for the quinquennium 1939-44, and fell further to 136.8 kg. The average annual net per capita foodgrain availability which had been 199.0 kilogrammes during the quinqennium 1897-02 had dropped to 148.5 kg. The last half-century of colonial rule had seen a sharp drop in per capita foodgrain production and availability in British India. And an extremely striking development was in the realm of foodgrain production, a development that usually goes unnoticed. At independence most industrial goods including even simple consumer goods, not to mention capital goods, were being imported but the dirigiste period saw substantial import substitution. The rate of industrial growth accelerated considerably compared to the colonial era, as did the rate of GDP growth.
The dirigiste regime had many important achievements to its credit which are worth recalling, since neo-liberal propaganda has tended to underplay these achievements.
But bourgeois participation was not supposed to make the path of development into a classical capitalist one for this reason strict controls over the operation of capital were imposed by the state through a system of investment and import licensing. The basic aim of the dirigiste regime was to break the domination over the economy of metropolitan capital which had been a feature of the colonial era and to usher in a ‘national’ development that was relatively autonomous of imperialism but in which the bourgeoisie would also participate. The public sector operated in mineral extraction, where it was expected to be the custodian of ‘national interests’ and in finance where credit was provided to agriculture and a few other ‘priority sectors’ at subsidized interest rates the public sector was also instrumental in developing infrastructure and basic and heavy industries where private capital was not forthcoming and also where the country needed to acquire the technological know-how to break the stranglehold of metropolitan capital over the economy through its control over technology. Earlier, India had a dirigiste regime where the economy had high levels of protection from foreign goods, controls over cross-border capital flows, state support for the petty production sector including peasant agriculture, and a significant public sector. Though a drift towards ‘liberalization’ had started since 1985, neo-liberal ‘reforms’ were officially introduced in India in 1991. The Contradictions of the Dirigiste Regime
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