Constitutional Provisions for Socio-Economic Inclusivity: Theory and Parliamentary Practice

“India is a geographical and economic entity, a cultural unity amidst diversity, a bundle of contradictions held together by strong but invisible threads. Overwhelmed again and again, her spirit was never conquered and she remains unsubdued and unconquered. About her illusive quality of a legend of long ago some enchantment seems to have held her mind. She is a myth and an idea, a dream and a vision, and yet real and present and pervasive.”

-Nehru, Discovery of India

Introduction

The soul of India resides in pluralism and tolerance. This plurality of our society has come through assimilation of ideas over centuries. Secularism and inclusion are a matter of faith for us. It is our composite culture which makes us into one nation. India’s Nationhood is not one language, one religion, one enemy. It is the ‘Perennial Universalism’ of 1.3 billion people who use more than 122 languages and 1600 dialects in their everyday lives, practice 7 major religions, belong to 3 major ethnic which leads to the peaceful co-existence, compassion, respect for life, and harmony with nature as the foundation of our civilization.

Kautilya’s Shloka from Arthashastra, inscribed near lift No. 6 in the Parliament House says:

प्रजासुखे सुखं राज्ञः प्रजानां च हिते हितम् । 
नात्मप्रियं हितं राज्ञः प्रजानां तु प्रियं हितम् ।।

In the happiness of the people lies the happiness of the king, their welfare is his welfare. He shall not consider as good only that which pleases him but treat as beneficial to him whatever causes happiness to all people. People are at the centre of all activities of the state and nothing should be done to divide the people and create animosity amongst them.

The aim of the state should be to unite them to fight a concerted war against poverty, disease and deprivation and to convert economic growth into real development. It has been my firm belief that the objective of spreading Peace, Harmony and Happiness must always inform the formulation of our public policy and guide all the actions of our state and citizens in their everyday life.

Historical Perspective

India’s ancient religious texts, The Vedas, teach us the principles of regard for human dignity, love for all living beings, respect for all religions, and justice to all. Our scriptures like the Ramayana and Mahabharata have imbibed in us the principle of righteousness and instructed us to fight against evil.

The ethos of inclusion, co-existence and a democratic system of governance find their roots in the civilisational values. Both Kautilya's work and the ManuSmriti are considered classic expressions of ancient Indian political and social theory. A reader of these or other Brahmanical treatises finds it very easy to visualize ancient Indian society as one where "monarchy was the normal form of the state."

In the 4th century BC, Chandragupta Maurya built a powerful empire comprising of North-Western and Northern India. The central administration of the Mauryas represented a comprehensive system. “Administration cannot be work of one man, just as one wheel cannot drive a chariot.” says Kautilya.

Emperor Ashoka was the most illustrious king of the Mauryan dynasty. The nature of his rule, as reflected in the orders issued by him, paint him as an unusually humane ruler who strived for peace and equality amongst his subjects.

A striking feature of Ashoka’s four-decade long rule was the setting up of one of the first welfare states in the ancient world with equal laws and punishments for all its subjects. The emperor took great interest in the welfare of his populace, spending state funds on developing/improving water reservoirs (Junagadh’s Girnar city had a dam built by Ashoka’s grandfather, Chandragupta Maurya, which was expanded with additions of canals through Ashoka’s ‘Yavana’ Greek governor), highways lined with shade trees, frequent wells, orchards and public guest houses for travellers.

The Gupta age around 550 AD, characterised by an Imperial Government, did remarkable progress in cultural sphere but lacked in development of social and economic landscape.The Mughal Empire at its zenith commanded resources unprecedented in Indian history and covered almost the entire subcontinent. From 1525 to 1707, it was a fairly efficient and centralized organization, with a vast complex of personnel, money, and information and dedicated to the service of his nobility rather than the general population.

Throughout this period of 2500 years of changing political fortunes and conquests, the 5000 year old civilizational continuity remained unbroken. In fact, each conqueror and each foreign element has been absorbed to form a new synthesis and unity.

India: A Prosperous Region before the advent of Britishers

India is a constant flame of continuity amidst discontinuities. Like a vast canvas, it is painted with pigments of varying hues, while retaining a remarkable compositional unity. The persistence and survival of this identity of India has given it a unique character and motivational force. It has been ever changing - with rapidity even as it is immobile - through different periods of history. Progressions and regressions in its economic development at various stages of its growth have not obliterated its changeless core of spiritualism.

India was an open society, globally connected along the Silk and Spice Routes. These busy highways of commerce and conquest witnessed a free exchange of culture, faith and invention as merchants, scholars and sages traversed mountain and desert and sailed the oceans. Ancient travelers like Megasthenes in the 4th century B.C., Fa Hien in the 5th century A.D. and Hiuen Tsang in the 7th century AD; when they came to India, wrote about the efficient administrative systems with planned settlements and good infrastructure.

When India gained independence, it faced abject poverty and lack of resources. How did India become so poor, indeed one of the poorest countries in the world? The irony is that one does not have to invoke some mythical golden age from an imagined past to think of a time when India was not – nor taken to be – poorer than most other countries. Indeed, far from it. Adam Smith thought that India in general, particularly Bengal, was one of the most prosperous regions on the globe, and he devoted some time in The Wealth of Nations (1776) to explain the roots of India’s comparative prosperity, which he attributed mostly to its nourishing system of trade, utilizing its navigable rivers.

Colonial Exploitation

When the East India Company initiated, through the battle of Plassey in Bengal in 1757, what would gradually become Britain’s vast Indian empire, the region was famous for its industrial exports, particularly of textiles of various kinds. Upstream from the settlements of the East India Company on the Ganges, there were other trading centres where merchants from Portugal, the Netherlands, France, Denmark, Prussia and other European nations were busily involved, among other channels of commerce, with exporting Indian manufactures to Europe and elsewhere.

Indeed, in long periods during the epochal British rule the per capita real income of India actually declined. When there was growth, it was so moderate that falling behind other countries was not a hard feat. S. Sivasubramonian’s detailed study of ‘the national income of India in the twentieth century’ places the annual growth rate of India’s per capita income at about 0.1 per cent between 1900–1 and 1946–7. Growth was positive (though barely so) in this period because the dismal GDP growth of 0.9 per cent was counterbalanced by a low population growth rate (0.8 per cent), reflecting in the high mortality rates that characterized British India.

Indian Independence Movement was a precursor to the complete annihilation of the British empire. The saga of Indian Independence was a dramatic event that not only profoundly influenced India, but in a non-trivial sense, transformed the world itself. Gandhian techniques of non-violent confrontation and Satyagraha entered into the world-lexicon. It deeply influenced and changed the course of political development in many parts of the world like South Africa, USA, Czechoslovakia, Philippines and elsewhere. Gandhiji brought to the fore the concept of inclusive socio-economic development through various movements like Salt Satyagraha, Champaran Satyagraha, Non-cooperation and Swadeshi Movement etc.

Aftermath of British Rule

After almost 2 centuries of economic exploitation, India was left a resource ravaged nation which had to formulate policies in a way that the large population’s needs could be taken care of. India, which primarily served as a market for the British was in ruins. In this scenario, the Constituent Assembly undertook the task of building a vision of a democratic nation and setting up goals for achieving that vision. It took up the challenge of making India into an egalitarian society with optimal resource usage. Our founding fathers undoubtedly had a momentous task of putting in place a system that not only addressed the imminent problems of abject poverty, illiteracy, lack of skills among others, but also a system that responds to and is accommodative of the changing times.

The planners, economist, and the administrative machinery of the Government of the pre-independence era had assumed that after Independence, the economic policies that had been initiated would bring about definite social and attitudinal changes. This supposition was based on western concepts. But eastern culture, loaded as it is with emotionalism, in contrast to the rationalism of the west, called for more understanding and research in this area for obtaining greater cooperation from the people and better integration of the country for the advancement of its economy.

Let me therefore, with this background try to describe contours of the new awareness which has guided us since we gained Independence. The main pillars of the inclusive economic philosophy on which the Indian economic system has evolved are discussed below.

Making of the Constitution

With the Independence of India, the policy makers and the leadership was faced with the challenge of consolidating the Indian polity, economy and the democratic landscape of the country. The foremost challenge was to optimise the resource utilisation, because the British left the country into ruins after plundering the wealth and resources of the nation. It was at the brink of breakdown of the economy when we gained Independence.

Furthermore, India was still in the nascent stage of its new found Independence and was a disintegrated entity with 565 Princely states. It was due to the efforts of Sardar Vallabhbhai Patel that India as a Union of States came into being after the integration of Provincial and Princely States into the Indian Union. The process of integration came into finality with the passage of State Reorganisation Act, 1956.

The Constituent Assembly which drafted the Constitution from December 1946 to December 1949, worked towards drafting a constitution with remarkable idealism and a strength of purpose born of the struggle for independence. The aim of the Constitution was to foster the achievement of many goals, to shape the destiny of new India, to pursue their long proclaimed aims and aspirations, and to create the national institutions that would facilitate the fulfilment of these aims.

Even during this process of the making of the Constitution, the Assembly acted parallely as the Central Assembly and steered the nation towards inclusive development. Some of the Acts and Legislations so passed were:

● The Minimum Wages Act of 1948: In its first session during November 1948, the Central Advisory Council appointed a Tripartite Committee of Fair Wage. This committee came up with the concept of a minimum wage, which not only guarantees bare subsistence and preserves efficiency but also provides for education, medical requirements and some level of comfort.

● The Factories Act, 1948 (Act No. 63 of 1948), served to assist in formulating national policies in India with respect to occupational safety and health in factories and docks in India.

● Banking Regulation Act, 1949 The Act provides a framework using which commercial banking in India is supervised and regulated. The Act supplements the Companies Act, 1956. Primary Agricultural Credit Society and cooperative land mortgage banks are excluded from the Act.In 1965, the Act was amended to include cooperative banks under its purview by adding the Section 56.

● Industrial Policy Resolution 1948 and Industries (Development and Regulation) Act of 1951:

○ Industries Developed by State and Monopoly in (a) Railways, (b) Air Transport, (c) Arms and Ammunitions, and (d) Atomic Energy

○ Industries which will be progressively State-governed but private sector will also have opportunity to develop them.

○ Industries in which investment is made by private sector, State can invest along with private sector without any monopoly.

Constituent Assembly

Composition - It is true that the Constituent assembly did not hold representation from each and every section of the society. It is widely believed by many that it was only a sect of elite intellectuals who sat together to write down a document which would decide the fate of a country where more that 70% of the population could not even read. However, I disagree. I believe that the participants of the Assembly attempted to anticipate and address, to the best of their abilities, the problems that were faced by the infant nation or that could be faced in the foreseeable future.

Constitution of India

On 26 January 1950, the Constitution of India came into effect. The longest written Constitution with 22 parts, 295 articles and 8 schedules came into existence. Today it has 25 parts, 448 articles and 12 schedules. In a remarkable display of idealism and courage, we the people of India gave to ourselves a sovereign democratic republic to secure for all its citizens justice, liberty, and equality. We undertook to promote among all citizens fraternity, the dignity of the individual and the unity of the nation. These ideals became the lodestar of the modern Indian State. Democracy became our most precious guide towards peace and regeneration from the swamp of poverty created by centuries of colonial rule.

We have a written Constitution in India, which is a living document, not a relic cast in stone. It is a magna carta of socio-economic transformation.The Apex Court of India has continuously been interpreting the mandate for good governance enshrined in the Constitution on the altar of contemporary situations and challenges facing the country, whether due to global winds of change or from within. This has not been merely an exercise in interpretation of laws or legal order, much less an exercise in edifying jurisprudence; it has captured the ethos of our developing society as it has evolved from the colonial shackles to a social order replete with the essence of human dignity, of aspirations of a populace maturing into a sovereign, socialist, secular, democratic republic as mandated by the makers of our Constitution.

For us, Democracy is not a gift, but a sacred trust. The Indian Constitution, is not merely a legal document but a Magna Carta of socio-economic transformation of the country. It represents the hopes and aspirations of the billion plus Indians. From our constitution flows our nationalism. The construct of Indian nationalism is ‘Constitutional Patriotism’, which consists of an appreciation of our inherited and shared diversity; a readiness to enact one’s citizenship at different levels; the ability to self correct and learn from others.

Indian Parliament

In a democracy, the Parliament has three vital functions – representation, law-making and oversight. Though the formulation of policy and initiation of legislation is mainly the function of the Executive, enactment of legislation or its rejection is within the domain of the legislature. Interpretation of law falls in the domain of the Judiciary.

The Parliament stands for the will and aspirations of the people. It is the platform where through debate and deliberations, this ‘will’ and ‘aspirations’ have to be prioritized and translated into laws, policies and concrete programmes of action. When that does not happen, an important element in the functioning of a democracy gets compromised to the disadvantage of the people.

Law refers to principles and rules, codified or enshrined in customary practices, established for mediation of social relations between people and communities in a society. It serves two important purposes. It gives shape to social values and strengthens their aspirational dimension. It also helps in guiding human behaviour towards desired social ends. Thus, by definition, law provides the normative basis and the architecture for the conduct of public policy.

Law-making or legislation is the exclusive domain of the Parliament and the legislative assemblies in our Parliamentary democracy. A legislature is effective only if it is able to address the differences amongst stakeholders and succeeds in building a consensus for the law to be enacted and enforced. When the Parliament fails in discharging its law-making role or enacts law without discussion, it breaches the trust reposed in it by the people. This is neither good for the democracy nor for the policies anchored in those laws.

Policy refers to a definite course of action adopted for expediting or facilitating desired results in a given situation. It is normative in nature. These norms come from laws and social practices prevalent in a society, or from international conventions that a state becomes party to. Policies have to essentially address the concerns of different stakeholder in a society, in the larger national interest.

The policymaking in India’s context is guided by its Constitution. The Directive Principles of State Policy represent affirmative instructions to provide the basis for all executive and legislative action. While these principles are non-justiciable, they are fundamental in the governance of the country. In the landmark 1973 Judgment in Kesavananda Bharati vs. State of Kerala, the Supreme Court observed that both Directive Principles and Fundamental Rights are equally ‘fundamental’ even though Directives are not directly enforceable by the courts.In the past decade, people have been given entitlements for right to information, right to employment in rural areas, education and food through legal guarantees. Each legislative intervention has resulted in a shift in policy towards the objectives laid down in our Constitution and in furthering human well-being.

The Parliament having aided policy formulation also ensures that policy and programmes that it has helped define through legislation is implemented in the envisaged manner. It exercises oversight, to ensure that programmes are carried out by the Executive legally, effectively and for the purposes they are intended. Parliamentary oversight extends also to two other important functions.

There are various Institutions and Mechanisms that ensure a holistic approach to policy formulation and implementation, whose roles are defined as follows:

● Cabinet: It is the supreme directing authority, the magnet of policy, which co-ordinates and controls the whole of the executive government of the Union and integrates and guides the work of Parliament.

● Cabinet Secretariat : It ensure the collective responsibility of the Cabinet to the Lok Sabha (the House of the People). The Secretariat assists in decision-making in Government by ensuring Inter-Ministerial coordination, ironing out differences amongst Ministries/Departments and evolving consensus through the instrumentality of the standing/ad hoc Committees of Secretaries.

● GoMs (Group of Ministers) and EGoMs (Empowered Group of Ministers) : In order to make decision-making more efficient and governance more effective, GoMs and EGoMs are constituted to discuss and deliberate at length on crucial and contentious issues.This necessity of this instrument multiplied with the advent of coalition era. During UPA-I and II, I headed more than 95 EGoM’s and GoM’s..

● Parliamentary Committees : Some Standing Committees as well as numerous ad-hoc Committees are constituted regularly to involve experts and ensure swift and effective decision-making. Standing Committees like the Committee on Public Accounts, Estimates Committee, Business Advisory Committee, Committee on Public Undertakings, amongst others, recommend feasible policies to the government from time to time.

● Consultative Committees of the Ministries: Apart from these, the Ministries constitute Consultative Committees based on Pandit Jawaharlal Nehru’s belief that there should be some kind of Standing Advisory Consultative Committees of Parliament to provide opportunities to Members to have some glimpse into the working of the Government. The main objective of these committees is to provide a forum for discussion between Members of Parliament, on the one hand, and Ministers and senior officers of the Government, on the other, hand on the policies, principles and programmes of the Government and the manner of their implementation.

Democratic Centralism to Cooperative Federalism

Quasi-Federal Structure

Prior to the formation of the Constituent Assembly, the Cabinet Mission Plan emphasized on a Central Government with very limited powers to be confined to foreign affairs, defense and Communication. Mahatma Gandhi favored the decentralized structure and preferred a panchayat/village based federation. On the other hand, the then Prime Minister Jawaharlal Nehru and Dr BR Ambedkar were in favor of a unitary system of governance while the Home Minister Sardar Vallabhai Patel also stood for the idea of federalism. The result was a balance of power between the Centre and the State, and India was thus described as ‘Union of States’ and this unity being indestructible.

Letters of Nehru

Pandit Nehru started the tradition of writing fortnightly letters to the Premiers and Chief Ministers of the states from October 1947 and continued writing such letters till December 1963. The purpose of these letters was to discuss the issues of governance, the rights of the people and foreign policy with the states. In a way, these letters established a dialogue between the Centre and the States, laying down the foundation of cooperative federalism.

Centre-State Fiscal Relations

The unequal distribution of resources made the creation of a strong union necessary to transfer resources, to correct regional imbalances, and to achieve distributive justices.

Article 280 of the Constitution stipulates that after every five years an independent, quasi-judicial and ad-hoc finance commission should be appointed to give recommendations on financial distribution between Centre and State.

State Finance Commissions

The state finance commissions were added by 73rd amendment act. They have been enshrined in article 243-I and 243-Y in Part IX A and IX B.They are constituted by Governor every five years.Primary concern is to suggest ways and means to strengthen the institutions of local governance viz. PRIs and ULBs.They recommend principles and methodology as regards the devolution of funds to PRI’s and ULB’s.

Planning

An important dimension of the model, which I wish to outline in this lecture refers to Democratic Centralism and its gradual transformation to cooperative federalism. We are a large country with geographical, ethnic and linguistic diversity. The endowment of natural resources also varies. Immediately after Independence these factors called for a democratic and strong center, which would utilise and transfer resources equitably to achieve a high and sustained rate of growth, a progressive improvement in the standards of living of the people across all regions, eradication of poverty and unemployment, and lay the foundation for a self-reliant economy.

Central Planning came to India not as an outcome of development which was the experience of the advanced countries of the west. We adopted Central Planning as an instrument for developing more on the pattern of the socialist countries. At the same time, regimentation of the socialist type in a centrally planned economy, which was inconsistent with our democratic setup, was avoided. Our planning also did not envisage total control of resources with a view to direct these for predetermined objectives. We adopted the middle path - the concept of mixed economy with public and private sectors playing complementary roles and remaining active partners in the common task of development.

It is in this perspective that our plans were designed to yield best results keeping in view both the short term and long term needs of the economy. While the precise formulation of plan priorities varied in successive plans, at the core of the entire exercise were the objectives of equity, growth, social justice, self-reliance and modernisation.

The Planning Commission was set up by a Resolution of the Government of India in March 1950 in pursuance of declared objectives of the Government to promote a rapid rise in the standard of living of the people by efficient exploitation of the resources of the country, increasing production and offering opportunities to all for employment in the service of the community. Our planning process began with the start of the first FYP in April 1951.

Since then, twelve five year plans have been implemented in consonance with the changing times, different models of planning like rolling plan, for the sixth plan, indicative and perspective planning for the eighth plan. The plan outlay which stood at 2069 crores(at current prices) and 558 lakhs(at constant prices) in first FYP rose to 3568626 crores in 12th FYP.

Twelve plans have been implemented since 1950 to 2017. The Planning Commission was replaced by NITI Aayog in January 2015.NITI Aayog, was formed via a resolution of the Union Cabinet on January 1, 2015. It is the premier policy ‘Think Tank’ of the Government of India, providing both directional and policy inputs.This was done in order to better serve the needs and aspirations of the people of India. An important evolutionary change from the past, NITI Aayog acts as a platform of the Government of India to bring States to act together in national interest, and thereby fosters Cooperative Federalism.

In a democracy, implementation of plan is a participative process. The rate of growth in a planned economy is bound to be higher than it could have been without resorting to the instrument of planning. Indian Planning represents an effort to combine rapidity of growth with minimum dislocation of existing balance in social and political spheres.

Public Sector

Immediately after gaining Independence, there was a need to handhold the infant Indian economy and strengthen the socio-political fabric of the country.

Although the State does not own all the resources as is the case in the socialist economies, India had assigned a dominant role to the public sector with a view to promote economic development and growth, seek self-reliance in strategic sectors, prevent concentration of economic power and create the necessary infrastructure for attracting investment and development of private enterprise in the country.

The first FYP provided for 46.4% of the plan outlay for public sector as against 53.6% in the private sector. Gradually the share of the public sector rose to a high of 66.6% in the fifth five year plan. The total investment in the public sector increased from Rs.29 crores as on 31 March 1951 in 5 enterprises to Rs.12.5 lakh crore as on 31 March 2017.

For the first eight Plans the emphasis was on a growing public sector with massive investments in basic and heavy industries, but since the launch of the Ninth Plan in 1997, the emphasis on the public sector became less pronounced and the current thinking in the Government is that larger space should be created for private sector with public sector undertaking from those areas where private sector has attained proficiency.

((As I have always said and believed that when a child at the age of 5 years wants to cross the road, you take his hand and help him cross the road. But when the same child at the age of 25 years asks you to handhold and help him across, you should seek medical attention.))

Panchayati Raj Institutions

The 73rd Constitutional Amendment Act, 1992 marked a new era in the democratic set up of the country as it created Panchayati Raj Institutions (PRIs) as tiers of self governance below the level of States in the federal set up. It is also a landmark in the decentralized development as it envisions people’s participation in the process of planning, decision-making, implementation and delivery. These Constitutional provisions provide for devolution of powers and responsibilities to different tiers of PRIs with respect to preparation of plans and programmes for economic development and social justice and their implementation in relation to 29 Subjects listed in the Eleventh Schedule. Consistent with the spirit of the provisions, the Central Ministries / Departments and State Governments are expected to confer necessary executive powers and administrative authority along with control over functionaries in their jurisdiction dealing with subjects allotted to them and devolve financial resources to the concerned level of PRIs to enable them to discharge their responsibilities effectively and efficiently.

Socialism to Liberalism

India had a unique distinction of being a country with both a quasi-federal democracy and a planned economy.

Socialism has been acknowledged as the cherished goal of Indian political system. Socialism lays emphasis on the welfare of the people, it seeks to give equality to the people and tries to remove exploitation of one class by the others and ensures economic and political equality to all. It has been held that not only political but economics and social democracy are equally essential for the development of the country. Under article 14 to 18 of Indian constitution right to equality is defined, in which all citizen are equal before law. On the basis of any caste, creed or religion nobody should be denied of her legal right, thus ensuring social equality. Untouchability was abolished, practices of untouchability in any form was punishable.In other social reforms, education was made free and compulsory up to the age of 14 to all. Steps were also taken for the benefit of backward classes, to bring justice and progress for them. The Indian Constitution, despite being permeated with the spirit of socialism, needed the 42nd amendment in 1976 to get the word socialism inserted in the preamble of the constitution as the basic philosophy of the Indian Polity. This was added to give economic content to justice, equality and fraternity and to affirm the resolve of non-discrimination on grounds of religion. Social and economic justices are the pillars of socialism. That is why, the framers of our constitution have prescribed these fundamental principles in shape of directive principle of state policy in part 4th of our constitution to establish a welfare state based on the principles of socialism.

Preamble

I would now like to touch upon the Preamble of the Constitution and its role in guiding the policies on inclusion. The Preamble is something that is the soul of the Constitution. In so many words, it defines the purpose of the Constitution so that no matter which age or time we live in, we know which principles to hold dear. Justice, Liberty, Equality and Fraternity are specified as the objectives of the Constitution while the Nature of Indian State is declared to be a sovereign, socialist, secular, democratic and republican polity.

The Preamble embodies the basic philosophy and fundamental values— political and moral—on which the Constitution is based. It contains the grand and noble vision of the Constituent Assembly, and reflects the dreams and aspirations of the founding fathers of the Constitution. In the words of Sir Alladi Krishnaswami Iyer, ‘The Preamble to our Constitution expresses what we had thought or dreamt so long’. According to K M Munshi, the Preamble is the ‘horoscope of our sovereign democratic republic’. Pandit Thakur Das Bhargava, another member of the Constituent Assembly, summed up the importance of the Preamble in the following words: ‘It is the soul of the Constitution. It is a key to the Constitution. It is a jewel set in the Constitution. It is a proper yardstick with which one can measure the worth of the Constitution’. Sir Ernest Barker, a distinguished English political scientist, described the Preamble as the ‘key-note’ to the Constitution. He was so moved by the text of the preamble that he quoted it at the opening of his popular book, Principles of Social and Political Theory (1951).

Justice

The term ‘justice’ in the Preamble embraces three distinct forms—social, economic and political, secured through various provisions of Fundamental Rights and Directive Principles. Social justice denotes the equal treatment of all citizens without any social distinction based on caste, colour, race, religion, sex and so on. It means absence of privileges being extended to any particular section of the society, and improvement in the conditions of backward classes (SCs, STs and OBCs) and women. Economic justice denotes the non-discrimination between people on the basis of economic factors. It involves the elimination of glaring inequalities in wealth, income and property. A combination of social justice and economic justice denotes what is known as ‘distributive justice’. Political justice implies that all citizens should have equal political rights, equal access to all political offices and equal voice in the government.

Liberty

Through this are ensured certain rights without which democracy cannot be established. These individual rights as mentioned in the Preamble are ‘freedom of thought, expression (19), belief, faith and worship (25-28)’ and are guaranteed against all authorities of State by Part III of the Constitution as Fundamental Rights.

Equality

To ensure that every individual is able to exercise their rights and live a life of dignity, it is necessary that equal opportunity be available to everyone. This objective is secured in the Constitution by making all discriminations by the State illegal, on the grounds of religion, race, caste, sex or place of birth (15); ensuring access to every citizen to public places (15)(2); abolishing untouchability (17); abolishing titles of honour (18); offering equality of opportunity in matters of public employment (16); guaranteeing equality before law and equal protection of the laws (14).

Fraternity

This value becomes uniquely important for India to develop a feeling of commonness for a vast sub-continent constituting many religions, races, languages and cultures. Democracy would indeed be hollow if it fails to generate this spirit of brotherhood amongst all sections of people - a feeling that they are all children of the same soil, the same Motherland.

Nature of the State

The defining characteristics of the State in the Preamble that declare its inclusive nature are Democratic, Socialist and Secular. Since the inception of the Constitution it was agreed and so implemented that each and every citizen of India be included in the process of governance as long as they reach a certain age no matter what their background, qualification, etc. The term ‘democratic’ is used in the Preamble in the broader sense embracing not only political democracy but also social and economic democracy. This dimension was stressed by Dr. Ambedkar in his concluding speech in the Constituent Assembly on November 25, 1949, in the following way:

“Political democracy cannot last unless there lies at the base of it social democracy. What does social democracy mean? It means a way of life which recognises liberty, equality and fraternity. The principles of liberty, equality and fraternity are not to be treated as separate items in a trinity. They form a union of trinity in the sense that to divorce one from the other is to defeat the very purpose of democracy. Liberty cannot be divorced from equality, equality cannot be divorced from liberty. Nor can liberty and equality be divorced from fraternity. Without equality, liberty would produce the supremacy of the few over the many. Equality without liberty, would kill individual initiative”.

The latter two characteristics have been added in the Constitution by the 42nd Amendment Act. But even before formalising it, the Indian State under the guidance of Pandit Jawaharlal Nehru strived to be a Socialist State which can take the responsibility for the provision of basic needs that citizens could not individually afford or invest in.

Nationalisation of Banks

Nationalization of banks in India by then Indian Prime Minister Indira Gandhi wrote a new chapter in Indian Banking history. The nationalized banks in India were compelled to focus on rural and agricultural sectors as a part of their social responsibility. Their resources were utilized to empower farmers and agricultural laborers in order to free them from the clutches of money lenders.

Agriculture

Agriculture, the single most important sector of our economic activity, holds the key for attaining success in our economic policies. The livelihood of more than 75% of India’s population is dependent on this sector.It employs more than 50 per cent of the total workforce in India and contributes around 17-18 percent to the country’s GDP. Some of our major industries like textiles, sugar and tea are dependent for supply of their raw materials on this sector.

A strong Federal structure had been part of the public discourse in India for many decades, before and after independence in 1947, but it has gained greater importance since the 1990s when the country’s national polity saw the advent of the coalition era.

Fundamental Rights

The Fundamental Rights are meant for promoting the idea of political democracy. They operate as limitations on the tyranny of the executive and arbitrary laws of the legislature. Through the writs of habeas corpus, mandamus, prohibition, certiorari and quo warranto an aggrieved citizen (as well as foreigners) can go directly to the Supreme Court to seek justice for the restoration of his or her rights. This is exemplar of how the Constitution has balanced the individual rights with social inclusion because at the end of the day, even one person’s rights cannot and should not be compromised for the societies’ needs. It is true that Fundamental Rights can be suspended during National Emergency but even then it has been made absolutely clear that in no case can the right against arbitrary arrest (20) or the right to life and personal liberty (21) can be done away with.

Directive Principles of State Policy

The most significant provision of the Indian Constitution embodying socio-economic inclusion is Part IV, the Directive Principles of State Policy. Extensive discussions and deliberations took place during the making of the Indian Constitutions revolving around this topic. It was the ingenuity of the makers of the Indian Constitution to put in place a set of directives for the Governments of the future as they recognised the infancy of the citizenry to enjoy the socio economic rights as well as the inadequacy of the State to ensure their provision.

The Father of our Constitution and the champion for socio-economic inclusion, Dr. B. R. Ambedkar had wonderfully shed light on the necessity and indispensability of the Directive Principles. In his words, “political principles or policies should be dictated by the people themselves through their votes and posterity should never be fettered by an announcement of policy or principle.” He further adds, “With regard to the word ‘directive’ I think it is necessary and important that the word should be retained because it is to be understood that in enacting this part of the constitution the Constituent Assembly, as I said, is giving certain directions to the future legislature and the future executive to show in what manner they are to exercise the legislative and the executive power which they will have…Because we did not want merely a parliamentary form of Government to be instituted through the various mechanisms provided in the Constitution, without any direction as to what our economic ideal, as to what our social order ought to be, we deliberately included the Directive Principles in our Constitution... our object in framing this Constitution is really two fold : (i) to lay down the form of political democracy, and (ii) to lay down that our ideal is economic democracy and also to prescribe that every Government whatever, it is in power, shall strive to bring about economic democracy.”

It is interesting to see how these Directives have been incorporated and formalised by law with time. When we trace their development we can observe that the Principles materiales into acts as and when India seemed ready to secure these rights to her citizens. For instance, when India gained independence, the literacy rate was barely 12% and education was not a priority for the majority of the population who were at that time fighting with abject poverty. After 5 decades of strengthening India’s economy, in 2009 the Parliament passed Right to Education Act which made primary education free and compulsory for the children aged 6-14 years.

A few more examples that stand out are, the Minimum Wages Act emanating primarily from Article 43, the Wealth Tax Act, Zamindari Abolition Act, Abolition of Privy Purses and the Bank Nationalisation Act, all of which are derived from Article 38 and 39 of the Constitution and the Wildlife Protection Act which is an implementation of Article 48A. These acts have been the enablers for achievement of socio-economic justice in pith and substance.

The Directive Principles served as enabler of the transition from welfare based legislations and policies to rights based legislations and policies. To my mind, the enactment of Right to Food Act (National Food Security Act) from Article 47, the Right to Education Act and Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), from Article 41, emanate from the conscience of the Constitution. Such initiatives have indeed made the directive principles nearly as enforceable as any other enforceable provision of the Constitution.

The Constitution provided for a strong centre essential for the integrated growth of the nation. At the same time a fair amount of delegation was given to the states in consonance with the needs of a vast country.This quasi-federalism was both necessary for proliferation of economic activities in the country and essential for sharing the power with constituents of a republic.

This ideological stance has always reflected itself in the choice of appropriate policy framework which is crucial to the success of any plan. Our taxation policy, the whole arena of centre state fiscal relations, mirrored the same concept. The concept of participative development for the largest number of people has also determined the course of our economic policy. This ideology and the style of functioning brought to fore another characteristic of Indian Economy which I would like to call “gradualism”.

In spite of our intense determination to accelerate growth by means of planning and to make rapid changes in the economy, our progress has been gradual. The complexity of social and cultural realities of India has had a profound effect on the speed with which these economic changes have been achieved. As a result of this we are beset with compromises and contradictions. While we accepted the public sector, the private sector had to be given its share too. While we allowed the mechanisation of the textile industry, we had to take care of the handloom sector in the villages.

The second dilemma concerns the scope of the programme and, in particular, whether extensive coverage of the whole country would be better than intensive efforts in selected areas. In India the latter might have assured greater success in certain areas, but progress in the rest of the country would have remained stagnant.

Protectionism to Globalisation

A defining feature of the philosophy of economic development in India in its early years was protectionism, which followed from our desire to become self-reliant and finds its origins in the Swadeshi movement. As a result, various safeguards were introduced for the growth of the village and small-scale sector. Steps were taken to protect few large and medium industries, with a view to develop indigenous production and know-how.

There was also a major thrust on import substitution which helped us not only to conserve foreign exchange but also to build our own capacity.

After 4 decades of protectionism,government relaxed its control and gave expanded opportunity to private players to come in with the advent of Liberalisation, Privatisation and Globalisation (LPG) reforms in 1991 with the New Economic Policy (NEP),which spurred the growth from 1991 onwards. Recently, India has been projected as the world's fastest-growing large economy for the rest of the decade, according to projections from the World Bank and the International Monetary Fund.

Humanism

The fourth dimension of our economic policy relates to humanism. This aspect connotes the determination of the state to foster human concern to eradicate poverty, unemployment and strive towards a Welfare State which is Humane, Hitech, Harmonious and Happy. The spirit of humanism has been very well described by Jawaharlal Nehru in The Discovery of India, where he said - “May happiness come to all, and freedom from misery, may all see the best of life, and no one may suffer.”

Institutions and Policies for Socio-Economic Inclusivity Financial Institutions

NABARD

The importance of institutional credit in boosting rural economy has been clear to the Government of India right from its early stages of planning. NABARD came into existence on 12 July 1982, with the vision of serving as a Development Bank of the Nation for Fostering Rural Prosperity, by transferring the agricultural credit functions of RBI and refinance functions of the then Agricultural Refinance and Development Corporation (ARDC). It was dedicated to the service of the nation by the late Prime Minister Smt. Indira Gandhi on 5 November 1982.

MUDRA (Micro Units Development and Refinance Agency Ltd)

Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of Government of India to “fund the unfunded” by bringing such enterprises to the formal financial system and extending affordable credit to them. It enables a small borrower to borrow from all Public Sector Banks such as PSU Banks, Regional Rural Banks and Cooperative Banks, Private Sector Banks, Foreign Banks, Micro Finance Institutions (MFI) and Non Banking Finance Companies (NBFC) for loans upto Rs 10 lakhs for non-farm income generating activities.

Small Industries Development Bank of India (SIDBI)

Small Industries Development Bank of India (SIDBI) set up on 2nd April 1990 under an Act of Indian Parliament, acts as the Principal Financial Institution for Promotion, Financing and Development of the Micro, Small and Medium Enterprise (MSME) sector as well as for co-ordination of functions of institutions engaged in similar activities.

The MSME sector, the focused business domain for SIDBI, has been an important pillar of the Indian Economy, contributing up to 33% in the country’s Gross Value Added (GVA) as per FY 2014-15, with 51 million enterprises providing employment to over 117 million Indians. Over the years, SIDBI has been working towards the sustainable development of MSME sector, pioneering efforts that have manifested in creation of economic wealth, its distribution for an egalitarian society while preserving the ecological wealth of the country. These include the innovative Credit Plus model, where credit is supplemented with advisory and mentoring facilities to MSMEs. Some of SIDBI’s other revolutionary initiatives include the MFI-led Microfinance movement in India that has nurtured and strengthened more than 100 MFIs and facilitated creation of SFBs, introducing a culture of energy efficient and sustainable finance for the MSME sector, introducing Venture Capital, Risk Capital, Reverse Factoring and other innovative facilities that have been later adopted by various public and private players in the country.

Today, through a motivated and focussed approach towards resolving both financial and non-financial hurdles of the rising number of MSMEs, SIDBI has undertaken a series of structural initiatives and strategic interventions that will help make the MSME sector a strong and vibrant sector

Development of Agriculture and Small Scale Industries: Priority Sector Lending

Priority Sector Lending is an important role given by the Reserve Bank of India (RBI) to the banks for providing a specified portion of the bank lending to few specific sectors like agriculture and allied activities, micro and small enterprises, poor people for housing, students for education and other low income groups and weaker sections. This is essentially meant for an all round development of the economy as opposed to focusing only on the financial sector.

Policies

Aadhar

As the chief evangelist of the idea, it was ‘close to my heart’, and I ensured that I not only mentioned it in every budget speech but wherever I spoke about effective governance, whether within the party, at conferences of chief ministers, cabinet meetings or in Parliament. Making a suo motu statement on inflation in November 2011, I presented Aadhaar as an instrument to protect the poor from the vagaries of market forces. I had then remarked, ‘Government is working to improve delivery of benefits including subsidies to the vulnerable sections of the population using the UIDAI platform’.I was not satisfied with merely letting it happen. I was determined to make it happen. In the Budget of 2010–11, I created the high-level Technology Advisory Group for Unique Projects (TAGUP) with Nilekani as its chairman.

TAGUP was mandated to advise the government on developing systems ‘for an effective tax administration and financial governance system through creation of IT projects which are reliable, secure and efficient’. The projects included the Tax Information Network, the New Pension Scheme, the New Treasury Management Agency, the Expenditure Information Network and the Goods and Services Tax. TAGUP recommended the creation of National Information Utilities in a unique private–public partnership where companies would be private so as to be able to attract talent and for speed but with the government retaining strategic control.

Aadhar, now a reality is a strategic policy tool for social and financial inclusion, public sector delivery reforms, managing fiscal budgets, increase convenience and promote hassle-free people-centric governance. Aadhaar can be used as a permanent Financial Address and facilitates financial inclusion of the underprivileged and weaker sections of the society and is therefore a tool of distributive justice and equality. The Aadhaar identity platform is one of the key pillars of the ‘Digital India’, wherein every resident of the country is provided with a unique identity. The Aadhaar programme has already achieved several milestones and is by far the largest biometrics based identification system in the world.

Aadhaar identity platform with its inherent features of Uniqueness, Authentication, Financial Address and e-KYC, enables the Government of India to directly reach residents of the country in delivery of various subsidies, benefits and services by using the resident’s Aadhaar number only.

Legal Aid

Article 39A of the Constitution of India provides that State shall secure operation of the legal system to promote justice on the basis of equal opportunity, and shall in particular, provide free legal aid, by suitable legislation or schemes or in any other way, to ensure that opportunities for securing justice are not denied to any citizen by reason of economic or other disability. Articles 14 and 22(1) also make it obligatory for the State to ensure equality before law and a legal system which promotes justice on a basis of equal opportunity to all.

The National Legal Services Authority (NALSA) has been constituted under the Legal Services Authorities Act, 1987 to provide free Legal Services to the weaker sections of the society and to organize Lok Adalats for amicable settlement of disputes. In every State, State Legal Services Authority has been constituted to give effect to the policies and directions of the NALSA and to give free legal services to the people and conduct Lok Adalats in the State. Lok Adalat is a forum where the disputes/cases pending in the court of law or at pre-litigation stage are settled/compromised amicably. The Lok Adalat has been given statutory status under the Legal Services Authorities Act, 1987

Pradhan Mantri Jan Dhan Yojana

The National Mission of Financial Inclusion named as the Pradhan Mantri Jan Dhan Yojana seeks to integrate the poorest of the poor with bank accounts. Following are the main features of the scheme-

All households across the country - both rural and urban are to be covered under the scheme. Bank accounts will be opened for 15 crore poor persons.

All bank accounts opened under the scheme are to have an overdraft facility of Rs 5,000 for Aadhar-linked accounts after satisfactory operation in the account for 6 months.

Issuance of RuPay Debit Card with inbuilt Rs 1 lakh personal accident insurance cover provided by HDFC Ergo and a life cover of Rs 30,000 provided by LIC.

A minimum monthly remuneration of Rs 5,000 to business correspondents who will provide the last link between the account holders and the bank.

E-governance

Common Services Centre: These are physical facilities for delivering Government of India e-Services to rural and remote locations where availability of computers and Internet was negligible or mostly absent. They are multiple-services-single-point model for providing facilities for multiple transactions at a single geographical location.

CSCs are the access points for delivery of essential public utility services, social welfare schemes, healthcare, financial, education and agriculture services, apart from host of B2C services to citizens in rural and remote areas of the country. It is a pan-India network catering to regional, geographic, linguistic and cultural diversity of the country, thus enabling the Government's mandate of a socially, financially and digitally inclusive society.

Based on the assessment of CSC scheme, the Government launched the CSC 2.0 scheme in 2015 to expand the outreach of CSCs to all Gram Panchayats across the country. Under CSC 2.0 scheme, at least one CSC will be set up in each of the 2.5 lakh GPs across the country by 2019. CSCs functioning under the existing scheme will also be strengthened and integrated with additional 1.5 lakh CSCs across the country.

Direct Benefit Transfer- With the aim of reforming Government delivery system by re-engineering the existing process in welfare schemes for simpler and faster flow of information/funds and to ensure accurate targeting of the beneficiaries, de-duplication and reduction of fraud Direct Benefit Transfer (DBT) was started on 1st January, 2013.

The scope of DBT include all welfare/subsidy schemes operated by all the Ministries/ Departments of Government of India directly or through implementing agencies, which involve cash / kind benefits' transfers to individuals.

Some other important Legislations in the goal of realisation of socio-economic inclusion

● Indira Awas Yojana

● Area Development Plans

● Forest Rights Act

● Jan Dhan Yojana

Women's Empowerment and Gender-Equity form a crucial element of socio-economic inclusion.

The government wings mentioned below take care of the same:

Ministry of Women and child Development

National Commission for Women.

Rashtriya Mahila Kosh (RMK) (National Credit Fund for Women)

Government Authorities and Boards

Government Programmes and Activities

National Commission for Women

Article 15(3)– Special provision enabling the State to make affirmative discriminations in favour of women.

Article 15 – The State shall not discriminate against any citizen …. Nothing in this article prevents the State from making any special provision for women and children.

Article 51 (A)(e) – To renounce the practices derogatory to the dignity of women.

To achieve this goal,i.e., the Inclusion of Backward Caste, Tribes and Linguistic Minorities, respective National Commissions are set up by the Parliament.

The Equal Remuneration Act of 1976

The Equal Remuneration Act, 1976 provides for payment of equal remuneration to men and women and help prevent gender discrimination. Article 39 of the Indian Constitution envisages that the States will have a policy for securing equal pay for equal work for both men and women. To give effect to this constitutional provisions, the Equal Remuneration Act, 1976 was introduced.

The Sampoorna Grameen Rozgar Yojana (Universal Rural Employment Program)

The Sampoorna Grameen Rozgar Yojana was announced by Former Late. Atal Bihari Vajpayee on 15th August 2001 and launched on 1 September 2001 by merging the provisions of Employment Assurance Scheme (EAS) and Jawahar Gram Samridhi Yojana (JGSY). The programme is self-targeting in nature and aims to provide employment and food to people in rural areas who live below the poverty line.

The Sampoorna Grameen Rozgar Yojana is an actually a combination of the provisions under the Employment Assurance Scheme (EAS) and Jawahar Gram Samridhi Yojana (JGSY)

The Food For Work Programme was restructured and renamed as National Rural Employment Programme in October 1980 by the then Prime Minister Indira Gandhi and it became a regular Programme from April 1981. The Programme was launched during the Sixth Five Year Plan. It aims the implementation of additional employment to under employed persons. Central-state contribution was on the basis of 50:50 ratio. In 1989 NREP was merged with Jawahar Rozgar Yojana.

Jawahar Rozgar Yojana (JRY) was launched on April 1, 1989 by merging National Rural Employment Programme and Rural Landless Employment Guarantee Programme by Prime Minister Rajiv Gandhi. The urban version of this program was Nehru Rozgar Yojana.

Protection of Civil Rights Act 1955

The act aims to achieve the objective enshrined in Article 17 of the Constitution of India and seeks to abolish the practise of untouchability by preventing and penalising the enforcement of disabilities arising from practise of untouchability.

On-going Schemes

● Pradhan Mantri Ujjwala Yojana : The scheme aims to empower rural women by providing free LPG connections.

● Venture Capital Fund for Scheduled Caste Entrepreneurs : The objective of this Scheme is to promote entrepreneurship among the Scheduled Castes and to provide concessional finance to them. The scheme would be implemented by the Industrial Finance Corporation of India (IFCI) Limited for which Rs. 200 cores has been allotted.

● Credit Enhancement Guarantee Scheme for the Scheduled Castes : The objective of the Scheme is to promote entrepreneurship amongst the scheduled castes and to facilitate concessional finances to them. A budget of Rs. 200 crores has been allocated to IFCI Limited to facilitate the scheme.

● Swachhta Udyami Yojana : As an integral part of 'Swachh Bharat Abhiyan' launched by the Prime Minister on 2nd October, 2014, the National Safai Karamcharis Finance & Development Corporation(NSFDC) has launched a new Scheme 'Swachhta Udyami Yojana' for financing viable community toilet projects and sanitation related vehicles to collect garbage.

● Green Business Scheme : The scheme has been started by NSFDC, with the aim of promoting green businesses to support sustainable livelihoods of Scheduled Castes and Safai Karamcharis. Financial assistance would be provided for those economic activities that could address the challenges of climate change, e.g., E-rickshaw, solar pumps and other instruments working on solar energy etc.

● Sanitary Mart Scheme : Launched in 2014-15, under the scheme, loans are provided to up to Rs. 15 Lakhs to Safai Karamcharis for construction of toilets/bio-degradable toilets.

● Stand up India : This scheme was recently launched to boost the spirit of entrepreneurship among the most vulnerable groups of the society. The specific groups are Scheduled caste, scheduled tribes and women. Under the umbrella of this scheme every single branch of a public sector bank is asked to support one entrepreneur each from women and SC/St. category.

Strengths and Weaknesses of Indian Economy

Weaknesses

- Communalism and Regionalism:

Now, more than ever, religious fundamentalism has began to threaten India’s cultural heritage of being a blend of various religions. These disruptive forces upset our development to a great extent.

- Traditionalism:

Modernisation and economic growth have been greatly retarded by taboos and beliefs of Hindu society which can be described as anti-success and anti-materialist attitudes.

- Isolationalism

A serious gap in communication exists amongst the ministries and institutions of governance creating duplication of efforts and wastage of manpower and resources. These exiting barriers between departments and an attitude of red-tapism have significantly hampered our progress.

- Bureaucratism

The problem with Indian bureaucratic system is two-fold. First is pertaining to its very nature of being a generalist service when more specialists are required to steer the country towards economic and technological advancement. Second, is its basic status-quoist outlook and inability to bring about changes in its thinking as well as approach to modern tools of management.

Strengths

- Demographic Dividend

Within the next 2 years, i.e. by 2020, India will have the youngest working population in the world. This. I believe, is the biggest strength of our country. However, if we do not utilise this powerful human resource that we are endowed with then this demographic dividend will turn into a demographic disaster.

- Natural Resources

India is blessed with abundance of natural resources. Moreover, we have tremendous potential to develop and utilise renewable sources of energy to meet our domestic demands. Once again, we must effectively employ technological know-how and expertise to reap the benefits or lest they become wasted.

- Savings

The practice of public savings has always been encouraged by the Indian Government by providing incentives at every step of the way to the end user. This practice has saved Indian economy from major shocks and crises facing the world economy like the one in 2008.

- Stable Polity 
Our strength is our ability to sustain a stable polity. The constitutional framework in India is such that the administration of the country has been fairly stable. India is still the largest functioning democracy in the world.

Concluding Remarks

67 years ago the Indian Constitution – a living document was written. I see it as a magna-carta of socio-economic development of the nation. I take this opportunity today to appeal to the billion plus population of our nation, the participants of our Constitutional democracy to work together in harmony for effective implementation of Directive Principles for achievement of socio-economic justice in India. This balance and harmony has to be maintained to overcome the challenges before us as a nation.

67 years ago the Indian Constitution – a living document was written. I see it as a magna-carta of socio-economic development of the nation. I take this opportunity today to appeal to the billion plus population of our nation, the participants of our Constitutional democracy to work together in harmony for effective implementation of Directive Principles for achievement of socio-economic justice in India. This balance and harmony has to be maintained to overcome the challenges before us as a nation.

These directions set by the Constitution in such beautiful words – “We, the People of India..solemnly resolved to constitute India into a Sovereign, Socialist, Secular, Democratic Republic…and to secure all its citizens: Justice, Liberty, Equality and Fraternity”, must act as a guide and a constant reminder for the pillars of democracy, the constitutional bodies and the citizens to work tirelessly towards realization of the goal of a well-rounded and robust social, economic and political order.

Thank You.

Jai Hind.