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: A chronological flip across the pages of India’s modern business history clearly demonstrates the evolution of big business, especially its relationship with the state. In what follows we shall briefly characterise this evolution as well as identify the gaps left by such an account.
The spirit of cooperation between political leaders and big business that characterised the freedom struggle—Gandhi’s closeness to the Birlas and Tata’s nationalistic urges—thinned in the immediate post-independence era with the former reposing confidence in a state led mixed economy characterised by public sector monopolies in many strategic/important sectors. Such restrictions were to be compounded in the late sixties and early seventies through the follies of the License Raj—a mesh of controls which was instituted ostensibly to prevent dominance but actually served to protect traditional business from incursions by fresh blood. The resultant quagmire of stagnant efficiency stunted Indian economic growth.
This state of affairs continued till the late 80s which was marked by significant changes—the near death of licensing and the consequent rise of a set of imaginative and risk loving entrepreneurs who had been hardened by the rigours of the licensing era. Liberalisation in the early 90’s lured foreign investment into India and made its domestic counterpart more attractive—the rise of Reliance in the 80’s was followed by the more refreshing rise of the software giant, Infosys and similar firms led by technocrats of high pedigree. The telecom revolution was ushered in later by a combination of imaginative private enterprise and the arrival of new technology.
Camaraderie blossomed between big business and politicians/ government with delineations becoming blurred. This often had a dark side to it—the government was rocked by major scandals from time to time. Over the course of a couple of decades, the political caging of business had been, according to some, replaced by the commercial enslavement of politics.
This fast paced and colourful history of Indian big business and its relationship with the government is known to many of us. But it is far from a comprehensive account of the history of Indian business as a whole, especially its relationship with the state. It neglects the Indian small and medium business sector which has made significant contributions to India’s economic march. These constitute 45% of Indian industrial output and 40% of its exports. However, individual hotlines to politicians and ministers are not a possibility for such entre- preneurs and chambers of...
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