What laws determine progress? An Indian contribution to the idea of progress based on Mahadev Govind Ranade's works, 1870–1901

ABSTRACT

By the late nineteenth century, the school of “Indian Political Economy” was founded to understand India's extreme poverty and deindustrialisation. This paper examines how Mahadev Govind Ranade (the school's founder) conceptualised progress by tracing its origins and evaluating how it was formulated to reconcile theory with India's political and socio-economic reality. Ranade identified specific Indian determinants of progress: the centrifugal nature of Indian politics; the dependence of a colonial economy; and its refutable role within the international division of labour theory.

KEYWORDS:

• Development
• Indian political economy
• international diffusion of economic thought
• deindustrialisation
• progress

JEL CODES:

• B10
• B15
• B31

Acknowledgments

I would like to thank Valbona Muzaka for her guidance, as well as Pierre E. Bach and Emilie Mendes de Leon for meticulously and carefully proofreading this paper. I am also thankful for the comments that I received during a presentation at the ESHET 2016 Conference. Finally, I thank the two anonymous referees for their useful suggestions.

Disclosure statement

No potential conflict of interest was reported by the author.

Funding

This work was supported by the London Arts and Humanities Partnership (LAHP) Studentship funded by the Arts and Humanities Research Council (AHRC) [1617380].

Notes

¹ As a British colony, India's economy was of course affected by this crisis (Davis 2002; Beckert 2014).

² According to Stimson (2014), Classical Political Economy is generally considered to have originated in the period between 1750 and 1867 with a group of thinkers who drew upon and revised Adam Smith's Wealth of Nations. There are of course other interpretations of this term. Indeed, it was Marx who first coined Classical Political Economy in his first edition of Capital, Volume 1, to describe those economists, starting with William Petty, who studied the real internal relations of bourgeois relations of production, as opposed to other economists who merely tried to describe the framework of those relations. Ranade's use of this term is not entirely transparent as he seems to use Political Economy and Classical Political Economy interchangeably to criticise the “Economical Doctrines”, coming primarily from Great Britain (IE, 7). According to Ranade, the Classical Political Economists relied on assumptions that were “literally true of no existing Community” (IE, 10) (the list of all assumptions is on IE, 9). Ranade generally lists Adam Smith, David Ricardo, James, McCulloch, and Thomas Malthus as members of Classical Political Economy. However, Ranade shows awareness of differences between British thinkers from this school. For example, Ranade praised Adam Smith for not separating economic considerations from social ones, which his successors did (IE, 17). More discussion on Ranade's critique of Classical Political Economy is to follow in Sections 3 and 4.

³ For descriptive histories of economic nationalists, see Singh (1975) and Spengler (1971).

⁴ Dutt (1934) analysed Sarkar and Gandhi's ideas of economic development (in a couple of chapters), but does not specifically deal with the protagonist of this paper – or any of the other major members of the ISPE.

⁵ See Cardoso (2008).

⁶ The primary sources analysed for this paper include Ranade's Maratha Power (Ranade 1900a) (denoted as MP); his introduction to Peshwa's Diaries (Ranade 1900b) (denoted as IPD); his Revenue Manual of the British Empire in India (Ranade 1877) (denoted as RM); and his Note on the Decentralization of Provincial Finance (Ranade 1894) (denoted as PF). Additionally, the several collections of Ranade's (1902) Essays and Speeches on Religious and Social Reform (denoted as RSR); Essays on Indian Economics (Ranade 1906) (denoted as IE); Select Writings on Indian States (Ranade 1942) (denoted as IS); and his Miscellaneous Writings (Ranade 1915) (denoted as MW).

⁷ Also referred to as the international division of labour.

⁸ Saint-Simonians include Thierry, Comte, Bazrad, Chevalier, Enfantin and the Pereires (see Iggers 1958; Eckalbar 1979; Simon 1956; Saint-Simon 1964).

⁹ List of books, Elphinstone College Records, Volume 9, Maharashtra State Archives.

¹⁰ Biographical information also found here: London School of Economics Library Archives on Britain and South Asia, Independent Labour Party papers (16 – non-ILP print: miscellaneous): ILP/16/1901. “Mahadev Govind Ranade: His Life and Career” (Pamphlet) (Madras: G. A. Natesan & Co., Esplanade.)

¹¹ The Poona Sarvajanik Sabha was a precursor of the Indian National Congress which represented the ideas of Indian intellectuals by publishing their work in the quarterly journal.

¹² “Pursuit of high ideals, mutual sympathy and co-operation, perfect tolerance, a correct understanding of the diseases from which the body politic is suffering, and an earnest desire to apply suitable remedies – this is the work cut out for the present generation” (RSR, 247).

¹³ http://www.gipe.ac.in/ (refer to footnote 2 for full list of sources analysed).

¹⁴ There are obviously some disagreements within the school; however, for the purposes of this paper, which focuses on Ranade's writings, this brief outline of the school's beginnings will suffice.

¹⁵ See also Naoroji (1901, 136), Ray (1895, 66), Joshi (1912, 749, 808, 886), Dutt (1904, 122–125), Iyer (1903, 104–107, 130–131).

¹⁶ Ranade (IE, 205) made his (and India's) objective very explicit: “We must realise clearly our exact situation, i.e., first, our phenomenal Poverty, and secondly, our growing dependence on the single and precarious resources of Agriculture”.

¹⁷ An Irish jurist and economist from the nineteenth century.

¹⁸ Further discussion on Ranade's critique of Classical Political Economy is included below.

¹⁹ The following scholars have also found that Ranade had a holistic view of the economy: Chandra (1966, 91, 748, 1991, 132, 158), Ganguli (1977, 56), Chatterjee (2003, 489).

²⁰ John Elliot Cairnes (1823–1875) was an Irish economist, often described as the last classical economist (see Boylan and Foley 1999).

²¹ Note that this is Ranade's interpretation – but a further discussion on how and why this may be a misinterpretation is beyond the scope of this paper.

²² Ranade listed their assumptions as the following (IE, 9): (1) national economy is individualistic and has no separate collective aspect; (2) individuals are only self-interested; (3) the self-interest results in the largest production of wealth; (4) the pursuit of individual gains results in the highest general societal good; (5) competition is the best regulator of the economy; (6) all state regulation encroaches on natural liberty; (7) individuals know their best interest and can act on this will; (8) there is perfect freedom and equality within a contract between individuals; (9) capital and labour are always freely mobile; (10) there is a universal tendency for profits and wages to arrive at an equal level; (11) population tends to overtake means of subsistence; and (12) demand and supply automatically adjust to each other. Again, refer to footnote 21.

²³ Shivaji possessed religious fervour, confidence, a rare insight into the “real needs of the time”, determined purpose, a readiness and resourcefulness rarely seen in European or Indian leaders, true patriotism (far advanced for his time) and a sense of justice (MP, 26).

²⁴ Again, how Ranade proposed to deal with this trend is beyond the scope of this paper.

²⁵ Cited in Ranade, IE, 5.

²⁶ A French historian and statesman from the nineteenth century.

²⁷ In another instance, he explains how social liberation tends “to be a change from the law of status to the law of contract” (RSR, 109).

²⁸ He does here MW, 31, in a discussion on which key works have been translated into vernacular languages.

²⁹ Henry Maine also stated that “political abstractions, founded exclusively upon English, and even here requiring qualification, are applied by the educated minority, and by their newspapers, to a society which, through nine tenths of its structure, belongs to the thirteenth century in the West” (Maine 1885, 108; see also Burrow 1966, 77). This is similar to Ranade's view that Classical Political Economy was not appropriate for Indian reality.

³⁰ “Teachers and Statesmen…seem to hold that the Truths of Economic Science, as they have been expounded in our most popular Text-books, are absolutely and demonstrably true, and must be accepted as guides of conduct for all time and place whatever might be the stage of National advance” (IE, 2).

³¹ Ranade's thought does differ from Veblen's in that Ranade theorises stages of progress like List, which Veblen did not. To Ranade, society passed through stages of progress and India had been at a higher level than its current state (to be discussed further below).

³² Other scholars were also theorising growth such as Spencer (see Burrow 1966, 187).

³³ Ranade referenced Adam Smith in his lecture on Indian Political Economy (IE, 7, 18).

³⁴ Also, Ranade wrote that “the past of our great ancestors in whose time our philosophies were developed, our literature and sciences grew up, and our people went to foreign lands, far off to Java, to the East, and far away beyond Mongolia to the North” (RSR, 148).

³⁵ The following examples help to illustrate what Ranade meant by India's progressive past. Two of Ranade's examples of India's former “proud position” were its iron and steel industries (IE, 176). At the Industrial Conference at Poona in 1892, Ranade (IE, 170–192) discussed the Iron Industry – Pioneer Attempts. During this speech, he stated that the Indian iron industry had in the past been able to supply all local demand, as well as export manufactured goods to foreign trade partners (IE, 171–172). Another example given by Ranade was the Indian steel industry. Indian steel had once “even” been demanded in England for cutlery (IE, 172). Ranade could have added the word “even” to make it clear that India had not always only imported manufactured goods from England and exported raw materials. Ranade explained how the Indian furnaces were forced to shut down due to foreign competition (IE, 172): there has been a “displacement of Home Manufactures” (IE, 173).

³⁶ Ranade also cites the American Political Economist, Carey, explaining how protection was the only solution for less advanced countries to overcome the obstacles thrown at them by the more advanced countries. The immediate loss of protection would pay off in the long run (IE, 19–20).

³⁷ The two words in Swadeshi, swa and des mean self and nation, respectively (Goswami 2004, 197).

³⁸ Further elaboration would be beyond the scope of this paper, because industrialisation fits more into what Ranade thought as the solution to bring about progress in India. In other words, industrialisation is part of the intentional plan, which I define as development. Rather, I focus on Ranade's conceptualisation of progress – i.e. immanent change in the Indian context.

³⁹ In fact, Ranade (IE, 25) wrote that contact with the British “represents the beam of light which alone illumines the prevailing darkness”.

⁴⁰ Note that Ranade seems to use development synonymously with positive progress here.

⁴¹ Another reference to childlike behaviour: MP, 66.

⁴² It made the Indians “helpless as children” (RSR, 175), so Indians needed to “learn to be men” (RSR, 148). It was clear to Ranade (RSR, 177) that substituting these damaging notions for “better ideas and forms” would bring about the needed progress.

⁴³ “The vitality of nation is best presented not merely by its capacity for self-defence but also by its power in each succeeding generation to raise up men fitted in every way to carry on the work with greater vigour and more assured success” (MP, 37).