Whole Lot Of Business Sense

There has been much theorising and even more empirical recording. The study of capitalist industrialisation in India is, however, still in its infancy. You get hagiographical accounts of the "captains" of business, you get dull historical detailing or sociological hypothesising, but very little hard facts about the social origins of business enterprise in India.

So, full marks to Harish Damodaran for a book that those interested in the dynamics of capitalist development in India must read. It바카라™s not just good journalism but the work of a profoundly talented observer of social change in India.

Everyone complains about Indian politics getting stuck in the caste groove. Indian business was there before. Caste networks helped create trust, an essential lubricant of business. Damodaran doesn바카라™t discuss the whys and wherefores of caste in business. He has stuck to digging out facts and showing us how different castes across the country made the transition from traditional economic activity to trade and industry.

Interestingly, vegetarian Indians바카라”the Jains, Marwaris and Brahmins바카라”exhibited "animal spirits" before the other castes caught up. They and the Parsis dominated pre-Independence business enterprise. After Independence came the Chettiars, Khatris, Kammas, Reddys, Rajus, Jats and Marathas, to name some of the other entrepreneurial castes.

Damodaran doesn바카라™t waste time trying to justify the caste lens. Nor does he get diverted by the question "Is caste class?" He believes capitalism in India has developed through what he calls "business communities" in which ethnic and other networks facilitate commercial activity. In elaborating the caste dynamics of capitalist development, Damodaran바카라™s taken scholarship in the area several steps forward. It would have been fascinating to see how Damodaran바카라™s grandfather, the Communist leader and Marxist theoretician E.M.S. Namboodiripad, would have viewed young Harish바카라™s work!

Damodaran identifies three sources of industrial capitalism in India바카라”mercantile capital ("bazaar-to-factory"); professionals ("office-to-factory") and agrarian capital ("farm-to-factory"). My own work on the development of capitalism in Andhra Pradesh, dating back to the early 바카라™80s, showed a fourth route바카라”public works-to-factory, the so-called "contractor class" who accumulate capital from public works. There are many prominent examples of businessmen who have milked the public exchequer, with help from politicians in office, to become "dynamic entrepreneurs".

Damodaran바카라™s book corrects one imbalance in existing literature on business enterprise in India바카라”the regional one. Most of existing work focuses mainly on Marwari, Jain, Parsi and Punjabi enterprise. There is very little published work on South Indian business, apart from the work of economic historians. Damodaran바카라™s chapters on South Indian castes in business, and his brief 바카라˜Note on Minorities바카라™ fill this gap.

The most important challenge Damodaran poses to his distinguished grandfather바카라™s intellectual and political legacy is not his focus on caste as a factor in the growth of new enterprise. Rather, it is his unequivocal demonstration that so many of the first-generation business groups across the country find their origin in the post-Green Revolution agrarian transformation of rural India.

The old theoretical formulations regarding India바카라™s inability to make the transition from feudalism to capitalism because of the semi-feudal nature of agrarian relations and the constraints imposed by backwardness fly out of the window. That may be true for parts of eastern and northern India, but, as Damodaran shows, in much of southern, western and northwestern India, farmers have become industrialists. The dynamics of Indian agriculture facilitated that transition, with help from the government.

I am particularly delighted to see Damodaran바카라™s rich detailing of this process because some of us had in fact argued even in the 바카라™80s that a new dynamism was visible in the countryside in places like coastal Andhra, southern Tamil Nadu, western Maharashtra and so on, where a new business class was in the making. It is not often that one reads a book you wish you had written. I certainly wish I had Damodaran바카라™s skill, energy and intellect to produce such a well-researched and readable book.