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India’s Far from Neo-liberal Economic Order in the Modi Era
India’s economic order is far from neo-liberal. The state, and thus politicians, have retained very substantial powers over market forces. Expectations that the Modi government would liberalise audaciously have been disappointed. Especially since mid-2019, it has used its remaining powers to intimidate corporate interests, in pursuit of its main objective: top-down control over all power centres. Thus, in crucial ways, the economic order has become less liberal (or neo-liberal) than before.
We often see suggestions that a neo-liberal economic order exists in India. They are not just inaccurate. They are far from the truth. Under a neo-liberal order, the powers of the state would be radically rolled back; those powers which the state retained would mainly be used to serve the interests of the private sector, and market forces would have a free rein and immense influence. These things have not happened in India.
Economic liberalisation has certainly occurred under successive governments since 1991, but that process has been cautious, incremental and limited. The influence of market-oriented thinking—and of the private sector—over policymaking has certainly grown. But India has stopped a long way short of a neo-liberal economic order in which the state has been captured and has lost its autonomy or even its predominant influence over economic policymaking (Jenkins 2020). There is “no neat capital–state nexus” in India and “the state remains the … prime mover” (Chatterjee 2014: 209).
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