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P. C. Mahalanobis, the author of India’s second five-year plan, played a crucial role in crafting independent India’s economic strategy

P. C. Mahalanobis, the author of India's second five-year plan, played a crucial role in crafting independent India’s economic strategy
P. C. Mahalanobis
P. C. Mahalanobis, the author of India's second five-year plan, played a crucial role in crafting independent India’s economic strategy
  • The book “Planning Democracy: How a Professor, an Institute and an Idea Shaped India” by Nikhil Menon recasts our understanding of the Indian republic, uncovering how planning came to define the nation and revealing the ways in which it continues to shape our world today.

  • This book explores how India married liberal democracy to a socialist economy. Planning not only built India’s data systems, it even shaped the nature of its democracy.

  • In this compelling history, Nikhil Menon brings the world of planning to life through the intriguing story of a gifted scientist known as the Professor, a trail-blazing research institute in Calcutta, and the alluring idea of ‘democratic planning’.

  • Read an excerpt from the book below.

Summer 1915, England. As bombs rained over Europe, in the relative calm of Cambridge, a slender, sharp-featured, robustly moustachioed Bengali waited to return home. The twenty-one-year-old undergraduate in mathematics and physics, Prasanta Chandra Mahalanobis, had been forced by the Great War to delay his journey to Calcutta. The trip to India was meant to be a short vacation and triumphant homecoming. As a local daily proudly reported, the youth—one of their own—had obtained the sole First Class in his physics cohort and snagged a scholarship to continue research in Cambridge’s Cavendish Laboratory under the direction of Charles Wilson (a future Nobel laureate). In an age when such distinction was rare for a subject of the British Empire, this was newsworthy, and no Indian city was more likely to be pleased.

One morning, young Prasanta’s tutor found him in the centuries-old King’s College Library, near the chapel’s stained-glass marvels crowned by gothic spires and the sloping lawn that rolled down to River Cam. When he drew the student’s attention to bound volumes of Biometrika, a journal of statistics, Mahalanobis, though aspiring to be a physicist, was immediately hooked. When he sailed to India soon after, he took with him several issues of the journal to study aboard the steamer. Once in Calcutta, the intended holiday turned into permanent residence as he accepted an offer to teach physics at his alma mater, Presidency College, turning his back on the Cambridge scholarship. But it wasn’t physics at all that would define Mahalanobis’ professional life. In fact, that branch of science became rather marginal to his career. Instead, what Mahalanobis discovered in the pages of that journal would occupy much of his career—founding the Indian Statistical Institute, becoming India’s statistician-in-chief and building a national statistical infrastructure. It was his eminence as a statistician that opened doors to the Planning Commission in Lutyens’ Delhi.

* * *

The dawn of Independence led to a surge in the state’s interest in data. Stimulated by the needs of a planned economy, the 1950s saw a massive expansion in the fledgling state’s data capabilities. The state began wielding information on a different order of magnitude, concentrating its power to make informed interventions in the economy. During this period, the state introduced new methods and instruments to scrutinize the economic life of India’s citizens, magnifying it for the planner’s gaze. If the economy was to grow and poverty be banished, the argument went, governments needed to be able to quantify the obstacles. It was this rapid phase of planninginduced state building that created a centralized national statistical system for the first time. It quantified the economy for planners and built the scaffolding necessary for constructing future Plans.

At the centre of these developments were Mahalanobis, once described as the ‘presiding genius of statistics in India’, and the Indian Statistical Institute (henceforth, the Institute) where he was patriarch. They were well-positioned to respond to the state’s needs thanks to their technical facility in scientific methods and managerial abilities in institution building.

Mahalanobis is justly considered integral to the story of planning in India. He was the author of the crucial Second Five-Year Plan (1956–61), whose underlying strategy—of a vast public sector and import substitution industrialization—later passed into policy orthodoxy. It defined the Indian economy right until the market reforms of the early 1990s. Though he plays a prominent role in the following pages, this isn’t about an individual singlehandedly shaping history. His role was only made possible by subterranean historical currents. Central planning, by its very top-down nature, privileged technocrats like him and cast them in the role of planners-in-waiting. Planning set the stage on which figures like Mahalanobis could strut.

Mahalanobis’ involvement in planning is often stated but rarely explained. The popular view is that it is almost entirely due to an association with Nehru. But the tale of the charismatic scientist meeting an impressionable Prime Minister, with a Five-Year Plan emerging from the ensuing friendship is suspiciously neat. We need to reframe the image of an academic floating into the position of plan-author, carried solely by gusts of Prime-Ministerial favour. It does not explain the context in which this statistician would emerge as a credible candidate for the job of a planner, nor why Nehru held Mahalanobis in such esteem to begin with. To understand these, we need to examine the rise of statistics to the status of a scientific discipline in India in the mid-century, the installation of a national statistical infrastructure and the transformation of the Institute into the premier think tank for planning in the 1950s. To lay all that at the door of a friendship is unconvincing, even if appealing. We need an institutional and structural account to bolster a narrative that has leaned too heavily on chance and personality.

In the mid-twentieth century, several nation states witnessed a spurt in the production of statistical data. The transformation was rapid in India, a country embarking on a new trajectory of development and committing to central planning. As both sides of the ‘socialist calculation debate’ among early twentieth-century economists like the free marketeer Friedrich Hayek and the socialist Oskar Lange made plain, planning required quantitative mastery over the economy. Choosing not to rely on the ‘invisible hand’ of price signals, planners saw the economy as being essentially calculable. Statistics were necessary for planners to plan, since they were quantitative descriptions of the economy. The simultaneous rise of planning and national statistics in India was thus not accidental. Centralized planning required data about the economy, and statistics came to be viewed as the discipline that could deliver it. The Institute was instrumental in defining the techniques by which the economy was made intelligible and parameters upon which its performance would be judged. Not only did this generate more information about the economy, it also helped define the very categories by which the economy would be described and analysed. The economy was calibrated and made more tractable for planned intervention. Those processes also produced a climate of opinion in which a statistician and an institute devoted to statistical research could be viewed as both obviously qualified and naturally suited to planning.

P. C. Mahalanobis, the author of India's second five-year plan, played a crucial role in crafting independent India’s economic strategy

Excerpted with permission from Planning Democracy: How a Professor, an Institute and an Idea Shaped India, Nikhil Menon, Penguin India. Read more about the book here and buy it here.


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P. C. Mahalanobis, the author of India's second five-year plan, played a crucial role in crafting independent India’s economic strategy