Rajaji: His support for free enterprise and opposition to state capitalism was proved right

It would be appropriate to celebrate the birthday of Rajaji - not just an independence activist, but a lawyer, writer and statesman - at least next year as a day of free enterprise

N S Venkataraman Dec 14, 2021
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C R Rajagopalachari (Rajaji)

The birth anniversary of Rajaji, or C Rajagopalachari, the last Governor-General of India, on December 9 went unnoticed for all practical purposes in India, and even in Tamil Nadu, his home state. This is in sharp contrast to the way India celebrates the birth anniversaries of eminent persons like Mahatma Gandhi, Jawaharlal Nehru and Sardar Vallabhai Patel.  

This is also unlike the way Tamil Nadu celebrates the birth anniversaries of Periyar, Annadurai, Kamaraj, Bharathiar and V.O. Chidambaram Pillai. Rajaji was no less an eminent person than these stalwarts. Rajaji - as he was popularly known and called -was described as his conscience keeper by Mahatma Gandhi. 

Rajaji’s public life can be divided into pre-independent and post-independent India.

During the British Raj, there were many great leaders crisscrossing India under the leadership of Mahatma Gandhi. Rajaji was one of them. However, post-August 1947, Rajaji’s role was unique as he spoke about socio-economic subjects with a high level of clarity, understanding and courage of conviction even when they would differ from the popular perspectives. 

Rajaji advocated free enterprise 

One of the important policies Rajaji advocated was the need to promote free enterprise for India’s rapid industrial and economic growth. These views were different from that of state capitalism which Prime Minister Jawaharlal Nehru practiced.

At that time, Rajaji was severely criticized by socialists and communists who castigated him for allegedly taking the side of the affluent and rich. According to his critics, investment for growth has to be necessarily, fully or mostly, with the government. According to them, such state capitalism was necessary to achieve equitable distribution of income and opportunities. The critics of Rajaji had a strong faith in public sector enterprises.

The advocates of state capitalism were striving to implement the communist philosophy in a democratic society. Initially, this experiment caught the imagination of the people. Massive projects like steel and power plants were set up under the public sector. Prime Minister Indira Gandhi even nationalized banks. Such steps appeared to take the country ahead when viewed from a short-term perspective. However, they proved to be counter-productive in the long run as inefficiency, political interference and other negative elements crept into their management. Several public sector enterprises became sick and white elephants.  

While communism collapsed in the Soviet Union, the other big communist country, China, has considerably diluted the concept of state capitalism by encouraging private ownership in a big way and allowing multinational companies to play a big role in its industrial and economic sphere. Today, the Chinese form of governance is communism in namesake. 

History proves Rajaji right 

In recent times, a number of public sector enterprises have been privatized in India. The Modi government is also closing down unviable and sick public sector units. Special incentives are being offered to promote greater participation of the private sector in industrial and economic growth. 

Present-day developments clearly show that Rajaji’s opposition to state capitalism has been proved to be appropriate and his views have stood the test of time.

Perhaps, it would be appropriate to celebrate the birthday of Rajaji - not just an independence activist, but a lawyer, writer and statesman - at least next year as a day of free enterprise. 

While Rajaji’s birthday in December has largely gone unnoticed, it is hoped the country will remember him on his forthcoming death anniversary, also in December, and pay tributes to the visionary and thinker par excellence.

(The writer is a Trustee, NGO Nandini Voice for the Deprived, Chennai. The views expressed are personal. He can be contacted at nsvenkatchennai@gmail.com) 

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