International Research Journal of Management Science & Technology ISSN 2250 – 1959(0nline) 2348 – 9367 (Print) An Internationally Indexed Peer Reviewed & Refereed Journal

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

Thought of B.R.Ambedkar in the context of Indian Industrial policy

Md saad Uddin (Mirza Ghalib College, Gaya, )

After long periods of disregard, the thoughts of B.R. Ambedkar appear to pick up money. While his considerations on Indian culture and governmental issues have collected more consideration, a portion of his financial thoughts also merit more prominent consideration.

Referred to a great extent as the dad of the Indian Constitution and a pioneer of Dalits, Ambedkar started his vocation as a financial expert, making significant commitments to the major monetary discussions of the day. He was, truth be told, among the best taught financial experts of his age in India, having earned a doctorate in financial matters from Columbia University in the US and another from the London School of .

Ambedkar's London doctoral postulation, later distributed as a book, was on the administration of the rupee. Around then, there was a major discussion on the overall benefits of the best quality level opposite the gold trade standard.

The highest quality level alludes to a convertible cash where gold coins are given, and might be supplemented with paper cash, which is swore to be completely redeemable in gold. Conversely, under the gold trade standard, just paper cash is given, which is kept replaceable at fixed rates with gold and specialists back it up with outside money stores of such nations as are on the highest quality level.

Ambedkar contended for a highest quality level rather than the proposal by John Maynard Keynes that India should grasp a gold trade standard. He contended that a gold trade standard permitted the backer more prominent opportunity to control the stock of cash, imperiling the steadiness of the fiscal unit.

Ambedkar's Columbia thesis was on the state-focus budgetary relations under the direction of Edwin Seligman, one of the chief experts on open money on the planet. Ambedkar contended that under a sound managerial framework, each political unit ought to have the option to back its consumption by raising its own assets, without depending too intensely on another.

Ambedkar's perspectives on the rupee and on open fund were reactions to the seething financial issues of the day and not the entirety of his investigation might be important today. Be that as it may, a portion of the standards he articulated, for example, that of value solidness and of financial duty stay pertinent even today.

Of all his scholastic distributions, the one that has matured best and has incredible pertinence for contemporary financial discussions is a 1918 article on cultivating and ranch possessions distributed in the diary of the Indian Economic Society.

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

In that paper, Ambedkar thought about the issue of little landholdings in India and their discontinuity. In the wake of inspecting different proposition to unite and broaden such landholdings that were being bantered back then, Ambedkar arrived at the resolution that such recommendations were in a general sense imperfect.

Ambedkar contended that land was just one of the elements of creation required to deliver crops, and except if it was utilized in an ideal extent with different components of generation, it would be wasteful. Landholdings should, accordingly, not be fixed yet ought to in a perfect world fluctuate with the accessibility of different components of generation: expanding with the accessibility of homestead gear and contracting if the last shrank.

Any proposition to expand possessions can be engaged just on the off chance that it tends to be demonstrated that the accessibility of ranch actualizes has developed significantly in the nation, contended Ambedkar. What's more, he then marshaled information to destroy that contention by indicating that capital stock had, actually, declined.

Ambedkar contended that the genuine test lay in raising the supply of capital and that will be conceivable just if there is more prominent reserve funds in the economy. This was unrealistic up to an incredible mass of individuals relied upon land for their jobs, he contemplated. In this way, he placed industrialization as the solution to India's horticultural issue.

"To put it plainly, weird however it might appear, industrialization of India is the soundest solution for the horticultural issues of India," Ambedkar finished up. "The aggregate impacts of industrialization, to be specific a diminishing weight (ashore) and an expanding measure of capital and capital products will persuasively make the financial need of broadening the holding. Not just this, industrialization by obliterating the premium ashore will offer meet the challenge at hand for its sub-division and fracture."

What is generally noteworthy about Ambedkar's investigation is that he had the option to think about the idea of "camouflaged joblessness" much before it came into vogue being developed financial aspects, and that he had the option to envision one of the key bits of knowledge of Nobel Prize- winning market analyst Arthur Lewis three decades before Lewis defined his acclaimed two-segment model of the economy.

Lewis assumed that creating economies had surplus and inert work in the homestead division, and indicated how moving work from ranches to industrial facilities would raise investment funds and efficiency levels in the two areas, prompting by and large development. The model Lewis defined in 1954 was undeniably more intricate than what Ambedkar laid out in his exposition, however there are striking similitudes in the manner in which both encircled the issue.

Ambedkar came back to this topic in a 1927 discourse made on the floor of the Bombay administrative gathering (as it was then called), which was discussing a proposition for directing landholdings.

Ambedkar cautioned of the indiscretion of such guideline, repeating his contentions made in the 1918 exposition. He contended that the amplification of landholdings by controlling the segment of

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

steadfast property and closeout of united possessions would make a little outside layer of well off landowners and a huge mass of landless "homeless people".

Regardless of his issues with numerous social traditions endorsed by Hindu sacred writings, Ambedkar voiced his endorsement of the Hindu law of legacy, which, as indicated by him, forestalled the formation of plutocracy, which primogeniture (the privilege of progression having a place with the firstborn youngster) would unquestionably have made. A superior method for tending to the issue of fracture was to present helpful cultivating, and "to constrain proprietors of little strips included in that to participate in development without wrecking private possession".

In later years, Ambedkar's energies were dedicated more to legislative issues and social change as opposed to financial investigation, however even his works and talks on governmental issues mirrored a profound commitment with monetary issues and inquiries of political economy.

Similarly as his legislative issues are today being appropriated by legislators all things considered, his financial aspects today has become a battleground between the left and the right, with the two sides asserting that he was entirely their side. In any case, a cautious perusing of Ambedkar's compositions scatters the view that he was either a boss of a free enterprise economy or a progressive communist.

Ambedkar's perspectives on financial aspects were as mind boggling as his perspectives on legislative issues and almost certainly, one molded the other. As his perspectives on India's agrarian issues demonstrate, he saw no logical inconsistency between supporting for industrialization from one viewpoint and helpful cultivating on the other. What's more, in the two cases, he upheld his contentions with instances of nations in different pieces of the world which had received the arrangements he was supporting. More than principle, experimental proof appears to have guided a large number of his arrangement positions.

Despite the fact that Ambedkar stood up for industrialization and urbanization, he likewise cautioned of the ills of private enterprise, contending that liberated free enterprise could transform into a power of persecution and misuse.

It was Ambedkar who proposed to the Constituent Assembly that the part on essential rights in the Constitution should incorporate both negative rights (identifying with common freedoms) just as positive rights (identifying with social and financial equity). In a notice regarding this matter, Ambedkar illustrated his vision of the privileges of citizenship in a free India, and clarified why it would involve broad state power over the economy.

Ambedkar remembered an area for cures against "financial abuse", which proposed, in addition to other things, that key businesses ought to be claimed and run by the state and that agribusiness ought to be a state industry. Ambedkar contended that an altered type of state communism in industry was essential for quick industrialization, and that aggregate cultivating was the main salvation for landless workers having a place with the "distant" ranks.

Envisioning the complaints of "established legal advisors" who may feel that Ambedkar's detailing went past the extent of the standard sort of principal rights, Ambedkar contended that such a view

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

would be founded on an exceptionally tight comprehension of basic rights. On the off chance that the goal of such rights was to ensure singular freedom, his proposition did likewise, Ambekar contended.

Ambedkar contended that an economy dependent on the benefit intention damaged two precepts of political popular government: one, it permitted private businesses, as opposed to the state, to administer the lives of people, and two, it might compel a person to surrender his established rights to increase a living.

Problem of Rupee: Gold Standard versus Gold Exchange Standards

Before 1835 in India multiple coins were in circulation and this was quite confusing. East India

Company (EIS) tried to solve this problem by unifying all the currencies. An act was passed to introduce the bimetallism (Gold & Silver). Due to the discovery of gold in various parts of Australia and California gold coins (Bad currency) were overvalued and drove the silver coins (Good currency) out of the market. In 1853, EIC stopped receiving any gold coins and tried to demonetise the gold currency. This led to liquidity crisis and at the same time demand for silver coins aggravated. Government of India was not in favour of introducing gold currency and preferred paper currency to improve the situation. So, in 1861 paper currency act was passed and paper currency was made the legal tender. But these paper and silver currencies were not enough to cope up with the increasing monitory demand. In 1870‟s silver metal was discovered in South America and Mexico, due to this in 1873 the value of silver drastically fell down in terms of gold. Consequently there was a fall in the exchange rate and British imports got expensive. Large scale minting of rupee at that time gave rise to high inflation. Suggestion was made to adopt the gold standard and stop minting of silver coins. In 1893, minting of silver coins was stopped and Indian rupee was adopted as the legal tender. In the period 1898 to 1916, gold exchange standard were adopted and more emphasis was given to the external stability i.e. exchange rate stability. In 1914-15, the exchange rate got weak and India was running out of gold to pay back it remittances. Leading to an increase in the demand of rupee, as a result government of India started minting rupee to tackle the situation. This created inflationary pressure in the economy at that period of time.

Dr. B.R. Ambedkar studied this matter in depth and commented on whether the gold standard or gold exchange standard would be better for curb the inflation in a country like India. In his doctoral thesis he has mentioned that excess importance was given to exchange rate stability rather than price stability. According to him exchange rate stability will benefit only the trading class not the poor‟s in the economy. Poor„s will be benefitted only when there is an internal stability. Ambedkar asked a very relevant question, what is the purpose of money? Is it how much gold we can purchase or how much commodities we can purchase out of it. The obvious answer to this is how much commodities and services we can purchase out of it. According to Babasaheb currency should be stable in terms of commodities not in terms of gold. He was against the concept of linking money supply with gold. He pointed out that Government under gold exchange standard tries to manipulate the currency to keep it at par with the gold value which is not a good idea. Ambedkar was a strong believer of quantity theory of money. He did not like the idea that government should manage the flow of the currency. He was afraid that government will not be able to manage it properly. He was not in favour of giving the power to the government to expand the money supply without expanding the

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

production of goods and services; since it can lead to an unstable currency value. So he strongly opposed the managed currency system and supported gold standards with some modification.

“If a person who is unemployed is offered a choice between a job of some sort, with some sort of wages, with no fixed hours of labour and with an interdict on joining a union and the exercise of his right to freedom of speech, association, religion, etc., can there be any doubt as to what his choice will be?" Ambedkar wrote. “The fear of starvation, the fear of losing a house, the fear of losing savings if any... are factors too strong to permit a man to stand out for his Fundamental Rights."

Responding to libertarian lawyers who argued for minimum state intervention to protect liberty, Ambedkar argued that withdrawal of the state may lead to liberty but that liberty is “liberty to the landlords to increase rents, for capitalists to increase hours of work and reduce rate of wages".

“In an economic system employing armies of workers, producing goods en masse at regular intervals, someone must make rules so that workers will work and the wheels of industry run on," he wrote. “If the state does not do it, the private employer will. Life otherwise will become impossible. In other words, what is called liberty from the control of the state is another name for the dictatorship of the private employer."

Abolition of Khoti System

Ambedkar moved a bill against the Khoti system in 1937 which was popularly known as “The Khoti Abolition Act”. British government used to appoint some powerful persons known as Khots. They were middlemen between the tax collector (British Government) and tax payer (Inferior land holders). Khots were responsible to hand over the tax revenue collected for the entire empire to the British government, for this they used to freely exploit and abuse the inferior land holders. This kind of system was more prominent in the Ratnagiri district, Kolaba district and Thana district. Ambedkar wanted that this anti Khoti bill should be enacted in the complete Bombay Presidency.

Ambedkar’s Canons of Public Expenditure

In 1945, while discussing about the functions of Comptroller and Auditor General of India Ambedkar pointed out that government should responsibly spend the public funds. The revenue which is collected from the public should be spend according to rules & regulations and due respect should be given to faithfulness, wisdom and economy. These principles of spending the public fund are known as Ambedkar‟s Canon of Public Expenditure. The dictionary meanings of faith are duty, commitment and promise. It‟s the dut y of the government to provide the basic amenities to the tax payers. We know that it is easy to deceive the public as the public investment has a long gestation lag period. So, every government should keep in mind that public has an immense faith in them and they should be committed to provide roads, medical facilities, law and order to its citizens. Ambedker pointed out that even though the intention of spending the public funds may be correct but still if it is not used wisely then also the planning fails. In this context he has talked about wisdom of Government to spend the public money. By wisdom he was indicating about the knowledge and experience which should be used while spending the public funds in a better way. Another important principle of Ambedkar‟s canon was economy. By economy he didn‟t mean less public

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IRJMST Vol 10 Issue 6 [Year 2019] ISSN 2250 – 1959 (0nline) 2348 – 9367 (Print)

spending, it basically means how the government should spend the public funds so that they are used optimally.

Contribution in Agriculture Economics: Problem of small holdings in India

The major problem of Indian agriculture is low productivity of land. One of the main reasons of low productivity is the small land holdings by the farmers. In 1917, a committee was formed to give suggestions on the problem of small holding in the Baroda state. The committee gave a suggestion to consolidate the holding which can be cultivated by an individual farmer under the administrative measures. Dr.B.R.Ambedkar was in favour of consolidation of land holdings but according to him it should be state owned. State should acquire all the agricultural land from the private players, owners, tenants or mortgagers and pay them the right compensation, after consolidating the acquired land it should allocate this land in a standard size to the original cultivators without any discrimination based on caste, creed and religion. Ambedkar questioned about what could be the right size of the land holding to increase the land productivity. He pointed out that land is only one factor of production, in order to increase the farm productivity other factors like capital and labour shoul d be rightly mix with the land. Every factor is responsible for the low productivity of land. Because of insufficient capital, surplus labour, and deficient irrigation there is low agriculture productivity in India. Ambedkar in his paper on “Small Holdings in India and their Remedies (1918)” has suggested state owned cooperative farming and industrialisation as the remedial measures. Cooperative farming is a consolidation of land holdings by the farmers who collectively are willing to cultivate the land, but it should be under the rule and regulation of the government. This kind of practice not only increases the productivity it will also reduce the cost of production. According to Ambedkar, industrialisation can be an alternate solution for the vast disguised unemployment in Indian agricultural sector. Surplus labour in the agriculture sector can be transferred to manufacturing sector. This will not only increase the productivity in agricultural sector it will also increase the production of the capital goods. This will indirectly help in the reduction of poverty and inequality. In 1950‟s, Noble Laureate Prof. Arthur Lewis formulated a dual economy model in which he tried to explain the same concept of shifting the idle labour from one sector (capitalist) to another (non- capitalist) which Babasaheb had already discovered as a solution for the idle labour in agriculture sector in the year 1918.

Both the political and economic structure should be defined by law to translate the rule of one man, one vote to the doctrine of one man, one value, Ambedkar argued. Countries such as India should profit from the experiences of other countries and define the shape and structure of the economy in the Constitution itself, he felt.

Yet, Ambedkar’s radical proposals did not win the support of the Constituent Assembly. Instead, many of the provisions outlined in his memorandum found place in the Directive Principles of State Policy, which, though important, are not justiciable in a court of law.

Ambedkar seemed to have accepted that compromise with equanimity when the chapter on directive principles was finalized in late 1948, even though just a year earlier (in 1947), he had made an impassioned plea for making socioeconomic rights justiciable. “How and why Ambedkar’s position

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on social and economic rights changed remains a puzzle," writes political scientist Niraja Gopal Jayal in her 2013 book, Citizenship and Its Discontents.

Conclusion

Dr. Bhim Rao Ambedkar is known as the father of Indian constitution as he was the foremost draftsman of Indian constitution which was adopted on 26th November 1949 and got implemented on 26th January 1950.Because of his noteworthy works and contributions in the various fields he is also known as a great leader of freedom movement, a high-calibre lawyer, a great dalit leader and a distinguished economist. Babasaheb was a highly intellectual person of his time. He was the first person to pursue PhD in economics from abroad. He was the first South Asian to have double doctorate degree in economics from London School of Economics and Columbia University. With such a strong background in economics still Babasaheb contributions in the field of economics are not so popular. The possible reason may be that his extraordinary work in , law, religion and politics has overshadowed his contributions in economics. But this does not mean that his contributions in economics were diminished. The important contributions of Dr.B.R.Ambedkar in the form of thesis, dissertations and papers are “The present problem in Indian Currency”, “The Problem of Rupee: Its Origin and Its Solution”, “Ancient India Commerce”, “The Evolution of Provincial Finance in British India: A Study in the Provincial Decentralisation of Imperial Finance”, “Administration and Finance of the East India Company”, “Small Holdings in India and their remedies”. The Department of Education, Government of Maharashtra has published many speeches and writings of Babasaheb in different volumes.

References

1. Bagga, P.S (2014), “The Practice of Economics by Dr. Ambedkar and its Relevance in Contemporary India”, Journal of Business Management & Social Sciences Research (JBM&SSR) Volume3, No.10, October 2014. 2. Jadhav Narendrea (1991), “Neglected Economic Thought of Babasaheb Ambedkar”, Economic and Political Weekly, Vol.26, No.15 (Apr.13, 1991), pp. 980-982. 3. Ingle, M.R (2010), “Relevance of Dr. Ambedkar‟s Economic in the Current Scenario”,International Research Journal, September 2010. 4. Ishita Aditya Ray, Sarbapriya Ray (2011), “B.R.Ambedkar and his Philosophy of Land Reform: An evaluation”, Afro Asian Journal of Social Sciences, Volume 2, No.2.1. 5. Sarkar Badal (2013), “Dr. B.R.Ambedkar Theory of State Socialism”, International Research Journal of Social Sciences Vol.2 (8), 38-41, 2013. 6. Singariay M.R (2013), “Dr. B.R.Ambedkar: As an Economist”, International Journal of Humanities and Social Sciences Invention, Volume 2, Issue 3, P.24-27, 2013.

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