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4 January 2026|The Indian Express
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EconomyEconomyPolity & GovernanceEDITORIAL

Economic Odyssey: A Critical Look at India's Growth Story and Policy Debates

A new book critically analyzes India's economic growth from 1950 to present, sparking debate on policy impacts.

Background Context

The article reviews a significant book on India's economic development since independence, sparking a debate on historical growth patterns and policy effectiveness. It touches upon the 'Hindu rate of growth' era (1950-80), the post-1991 liberalization period, and recent economic challenges.

Pulapre Balakrishnan reviews "A Sixth of Humanity: Independent India's Development Odyssey" by Devesh Kapur and Arvind Subramanian, a book that attempts to answer why India's growth was tepid from 1950-80 and why formal job creation remains low despite rapid post-1991 growth. The review critiques the book's framework, arguing it mischaracterizes the 1950-80 period's growth as uniformly poor and overlooks early growth accelerations. It also highlights the book's failure to seriously evaluate economic performance under the Modi government, particularly regarding the impact of demonetisation in 2016, which the reviewer suggests may have caused an economic slowdown from 2017. This critical analysis underscores the ongoing debate about India's economic trajectory and the effectiveness of various policy regimes.

Key Facts

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Book: A Sixth of Humanity: Independent India's Development Odyssey

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Authors: Devesh Kapur and Arvind Subramanian

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Reviewer: Pulapre Balakrishnan

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Growth period 1950-80 characterized as 'socialist' era

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Growth period post-1991 characterized as 'neoliberal' era

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Demonetisation occurred in 2016

Latest Developments

The review critically examines the book's assessment of India's economic trajectory, particularly its characterization of early growth and its omission of a detailed evaluation of recent policy impacts like demonetisation. This highlights ongoing policy debates and the challenge of formal job creation.

Editorial Analysis

Balakrishnan critiques Kapur and Subramanian's book for its flawed narrative of India's economic growth, particularly its characterization of the 1950-80 period and its omission of a serious evaluation of the Modi government's economic performance, especially regarding demonetisation.

Main Arguments:

  1. The book mischaracterizes the 1950-80 period as having uniformly "poor" growth, ignoring early accelerations and higher per capita income growth compared to the Raj.
  2. It fails to adequately evaluate the economic performance under the Modi government, particularly the potential negative impact of demonetisation in 2016, which may have caused a slowdown from 2017.
  3. The book's framework of 'State, society, nation and markets' is insufficient for a theoretical vision of growth.
  4. The economic policy of the Nehru era, while not optimal, was not solely a failure of licensing but also lacked a program for widespread schooling and health infrastructure.

Conclusion

The book, despite offering interesting snapshots, is hobbled by a lack of theoretical vision and a flawed narrative, particularly in its assessment of economic performance under Modi and the impact of demonetisation.

4 Key Concepts to Understand

This article covers important concepts like Economic Growth and Development, Formal Job Creation / Employment and 2 more. Understanding these will help you answer exam questions better.

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