The journey of a progressive economist

Print edition : June 08, 2002

WITH his gentle and unhurried speech, his calm and composed mien, he looked more like a saint than the man of the world, which an economist is popularly supposed to be. Indeed, even apart from his appearance, there was something saintlike about Iqbal Gulati: he was straight, dignified, considerate, and morally upright.

But this saint, perhaps in common with all saints, also had a core of steel in him. His family had been uprooted from its native place in the far west of Pakistan during Partition. It had suffered great privations, through which Gulati had struggled. From his "home" in the refugee camp in Delhi's Kingsway Camp he used to bicycle every day to the Ministry of Finance where he held a small job; from his meagre earnings he educated himself and his brother and sustained his family.

It may have been his own travails, it may have been the ambience of the Nehru era, or it may have been his exposure to Left Keynesianism through proximity to economists like Nicholas Kaldor (when he visited India in the mid-1950s to prepare a comprehensive scheme of tax reforms and Gulati worked closely with him) - whatever the stimulus, Gulati developed a remarkably progressive outlook as an economist which he never abandoned. Indeed, as time passed and other colleagues of his moved away from progressivism, Gulati's commitment to it became, if anything, even more pronounced.

It is this sympathy for the progressive cause which made Gulati pay a short visit to Trivandrum, soon after the first Communist Ministry under E.M.S. Namboodiripad had been formed in the State, to prepare some economic documents for the government. His living conditions during the stay were spartan; he shared a room with another young economist, Ashok Mitra, who had come on a similar mission and with whom he was to enjoy a close friendship all his life. They were only two out of a galaxy of young idealistic economists who had flocked to Kerala after 1957 to be part of the grand experiment that was being attempted there. Others included Satyabrata Sen and Ashok Rudra.

Gulati was then teaching at M.S. University, Baroda, and Ashok Mitra was on the research staff of the National Council of Applied Economic Research (NCAER). Both had slipped away clandestinely from their respective jobs to help the Kerala government. Discovery in either case would have meant severe harassment. But in those heady days, taking the risk was itself an act of self-fulfilment.

That was the beginning of Gulati's love affair with Kerala. After much meandering - from the teaching job at M.S. University, where he met Leela who was to be his life-partner; to post-graduate research at the London School of Economics; to a variety of official and semi-official employment - Iqbal was to return to Trivandrum permanently in the early 1970s to become a founding faculty member, along with K.N. Raj, T.N. Krishnan, N. Krishnaji and P.G.K. Panikkar, of the Centre for Development Studies.

The year 1957 also marked the start of another love affair for Gulati - with the Left in Kerala. He remained committed to the Left Democratic Front (LDF) throughout and was the Vice-Chairman of the Kerala State Planning Board under both the Nayanar governments, between 1987 and 1991 and between 1996 and 2001.

GULATI did outstanding work in a number of fields in economics, of which I shall mention only two. One, not as well-known as it should be, is international finance, where he wrote a series of pioneering articles unravelling the changing role of the International Monetary Fund (IMF). While during the first oil shock the IMF had been the chief agency for financial recycling to the Third World, through the various "facilities" it had set up, during the second oil shock the proportion of funds recycled through the IMF had fallen quite sharply. Metropolitan banks involved themselves directly in the recycling business to a much greater extent than earlier. But they needed a security cover to operate in the Third World economies, and the IMF, through its "conditionalities", provided that cover.

Within a very short span of time, in other words, the IMF's role had changed from being a major financier of the Third World to that of merely providing security to burgeoning private financiers. To be sure, even when the IMF was at the centre of the recycling business, it discriminated systematically between First World and Third World borrowers, as Gulati showed quite convincingly in his Kale Memorial Lecture on "IMF Conditionalities and the Third World", but the changing role of the IMF he drew attention to was an altogether different matter. This change was in keeping with the ascendancy of "globalised" finance capital, and constituted a good barometer of this ascendancy.

The other field in which Iqbal Gulati was an acknowledged authority was of course public finance. His advocacy of devolution of resources from the Centre to the States and further down to the elected local bodies is well-known, as is his strong criticism of successive governments at the Centre for denying State governments their legitimate rights. (He was very critical of the Eleventh Finance Commission's approach in this regard, apart from being upset at its unfair treatment of Kerala in particular, and was appreciative of the dissenting note by one of the members, who questioned the constitutional legitimacy of some of the provisions.) He wrote extensively on Centre-State financial relations and served with distinction as a member of the Sixth Finance Commission.

What is less well-known, however, is his general approach to public finance, where his early Left Keynesian sympathies made him detest deflation. Iqbal was all for government spending: tax revenue, he felt, could always be raised with a bit of imagination and a bit of political will. His stewardship of Kerala's economy during the period of the first Nayanar government was quite admirable. The size of the budget, on both the revenue and expenditure sides, increased considerably, and the economy, after long years of stagnation in the material production sectors, taken as a whole, gave clear indications of breaking out of it. The LDF government, after a remarkable success in the panchayat elections, felt confident enough to call for early Assembly elections, before its term was over. The assassination of Rajiv Gandhi and the sympathy wave it generated put paid to the LDF's hopes, but Kerala's economy had begun to stir and its production performance had begun to look up.

GULATI'S second tenure as the Vice-Chairman of the State Planning Board would be long remembered because of its bold experiment of democratic decentralisation within the State which followed in the wake of the Peoples' Plan campaign (Frontline, December 8, 2000). While E.M.S. Namboodiripad led the campaign, the Planning Board was the agency through which it was implemented. And Iqbal Gulati, together with other members of the Board, especially the two "young Turks", T.M. Thomas Isaac and E.M. Sreedharan, threw himself, heart and soul, into the campaign. A 73-year old Iqbal travelled through the length and breadth of Kerala, attended Gram Sabha meetings, addressed panchayat leaders, and spent many sleepless nights until his health could take it no more. When future generations talk, as they no doubt will, of the "Kerala Model" of decentralisation, with its core provision of handing over nearly a third of the State's Annual Plan outlay each year to the local self governing institutions for deployment on projects which they consider worthwhile, these four names - EMS, Gulati, Isaac and Sreedharan - will certainly be remembered with gratitude. And of these four, Iqbal's is particularly remarkable since he came to the positions he took for reasons among which political considerations were the least important.

Indeed, Iqbal's relationship with politics is a fascinating issue in itself. Even though Iqbal's intellectual positions were consistently progressive and he was a steadfast friend of the Left all his life, he was not a Marxist or a Communist. And yet, even apart from his official work for the LDF, Iqbal, towards the end, used to write a regular column in Deshabhimani, which he discontinued only when his failing health would permit it no longer. This journey of a progressive economist towards becoming actively engaged in the Communist movement without necessarily subscribing to Communist theory is instructive: it throws much light both on Gulati as a person and on the Communist movement in the country today.

As the "mainstream" discourse in economics, both in the academic and official terrains, has moved to the Right over time, many who in the old days held views similar to Iqbal's also changed with the times. On the other hand, in the midst of this change a person like Iqbal who consistently adhered to the position he had held earlier appeared increasingly to belong to the Left spectrum within the profession. At the same time, with the collapse of Nehruvianism, inter alia through its abandonment by its own earlier adherents, the Marxist Left enlarged the intellectual space occupied by it by moving into the vacant Nehruvian space. Putting it differently, with the withdrawal of the erstwhile Nehruvians from anti-imperialist positions, the Left became the leading anti-imperialist intellectual force, and shared much common ground with intellectuals like Iqbal. As mentioned earlier, Iqbal was always sympathetic to the Left. But the fact that the bonds between him and the Left became stronger over time was as much a reflection of Iqbal's courage, intellectual consistency, honesty, and self-confidence in sticking to his convictions, as it was of the Left's lack of rigidity, of its suppleness in enlarging its intellectual space in accordance with its changing perception of the nature of the primary contradiction.

The number of persons who have this courage of intellectual consistency, as time has shown, is indeed very small; and Iqbal was one of them. Every loss from this small group is a major blow to the intellectual life of the country. Iqbal's passing leaves a void that is difficult to fill. And for friends - among whom I feel privileged to count myself - there is only the memory: of the gentle voice on the veranda talking of the Partition days, of old memories, of common friends, as dusk turns into night and the first flickering lights appear in the valley below.

Prabhat Patnaik is Professor of Economics, Jawaharlal Nehru University, New Delhi.

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