D. N. Hosali’s publication, “The Place of Free Enterprise in a Backward Economy,” critiques the shift towards socialism in India. Hosali argues that socialism stifles the growth and efficiency of the private sector, which is crucial for developing backward economies. He contends that free enterprise is more effective in driving economic progress and ensuring freedom.
Chambers of Commerce and trades bodies in the country performed a very useful function in our economy in the past. It was through the Chambers of Commerce that the business community voiced its grievances and sought redress for them at the hands of the Government. The Governments of the past also attached great importance to the pronouncements made by them and tried to modify their policies to the extent possible to suit the requirements of trade and industry. It was as a result of this that even under an alien Government our commerce and industry made significant progress during the past quarter of a century. But alas, during the past years we have seen a complete reversal of these policies. Although the old procedure of inviting Ministers of the Government to the Annual Meetings and submitting to them the difficulties of trade and industry continues, little or no importance is attached to the pronouncements of the Chambers of Commerce, and the policies of the Government are shaped in complete disregard of, and often in detriment to, the interests of trade and industry. I state this after due deliberation. As to the numerous representations made by this Chamber during the past two or three years, it has obtained redress hardly on any issue.
This is a significant matter, as it indicates a change in the attitude of the Government towards that section of the population which is traditionally in the pursuits of private trade and industry. Since the decision of the Government to establish a socialist economy in the country, this section has come in for quite an unnecessary measure of discrimination and has been discredited and discouraged at every stage. It is told that ours is now a socialist state and hence the private sector must subordinate its interests to the state plan and if need be liquidate itself in course of time. The statements made by Ministers of the Government are quite baffling and are many a time diametrically opposed to each other. Prime Minister Nehru, who is a great believer in democracy, said at the A.I.C.C. meeting in January last that he would prefer slow progress to risking individual independence for rapid progress. On the other hand, Shri T. T. Krishnamachari, the Finance Minister, has declared that the Second Plan would demand sacrifice and regimentation of our economy, and Shri M. M. Shah, Union Minister of Heavy Industries, said the other day that the public and private sectors could easily coexist without any kind of trouble for the next ten or fifteen years which means by implication that after that the private sector must expect the deluge.
Where do all these statements lead us? The private sector needs as much planning as the public sector. Is it possible for any group of entrepreneurs to go in for any big plan of industrialisation when the only lease of life you give them is ten to fifteen years? Needless to state that the policies of the Government act as a serious deterrent to the growth of any new industry in the private sector.
This serious situation has arisen as a result of the adoption of the socialist economy by our Government. Our Government claim that their policy has been endorsed by the country; which means that the vast majority of the unthinking millions of the country have understood the implications of this policy and approve of it. On the other hand, there are thousands of thinking people in the country who are convinced that these policies will not only result in raising the standard of living, but may well create a totalitarian regime. But nevertheless the determination of our Government to press forward with their socialist plans seems to gather strength as time goes on, as though socialism is the only panacea for our economic ills, and the private sector represents all the anti-social evils in our body politic.
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