DHANANJAY
RAMCHANDRA GADGIL
1901–1971
· Dhananjay Ramchandra Gadgil,
also known as D. R. Gadgil, was an Indian economist, institution builder and
the Vice Chairman of the Planning
Commission of India.
· He was the founder Director
of the Gokhale Institute of Politics and
Economics, Pune and the author of the Gadgil
formula, which served as the base for the allocation of central assistance
to states during the Fourth and Fifth Five Year Plans of India. The central
library of the Gokhale Institute of Politics and Economics has been named
Dhananjayrao Gadgil Library, in his honour.
·
Born in Nashik and educated
in Mumbai, Gadgil then took a research degree at Cambridge, writing a landmark
dissertation (later published as a book) on industrial growth in India.
· With his intellect and
background, Gadgil could easily have joined the elite Indian Civil Service. But
he chose to forge his own path instead. In 1930, he set up the Gokhale
Institute of Politics and Economics in Puné, the country’s first social science
institute, run and staffed entirely by Indians with no connections to the
British colonial regime.
· While nurturing younger
scholars, Gadgil continued to do his own research. He wrote important
monographs on federalism, on economic planning, and on the sociology of
business communities. Keen to combine theory with practice, he played a
critical role in the formation of agricultural co-operatives in his native
Maharashtra.
· D R Gadgil was a scholar of
a conspicuous independence of mind. The well-known columnist D F Karaka wrote of
him that ‘it would be difficult to find a truer picture of all that is best in
the ancient Indian tradition than Gadgil. A slim, gaunt man, argumentative and
aggressive on the right occasions, full of courage and with a wisdom grounded
in deep knowledge of both theory and facts, Gadgil had devoted himself for many
years to the building up of a true school of politics and economics, eschewing
all profitable pursuit.’
· He is credited with contributions
towards the development of Farmers' Cooperative movement in Maharashtra. The
Government of India recognised his services by issuing a commemorative postage
stamp in his honour in 2008
· He graduated from Mumbai
University and proceeded to Cambridge University from where he secured Master
of Arts (MA) and Master of Literature (MLitt) degrees.
· It is reported that the
dissertation he submitted for his MLitt degree became a classic and was published
by Oxford University Press as a book, The
Industrial Evolution of India in Recent Times in 1924. He stayed at
Cambridge and returned to India after obtaining a DLitt (Honoris Causa).
· Throughout his writings, he paid
special attention to the local-, regional- and even village-specific social and
economic peculiarities of different activities. According to his general
position, these specificities of micro level environments were neglected by the
generalised approaches to economic policies at the central or international
levels. His `Industrial Evolution of India', published in the early 1920s and
which ran into more than five editions, looked at the problem of industrial
change in India in the setting of the technological revolutions taking place in
Britain, France, Germany, etc.
· He reached the position that
the adverse domestic consequences of technological changes in these countries
were being transferred to such countries as India. Consequently, displacements
and dislocations were continuously taking place in the Indian economic process.
The periodic shocks occurred elsewhere but the brunt of the disequilibrium was
mostly felt in such nations as India.
· The Gadgil formula was formulated with the formulation of the fourth five-year plan for the distribution of plan transfers amongst the states. The
central assistance provided for in the first three plans and annual plans of
1966–1969 lacked objectivity in its formulation and did not lead to equal and
balanced growth in the states. The National Development Council (NDC) approved
the following formula:
Special Category
states like Assam, Jammu and Kashmir and Nagaland were given preference. Their
needs should first be met out of the total pool of Central assistance.
The remaining balance
of the Central assistance should be distributed among the remaining states on
the basis of the following criteria:
Ø 60
per cent on the basis of population;
Ø 7.5
per cent on the basis of tax effort, determined on the basis of individual
State's per capita tax receipts as percentage of the State's per capita income;
Ø 25
per cent on the basis of per capita state income, assistance going only to
States whose per capita incomes are below the national average;
Ø 7.5
per cent for special problems of individual states.
· Indian economics has a rich
tradition. Even economists such as Lewis and Nurkse had recognised that the
Indian scene had specificities and heterogeneities in its geographical,
historical, political, economic and social settings, which warranted the Indian
economy as a separate subject in economics.
· Indian economists have
always been historically challenging the postulates of mainstream economics in
theory and policy. Gadgil's ideas are a rich legacy in this tradition. That he
named his Institute as one of politics and economics is also a noteworthy
point. Is it not true that it is politics even now that is pushing the donkey
cart of economics? And is there an economist in India who can lay his hand on
his heart and say that economic considerations are the most dominant in the
policy formulation in the Indian setting?
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