Thirty years ago, on May 11 and 13, 1974, India imploded its first atom bomb. For me as a Tata executive, the event was made even more memorable by the meeting, exactly on this day, between our Group Chairman, J R D Tata, and the (by now) legendary Prime Minister of Singapore, Lee Kuan Yew.The meeting that lasted nearly one and a half hours saw Lee making a number of points and prophesies.Lee was exceptionally critical of Mao Tse-Tung’s leadership, which had given China not only considerable political instability but also a punishingly low rate of economic growth. Lee said that he could prophesise two major events for China. After the demise or retirement of Mao, the Chinese people would evolve their own pattern of socialism under which their creative energies, backed by their traditions of hard work, will find a fuller expression.All that the people of China would want, after Mao, is a climate of political stability and economic incentives, in which they could give their best. From this, Lee said he could make the second prophesy, namely the rulers of China, after Mao, would dedicate themselves to economic growth. They would try, not only to make up for almost a decade of economic chaos, but also move fast to rival not merely the small city-states like Singapore and Hong Kong but even Japan.At this stage, J R D Tata asked Lee how he viewed the economy of India in his exposition of ‘‘modern socialism’’. Lee said that it was not for the leaders of Singapore to pass judgement on the economic performance of other countries, but since Tata had expressly invited him to do so, he would categorise Indian socialism as a relic of the 19th century. It is a socialism in which politicians and bureaucrats dominate the economy. It is a socialism which runs the economy instead of making the economy run. It is a socialism which believes in controls, not incentives. Not least, it is a socialism in which the poor of India do not seem to be the immediate or ultimate beneficiaries.What India needs is 20th-century socialism, not 19th-century socialism, based on nationalisation and commanding heights of economy. What India needs is a modern socialism which combines the drive and the dynamism, the profits and the productivity of the market with the humanitarian goals of socialism.Statesmanship, in modern times, demands the use of market forces for promoting the goals of socialism; in short, a socially responsible market system.‘‘I cannot believe that with your 3.2 per cent growth, matched by your 2.2 per cent rate of population growth, you have the conditions of solving the poverty of the people of India. You must have a faster rate of economic growth, combined with a ‘shop-floor socialism’—let the people see for themselves the new houses, schools, factories that come up.’’Why can’t India, as a federal country with a strong Central Government, leave one or two states to try out the magic of modern socialism. Within a matter of a few years, the people of India, known the world over for their industry and creativity, will show a rate of growth which will not only create substantial employment opportunities but also help lower population growth. A faster rate of economic growth is what India needs, but with the present system of controls, this is most unlikely to be achieved in India.The Indian migrants have made a success wherever they have gone; why can’t the people of India reproduce this success in their own country?— The writer was for many years a key member on the board of Tata Sons
