India now has the world's fifth-largest economy and one of its fastest-growing, expanding at roughly 7 percent a year, but for decades it was a byword for stalled development. A new book reviewed by Foreign Policy columnist Sumit Ganguly, Devesh Kapur and Arvind Subramanian's A Sixth of Humanity: Independent India's Development Odyssey, traces how the country got from one condition to the other, and argues the early choices that held it back still shape its problems today. Kapur, a political scientist, and Subramanian, an economist, spent 824 pages walking through the policy record since independence, and Ganguly calls the result a milestone in the scholarship on India's political economy.
The book's central revision, per the review, is that India is usually described as having embraced import-substitution industrialization, the tariff-heavy strategy proposed by economist Raúl Prebisch to protect "infant industries" in developing countries. Kapur and Subramanian argue India never actually implemented that strategy in a way that could have worked: it shut off foreign supply chains and built an unwieldy, loss-making public sector, but also choked off the private sector that might have made the approach pay off. The result, Ganguly writes, was that close to 60 percent of India's population remained in poverty between 1950 and 1980, undercutting the era's own defense that India's performance beat British colonial rule.
Ganguly highlights the book's account of how India's democratization actively undermined its fiscal discipline. As the Indian National Congress lost ground to more competitive politics in the late 1960s, Prime Minister Indira Gandhi turned to bank nationalization and expanded subsidies to shore up support, and the review notes that few politicians since have been willing to unwind those popular measures. Kapur and Subramanian trace a direct line from that shift to today's crony capitalism, as large firms consolidated the market Gandhi-era policy helped protect. The tax base never recovered either: agriculture was constitutionally exempted, loss-making state enterprises drained the treasury, the politically influential middle class secured exemptions, land transactions went untaxed even after post-1991 land values soared, and extortionate rates on the wealthy during India's socialist period drove widespread evasion.
The review also credits the book for tracing India's lopsided investment choices: heavy spending on state-run factories and, more recently, showpiece infrastructure like high-speed rail, while basic public transport and public health went underfunded. Kapur and Subramanian cite the late political scientist Myron Weiner's argument that India's elites, partly because of caste's grip on the society, never grasped the importance of mass primary and secondary education, favoring higher education instead. Ganguly connects that legacy directly to this year's Cockroach Janta Party protests, the youth-led movement that started as online satire and grew large enough to force the resignation of India's education minister over leaked exam papers, part of a broader reckoning with the jobless growth and soaring youth unemployment now confronting Prime Minister Narendra Modi's government.
Ganguly's one criticism is that, unlike economist Vijay Joshi's 2010s prescriptions for privatization, labor-market flexibility, governance reform, and education spending, Kapur and Subramanian largely stop at diagnosis. The book closes instead by naming four forces the authors expect to shape India's development going forward: geopolitical shifts, technological change, climate change, and demographic change. Ganguly's takeaway is that New Delhi has made only sporadic use of the reform playbook already on offer, and that the Modi government has yet to answer the younger generation's legitimate anxiety about what those four forces mean for their own futures.