Rajaji — Champion of Free Enterprise in India

Rajaji's public life can be divided into two parts, with one part before India's independence in 1947 and the other part after the year 1947.

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C. Rajagopalachari, the last governor general of India with Dr. Babasaheb Ambedkar [Photo: Wikimedia]

In the month of December, it is time to remember Sri C. Rajagopalachari (Rajaji), who was born on 10 December 1878 and passed away on 25 December 1972.

Rajaji, the first Governor-General of independent India, was hailed by Mahatma Gandhi as his conscience keeper. Rajaji was an intellectual par excellence and could think far ahead of his time; he was an unbending fighter for the causes dear to his heart. He wrote and spoke with a high level of depth, clarity, and understanding on multiple Indian and international subjects, including politics, economics, nuclear disarmament, religion, social welfare, and so on.

Rajaji’s public life can be divided into two parts, with one part before India’s independence in 1947 and the other part after the year 1947.

Pre-independent period:

During the pre-independent days, there were several stalwarts in Indian public life, such as Sardar Vallabhai Patel, Jawaharlal Nehru, Dr. Rajendra Prasad, Rajaji, and others, who sacrificed their personal interests for the national cause and worked under the leadership of Mahatma Gandhi to achieve India’s independence.

Rajaji led the salt satyagraha movement in Tamil Nadu when Mahatma Gandhi launched the Dandi march in Gujarat, defying British authority. Thus, Rajaji proved that the spirit of the salt satyagraha movement was not confined to one region but was prevalent all over India.

Post-independent period:

During the pre-independent days, while Rajaji was one of the many stalwarts in India, Rajaji’s role in Indian public life in the post-independent days was even more significant, as many stalwarts of the pre-independent days either passed away or withdrew from the active political field.

Nehru’s faith in democratic socialism:

When Jawaharlal Nehru, praised as the jewel of India and a close associate of Rajaji, became the first Prime Minister of independent India and stayed on for several years, he initiated many reform measures and development projects with the national good at heart.

Nehru’s approach of democratic socialism largely reflected the methods of communist countries like the erstwhile Soviet Union, where government investment in industrial infrastructure and other projects was given importance and priority, and policies were restrictive as far as the private sector was concerned. Public sector projects were given much more thrust than the private sector, and therefore, the potentials of private sector projects were ignored or even suppressed to some extent.

Such policies towards large government initiatives were viewed by Jawaharlal Nehru as the be-all and end-all of the strategy to promote an egalitarian society and lift the economic conditions of those in the lower-income group, thus ‘eliminating the feasibility of large profits of the private sector going under the control of a few capitalists.’

At the same time, it should be noted to the credit of Jawaharlal Nehru that he did not adopt the model of the erstwhile Soviet Union, denying liberty and freedom to the people.

Rajaji’s objection:

Rajaji objected to several such initiatives of Jawaharlal Nehru, and he did that with the courage of conviction, even as he held Nehru in high esteem. Rajaji felt that Nehru’s approach to certain economic and development issues in India was not appropriate.

Rajaji vigorously opposed Nehru’s policy of what Nehru described as democratic socialism, which Nehru thought could be a via media between communist philosophy and democratic spirit, combining the best of both.

Rajaji was of the view that the government should be concerned about promoting industrial and infrastructure ventures with faith in the capability and initiatives of the private sector and motivating private project promoters. Rajaji described the restrictive private sector policy of Jawaharlal Nehru as ‘permit, license, quota raj.’

Rajaji recognized that the public sector was also needed for investment in certain areas, but the focus must be more on the private sector. Rajaji eloquently said, ‘that the government is to govern and not to do business.’

Rajaji fundamentally disagreed with Nehru in that whereas Nehru thought that investment in large public sector investments would provide better distribution of wealth and opportunities, Rajaji said that the natural desire of people to prosper individually should be recognized, and policies must be implemented in tune with the natural aspirations of people to earn wealth and improve their material affluence.

Rajaji – Champion of free enterprise:

In the early 1990s and subsequent years, the policy and reform programs of the government led by the late P.V. Narasimha Rao were largely based on incentivizing private promoters, reflecting Rajaji’s economic philosophy.

Obviously, in independent India, Rajaji deserves credit as the champion of free enterprise.

The recent Government of India’s Start-Up India program fundamentally reflects Rajaji’s clarion call for a free enterprise movement in the country, which, of late, has stood the test of time.

Rajaji’s birthday as Start-Up day:

In such circumstances, it is appropriate that Rajaji’s birthday on 10th December should be declared as the Start-Up Day for Entrepreneurs, just as Sardar Vallabhai Patel’s birthday is National Unity Day, Jawaharlal Nehru’s birthday is Children’s Day, and Dr. Radhakrishnan’s birthday is Teachers’ Day.


N. S. Venkataraman is a trustee with the "Nandini Voice for the Deprived," a not-for-profit organization that aims to highlight the problems of downtrodden and deprived people and support their cause and to promote probity and ethical values in private and public life and to deliberate on socio-economic issues in a dispassionate and objective manner.

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