Indian Politics & Policy Volume 1, Number 2, Fall 2018 | Page 131

Indian Politics & Policy
any time soon” (7). A weak government
sector and crony capitalism additionally
compound existing challenges.
Interestingly, Joshi departs from
standard neoliberal analyses of India’s
economic performance and prospects
by arguing that more liberalization
is necessary but will not be sufficient
to ensure and sustain “high-quality”
growth. This is because the Indian state
“no longer performs its core functions
effectively” (7). A central weakness of
the current growth model for Joshi,
thus, lies in the nature of India’s state–
market relationship. According to him,
India has not found the correct balance
between state and market to achieve
“high-quality” growth. This, in turn,
necessitates the need for radical reform
of the state and the state–market relationship.
As an interesting aside, and a
clear contrast with Ayres in this regard,
Joshi argues that deliberate pursuit of
great power status by India would be
“unwise, if not foolish,” given the scale
of the domestic challenges that remain.
After offering a preview of the
main argument, the book is divided
into five parts. Part 1 offers an evaluation
of India’s economic performance
since independence, Part 2 focuses on
the challenge of growth, Part 3 examines
stability and inclusion, Part 4 focuses
on India’s political economy, and
Part 5 discusses future prospects and
evaluates the performance of the Modi
government on various measures required
to ensure rapid and inclusive
growth.
In examining the history of India’s
economic performance, Joshi suggests
that India’s disappointing growth
performance between 1950 and 1980
was primarily due to the fact that “Indian
policymakers acted with a mistaken
conception of the role of the state” (19).
Joshi confirms that growth acceleration
after 1980 has been most pronounced
in the service sector, which also saw total
factor productivity grow much faster
than agriculture or industry. Unlike cases
in East Asia, India has not exploited
the gains associated with shifting labor
out of low productivity farming. For
Joshi, the marked weakness in terms of
employment generation lies firmly with
the nature of labor laws in India and he
suggests that radical reforms in terms
of flexibility, severance, and unemployment
benefits and job-search training
are required.
In terms of inclusion, Joshi highlights
India’s gross underperformance
in health and education. The problem
in his view is that it has historically
been taken for granted in India
that the state should deliver education
and healthcare. Solving this problem
involves a much more extensive role
for the private sector; while the state
should ensure access to health and education
for the poorest, the delivery of
services needs to be shifted more significantly
to the private sector. Two major
trends—“social and political awakening”
and “institutional decay”—have
characterized Indian democracy for
Joshi in recent years and have had effects
on the state’s performance. Joshi
also highlights the weakness in state capacity
through a lengthy discussion on
petty and grand corruption as well as
crony capitalism in India. The glaring
lack of state capacity and accountabili-
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