Economic thoughts of Dr. B. R. Ambedkar

Ambedkar was the first Doctoral Degree holder in economics among Indians. He is one of the great economist both by training and by practice. His economic expertise covers public finance , Monetary economics , agricultural economy and activities of uplifting downtrodden socially and economically. also he was a pioneering feminist of modern India.

1. Economic thoughtS of Dr . B. R. Ambedkar, in the context of Indian Economy MAJOR ADVISOR: Dr. M. N. VENKATARAMANA Associate Professor. Dept of Agril . Economics. PRESENTED BY : K. C. VENUPRAVEEN PALB- 4096 1

2. Introduction Dr. Ambedkar: The Economist Scholarly Contributions To Economics Contributions To Public Finance Contribution To Monetary Economics Analysis of Indian Economic Problems Economics of Caste System And Untouchability Agriculture and Poverty Ambedkar’s water resources policies Ambedkar And Women Empowerment Dr. B. R. Ambedkar And Mahatma Gandhi, Interface Conclusion Flow of presentation 2

3. Dr. B.R. Ambedkar (14 th April 1891 – 6 th december 1956) (B.A., M.A., Ph.D., D.Sc., Barrister-at-Law., L.L.D., D.Litt ) Education: Ph.D in Economics, From Columbia University. USA . D.Sc. in Economics, From London School of Economics . Barrister-at-Law at Gray's Inn, London Introduction   Maharaja Gaekwad  of  Baroda , who opened an opportunity for Indians to study at Abroad . Shahu Maharaj , who financially supported Dr. Ambedkar, to continue his education in LSE. 3

4. 1918: Professor of Political Economy Nominated Member of Bombay Legislative Council-in 1926. His remarks on Budgets were of a great treasure for taxation policy and public works for Inclusive development of the people. As a labour leader, he struggled for safeguarding rights and welfare of workers. Member of Viceroy’s Executive Council ( L abour, Water, Power and Mineral Resources) 1 st Law Minister of Independent India. Father of Indian Constitution. 4

5. Dr. AMBEDKAR : AN ECONOMIST “ Ambedkar is my Father in Economics, His contribution in the field of economics is marvelous and will be remembered forever ..!” - Dr Amartya   Sen “Ambedkar's economic thought, vision not fully understood” "the more we recall Ambedkar's thought, in the context of issues currently faced by India, the more we come to respect his vision and his approach to inclusiveness .“ - The PM, Narendra Modi . RECENT DEVELOPMENTS IN INDIA 5

6. 1 . Intellectual slavery : Indians most often quote foreign authors neglecting contributions of Indians 2. Shadowing effect of his other magnificent works( law, politics, religion, sociology, etc.) . Rejection of these Theories ( Narendra jadav ) e.g. Dada Bhai Navaroji and Mahadev Govinda Ranade are often quoted rather than Dr B.R.Ambedkar . Other reasons ( Ambirajan ) 1. F ault of the Indian political leadership in the post-independence era . 2. F ault of the Dalit community for having projected him exclusively as its own leader. Reasons for Neglecting Ambedkar’s Economic Thoughts 6

7. Ambedkar as an Economist 1 st phase: as a Student and Professor of Economics. In the form of dissertations and articles. (1915-1923) 2 nd phase: A s a professional economist in addressing India’s economic problems and in managing economic affairs of the country. (1923 – 1956) Ambedkar’s Contribution to Indian E conomics 7

8. CONTRIBUTIONS TO PUBLIC FINANCE : a. Administration and Finance of t he East India Company. (M A thesis submitted to Columbia University ) b. The Evolution of Provincial Finance In British India .( P h. D thesis submitted to Columbia University) . SCHOLARLY CONTRIBUTIONS TO ECONOMICS: 8

9. Ambedkar provides a historical review of the changes in administration and finance of the East India Company during 1792-1858 and depicts how those changes led to the suffering of the Indian people at the hands of the British rulers . Key findings: Administration and Finance of the East India Company Creation of “Public Debt of India ” even though having budget surplus for 36 years out of 60 years . Through , drain of wealth of India , as a continuous tribute to pay dividends for the Company’s share holders. The Indian debt created in India > The home bond debt created in England. 9

10. Contd … Huge Land Taxes :- 54 per cent of total revenue and which was also highly fluctuating to the extent of 80-90 per cent in some provinces, whereas in contrast to this only 10 per cent in England for years up to 1798. Government expenditure:- military expenditure accounted for as much as 45-64 per cent of the total budget He also points out that Manchester city in England spent on a single item - water, a larger amount of money during 1834 than what the EIC had spent on all kinds of public works in India. Trade Policies :- He also pointed on imposition of prohibitive duties on Indian manufacturer exports to England as against negligible duties on British manufacturer imports to India. However, cotton exports from India to Great Britain from free from duty etc which is discriminatory . 10

11. Contd … View on Expenditure . Finance of a country are to be judged from the view point of developmental expenditure and among the developmental expenditure public works ( roads , canals, electricity, telegraph, etc .) should receive prominent position . Over all view :- In entirety he condemns the entire fiscal system of the east India Company By considering all these, Dr Ambedkar points that the Indian public debt is done largely by the government of India, i.e., EIC as it was entirely due to creation of war, etc 11

12. Ph.D. Dissertation submitted to Columbia University. It reveals evolution of Centre- state financial relation in British India from1833 to 1921. 1833-1871: Imperial S ystem of Government. Failure of this system lead to evolution of Provincial Finance. THE EVOLUTION OF PROVINCIAL FINANCE IN BRITISH INDIA Under the imperial system, the expenditure budgets were prepared by the provincial government but the responsibility for finding the ways and means for financing them rested on EIC. 12

13. In provincial Finance system Ambedkar discusses three forms of systems, namely Budget by assignment Budget by assigned revenues Budget by shared revenue Under each type Ambedkar discusses how were the revenues and expenditure system and at the end discusses what ought to be the system of relationship related to financial responsibility in different Departments. This book is the first of its kind dealing with the most discussed topic in the present context - the state and Centre financial relationship. Contd … 13

14. Bombay Provincial budget (1927-28 ):- Addressing Finance Minister Most essential requirement of a good revenue system is that it should be reliable It doesn’t matter whether that revenue system brings in large revenue or small revenue . More than the revenue, the variation is crucial, which has to be the least. But, Land revenue and excise, the two top parts of Budget, have large variations Addressing tax payers T he revenue system of the presidency is inequitable and indefensible Every farmer, whatever may be his income, is brought under the levy of the land tax. But under the income tax no person is called upon to pay the tax, if he has not earned any income during the year Under the land revenue system a person is taxed at the same rate, whether he is an owner of one acre of land, or a jahangirdar or an inamdar. Provincial Budgets 14

15. Remarks on excise duty This was not meant for the purpose of enabling the government to raise revenue , but the monopoly was enacted . e.g.. Government accepted policy of prohibition of alcohol consumption and measures undertook by the government such as rationing. Cont... 15

16. Contemporary Relevance of Ambedkar’s Contribution To Public Finance Replacement of Planning Commission by NITI Aayog, to enable increased participation of States for greater planning. Provision of Finance Commission in the Constitution. 16

17. The Problem of Rupee ; its origin and its solution , and statement and evidence before the royal commission on Indian currency and finance in 1926 . In 1 st part of the book Ambedkar discusses how currency evolved over the period from 1800 to 1920, through Silver Currency, gold standard and gold exchange standard. In the 2 nd part, he discusses an ideal system of currency system to maintain stability and to save people from evils of Inflation. MONETARY ECONOMICS 17

18. Ambedkar Vs J. M. Keynes GOLD STANDARD VS GOLD EXCHANGE STANDARD . “The Problem of Rupee-1923” Gold coins themselves used as currency or medium of exchange. The affairs of mankind with the deal of Nature- creates automaticity. But flexibility is a double edged weapon. It is bad if there is reckless issue of currency by an irresponsible government . Leads to inflation with negatively effects the interest of common man. “ Indian Currency and Finance-1914” Paper currency backed up by gold reserves is used as a currency. He recommended gold exchange standard for a developing country like India. There is virtue of flexibility, so the Govt. can alter the availability of money. 18

19. Ambedkar and formation of RBI The memorandum submitted to the Hilton young commission in 1925 “a managed currency is to be altogether avoided when the management is to be in the hands of the government”. In the case of the government “ the chance of mismanagement is greater ” because the issue of money “is authorized and conducted by men who are never under any present responsibility for private loss in case of bad judgment or mismanagement”. The Commission members found Dr. B. R. Ambedkar’s book "The Problem of the Rupee- Its origin and Its Solution” an invaluable reference tool and the Central Legislative Assembly eventually passed these guidelines as the RBI Act 1934 Relevance of Ambedkar’s concept E.g.. Issue of 1,08,000 crores worth of ad hoc treasury bills , to maintain a balance of 50 crore in RBI by Central Govt. In 1994 ,the system was withheld. 19

20. Other than these scholarly contributions of Dr. Ambedkar, after his back to India , he didn’t write any book on Economics, But every work he did, as MLA, Labour leader, Minister in Viceroys Executive Council, Law minister and as a Constitutionalist had an imprint of Ambedkar as Economist. He was of a personality, who had understood every grievance of people and struggled for the welfare and the progress of India. e.g. He quotes Bateson’s in his Heredity theory of Mendel , in his Book ANNIHILATION OF CASTE Analysis of Indian Economic Problems 20

21. Chaturvana as a concept of Division of Labour . even Gandhiji was sympathetic to this view. Annihilation of Caste: division of laborers Economics of caste system and untouchability T his division of laborers was not based on natural aptitudes or acquired skills but on the dogma of predestination. While there is nothing wrong in the notion of the division of labour, no civilized society in the world has a division of labour along with such unnatural division of laborer! 21

22. Ambedkar believed that the caste system as a major obstacle to economic growth and development through immobility of Capital and Labor . According to him, untouchability was not only a religious system but also an economic system which was worse than slavery . Contd… 22

23. The problem of small holdings in agriculture . Traditional definition of an economic holding: “ a holding which allows a man a chance of producing sufficient to keep herself and his family in reasonable comfort after paying his necessary expenses ” Ambedkar opposes this as it was from standpoint of consumption rather than from the viewpoint of production Economic holding: Mere size of land is empty of all economic connotations… It is the right or wrong proportion of other factors of production to a suit of land that renders the latter economic or uneconomic AGRICULTURE AND POVERTY 23

24. 24 (in hectares) (in hectares)

25. Remedy lies in not enlarging the holdings but in increasing capital and capital goods and in greater Urbanization. Industrialization of India is the soundest remedy for the agricultural problems of India. For maintenance of standard size of holdings he proposes for co-operative farming than enlarging holding size under a single ownership. The co-operative farms will be like a shareholders company in which the company remains even though the shareholders change Land reforms and prominent role for the state in economic development- state socialism. 25

26. Abolition of The Khoti System: Ambedkar introduced a holistic bill as an elected member in the Mumbai legislative assembly aimed at abolition of Khoti system in 1937 “ I know your grievances. The Khoti system is sucking your blood. This system of land tenure must be abolished, its abolition will bring you peace and progress. In order to achieve your goal you must keep the agitation going on ” 26

27. March 19 th 1928, Ambedkar introduced a bill in the Bombay legislative council to amend Act of 1874 for securing the rights of servants and reformation in the bill for revised Vatan system and P ayments according to their cost of living. This bill got opposition at many times but subsequently came to an end by the act of Bombay inferior village Vatan abolition Act of 1959 Mahar vatan 27

28. The Bombay Moneylenders Bill:- Prepared by Ambedkar in 1938 Had some very innovative provisions, even by the prudential, standard advocated today Such as, Moneylenders being subjected to licenses from the Government renewable every year, Compulsion of written records of all lending operations and mandatory issue of passbooks detailing all transaction between borrowers and lenders . 28

29. Right to strike :- fought against industrial dispute Bill in 1938 C reation of Labour organizations 1936- Independent Labour Party aiming to strengthen the workers politically and economically Labour minister in Viceroy’s executive council - Tripartite conference (Labour, employers and the government) as an advisory body to help achieving further progress in respect of Labour welfare measure. E mployment Exchanges As a Labour leader 29

30. policy initiatives taken by Ambedkar as a cabinet minister of labour, Irrigation and power A remedy for present day Water Sharing Dispute . Critic on Act of 1935: On the lines of Water as a Wealth of Nation. WATER RESOURCE POLICIES 30

31. Greater role for centre: Formulation of a integrated approach for optimal utilization of the Water Resources Ambedkar suggested the establishment of independent authorities, giving the central government a leading role Ambedkar’s policy framework led to… The adoption of River Valley Authority (to overcome the jurisdictional problem) and The creation of present day Central Water Commission an apex technical body at the Centre. 31

32. Implemented works as per the Policy Framework Damodar Valley Project in Bihar and West Bengal, based on the Damodar Valley Corporation Act 1948 He gave legal frame work to this approach while framing Constitution. Ambedkar,for the first time had suggested interlinking of Krishna, Godavari and Tapti Rivers The torch lighted by Ambedkar for the first time in Damodar Valley has been since passed on to the Mahanadi, Kosi , Sone , Bhakra-nangal Project( bringing prosperity to Punjab, Haryana, Rajasthan, Himachal Pradesh and Delhi ) and other river valley development schemes. 32

33. He was the champion of human rights, he promoted Equality, Liberty and Fraternity in the society G ender E quality Women E ducation Hindu Code Bill - constitutional foundation for safeguarding the rights of Indian women and oppressed classes Women organization Maternity bill WOMEN EMPOWERMENT “I measure the progress of a community by the degree of progress which women have achieved” . “ It is in the interest of the nation that the mother ought to get a certain amount of rest during the pre-natal period and also subsequently, and the principle of the Bill is based entirely on that principle ” 33

34. Article 14- Guarantees that the state shall not deny equality before the law and equal protection of the laws; Article 15- Prohibits discrimination against any citizen on the ground of sex; Article 15 (3) - Empowers the state to make positive discrimination in favour of women and children; Article 16- Provides for equality of opportunity in matters of public employment; Article 23- Prohibits trafficking in human beings and forced labour ; Article 39 (a) and (d) - Enjoins the state to provide equal means of livelihood and equal pay for equal work ; Article 42- enjoins upon the State to make provisions for securing just and humane conditions of work, and for maternity relief ; Constitutional Provisions 34

35. Article 51A (e) - imposes a Fundamental Duty on every citizen to renounce the practices derogatory to the dignity of women; Article 243D (3) - provides that not less than 1/3rd of the total number of seats to be filled by direct election in every Panchayat to be reserved for women, and such seats to be allotted by rotation to different constituencies in a Panchayat ; Article 243T(3) - provides that not less than 1/3rd of the total number of seats to be filled by direct election in every Municipality shall be reserved for women and such seats may be allotted by rotation to different constituencies in a Municipality; Article 243T(4) - provides reservation of offices of Chairperson in Municipalities for Sc, ST, Women in such manner as the legislature of a State, may by law provide; 35 Contd …

36. Caste and untouchability: Division of L abour VS D ivision of L abourer Village and solvation of India Gandhi - Gave a call to the people to back to villages and revival of village industries and he argues that solvation of India lies in spinning wheel, the Charakha . Ambedkar- A griculture is the most congested occupations hence salvation of the whole India lies in greater urbanization In reviving our towns, in building our industries, in removing as much population as we possibly can from our village to the towns Dr. AMBEDKAR AND MAHATMA GANDHI- INTERFACE Gandhi to Ambedkar . YOU HAVE BORNED AS AN UNTOUCHABLE BUT I HAVE ADAPTED MY SELF AS AN UNTOCHABLE 36

37. Gandhi was against modern civilization and mechanization but Ambedkar was pro- modernization. Village S waraj VS individual independence. Swadeshi: Production , Consumption and Distribution within the territory only. Decentralization and Federalism. 37

38. Indian Agriculture is an occupation not an Industry Balanced cultivation Greater urbanization , reviving our towns and driving excess population to towns. Industrialization is the sound remedy for problem of small holdings. Debate on Agricultural problems 38

39. Conclusion LEGALITY INEQUALITY GOVERNANCE CASTE ECONOMICS POLITICIZATION HISTORY AND ANTHROPOLOGY OF CASTE Ambedkar as a personality DISCRIMINATION 39

40. 40 THANK YOU