MAVERICK VIEW. For an economics of compassion

Economist NA Mujumdar whose prolific writings span more than 55 years, passed away on April 6. He had a long and distinguished career in the Reserve Bank of India during which his services were sought by five central banks under the aegis of the International Monetary Fund.

After retiring from the RBI in 1988, he was associated with a number of institutions and wrote a number of books as also articles in financial dailies, including the Hindu BusinessLine . Till his demise he was the editor of the Indian Journal of Agricultural Economics .

Mujumdar’s writings have all along been an alternative to mainstream Indian economic thought and it is, therefore, important to take cognisance of this.

His latest book, Reinventing Development Economics: Explorations from Indian Experience (published by the Academic Foundation, New Delhi, 2014, ₹995) was released a few days after his demise.

This last book should be mandatory reading for all those who have an abiding interest in Indian economic development. In short, telling chapters, Mujumdar questions the Indian development model followed after 1991. One should not dismiss the voice of dissent as merely the thoughts of a bygone era. The leitmotif of Mujumdar’s writings is applying the acid test of whether the policies are conducive to the interests of the common person. The book is a fusion of economics, philosophy and ethics, and if ever India turns its policies upside down, this book by Mujumdar will be a reference point for such a change.

The opening chapter of Mujumdar’s book is his presidential address at the 71st annual conference of the Indian Society of Agricultural Economics (2011).

This is a virtual indictment of post-1991 economic policies. He feels that in the euphoria of sustained high growth, we overlook the mistakes of policymakers during the period of liberalisation.

There is, according to Mujumdar, erroneous focus on market-led growth, fiscal correction, promoting private and foreign investment, development of the capital market and creation of an environment of consumerism. His concern is that basic issues of development are overlooked which has led to the neglect of agriculture, disdain for subsidies and disregard for elementary principles of food security. He calls the period 1991-2004 the ‘Milton Friedman phase’ and 2004-2011 as the ‘Mahatma Gandhi phase’.

It is pertinent to note that his trenchant criticism cuts across the entire political spectrum and as such is a non-partisan view of development over the past quarter of a century.

Mujumdar’s indictment of economic policies is not an emotional diatribe. He marshals facts and figures, and quotes impeccable economic-social scientists in support of his evaluation of Indian economic development. He quotes ancient Indian scriptures which enjoin us that our lives must be guided by control of oneself, giving to others and being compassionate.

The rest of the book (53 short chapters) is asharp and pointed criticism of the policy initiatives covering broad development issues, monetary policy, banking policy, fiscal policy, food security and the global environment.

On each issue that he takes up, he applies the litmus test of whether the policies are for the betterment of the disadvantaged segments of society.

Mujumdar in all probability knew this would be his last book and therefore he put everything into his message to policymakers.

Policymakers the world over believe that the wisdom they have is the ultimate and nothing can be better than what they advocate. In this book, Mujumdar has left pertinent issues for posterity and thereby has earned his place in the pantheon of the greats. I am aware that there are still some writings by Mujumdar (done in 2013-14) and I hope a compilation of these will be published. What Mujumdar advocated in his writings is in unison with his personal approach to life.

A characteristic of Mujumdar’s approach to life was to help those in difficulty, even if they did not seek his help.

His writings were centred on compassion for the downtrodden and that is what he practised in life. He believed in a Socratic tradition of free and frank exchange of views even if they revealed sharp differences and he believed that this was essential to progress.

On a personal note, I was, over the years, the recipient of sharp criticism from Mujumdar of my work, but at the same time I have been a major beneficiary of his unstinted support in my career. I had never imagined that the loss of a sparring partner would hurt that much.

The writer is a Mumbai-based economist

COMMENT NOW