Discuss the emergence of economic nationalism in India.

 Economic Nationalism emerged in India out of the ideological contestation between the colonial government officials and the early nationalists. The late nineteenth century was the period when this ideological struggle was the most intense. The earlier optimism that world’s leading industrial power would develop India in its own image gave way to despairing realisation that India was in fact regressing. After comprehensive and repeated analysis of each aspect of Indian economy, the early nationalists seemed to be reaching the conclusion that stagnation and decline of Indian economy was not due to oversight by the colonial masters but was integrally connected with the structure of colonial rule, that the ‘British rule was economically injurious to India and perhaps it was designedly so’ [Chandra 1966: 737].

The critique of the classical political economy and of the narrow economic policies of colonial regime provided the ground to develop the concept of a ‘dependent colonial economy’ along with the universalistic principles of nationalism. Ranade, in his writings of economics during the 1890s, criticised classical economics for being too individualistic and particularistic. He argued that it was developed in the specific context of Britain and was not universally applicable. He criticised the English economists for proposing laissez faire purely from an economic point of view without looking at the broader issue. The broader context consisted in taking into account ‘the political and social elements’. And ‘if political economy is to be anything more than schoolmen’s metaphysics’, it has to consider ‘the higher interests and aspirations’ of the people. The individualism and economism of the classical economics can be tamed only by subordinating it to the higher principle of the national and general interest:

‘Individual interests are not the center round which the Theory should revolve ... the true center is the Body Politic of which that Individual is a member, and that Collective Defense and Well-Being, Social Education and Discipline ... must be the center, if the Theory is not to be merely Utopian’. [Quoted in Goswami 1998: 619].

What the nationalists desired was the development of a proper national economic policy which would serve Indian interests. They wished to propel India on to the path of modern industrial development. Overall, their economic outlook was bourgeois in character. But they did also speak for the masses of the peasants and workers. Their greatest achievement was to make ‘the people of India conscious of the bond of common economic interests and of the existence of a common enemy and thus helped to weld them in a common nationalism’ [Chandra 1966: 758].

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