The Political Necessity of the Licence-Allow Raj

Prof Rashmi Venkatesan of Nationwide Legislation College of India College in this article at TheIndiaForum:

In modern standard creativeness, the ‘license-permit-quota raj’ symbolises the whole lot mistaken with state regulation and intervention in ‘socialist’ India. Many, like Arvind Panagriya, an economist and former boss of the NITI Ayog, have linked it to the nation’s “meagre progress for nearly 4 many years” and dismiss it as as dangerous economics based mostly on socialism.

Whereas the logic of market reforms is repeated usually to justify the disbandment of licencing within the wake of the 1991 reforms, a lot of the commentary overlooks the rationale and historical past of licencing. Industrial licencing emerged out of the nationalist discourse on improvement, and was one of many key devices in establishing and legitimising the sovereignty of the post-colonial Indian state. It was not initiated to provide impact to anyone coherent political ideology, however somewhat, to consolidate the eminent area of the state in issues of business governance in order that the state may pursue any political and financial objective it recognized.

Essentially a political mission, industrial licencing can’t be analysed solely in financial phrases. It should be contextualised within the wider political and authorized creativeness of a post-colonial India.