INDIA after Independence_ Early Days of Nation Building through Institutional Arrangements

 

INDIA after Independence_ Early Days of Nation Building through Institutional Arrangements

This is a short account of setting up of institutions that played critical role in India’s nation building. 

As the first Prime Minister of India Pt. Jawahar Lal Nehru laid the foundation of India as a modern nation and as one of the largest democracies of the world.

India’s first cabinet reflected the rich fabric of India’s diversity represented by such stalwarts with complementary talents, expertise and lingo-religious affiliations: Dr. B.R. Ambedkar, Rafi Ahmed Kidwai, Sardar Baldev Singh, Maulana Abul Kalam Azad, Sardar Patel, Dr. John Mathai, Rajkumari Amrit Kaur, Dr. S.P. Mukerjee, Khurshed Lal, R.R. Diwakar, Mohanlal Saxena, Gopalaswami Ayyangar, N.V. Gadgil, K.C. Neogi, Jairamdas Daulatram, K. Santhanam, Satya Narayan Sinha and Dr. B. V. Keskar. Shyama Prasad Mukherjee belonged to Hindu Mahasabha and Baldev Singh was of Panthic Party.  

Post-independence, Junagarh was made part of India in 1947 through plebiscite and Hyderabad in 1948 through army intervention. Goa was liberated in December 1961.

Process of industrialization was set in motion by establishing Indian Telephone Industry- ITI Ltd. and Damodar Valley Corporation in 1948.

Massive Dam development projects were taken up immediately after independence: Bhakra Nangal in North, Damodar Valley Project and Hirakund Dam in the East, and Nagarjunsagar Project in the South.

1950 could be remembered as a Happening Year for the Indian democracy. India declared itself as a Sovereign, Democratic and Republic state with the adoption of Constitution of India. Planning Commission was established in 1950 to oversee economic and social progress through the mechanism of five-year plans. Supreme Court of India and Election Commission were both formed in January 1950.

1950s also saw the formation of institutions like Indian Institute of Technology (IIT) Kharagpur in 1951, Indian Institute of Public Administration (IIPA) and Atomic Energy Establishment Trombay (AEET) in 1954 which later came to be known as Bhabha Atomic Research Centre (BARC), Administrative Staff College of India (ASCI) in 1956 and Defence Research Development Organisation (DRDO) in 1958.

1950s was the making of Public Sector Enterprises like Indian Rare Earths Limited in 1950, Hindustan Shipyard and Bharat Petroleum in 1952, Hindustan Machine Tools- HMT Ltd. And National Research Development Corporation NRDC  in 1953, Hindustan Insecticides and Hindustan Antibiotics in 1954, National Small Industries Corporation NSIC in 1955, NLC India Ltd., State Trading Corporation of India STC and State Bank of India SBI in 1956, National Projects Construction Corporation Ltd., Export Credit Guarantee Corporation of India ECGC and Central Warehousing Corporation of India CWC in 1957, NMDC and Heavy Engineering Corporation HEC  in 1958 and Indian Oil Corporation IOC, Oil India Limited OIL and Hindustan Salts Limited in 1959.

The trend continued in early 1960s with National Buildings Construction Corporation NBCC and Garden Reach Shipbuilders & Engineers in 1960, Indian drugs & Pharmaceuticals IDPL, Fertilizers Corporation of India FCI and Shipping Corporation of India SCI in 1961, National Cooperative Development Corporation, MMTC, Kochi Refineries and Hindustan Aeronautical Ltd. HAL In 1963 and Bharat Earth Movers Limited, MSTC and Bharat Heavy Electricals BHEL in 1964.

On the Financial Institutions infrastructure front, we had developmental financial institutions DFIs like Industrial Finance Corporation of India IFCI in 1948 and Industrial Development Bank of India IDBI in 1964 in public sector and Industrial Credit & Investment Corporation of India ICICI, in 1956, in the private sector with the help of International Financial Corporation, Washington. State Financial Corporation SFC Act 1951 facilitated creation of state level development financial institutions like UPFC and MSFC etc. Life Insurance Corporation LIC, the biggest of all financial corporations of India, was set up in 1956 and Unit Trust of India was established in 1963.

Scientific Policy Resolution 1958 was a document of vision and intent running into seven paragraphs only unlike the lengthy document of Industrial Policy Resolution of 1956. Country’s first atomic reactor APSARA went critical in 1956 and India successfully tested its first rocket from Thumba in 1963. India made forays in atomic energy, space technology and ocean science amongst others.

National Institute of Virology, Pune was setup in 1952. All India Institute of Medical Sciences (AIIMS) was setup in 1956, Maulana Azad Medical College in 1958, Govind Vallabh Pant Institute of Postgraduate Medical Education and Research in 1961 along with many other public health institutions.

In the field of higher education IIT Kharagpur was established in 1951, IIT Bombay in 1958, IIT Madras and IIT Kanpur in 1959 and IIT Delhi in 1961, IIM Calcutta and IIM Ahmedabad in 1961. The government opened the first 6 Regional Engineering Colleges, now NITs, in 1960. There were 6 more by 1967. National Institute of Design was set-up in Ahmedabad in 1961. Indian Institute of Public Administration was setup in 1954. Birla Institute of Technology BIT Mesra, Ranchi was formed in 1955 and Thapar Institute of Engineering & Technology, a deemed-to-be University was setup in 1956.

GB Pant University of Agriculture & Technology was established in 1960 in collaboration with few US Land-grant Universities.

All India Council of Technical Education was setup in 1945 and University Grants Commission in 1953. ICAR-Central Institute of Fisheries Education, a Deemed University was setup with UNDP assistance in 1960. The Punjab Agriculture University PAU Ludhiana was established in 1962 on Land Grant System of USA. Jawaharlal Krishi Vishwavidyalaya Jabalpur was established in 1964 through Joint Indo-American Team on Agriculture Research and Education. Orissa University of Agriculture and Technology, State Agricultural University was established in 1962.

Indian Council of Cultural Relations was established in 1950. National Council of Applied Economic Research, NCAER, is functional since 1956. National Council of Education, Research & Training, NCERT, was established in 1964.

For Nehru, modernization was the national philosophy with seven goals; national unity, parliamentary democracy, industrialization, socialism, development of scientific temperament and non-alignment as per Bhikhu Parekh.

Raising of financial resources required for nation building was a humungous task which historians and economists of Indian Economic History have not dwelt upon in detail. Nehru was a co-founder of Non-Aligned Movement along with Nasser, Tito and Sukarno. Keeping equal distance from both power blocks, namely, USA and USSR and being accepted as a third world leader gave tremendous advantage to Nehru which he leveraged to the fullest. India could get large amounts of money in the form of aids, grants and soft loans.

Rourkela Steel Plant was commissioned with German collaboration and Bhilai Steel Plant was commissioned with Soviet Union collaboration in 1959. Durgapur Steel Plant was set up with United Kingdom collaboration in 1962 and Bokaro Steel Plant was set up with Russian collaboration in 1964. Ford Foundation funded USD 2 million for the training of engineers working in these plants in America. Later US Government picked up the direct training cost and some 500 engineers got trained.

It was understood that new institutions to reflect the complexity of the economy and the society must be built, and that good models existed abroad suitable for replication in India. Nehru knew the importance of replicating world-class institutions in India. His 1949 visit to Massachusetts Institute of Technology ultimately led to setting up of 5 iconic IITs in India.

IIT Bombay was setup with Russian support, IIT Madras with German help, IIT Kanpur with US help and IIT Delhi with British support. IIM Ahmedabad and IIM Calcutta got necessary help and support from Ford Foundation of USA. Ford Foundation also helped Birlas in setting-up Birla Institute of Technology, BITS Pilani with multi-year collaboration with Massachusetts Institute of Technology, USA in 1964.

Nehru had the ability to induct greatest of scientific minds of the times into nation-building. Vikram Sarabhai, Sir C V Raman, Homi J Bhabha, Satish Dhawan, S. S. Bhatnagar and many others were picked up to run the premium research institutions of the country and were given a free hand. Nehru helped setup the National Chemical Laboratory, the National Physical Laboratory, the Fuel Research Station, the Glass & Ceramics Research Institute and the National Metallurgical Laboratory under the stewardship of S. S. Bhatnagar.

Individuals like Vikram Sarabhai helped in setting up first IIMs, Gautam Sarabhai and Pupul Jaikar pushed for establishing NID at Ahmedabad.

Nehru trusted his colleagues like Maulana Abul Kalam, C.D. Deshmukh and later people like Humayun Kabir who helped in setting up many of the top Higher Education Institutions of India. C.D. Deshmukh, the then Finance Minister and Deputy Chairman of Planning Commission facilitated making of State Bank of India in 1955 and Life Insurance Corporation in 1956.

Paul Hoffman was appointed as the first President of Ford Foundation. He visited India at the behest of Vijay Lakshmi Pandit, Indian Ambassador to USA and met Pt. Nehru and C.D. Deshmukh in August 1951. India got very encouraging help and support from Ford Foundation in many areas of social and economic importance in early decades post-independence. More help came in the area of management and higher education. 

The Administrative Staff College of India created in 1957. It used Ford Foundation grant in early 1960s to introduce case study method of instruction and to develop an active consulting role with industry and government. Foundation’s funds financed collaboration, including staff training and library development between the Harvard Business School and IIM Ahmedabad and between the Sloan School of Management of MIT and IIM Calcutta. A set of grants by Ford Foundation to government of India helped in setting up and funding National Institute of Design NID in Ahmedabad. In 1953 experts led by a Swedish Expert were brought to help setup eventually NSIC.

Rockefeller Foundation, too, helped mainly in the areas of agriculture and population control. Rockefeller Foundation, starting 1954, provided support for higher yielding variety of corn, then for wheat and finally for rice in 1964-65 along with Indian Council of Agricultural research.

In sum, a vast network of institutions, in social, political and economic arenas, was laid out during 1948-1964 with the visionary leadership of Pt. Jawahar Lal Nehru who heavily relied on his goodwill, contacts and canny ability to pick up the best brains and empower them to work. The already-existing institutions such as Reserve Bank of India and the Indian Army were respected and supported by the executive branch without any undue interference.