<b>Ruminations:</b> The spirit of enterprise
Among the many evils that the ruling NDA holds the Congress responsible for is the one related to the economy. It starts with panning Jawaharlal Nehru’s Fabian Socialism inspired political thinking and the adaptation of the Soviet command economy model to India, reflected in the setting up of the now disbanded Planning Commission. These, more than the corruption of the licence raj era, are blamed for running businesses to the ground. Those early years and thereafter, which included the prime ministership of Indira Gandhi, reflected a standoffishness towards business, especially big business. That sentiment persisted during the brief Janata regime. Generally, support for big business and multinational companies was seen as being opposed to good politics.
A glimpse into the Congress manifesto of 1980 -- it was known as the Congress (I) then -- will give an idea of this barely concealed mistrust. The manifestos of subsequent Congress governments of Rajiv Gandhi and Narasimha Rao are not cited because the period of modernisation is generally believed to have started around then -- Rajiv Gandhi, though, was found wanting in political will to carry forward his ideas.
The section on monopolies of the Congress (I) manifesto for the 1980 elections says, “The Congress (I) believes in restricting the growth of monopolies to the utmost possible extent in the interest of an egalitarian order. Appropriate measures will be taken in pursuance of this objective. Steps already devised will be made more effective. The role of multinationals in the various sectors of industry will be examined thoroughly with a view to devising suitable measures to restrict their activity and to counter the deleterious effects thereof on the country’s economy.”
Those goals for the nation seem unrecognisable now, actually antediluvian, even though there is some distrust towards foreign money at the policy level, which reflects in FDI in some areas, and in funding for charitable work.
Yet, Nehru and the early Congress ministries did not preside over a corporate wasteland. With Nehru as the pathfinder, they created venerable properties in the form of PSUs of the size that the private sector at the time could not match. Take the steel industry for instance. At no time did TISCO match Hindustan Steel and later Steel Authority of India for size. That situation remained even after the opening up of the economy and is true even today.
These public limited units, which were created with the help of the Russians, Germans, Americans and the British, were crucial at the time for another very important reason: they provided employment to people of a poor country that had become free and which was struggling to stand on its own two legs. The PSUs were pathfinders also because built into them was the idea of a model employer. Each PSU was a self-contained unit that provided all facilities to employees, and in time led to the establishment of townships around them.
The jury is out on whether in later years poor management did many of them in or politicians. Even now, reports that PSUs have been asked to host functions related to the three-year celebrations of the NDA government are disconcerting.
As for the private sector and the captains of industry, it is worth testing their claims that the policies of Nehru and his daughter had dulled their entrepreneurial streak. The IT industry has in recent years held pride of place in India Inc. IT stocks are blue chip, IT czars are wealth creators, and they provided huge employment. With new challenges and a changing world situation for which they appeared hugely underprepared, IT giants are now suddenly trimming down and letting go of employees in hundreds of thousands. The general consensus is they lacked the drive to innovate in a manner that would make them relevant into the future. What makes the current narrative sadder is that Narayana Murthy, the doyen of the Indian IT industry, has gone public with a pedantic exhortation to save jobs and reputations in the IT sector: cut salaries of top management.
Cut to the mid-80s and the Indian auto industry when Fiat and Ambassador ruled. They remained unchallenged till Suzuki, a company which at the time had no reputation as a car manufacturer, entered the market in 1984 under the Maruti brand name and quickly toppled the earlier car makers from their perches. Both companies went down without much of a fight, again because they lacked the wherewithal to join in the battle. Similar stories abound in key areas like pharma, power, mobile handsets and technology.
It is perhaps in the fitness of things that India Inc revisit the whole issue of entrepreneurial spirit and find ways to make themselves relevant in a competitive world. Engaging with the political establishment is a good idea to make pathways that will aid that spirit. However, running down the Socialism of a bygone era, which mirrored the mood of those times, and blaming it for the ills of today could be a little far fetched. Besides, the argument undermines the buccaneering spirit of enterprise that it can succeed even in the most hostile environment.

Ananda Majumdar