Dr. Manmohan Singh, recognized as the architect of India's economic liberalization, privatization, and globalization (LPG) reforms, is widely admired for his role in the country's growth trajectory. Nonetheless, his policies, covering his time as Finance Minister (1991–1996) and Prime Minister (2004–2014), have encountered substantial critique from leftist, Marxist, and subaltern viewpoints. Critics contend that although Singh’s reforms spurred swift economic expansion and global integration, they exacerbated socio-economic disparities, sidelined at-risk communities, and solidified corporate power. This article analyzes Singh's economic strategies using these essential perspectives.
A prominent outcome of Singh’s policies was the worsening of economic inequality. By 2014, the richest 1% of India's population possessed almost 49% of the country's wealth, according to the Credit Suisse Global Wealth Report, rising from 36% in 2000. The Gini coefficient, an indicator of income inequality, increased from 0.45 in 1990 to 0.51 in 2013 (World Bank). From 2005 to 2012, corporate profits increased by 15% each year, whereas real wages in the manufacturing sector remained flat at under 2% annual growth (Economic Survey, 2014). These inequalities highlight how Singh’s neoliberal policies predominantly benefited the elite, neglecting the working class and rural impoverished.
Singh’s forceful drive for privatization dismantled public sector enterprises (PSEs), including Bharat Aluminium Company (BALCO) and Hindustan Zinc, shifting wealth from the government to private companies. Critics such as Prabhat Patnaik contend that these actions weakened redistributive systems and limited job prospects for marginalized communities. Public investment in healthcare and education remained unchanged during Singh’s time in office, as healthcare expenditure was only 1.2% of GDP, far less than the global average of 6% (WHO). Welfare initiatives likewise endured financial cuts, worsening the socio-economic gap.
Singh’s economic policies encouraged labor flexibility, leading to the informalization of employment. As of 2012, more than 90% of India's labor force was engaged in the informal sector, where employees faced a lack of job security and social safeguards (ILO). Trade unions were diminished, and collective bargaining was stifled by policies that favored industrial harmony over workers’ rights. Although GDP growth averaged 7.5% per year during Singh’s time in office, real wages for industrial workers stayed flat, indicating an uneven distribution of economic benefits.
The agricultural sector, employing almost half of India's workforce, was consistently overlooked during Singh's time in office. The proportion of GDP attributed to agriculture fell from 32% in 1991 to 17% in 2014 (Economic Survey). Increasing input expenses, decreasing government support, and fluctuating crop prices pushed farmers into debt. According to the National Crime Records Bureau (NCRB), more than 300,000 farmer suicides occurred from 1995 to 2014. Policies that promote contract farming and corporate agriculture have pushed small-scale farmers to the margins, worsening the agrarian crisis
Singh’s city-focused development approach emphasized industrial corridors, overlooking rural and underdeveloped areas. Initiatives such as the Golden Quadrilateral highway network focused 70% of infrastructure funding in urban regions by 2014, resulting in rural areas being deprived of adequate investment (Planning Commission). Regions such as Bihar, Odisha, and Jharkhand experienced minimal advantages from economic reforms. For example, in 2014, Bihar's per capita income stood at ₹35,000, which was much lower than the national average of ₹74,000 (NSSO). This uneven growth maintained regional disparities.
Singh’s neoliberal approach resulted in the commercialization of healthcare and education, rendering them unattainable for the impoverished. By 2014, private providers controlled 70% of the healthcare sector, leading to significant out-of-pocket costs for families (WHO). In the realm of education, reductions in public funding have resulted in worsening performance in rural schools, as just 40% of Dalit children finish secondary school, in contrast to the national average of 66% (ASER, 2014). Welfare initiatives such as MGNREGA faced budget shortfalls, hindering their effectiveness in reducing poverty.
Critics have charged that Singh’s economic strategies promote crony capitalism, favoring corporate interests at the expense of public welfare. Controversies such as the 2G spectrum allocation scam (2008) and the coal block allocation scam (2012) revealed deep-rooted corruption, leading to estimated losses of ₹1.76 lakh crore and ₹1.86 lakh crore to the treasury, respectively (CAG). Business magnates such as Mukesh Ambani and Gautam Adani gained excessively from advantageous policies. From 2004 to 2014, Adani's fortune increased by more than 230%, showcasing the advantages received by companies with political connections. At the same time, small and medium enterprises (SMEs) faced challenges in competition, leading to a 30% decline in the small-scale industrial sector by 2014, which resulted in millions of workers being displaced (NSSO).
Large industrial projects driven by Singh's development-focused strategies resulted in considerable environmental harm. According to the Ministry of Environment and Forests, India lost more than 1.5 million hectares of forest area from 2001 to 2014. Mining and infrastructure initiatives have disproportionately impacted tribal communities, displacing millions without sufficient rehabilitation. These measures favored industrial growth at the expense of environmental sustainability and the rights of native communities.
Subaltern critiques emphasize how Singh’s policies pushed Dalits, Adivasis, and women to the margins. Infrastructure initiatives and SEZs uprooted millions, with Adivasis constituting 40% of the displaced population (Ministry of Rural Development). Dalits, who are disproportionately found in low-wage employment, made an average of under ₹5,000 monthly (2011 Socio-Economic and Caste Census). Rural women experienced a decrease in workforce participation, falling from 26% in 1991 to 19% in 2011. These systemic exclusions reveal the disparities deepened by Singh’s neoliberal model.
Conclusion- Dr. Manmohan Singh's economic strategies, despite promoting swift growth and global integration, reinforced systemic inequalities, sidelined vulnerable communities, and favored corporate interests over public well-being. Leftist, Marxist, and subaltern critiques highlight the necessity for a different economic model that emphasizes fairness, sustainability, and inclusiveness rather than just economic expansion. Singh's legacy illustrates the challenges of reconciling growth with social fairness, emphasizing the pressing requirement for policies that tackle systemic inequalities and uplift marginalized groups in society.
- Mukesh Madhukar is a research scholar in economics, currently pursuing a PhD at IGIDR, Mumbai.
You can also join our WhatsApp group to get premium and selected news of The Mooknayak on WhatsApp. Click here to join the WhatsApp group.