India Unbound

Das, an Indian venture capitalist and columnist for the Times of India (and former CEO of Procter & Gamble India), uses his own experiences as a businessman as the context in which to comment on India's postcolonial economic policies. He begins with Nehru's mixed economy (which he argues achieved democracy but ignored entrepreneurship and competition, resulting in an absence of industrial development) and continues through to the economic reforms of 1991 under Prime Minister Narasimha Rao (whom he labels a ""reluctant liberalizer""), demonstrating how India has abandoned state-directed industrialization and finally become a free-market democracy with a burgeoning middle class. He also points out how India's late (and incomplete) entry into the international economy continues to hamper its growth, as compared to other late entries, such as that of China, which had a lower per capita income than India did in the mid-'60s and today boasts one twice as large as India's. Nevertheless, Das remains optimistic that ""the new India is increasingly one of competition and decentralization,"" particularly because of the Internet and the boom in software entrepreneurship. In explaining India's economic policies, he gives much credence to theories about high-caste Brahmins being averse to making money and the government's fears that capitalism would crush the poor; but Das only mentions in passing Russia's ideological sway at the time of India's independence and does not discuss the Cold War or the context for India's belief that import substitution was necessary to make India less dependent on the outside world for its survival. Business readers with an interest in Third World development will learn much from Das. (Feb. 26)