchange and over import and export, and price and physical controls, the investment decisions of the private businessmen can be guided along the desired channel. It may be remembered that the different controls by the State, even State management and State ownership of many industries, were urged by the tycoons themselves in the Bombay Plan. The plans drawn up by the colonial masters in the mid-forties also stressed their necessity. It was felt that these controls, licences, State intervention were essential in the interest of the tycoons themselves.
The question is: who guides whom when individual profit is the motive of production? In a society where the means of production are mostly the private property of small classes of people, there invariably exists a close nexus between the big capitalists and the policy-makers and administrators. The government in a capitalist country, as Marx and Engels said, "is but a committee for managing the common affairs of the whole bourgeoisie."[6] In India the government functions as a committee that manages the common affairs of the big comprador bourgeoisie and their imperialist principals as well as of the rural oligarchy. "The powers of the State [under capitalism] having to do with taxation, the regulation of foreign trade, public lands, commerce and the discharge of the functions of public administration," writes Harry Braverman, "have served as an engine to siphon wealth into the hands of special groups, by both legal and illegal means."[7] Some token welfare measures are undertaken to provide minimal relief to the people groaning under conditions of almost incredible poverty and deprivation — in order to create illusions about the character of the State and forestall revolutionary struggles which would otherwise be inevitable.
A notion is today being propagated that the earlier regime of 'controls' — the 'license-permit raj' — was socialistic, and that that the dismantling of them is a fundamental break in policy with the earlier regime. This is false. Actually, the earlier policy of the Indian State — its licensing policy, control over capital issues, permits and quotas — was designed to promote the interests of the big compradors and their foreign collaborators, and these interests took precedence over the brave declarations in the Plans. Even the public or nationalized sector — manufacturing and financial — is intended to serve the interests of the private sector.
Let us consider how the industrial licensing system actually worked. It was the usual practice of big business houses to put in a number of applications for each product. The purpose was not to implement them, if approved, but to foreclose the licensable capacity and prevent rivals or new entrepreneurs from entering different industrial sectors. This has been pointed out in the Industrial Licensing Policy Inquiry Committee (Dutt Committee) Report of 1969. As R. K. Hazari writes, "multiple applications for the same product and for a wide, very wide indeed, variety of products are meant to foreclose licensable capacity. This appears to be particularly true of Birla applications." Hazari cites concrete instances. Among them is the Manjushree Industries, a Birla concern. Manjushree, "which holds licences/letters of intent, among other things, for acrylic fibres, bamboo pulp, steel castings and cotton spinning had, on 30th September 1964, a share capital of Rs 5,000 and no liabilities or assets to speak of." A few favoured business houses always received the maximum number of industrial licences. The licensing system encouraged, as Hazari points out, "foreclosure of licensed capacity by influential groups," who would sit "tight on unimplemented licences.... There is very little follow-up of licensing to see that the approved projects fructify in a satisfactory phased schedule. Even the authorities concerned are not fully aware of the total investment and foreign exchange commitments of licences issued or those under implementation at any particular period of time."[8] A vastly disproportionate share of licensed capacity was allotted to the largest business houses. The practice of pre-empting licences and sitting tight on many of them by big houses with political clout was one of the causes of the shortfalls in production targeted by the Planning Commission.
Lip-service was invariably paid to social priorities by the planners but, in actual practice, "licences," as R. K. Hazari pointed out, "were given for nearly all projects which satisfied certain criteria of secondary importance like foreign collaboration, import substitution, etc. but which bore little relationship to desired priorities."[9]
By making use of the licensing policy, the Government tended to create monopoly or oligopoly, for the grant of licences was related to capacity — to potential availabilities and potential demand. It assured a monopolistic market to Indian business magnates and their foreign collaborators by keeping competitors out and helped their rapid growth and expansion.
It has been usual with the planners to indulge in wishful thinking about the rate of growth of the GDP. While the growth of the GDP has always been estimated at more than five per cent per annum, the average annual rate of growth has been about 3.5 per cent. There are often wide gaps between physical targets and financial targets — the estimates of the available resources (including hoped-for loans from foreign creditors). Speaking of the Third Plan, Hanson states that "the commission appeared to be deceiving those of its readers who were prepared to take its own arithmetical exercises on trust." He points out the wide contrasts between physical and financial targets.[10] Gunnar Myrdal observed that in India "plan fulfillment has regularly fallen short of the targets for public investments in basic facilities and in industry. As for the dispersed and less calculable public efforts in agriculture, rural uplift, and education, the distance between plans and accomplishments is even wider. The relevant chapters in the Indian plans often have an abstract and unrealistic tone of academic propaganda as does the public discussion."[11]
As we noted before, the Draft Five Year Plan, reviewing the results of twenty-five years of planning, admitted that "the most important objectives of planning" had not been achieved, that "the concentration of economic power" had increased and that "the land reform measures" had no "impact on distribution of rural property."
D.R. Gadgil, who became vice-chairman of the Planning Commission, observed that the most outstanding feature of India's "planned" economy was the total absence of a policy frame, that it operated as "almost a 'laisser-faire' economy, in part, modified by the operation of particular controls." "There is no doubt," he said, "that the present shape and direction of economic policy in India are largely the result of the influence of vested interests...." He held that the continued dependence on external aid "mortgages our future to the giver of aid: and as recent experience has painfully underlined, it gives outsiders enormous influence in shaping our economic policy."[12]
Charles Bettelheim, the eminent French economist, who had intimate knowledge of India's 'development' plans, stated that neither the politicians not the civil servants and technicians who prepared the plans "had any definite theories in mind. The Indian Plans are above all empirical; they are intended to provide the answer to some urgent problems and to satisfy a certain hope and need". Bettelheim further commented that the main characteristic of the plans "is that they state what is anticipated or expected. They are entirely different from socialist plans, which lay down imperative and compulsory conditions.... the Indian Plans attempt to define as precisely as possible the Government's agricultural, economic and industrial policies for the following five years. The Government and its administration naturally want to fulfil as much of the Plan as possible, but they may adopt measures very different from those suggested by the original Plan without violating any legal obligations. The fundamental cause of this situation is the capitalist nature of India's economy which gives a lot of initiative to private capital. Few restraints are used.... There is therefore no planning in the true sense, as there can be none in any capitalist economy if the term is taken to understand not only the preparation of plans but their compulsory execution."[13]
Writing in the sixties, Bettelheim also noted "India's growing reliance on foreign debt", the "heavier costs resulting from the foreign debt and foreign investments". He predicted that, unless things changed, India would soon face "the classic and all too-well-known situation prevalent in South America: incapacity to meet foreign expenses (repayment, interest costs, dividends, import costs, etc.), a demand for more aid and for a payment moratorium, the arrival of a mission of 'financial experts' sent by the creditor countries or by the I.B.R.D. or the IMF, who would outline an 'austerity programme' which India would be forced to accept, thus losing the initiative in matters of investment, prices, currency, etc."[14]
Planning went hay-wire after the mid-sixties when, in 1966, the devaluation of the rupee to the extent of 36.5 per cent was forced on the Indian government by the U.S. imperialists and the World Bank. Asoka Mehta, then India's minister of planning, followed prime minister Indira Gandhi to Washington, had two meetings with U.S. President Johnson, carried on negotiations with U.S. cabinet members and with the president of the World Bank, George Woods. To quote Francine Frankel, "The minister of planning, who placed virtually all of India's major Fourth Plan schemes before George Woods for his consideration and approval, pointed to the progress in carrying out the new agricultural strategy [called the Green Revolution ensuring imperialist capital's penetration into Indian agriculture, which the Indian government ushered in at the dictates of the U.S. imperialists];[14a] a major new commitment to family planning, with the creation of a separate Department of Family Planning in the Ministry of Health; new opportunities for foreign private investment in fertilizers and petroleum; and the first steps toward relaxation of industrial licensing policy and price and marketing controls."[15]
Earlier in late 1965, as noted before, C. Subramaniam, the food and agriculture minister of the government of India, travelled to Washington to submit an outline of India's new agricultural strategy to the U.S. department of agriculture and obtain its approval. And he again saw the U.S. secretary of agriculture, Orville Freeman in Rome and "the specific policy proposals were reviewed item by item, including the plans for incentives to foreign private investment, especially in fertilizer."[16] And when India's food minister saw U.S. president Johnson, Johnson "insisted that Subramaniam put those policies [approved by him] in a written agreement with the American secretary of agriculture, Orville Freeman."[17] This was done: India signed on the dotted line.
The major economic policies of India have been drawn up virtually at the behests of imperialist masters in the interest of imperialist capital: India's Plans adjust themselves to those policies. It is not the Plans but imperialist capital — as represented by the Western powers and Japan — and Indian big comprador capital that actually control the economy.
Since the mid-sixties a policy of gradual delicensing, relaxation of controls and deregulation has been followed. The process was hastened when, in the early eighties, India's ruling classes approached the IMF for five billion SDRs (about Rs 5,200 crore at the current exchange rate). Secret negotiations were carried on between the Indian government and the IMF. The IMF imposed certain conditionalities. On the Indian government's compliance with them the loan was to be released in three installments. The release of the second and third installments would depend on the Indian government's satisfactory performance — satisfactory to the IMF. Besides an "austerity programme" — austerity not for the upper stratum but for the common people —, the conditionalities included demands for the boosting of the private sector — both native and foreign, 'liberalization' — closer collaboration with foreign capital and offer of more liberal royalty payments, relaxation of controls over imports, greater incentives to exports, cut in food and fertilizer subsidies, raising of administered prices of agricultural products and of products of public sector enterprises, etc. These binding conditions were agreed to by the Indian government in the finance minister's letter of 28 September 1981 to the managing director of the IMF and in the Statement of Economic policies which was enclosed with that letter.[18]
Contrary to all estimates of the planners, imports of goods, mainly capital goods and luxury articles for the consumption of the rich, soared. Collaborations with foreign capital multiplied. There was "liberalization" in respect of industrial licensing and controls. The investment "limit" of the delicensed sector was gradually raised from Rs 3.0 crore in 1983 to Rs 25.0 crore in general and to Rs 75.0 crore for projects in backward areas in 1990. Chandra Shekhar, who became India's prime minister for a brief spell, observed that nearly 75 per cent of the industrial investments and production were taken out of the scope of planning.[19]
During the eighties, with steady relaxation of controls over capital issues, licensing, etc., lowering of tariffs over imports and exports, increase in incentives to exporters, relaxation of foreign exchange regulations and so on, India's trade deficit and adverse balance of payments, chronic since the inception of planning, grew from bad to worse; India's budget deficit rose from Rs 3,451 crore in 1980-1 to Rs 12,149 crore in 1989-90. All this necessitated increased dependence on external debt. In rupee terms India's external debt rose about five times — from Rs 13,479 crore in 1980-1 to Rs 66,017 crore in 1989-90. The rupee went on depreciating in value: the value of the rupee per U.S. dollar fell from Rs 7.908 when the decade opened to Rs 16.923 when it closed. On an average the rate of inflation was nine per cent during the eighties.
The increasing balance of payments difficulties, the soaring external debt with a large proportion of short-term, high-interest commercial loans, the debt-servicing obligations and the acute foreign exchange crisis — the inevitable outcome of 'development' planning for about forty years — placed India's ruling classes completely at the mercy of the IMF and the World Bank. These classes wanted to solve the crisis at the expense of the people. The watchdogs of the interests of imperialist capital — the IMF and the World Bank — undertook to salvage them out of it and initiated economic policies for implementation by India's parliamentary political parties of all hues — right, centre and 'left'. The ritual of planning ceased for the time being.
The advanced capitalist countries had been hit by recession since 1978-9. They were anxious to export more capital goods and luxury consumption goods to Third World countries like India — and were keen that all restrictions on their export should be removed. Their interests converged with the interests of the big Indian compradors. They too were chafing against various controls — the industrial licensing system, controls over capital issues, foreign exchange regulations, import controls and other restrictions that now came to stand in the way of their operations. These very controls had made them what they were, created for their industries a monopolistic or oligopolistic market and had been sought after by them before, though they were outwardly critical of them. But now these had become outworn weeds which were proving irksome for them. 'Socialist pattern' had served its purpose. 'Democratic planning' had made them proud possessors of vast financial resources — legal and illegal. They had large hoards of money capital within the country as well as stashed away in secret accounts in foreign banks. Part of these they wanted to bring back laundered as white money to realize their dreams of expansion. As before, their dreams could be made real as junior partners of transnationals based in imperialist metropolises. With massive amounts of equity and loans from State-owned banks and other financial institutions and with foreign collaboration, capital goods and technical know-how from foreign collaborators, they were now in a position to launch into industries which they had shunned before and for the products of which they had relied on the public sector. The profit-making public sector enterprises were themselves a tempting prize which they wanted to grab.
So the wind of 'liberalization', that is, the dismantling of controls and restrictions — necessary instruments of planning — turned into a gale. India: An Industrialising Economy in Transition, a report released by the World Bank in December 1989, became the basis of India's 'new industrial policy,' which was announced soon after. It was contrary to the guidelines for industrial policy in the Planning Commission's Approach to the Eighth Plan which the Commission had laboriously prepared and which had been approved by the union cabinet a few days earlier.[20] Apart from delicensing all new units up to an investment of Rs 25 crore in fixed assets in non-backward areas and of Rs 75 crore in centrally notified backward areas, the 'new industrial policy' permitted free import of technology without prior Government clearance (provided the royalty payment to the foreign collaborator was not unusually exorbitant) and foreign investment in equity up to 40 per cent on an automatic basis.
As India's crisis grew, the IMF, the World Bank and the Aid-India Consortium members demanded more 'liberalization' of the Indian economy — a steep devaluation of the rupee; a more or less open door to foreign capital; freer imports of capital goods, industrial raw materials and other goods; lowering of tariffs, relaxation of Foreign Exchange Regulation Act provisions and of the Monopolies and Restrictive Trade Practices Act; change in India's Patent Act and so on. The demands no doubt received satisfactory responses from India's ruling classes.
While extending a meagre loan of $1.8 billion (about Rs 3,250 crore) to the Indian government as a stop-gap to meet India's immediate balance of payments difficulties, the IMF stated in a press note of 29 January 1991 that "the Government is committed to continuing adjustment process in the fiscal year 1991-2 beginning in April." India's finance minister declared in parliament in March 1991: "I would like to stress, once again, that my commitment to adjustment in 1991-92 remains firm and irrevocable."[21]
Immediately on assuming office in June 1991, the new government with Narasimha Rao as prime minister announced policies that went a long way to meet the IMF and World Bank demands, and the new finance minister assured the managing director of the IMF in a letter of 27 August 1991 and the enclosed "Memorandum on Economic Policies for 1991/92 - 1992/3" that more would be done. Already the Government had devalued the Indian rupee against the major currencies of the world by almost 20 per cent: its value was fixed at Rs 25.95 per U.S. dollar. Announcing a new industrial policy in parliament on 24 July 1991, the Government abolished the industrial licensing system for all industries except a few related to security, strategic concerns and the like; did away with the system of phased manufacturing programme which required the gradual reduction in the import content of some products; declared the policy of abolishing official controls and promoting energetically foreign investments; assured approval of "direct foreign investment upto 51 per cent foreign equity in high priority industries" (in practice, 'priority industries' include cold drinks, Kentucky Fried Chicken and the like) as well as in "trading companies primarily engaged in export activities"; offered warm welcome and very attractive terms to foreign technology; encouraged the private sector to enter areas previously reserved for the public sector enterprises; promised the closure of loss-making public sector undertakings and part-privatization of the profit-making ones; and promised unhampered growth of monopoly houses by amending the Monopolies and Restrictive Trade Practices Act.[22]
In brief, the main ingredients of new economic policy are: steep devaluation of the rupee which would transfer resources from India to foreign countries by making imports dearer and exports cheaper, inflate the foreign debt, add to inflationary pressures, reduce real wages and make the rich richer and the poor poorer; dismantling of the regulatory system (without which planning becomes meaningless); closer integration of Indian economy with the economy of imperialist countries ("our strategy to promote the international integration of our economy", said the "Memorandum on Economic Policies for 1991/92-1992/93"); an open-door policy towards foreign capital and foreign technology; "trade liberalization", lowering of tariffs and removal of other restrictions on free flow of imports (progressive elimination of "licences and quantitative restrictions, especially of capital goods and raw materials"); all-out efforts to increase exports; unrestricted growth of monopoly houses; withdrawal of budgetary support to public sector enterprises and rendering them unviable, closing down sick ones and the beginning of privatization of profit-making ones; dereservation of the areas previously reserved for public sector enterprises; a tight monetary policy, cuts in the expenditure on social welfare, health, education, etc., gradual withdrawal of subsidies for food and fertilizers, considerable increase in administered prices of food, fertilizers, petroleum products and so on; changes in labour laws and an 'exit' policy allowing employers to retrench workers and close down their undertakings freely; restructuring the financial sector; and gradual steps towards free convertibility of the rupee.[23]
While these measures were ruinous to the interests of the vast masses of people, they would be beneficial to the interests of imperialist capital and Indian big comprador capital and help in fulfilling their dreams of expansion. The Indian big bourgeoisie welcomed the free flow of foreign capital and technology, and their apex organizations — FICCI, ASSOCHAM and CII — hailed these measures. But some members of this class had fears that, unable to compete with vastly more powerful transnationals under the new economic order, their enterprises might be swallowed up by them. Yet they hoped to flourish as their collaborators, as their underlings. Speaking at Madras on 11 February 1995, A. K. Rungta, then president of the FICCI, said that while the strategy should be to welcome foreign direct investment, it should be linked to setting up joint ventures with Indian counterparts.[24] The Chairman and Managing director of the Hindustan Construction Company, India's largest construction company, told a Business Standard representative that "while there is a threat from large multinational construction companies, we are obviating that through strategic alliances. For example, we have a joint venture with Impregile, Italy, for a part of the Naptha Jhakri hydro-electric project in Himachal Pradesh.... It is going to be tough but I think where are are poised for the next 10-15 years, we would be needed by some of the foreign firms who want to establish themselves in India."[25] True compradors, the Indian big bourgeois hope that the transnationals would allow them to serve the latter, and by rendering service to them, they hope to serve themselves at the expense of the country and the people.
These economic policies have been framed in Washington by the IMF and the World Bank for implementation by India's ruling classes. The General Agreement on Tariffs and Trade (GATT, now renamed World Trade Organization) has strengthened some of them and added a few more like opening of the financial sector to foreign capital and safeguarding 'intellectual property rights', which would ensure imperialist domination, particularly over Indian agriculture and Indian pharmaceutical industry.
Is there any scope for planning when the Indian ruling classes have undertaken to implement these economic policies affecting every aspect of Indian economy? Do Indian Plans have any control over the economy?
The Planning Commission acknowledged in a paper "Emerging Issues of Planning" that the essence of the process of planning had been eroded. Yet it bravely claimed that it "still has a large role to play". The Eighth Plan 1992-7 pays as usual, lip-service to the people's welfare and repeats the old, empty verbiage about employment generation (achieving "near full employment level by the turn of the century"), "universalisation of elementary education", "health for all" by the year 2000 and so on, and at the same time makes a virtue of the injunctions of the IMF and the World Bank about abolition of "systems of control and regulation", of "quantitative import restrictions and tariffs", closing down of "unviable PSUs", etc. It states : "Planning and market mechanism should be so dovetailed that one is complementary to the other."[26] The difficulty is that though the market mechanism seeks State intervention to pamper the interests of big capital, it refuses to be guided by the professed objectives of the planners. During the past years of planning, the champions of the 'market mechanism' used State intervention — licences, controls, the public sector, the taxation policy, the credit policy and so on — to become what they are today. As they have grown bigger, they have progressively dismantled the controls and regulations. Today they are scrapping them as so many hindrances to their further expansion under the wing of imperialist capital. Naturally, the market mechanism refuses to be dovetailed with planning.
Our planners have coined a new phrase to describe their planning exercises. In the preface to the Eighth Plan, the deputy chairman of the Planning Commission, Pranab Mukherjee, said: "In line with the changed circumstances, we have redefined the role of the Planning Commission. From a highly centralized planning system, we are gradually moving towards indicative planning."[27] The Plan also states: "These reforms will lead to increased globalization of the economy and its greater integration with the world economy. The freedom and flexibility allowed to the industry will enable it to optimise its competitiveness. In this background, there will be less emphasis on quantitative targets and the planning will become more 'indicative'."[28]
The phrase is a new one; but what else were the previous Plans, if not "indicative"? There was no machinery or mandate to enforce them. As noted before, much of the allocation of available resources and most investment decisions were made according to the priorities which best served the interests of the tycoons, native and foreign. And for a large part of the resources the planners depended on foreign creditors. More important than the amount of resources obtained from external sources at great cost to the people and the country was their crucial importance to the Indian Plans. So the execution of the Plans depended to a great extent on domestic and foreign tycoons as well as on the imperialist lenders whose motives were not quite altruistic. As they paid the piper they invariably called the tune. It is they who controlled the Indian economy, not the plans. The Plans tried to conform to the policies laid down by them.
There has always been something unreal about the Indian Plans. Their objectives have never been fulfilled; their targets have never been reached. While it is claimed that the overall GDP targets for the Eighth Plan have been achieved, indeed surpassed, this merely underlines the deceptiveness and meaninglessness of overall GDP figures. In fact, apart from shortfalls in planned spending on education, health, and social services, there have been grave shortfalls in crucial infrastructural industries — foreboding crises in the medium term. These planning exercises are futile when the economy is controlled by forces represented by the IMF, the World Bank and the World Trade Organization. But they are not wholly futile if their main purpose is to sow illusions in the minds of the cheated people. Though somewhat useful as a tool of propaganda, they are hardly worth the name of Plans.
It is the development strategy, outlined in the Plans, that spells ruin for the lives of the people. Speaking of Latin America, Andre Gunder Frank wrote: "As Foreign Minister Valdes [of Chile] told President Nixon, and as the U.S. Department of Commerce and E.C.L.A. [Economic Commission for Latin America] have documented extensively, it is precisely the foreign investment and aid or external assistance which has generated not only Latin America's contemporary colonial structure, commercial and balance of payments crises, but also the underdevelopment-generating domestic economic and class structural aberrations.... The more 'external assistance' from the imperialist metropolis, the more underdevelopment for Latin America."[29] What Frank says is no less true of India. If the Indian people take their own destiny in their own hands and dare to struggle and win, then only can they break the imperialist stranglehold and put an end to this lumpendevelopment. There is no other way of overcoming the utter deprivation, disease and slow death, the appalling degradation and dehumanization — the lot of hundreds of millions of our people as of people in other underdeveloping countries. In the course of the struggle not only will the country be changed but they themselves will be transformed. The filth of ages will be swept clear.
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2. R. N. Jaju, G.D. Birla: A Biography, New Delhi, 1985, p.144.
3. GOI Planning Commission, Sixth Five Year Plan 1980-85, pp.iii-iv — emphasis added.
5. Baran, The Political Economy of Growth, 1962 edn., Preface, p. xxix — emphasis in the original.
6. Marx and Engels, "Manifesto of the Communist Party", Selected Works, Vol. I, Moscow, 1973, pp.110-1.
7. Harry Braverman, op cit, p.284.
8. Hazari, Industrial Planning and Licensing Policy, Vol. I: Text, GOI, Planning Commission, New Delhi, pp.8, 9, 18.
9. Hazari, The Structure of the Corporate Private Sector, Bombay, 1966, p.371.
10. Hanson, op cit, 207; also Frankel, op cit, p.123.
11. Myrdal, op cit, Vol. II, pp.732-3.
12. Gadgil, "Planning without a Policy Frame", EPW, Annual Number, Feb. 1967.
13. Bettelheim, op cit, pp.l46, 147.
14a. See Rosen, op cit, pp.75-81; Frankel, op cit, pp.286-7.
15. Ibid, p.297.
18. See The IMF Loan: Facts and Issues, Government of West Bengal, Calcutta, 1981.
19. Chandra Shekhar, "Statement on Economic Policies", Press release dated New Delhi, 1 Jul. 1990.
20. See BM, "Liberalisation Lobby's Attempted Coup", EPW, 9 June 1990, pp.l237-8.
21. See AIE, No. 3. Jan.-Mar. 1991, pp.2-3.
22. See Hindustan Times (New Delhi), 25 Jul. 1991.
23. See the finance minister's letter, dated 27 August 1991, to the managing director, IMF and the attached "Memorandum on Economic Policies for 1991/92-1992/93".
24. The Statesman, 12 Feb. 1995.
25. BS, 24 Oct. 1994 — emphasis added.
26. Eighth Five Year Plan 1992-97, Vol. I, p.19.
27. Ibid, Vol. I, p. ii — emphasis added.
28. Ibid, Vol. II, p. 108.
29. Frank, Lumpenbourgeoisie: Lumpendevelopment, New York and London, 1974 edn., p. 130 — emphasis added.