Beaurocracy in India is still seen as an anachronism. No one today, debates the case for or against it. Economists debate about its impacts on future economic growth and the impact of past reforms on growth. Some economists argue that economic policies are guided by class interests rather than any other considerations.
Contrary to this viewpoint, Beurocracy in India has shaped economic policies for more than three decades now. The first decade of the century saw a sweeping revolution in economic policies and the introduction of the national market. Beurocracy in India led to the formation of the Indian economic model which today is known as the Modernization Theory. The Modernization Theory argues that growth occurs through the stimulation caused by competition, knowledge creation and policies based on efficient production management and liberalization.
It is in the course of this argument that we should take a detailed look at how the impact of economic reforms in India has been felt. Economic reform was accompanied by dramatic changes in all aspects of life including politics, bureaucracy, economy and society as a whole. The impact of economic reforms can be gauged primarily in the level of optimism that pervades the masses. Economic boom led to urbanization, which in turn transformed the rural population. Moreover, the state-led economic reforms and the implementation of PPP (point of service) schemes led to the absorption of rural population in the cities.
Urbanization led to urban poverty reduction and the emergence of a skilled class, rural surplus growth and gradual increase in the per capita income. In addition to these, state-led economic policies initiated the construction of roads, irrigation and other infrastructure, which led to better utilization of agricultural resources. As the industrialization process progressed, state-led industrialization promoted rapid industrial spread and mass production. Ultimately, industrialization led to increased landlessness, social inequities and the emergence of a mass of lumpen population (Hindi – an English word – means “a group of people dwelling together”).
With the onset of globalization and liberalization processes, the global environment had a far more profound impact on the Indian economy than previously understood. Reforms and policies adopted by developed states in India promoted cross-border economic activity, opening up opportunities for developing nations to access international markets. The poor economic conditions in many countries worldwide, especially in the South and East Asia, have been instrumental in revitalizing attention to the Indian economy. The growth of the internet has also provided an important boost to India’s economy.
The logic of beurocracy in India can be explained using the prism of two contrasting states of modernity. On the one hand, there are the poor people of India who constitute a majority of the population. The state has failed to realize its development potential as a result of policies based on colonial mentality, materialism, poverty, chauvinism and corruption. Economic liberalization policies in India paved the way for the poor people to move out of the rural areas and join the cities in search of jobs and other livelihoods.
On the other, there is the upper strata of the society, the bureaucratic elite who constitute about good percent of the Indian population. This elite enjoys great wealth, but despite this, the poor people live in extreme poverty. The reason for this discrepancy between rich state and poor people is the state’s failure to provide basic public services. The administrative hierarchy, dominated by the powerful , has failed to provide basic health facilities, education, jobs and social welfare.
The current reforms of the government in India are aimed at improving the lot of the poor people and paving the way for a successful economic growth and development in India. Policy changes, like the increase in the Minimum Benefit Guarantee (MGB) and enhanced liquidity in the banking system are few of the many reforms being implemented. Although, the current reforms do not offer equal opportunities to the economically weaker section of the society, yet, these measures will help eradicate poverty. As per the estimates, about fourteen million families will be lifted out of poverty as a result of the new minimum benefit policy. Since, beurocracy in India is a product of socio-economic development policy, it is expected that, the policies, such as the MGB, introduced by the Finance Minister of India, Arun Jaitley will have a beneficial impact on the country’s economy.