Gandhi's thumb-rule ought to resonate across the ages no matter how large India's economy grows

Summary

In 1947, Mahatma Gandhi urged decision-makers to ask whether the poorest and weakest would benefit from their decisions. The test didn't just survive India's pursuit of rapid economic growth, it is all the more salient today.

"I will give you a talisman," Mahatma Gandhi offered in a handwritten note shortly before India achieved freedom in 1947, "Whenever you are in doubt, or when the self becomes too much with you, apply the following test. Recall the face of the poorest and the weakest man whom you may have seen, and ask yourself if the step you contemplate is going to be of any use to him. Will he gain anything by it? Will it restore him to control over his own life and destiny? In other words, will it lead to swaraj for the hungry and spiritually starving millions?"

Back then, 'talisman' conveyed a sort of north star for guidance, 'man' was gender-neutral and the Hindi term 'swaraj' meant one's own liberty as much as national self-rule.

The basic test that Gandhi set, however, retains both its clarity and vitality. Indeed, it ought to resonate across generations, regardless of how large India's economy grows.

For four-and-a-half decades, it was largely interpreted as a socialist filter. It may well have nudged India to adopt a 'mixed economy,' as proposed by the Bombay Plan of 1944 drafted by J.R.D. Tata, G.D. Birla and other leading industrialists.

Even the country's policy remix of 1991 was broadly justified as a path out of mass deprivation. "We need to expand the scope and the area for the operation of market forces," Manmohan Singh noted in his 1991 budget speech, arguing that while price-system reforms would improve resource allocation, state intervention must focus on the needs of those on "the edges of a subsistence economy."

Without wealth creation, Singh added, we would not be able to end "abject poverty, ignorance and disease." He wanted wealth harnessed in harmony with equity and justice to end poverty and serve everyone, for which he said Gandhi's philosophy of trusteeship "should be our guiding star."

Since 2014, relief for the hard-up has been a major policy theme of the Narendra Modi government too, with many welfare outlays expanded. That a larger economic pie means more money for national goals is now an axiom.

The only way to tackle poverty, Modi said in his 15 August address of 2018, was "through the empowerment of poor people." This was a shift in emphasis away from entitlements, but in consonance with Gandhi's advice.

Over the past 25 years, India has seen a sharp drop in extreme poverty. Yet, as the country prospers, how badly Indian multitudes have been left behind by prosperity -- at least in relative terms -- looks more stark than ever. This lends Gandhi's test a renewed urgency.

Signs of a 'K-shaped' economy persist long past the covid shock, with the well-off wealthier but vast numbers more or less stuck where they are.

Such a split in upward mobility could spell premature market saturation, which may dampen investment in productive capacity, constrain India's overall access to capital and leave us in a 'middle-income trap.' Intimations of it, evident in some sectors already, cannot be brushed aside.

If quality-of-life aspirations slump in the face of real-world hardships, the harder it will be to break above a GDP-per-head level that can fund a state apparatus designed to secure equitable health and education for all.

Had this been an earnest priority right from the start, India's post-1947 emergence may have dodged the risk of that trap, arguably. But it is never too late to plug the gaps that may get in the way of our goals.

This exercise must take inequities into account that economic theory tends to ignore. Even a flicker of doubt over the country's path should make us recall the poorest and weakest.