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The Political Economy of Hindu Nationalism in India 1998-2004

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The Political Economy of Hindu Nationalism in India 1998-2004 THE POLITICAL ECONOMY OF HINDU NATIONALISM IN INDIA 1998-2004 submitted for the degree of Doctor of Philosophy Politics and International Relations John Joseph Abraham Royal Holloway, University of London 1 2 Declaration of Authorship I John Joseph Abraham hereby declare that this thesis and the work presented in it is entirely my own. Where I have consulted the work of others, this is always clearly stated. Signed: John Joseph Abraham August 22, 2014 3 4 Acknowledgements I would like to express my gratitude to a number of people who have made this project possible. I thank my supervisors Dr. Yasmin Khan and Dr. Oliver Heath for their careful guidance, constant support and enthusiasm over these years. Thanks is also due to Dr. James Sloam for his insights at important stages of this project. Finally I would like to thank Dr. Tony Charles for his valuable support in the final stages of this work. I thank Dr. Nathan Widder under whose leadership the Department of Politics and International Relations has been a supportive environment and congenial forum for the development of ideas and Dr. Jay Mistry, Dr. Ben O'Loughlin, Dr. Sandra Halperin and Anne Uttley for the important roles they have played in my development as an academic scholar. Finally, thanks is due to my fellow researchers, Shyamal Kataria, Baris Gulmez, Didem Buhari, Celine Tschirhart, Ali Mosadegh Raad, Braham Prakash Guddu and Mark Pope for the many useful conversations and sympathetic understanding. This project would have not been possible but for the help of my family. I would like to thank my parents Abraham and Valsa Joseph as well as George and Annie Mathew for their constant encouragement and eager support. Sincere thanks to Binny and Silpa Abraham and their delightful children for their encouragement and support in the last stages of this work. My greatest thanks is due to my wife Mithu and my children Angie, Evelyn and Emma who travelled across an ocean and back to take this adventure with me, who nurtured my scholarly ambitions even as I neglected my household duties and who were a vital source of distraction, encouragement and joy between the endless hours of work. 5 6 Abstract This thesis sets out to investigate the relationship between economic policy and the politics of Hindu nationalism. It argues that the economic record of the Bharatiya Janata Party which formed two coalition governments in India between the years 1998-2004 was driven by transnational elites within senior positions in key ministries and in the Prime Minister’s Office. It argues that while the factors usually associated with economic policy formation such as ideological legacy, domestic politics or international pressures can provide some limited insights, transnational elites are the key to explaining the neoliberal economic policies pursued by this government. 7 Table of Contents Chapter 1: Problematizing the Political Economy of Hindu nationalism ........................................ 12 1.1. Purpose ...................................................................................................................... 12 1.2. Relevance and focus .................................................................................................... 14 1.3. The Research Question, Objections and Key Terms ...................................................... 16 1.4 Economic Nationalism and Economic Neoliberalism .......................................................... 21 1.5. Explanation: Domestic and International influences ......................................................... 27 1.5.1. Domestic Factors .......................................................................................................... 28 1.5.2. International Factors ..................................................................................................... 33 1.6. Explanation: Transnational Elites...................................................................................... 35 1.7. An outline of the thesis by chapter ................................................................................... 39 Chapter 2: In Search of Dharma: Integral Humanism, Economic Policy and the Bharatiya Jana Sangh .................................................................................................................................................. 45 2.1. Introduction .................................................................................................................... 45 2.2. Hindu nationalism and the economics of self-sufficient decentralization ........................... 48 2.3. Deendayal Upadhyaya (1916-1968): From Integral Humanism to a critique of Planning ..... 54 2.3.1. Integral Humanism ....................................................................................................... 56 2.3.2. Integral Humanism and Planning ................................................................................... 69 2.4. Towards an Economic Policy for Hindu Nationalism .......................................................... 76 2.4.1. Swadeshi ...................................................................................................................... 81 2.4.2. Planning ....................................................................................................................... 83 2.4.3. Governance .................................................................................................................. 90 2.4.4. Industry ........................................................................................................................ 94 2.5. Conclusions ..................................................................................................................... 98 Chapter 3: At Home with Hindutva – The Formation of the BJP's Domestic Economic Policy....... 103 3.1. Introduction .................................................................................................................. 103 3.2. From BJS to BJP ............................................................................................................. 109 3.3. Coalition Politics ............................................................................................................ 116 8 3.4. Interest Groups .............................................................................................................. 132 3.5. Voter Opinion ................................................................................................................ 148 3.6. Conclusion ..................................................................................................................... 163 Chapter 4: Home and the World: Hindu Nationalism in the International Political Economy ....... 168 4.1. Introduction .................................................................................................................. 168 4.2. Naming the NDA’s reforms ............................................................................................. 174 4.3. International influences on the Indian economy ............................................................. 178 4.3.1 International institutions: The International Monetary Fund and the World Bank .......... 180 4.3.2. International institutions: World Trade Organization ................................................... 193 4.4. Multinational Corporations ............................................................................................ 205 4.5. Conclusions ................................................................................................................... 216 Chapter 5: The net of Indra – transnational networks and the process of neoliberalization .... 222 5.1. Introduction .................................................................................................................. 222 5.2. How do Economic Transitions take place? ...................................................................... 225 5.3. Who are the Transnational Elites? .................................................................................. 231 5.4. The Global City: The neoliberalization of space ............................................................... 239 5.5. The Neoliberalization of the economy under the NDA: The role of transnational elites .... 251 5.6. Conclusions ................................................................................................................... 264 Chapter 6: Conclusion: from discontent to government, the BJP since 2004 ........................... 269 6.1. Introduction .................................................................................................................. 269 6.2. Findings ......................................................................................................................... 269 6.3. The BJP since 2004 ......................................................................................................... 276 6.4. The return of the BJP ..................................................................................................... 283 6.5. The Political Economy of Hindu Nationalism ................................................................... 287 Appendix 3.1: Voter Opinion ................................................................................................ 290 Appendix 5.1: Structural Adjustment Loans 1998-2004 .......................................................... 291 Appendix 5.2: Comparison of the index of Trade Freedom for Brazil, India and Turkey ..............
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