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HAS INDIA AN ECONOMIC FUTURE?

By Charles E. Lindblom
January 1966
Article Summary and Author Biography

Let us get down to cases rather than generalize grandly. In India, food- grain output is the pivot on which economic development swings. The most urgent demand of the population is for more to eat; the most acute problem of economic stability is keeping food-grain prices from rising too sharply as money demand outpaces the supply of food; and the core of development strategy has to be either an increasing provision of food-grains to satisfy new consumer demands in the urban and industrial sectors or deliberate retardation of industrial growth to head off the new demands. What is the record and prospect on food-grains?

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Let us get down to cases rather than generalize grandly. In India, food- grain output is the pivot on which economic development swings. The most urgent demand of the population is for more to eat; the most acute problem of economic stability is keeping food-grain prices from rising too sharply as money demand outpaces the supply of food; and the core of development strategy has to be either an increasing provision of food-grains to satisfy new consumer demands in the urban and industrial sectors or deliberate retardation of industrial growth to head off the new demands. What is the record and prospect on food-grains?

In 15 years of planned development, India has increased food-grain production about 50 percent. Interrupted between 1961 and 1964, agricultural growth resumed with a 10 percent jump in production last year, the crop year 1964-65. The resulting gain in welfare has been partly drained away in population growth, so that the per capita gain in food- grain production is perhaps 15-20 percent instead of 50. Still, India has managed to put a poorly trained labor force, whose marginal productivity has often been estimated to be zero, to work with little capital on exhausted soil and somehow come up with a massive increase in product.

We know why the gain was not more. Exhausted soil. Poor seeds. Little mechanization. Crude tools. Primitive plows, and bullocks too weak to pull heavier ones. Untrained farmers. Little capital investment in the land. The low repute of manual labor. Caste rules that block innovation. Traditionalism. Ignorance. Insecurity. Corruption. Apathy. But how in the face of these obstacles was any progress made at all?

Perhaps between one-fourth and one-third of the growth in output in the last 15 years came from new acreage brought under cultivation. That is a substantial share, and it has implications for the future to which we need to return. But what of the rest of the increase? Given the power of the obstacles, one would question the possibility of greatly raising productivity. It should not have been possible. How was it done?

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