Лицензионный Радж: Эпоха государственного регулирования экономики Индии (1947-1990)

Extensive system of licensing and regulation in India from about 1947 to 1990

The Licence Raj or Permit Raj (rāj, meaning "rule" in Hindi) is a pejorative for the system of strict government control and regulation of the Indian economy that was in place from the 1950s to the early 1990s. Under this system, businesses in India were required to obtain licences from the government in order to operate, and these licences were often difficult to obtain. The Licence Raj was intended to protect Indian industry, promote self reliance and ensure regional equality. Up to 80 government agencies had to be satisfied before private companies could produce something and, if granted, the government would regulate production. The term "Licence Raj" is a play on the "British Raj" which refers to the period of British rule in India. It was coined by Indian independence activist and statesman Chakravarti Rajagopalachari, who was strongly opposed to the system of strict government control and regulation of the economy that it represented. Rajagopalachari believed that the Licence Raj had the potential for political corruption and economic stagnation, and founded the Swatantra Party to oppose these practices. Reforms started in 1991 have significantly reduced regulation. However, Indian labor laws continue to protect workers in the formal sector from being laid off by employers and place significant restrictions on the ability of businesses to reduce their workforce without incurring significant costs and burdens. This is viewed by some as a barrier to economic growth and development as it may create a disincentive for businesses to hire workers and can make it difficult for them to respond to changing market conditions or economic challenges. It is also to be noted that majority of Indian workers are employed in the informal sector where much of the labour protections do not apply.

A key characteristic of the Licence Raj was a Planning Commission that centrally administered the economy of the country. Like a command economy, India had Five Year Plans on the lines of the five year plans in the Soviet Union. However, unlike Soviet Union, private sector also played a significant role. The Planning Commission was set up in 1950 to survey the available resources in the country and formulate plans to raise the standard of living. Planning Commission enacted the First Five Year Plan in 1951, aimed at developing the agricultural sector amid severe food shortages and an influx of refugees from the Partition, and that plan led to a 4% increase in GDP, higher than the projected 2%. Nehru's government hoped to build on the success of the First Five Year Plan with their more ambitious Second Five Year Plan aimed at continuing agricultural and infrastructure investment while developing heavy industry and increasing employment. But this plan failed to reach its goal of 5% growth and the heavy spending in the plan depleted the country's foreign currency reserves as the country did not have sufficient domestic resources to fund these projects and therefore had to rely on imported capital and technology. Next, the Industrial Policy Resolution of 1956 extended these restrictions by designating certain industries known as Schedule A to be exclusively under state control, and certain other industries under Schedule B to be majority state owned. Industries in Schedule A included defense production, metallurgy, mining, and transportation. During the 1960s, the Indian banking sector came under criticism for being controlled by a few big industrialists in large cities, and thus failing to meet the needs of rural Indians and small scale industry. In response, the government of Indira Gandhi began pursuing "social control" of banking institutions, with Deputy Prime Minister Morarji Desai spearheading the Banking Laws (Amendment) Bill in 1968 to regulate the commercial banks' leadership. The bill stipulated that at least 51% of the directors should not be directly connected monopolies and big business, that industrialist chairmen had to be replaced by professional bankers, and that banks could not form relationships with companies tied to their own directors. Additionally, Desai forged the National Credit Council (NCC) to regulate credit allocations in order to bring more credit to rural areas and small industry. However, many of these changes were rendered moot when Indira Gandhi decided to fully nationalize 14 major banks in 1969, with 6 additional banks coming under state control in 1980. Indian capital controls started as wartime restrictions imposed by the British on cross border transactions during World War II, eventually growing into a complex framework of restrictions on the current account and capital account. After independence the Indian government introduced restrictions on the flow of foreign exchange reserves, and following a balance of payments crisis from 1956 to 1957, the government became more concerned with carefully allocating foreign exchange between different sectors of the economy. After a failed attempt at liberalization in 1966, the Foreign Investments Board was established in 1968 to scrutinize companies investing in India with more than 40% foreign equity participation. Foreign investment that did not involve technology transfers was severely restricted, and foreign collaboration with local companies was conditioned on export quotas. This tight control over foreign investment became a core part of a broader policy of import substitution industrialisation, the belief that countries like India needed to rely on internal markets for development, not international trade. To achieve this goal, the Indian government erected strict import restrictions and a complex system of tariffs that featured high rates which varied by industry. One consequence of the Licence Raj was that it benefited large corporations at the expense of smaller businesses. Because large corporations were often better able to navigate the complex bureaucracy of the Licence Raj and secure the necessary licences, they were able to dominate many sectors of the economy. This made it difficult for small businesses to compete, and contributed to a concentration of economic power in the hands of a few large corporations. Another criticism of the licensing system in India was that it was prone to corruption, as businesses and individuals had to navigate a complex bureaucracy in order to obtain licences and permissions, and may have had to pay bribes or engage in other forms of corruption in order to obtain the necessary approvals. This corruption was fueled by a broader environment of corruption in India, which was characterized by a lack of transparency and accountability in the government, a weak legal system, and a culture of corruption that had been allowed to persist for many years.

The Licence Raj system was in place for four decades. Many members of the Congress, including Prime Minister P. V. Narasimha Rao and Finance Minister Manmohan Singh, were strong supporters of liberalisation and played key roles in implementing these changes. In 1991, Prime Minister Narasimha Rao, who was also the Minister of Industries, initiated a policy of liberalisation in India. This policy aimed to reduce government intervention in the economy and promote market based solutions to economic problems. The Licence Raj was believed by some to be hindering economic growth and preventing the Indian economy from reaching its full potential. This belief was based on the idea that the government's heavy intervention in the market was stifling economic activity and hampering the ability of the economy to grow and develop. Liberalisation resulted in substantial growth in the Indian economy, which continues today. The Licence Raj is considered to have been significantly reduced in 1991 when India had only two weeks of foreign reserves left. In return for an IMF bailout, India transferred gold bullion to London as collateral, devalued the rupee and accepted economic reforms. The federal government, with Manmohan Singh as finance minister, reduced licensing regulations; lowered tariffs, duties and taxes and opened up to international trade and investment. On 6 August 2014, the Indian Parliament raised the limit on foreign direct investment in the defence sector to 49% and removed the limit for certain classes of infrastructure projects: high speed railways, including construction, operation and maintenance of high speed train projects; suburban corridor projects through PPP; dedicated freight lines; rolling stock including train sets; locomotives manufacturing and maintenance facilities; railway electrification and signalling systems; freight and passenger terminals; infrastructure in industrial parks pertaining to railway lines and mass rapid transport systems.

The fall of the Licence Raj and the implementation of economic liberalization policies have contributed to increased regional inequality in India. Some experts argue that these policies benefited certain regions of the country, such as the major cities and industrial centers, at the expense of others, leading to a widening gap between rural and urban areas. It has contributed to mass migration from rural areas to cities, as people sought to take advantage of new economic opportunities and improved living standards in urban areas. This mass migration can place a burden on cities, as they may struggle to accommodate the influx of new residents and provide them with adequate housing, education, and other basic services. Slums in India are a common sight in many cities and are often found in areas that are vulnerable to flooding or other natural disasters. They are often home to marginalized communities, including migrant workers, informal sector workers, and other groups that may be excluded from mainstream society. The scaling back of public sector enterprises may also have led to a reduction in the ability of the government to direct investment and resources towards priority areas and to protect the interests of workers, minorities and other stakeholders.