Is India Broken?

In India Is Broken, author Ashoka Mody, a former senior economist at the IMF, argues that India’s democracy and economy are in a state of profound malfunction. There is a “continuous erosion of social norms and decay of political accountability,” he writes, and offers solutions to make the country a “true democracy.” But as Tunku Varadarajan points out in the book’s review, Mody’s solutions are naïve, and the country “will continue to be ‘broken’ for many years to come.”

[Excerpts of article published on the WSJ website on 3 March 2023]

‘India Is Broken’ Review: The Difficult Future for a Giant

Poised to become the world’s most populous nation, India struggles to deliver to its citizens both a healthy economy and a flourishing democracy.

[By Tunku Varadarajan]

Ashoka Mody, who was for many years a senior economist at the International Monetary Fund, is the sort of quietly effi cient global technocrat who retires to a professorship at a prestigious school—in his case, Princeton. Yet he’s different from his faceless ilk of briefcase-bearers in one astonishing way: 13 years ago, an attempt was made on his life. The alleged assailant, thought to have been passed over for a job at the IMF by Mr. Mody, shot him in the jaw outside his house in Maryland.

He recovered with remarkable verve, his intellectual drive intact. Yet a mood of gloom and pessimism is unmistakable in “India Is Broken.” Today, 75 years after independence from Britain, Mr. Mody believes that India’s democracy and economy are in a state of profound malfunction. The book’s tale, he writes, “is one of continuous erosion of social norms and decay of political accountability.” You might add that it is also a tale of an audacious political experiment on the brink of failure.

India started its post-independence journey, says Mr. Mody, as “an improbable democracy” whose citizens, mostly illiterate and poor, hungered for freedom and prosperity. Generations of Indian politicians—from Jawaharlal Nehru, the first prime minister, to Narendra Modi, the present one—have “betrayed the economic aspirations” of millions. India’s democracy no longer protects fundamental rights and freedoms in a nation over which “a blanket of violence” has fallen. A belief in “equality, tolerance and shared progress” has disappeared. And the country’s collapse isn’t just political and economic; it’s also moral and spiritual.

If India is your field of expertise, you will find little that is entirely new in Mr. Mody’s book. If it isn’t, “India Is Broken” will serve as a useful (if flawed) primer. India’s “essential failure,” he writes, has been its inability to keep up with its people’s demand for jobs. In a country with India’s population—on the verge of overtaking China’s—this is a gargantuan task. Today’s “grim reality” is that the economy needs to create 200 million jobs over the next decade to employ all working-age Indians.

This task is near-impossible, given the history of India’s economic development, with its emphasis on heavy industry and its scandalous neglect of export-oriented manufacturing,the means by which South Korea and Taiwan, not to mention China, raised themselves to levels of material well-being that vastly overshadow scruffy, argumentative, inefficient, poorly educated India. The employment deficit is also the stuff of political nightmares, given that jobs are, in Mr. Mody’s words, “the point of contact between economics and social discontent.”

In an aging world, India’s demographic dividend is touted by Prime Minister Modi’s government as a trump card. After all, 52% of the population is under age 30—meaning that India’s workforce will be abundant even as other major economies find themselves running out of people.

But this dividend is turning into a deadweight, creating the conditions for a socio-political meltdown. As the optimism of the early years of independence was frittered away by governments that cultivated a dogmatic form of socialism, the Angry Indian—materially thwarted and jobless—emerged as a political archetype. He has now given way to the Angry Hindu. Under India’s socialist prime ministers—most notably Nehru and Indira Gandhi—the West was seen as India’s nemesis, intent on denying a proud country its due.Under the Hindu-chauvinist Mr. Modi, Muslim Indians are the scapegoat.

How did India turn from the socialism of Nehru to the faith-based nationalism of Mr. Modi? The Hinduist strain in Indian politics dates back at least a century, but its practitioners were blocked from the electoral mainstream as long as the Congress Party—which shepherded India to independence—kept the idea of modernity alive.

Mr. Mody is right to note that India’s compact with the Congress Party began to unravel in April 1985, when the Supreme Court of India ruled in favor of Shah Bano, a 73-year-old Muslim woman. Her husband had divorced her in the traditional Islamic way—saying “I divorce you” three times—and had refused to pay her alimony beyond their religion’s obligatory three-month requirement. The secular court, controversially, overrode sharia law, which had until then governed the lives of India’s Muslims in matters of matrimony. Instead it held that Shah Bano was entitled to just as much alimony as any non-Muslim citizen of India. Muslim clerics and self-styled community leaders were enraged.

Rajiv Gandhi, India’s young prime minister, could have embraced the Supreme Court’s judgment. He had an irresistible majority in Parliament. He was personally liberal, indeed rather cosmopolitan, having been educated at Cambridge and having married an Italian woman. “The modernizer in Rajiv sympathized with the Supreme Court’s decision,” writes Mr. Mody. But he was callow and—let’s face it—feckless. Confronted with raucous protests from India’s imams, he oversaw the passage of a law that restored the primacy of sharia in Muslim personal affairs.

This “enraged the Hindus,” writes Mr. Mody—by which he means the growing numbers of Hindu hardliners who were howling for “Hindutva,” an ideology that calls for the primacy of Hinduism in India’s governance. After Shah Bano, they were ready for political prime time. In Mr. Mody’s apt analysis, the ostensibly secular Rajiv—grandson of Nehru—“accelerated Hindu nationalism.” Almost four decades later, Mr. Modi’s Hindu-centric Bharatiya Janata Party looks as entrenched in power as the Congress Party did decades ago. Hindutva has India’s secularism on the ropes.

A notable weakness in Mr. Mody’s analysis is his denial that the economic policies of Nehru and his successors were socialist. He writes of Nehru’s “alleged socialist legacy” and adds that it is a “mistake to identify central planning or big government as socialism.”Socialism, he insists, “means the creation of equal opportunity for all,” which India’s policymakers weren’t doing. Ergo, India wasn’t socialist.

If these protestations are almost laughable, Mr. Mody’s solution also invites some derision. Hope for India, he says, lies in making it a “true democracy.” And how can that be done?“We must move to an equilibrium in which everyone expects others to be honest.” This“honest equilibrium,” he says, will promote enough trust for Indians to work together “in the long-haul tasks of creating public goods and advancing sustainable development” and awakening “civic consciousness.” Mr. Mody, it is clear, has a dream. It is naïve, and it is corny. India, alas, will continue to be “broken” for many years to come.

—Mr. Varadarajan is a fellow at the American Enterprise Institute and at the Center on Capitalism and Society at Columbia University.