II. MEANING MAKING IN AN IMPERIAL CONTEXT

The dominant narrative or discourse about development asserts that progress spread from England to other European countries, then to European settlements in America, eventually reaching Russia and Japan by the end of the nineteenth century (Arndt Reference Arndt1987, p. 13). “Development” here includes economic, political, and social phenomena—e.g., industrialization, intellectual progress, and democracy. The idea of development is often confined to European industrial progress and that region’s specific experience with progress (Marglin and Marglin Reference Marglin and Marglin1990; Cowen and Shenton Reference Cowen and Shenton1996; Amin Reference Amin1989; Inden Reference Inden1990; Hobson Reference Hobson2004, Reference Hobson2012; Matin Reference Matin2013). The idea of development itself is said to have also originated in Europe and proceeded to disseminate across the world like the material processes of progress (Matin Reference Matin2013). It is unsurprising, then, that the dominant discourse on development is extensively founded on European ways of knowing (Marglin and Marglin Reference Marglin and Marglin1990; Cowen and Shenton Reference Cowen and Shenton1996).

What has been much less researched is how other meanings came about and what their specific contributions to development debates are. Dominant narratives, like the European idea of progress and development, minimize other ways of describing and theorizing the world. Within the discipline of history of ideas, and more specifically here the history of economics, studies are predominately about well-known figures such as Adam Smith and David Ricardo, while lesser known figures are less cited or analyzed.Footnote ¹ I address the gap by “unpacking” the production and diffusion of alternative discourses on development by focusing on a group of Indian scholars writing from the margins of the British Empire from 1870 to 1905.

The last three decades of the nineteenth century saw a radical decline in the belief amongst Indian intellectuals that Britain, with its relatively advanced industrialized economy, could successfully develop India (Ranade Reference Ranade1906, pp. 70–104; Chandra Reference Chandra1991, p. 84). There was also growing support for state-led development in western Europe, particularly in Germany, and in the United States and Japan. The state-led idea of development challenged British imperialism and increased the unevenness in the Indian colony (Goswami Reference Goswami2004, p. 11). India was experiencing deindustrialization, severe famines, and increasing poverty, and was negatively hit by Britain’s and Europe’s economic crisis from 1873 to 1896 (Davis Reference Davis2002; Beckert Reference Beckert2014). The authors of Indian economics, however, who were part of the Indian elite, had a different experience of India’s reality, due to imperial policies that were both draining India of much-needed capital and deindustrializing its economy (Ranade Reference Ranade1906, pp. 66, 183, 185; Joshi Reference Joshi1912; Dutt Reference Dutt1901, pp. vii–viii, 256, ch. 8; and Dutt Reference Dutt1902b, pp. vii, 218; Gokhale Reference Gokhale1920, pp. 19, 52; Iyer Reference Iyer1903; Chandra Reference Chandra1991; Chatterjee Reference Chatterjee, Porter and Ross2003, p. 489; Goswami Reference Goswami2004, p. 222). Indian economics theorized that India had gone into a period of “regress,” with some of the most severe famines in its history, increasing rural indebtedness and poverty and worsening regional inequalities (Ray Reference Ray1901, p. 656; Iyer Reference Iyer1918).

Ranade’s lecture in 1892 is considered the main founding text of Indian economics, primarily because the term “Indian economics” was first coined in that lecture (Ranade Reference Ranade1906, p. 1). The lecture hall was largely filled with Indian students. The audience may also have included some officials, as the college’s location was the summer capital of the imperial administration. Deccan College was part of the imperial university system, a prominent place for Indian intellectuals and one of the oldest modern educational institutions in India. The other founding text, Speeches and Writings, was authored by Ganapathy Dikshitar Subramania Iyer (see Iyer Reference Iyer1918), a leading Indian journalist and social reformer at the time. Both founding texts laid out two reasons why India needed its own economic thinking. First, the troubling socio-economic conditions in India and elsewhere seemed to disprove the relevance of universal economic principles such as free trade and comparative advantage (Ranade Reference Ranade1906, pp. 5, 11, 24). Iyer asserted that “orthodox economic science, as expounded in English text-books, have to be modified when applied to the conditions of this country” (reprinted in Govindarajan Reference Govindarajan1969, p. 1; see also Iyer Reference Iyer1903, App., p. 1). Similarly, Ranade said that the orthodox economics tradition did not take into consideration the “relative differences in Civilization, or the possession of natural advantages, or disadvantages, in matters of situation, climate, soil, National aptitudes” (Ranade Reference Ranade1906, p. 2). Second, there was a subsequent need for an Indian economics that reflected the realities of India’s current economic situation: namely, imperialism and the poor socio-economic state (Ranade Reference Ranade1906, pp. 21, 24; Iyer Reference Iyer1903, App., p. 3). Ranade said that “Indian economics” should be based on the study of how “Ethnical, Social, Justice, Ethical, or Economical differences in the environments” affected social change, “progress” or “regress,” to then identify an effective development plan (Ranade Reference Ranade1906, p. 2).

Indian economics would explain the Indian economy more adequately because, argued Ranade, it would employ a historical and global perspective. Ranade preferred the historical-institutional approach to research used by the German Historical School, as opposed to the deductive approach used by orthodox economists (Dasgupta Reference Dasgupta1993, p. 112; Goswami Reference Goswami2004, p. 11; Chandra Reference Chandra1966; Chatterjee Reference Chatterjee, Porter and Ross2003, pp. 487–488; Ganguli Reference Ganguli1977, p. 59; Gopalakrishnan Reference Gopalakrishnan1954). This methodological basis would reflect the necessary historical experience, practical observations, and social reality. For example, Ranade found that classical political economy wrongfully concentrated on only the economic aspects of free trade, ignoring the equally, if not more, important political and social perspectives (Chandra Reference Chandra1966, p. 711). Moreover, Indian economics would offer a much-needed global perspective. David Ricardo’s theory of comparative advantage advocated for a global division of labor that assigned raw material production to Asia and industrial production to the West, which stagnated Indian economic growth (Ricardo Reference Ricardo1817; Goswami Reference Goswami2004, p. 211).

Ranade’s and Iyer’s initial idea of an Indian economics proved popular with other contemporary Indian intellectuals, such as Dadabhai Naoroji, Romesh Chunder Dutt, Ganesh Vyankatesh Joshi, Prithwis Chandra Ray, Surendranath Banerjea, Kashinath Trimbak Telang, and Gopal Krishna Gokhale, enabling Indian economics to emerge (Chandra Reference Chandra1966, p. 712; Goswami Reference Goswami2004, p. 236). The 1870s and 1880s saw a rise in dialogue amongst Indians and with their rulers. Several town and regional organizations were formed. A hundred local associations were established in Madras alone during the decade after the Great Famine (Wilson Reference Wilson2016, p. 323). Each association represented a different societal group—e.g., the Pune Sarvakanik Sabha, established by Ranade, was mostly made up of mathematics teachers (Wilson Reference Wilson2016, p. 323). The Indian National Congress, established in 1885, was the major organization to house different professionals including political economists, teachers, lawyers, traders, and merchants, as well as political viewpoints (Wilson Reference Wilson2016, pp. 332–335). The seventy-two members who attended the first meeting in Bombay were all founders and leaders of modern institutions—many of whose writings were later put under the intellectual umbrella of Indian economics.

The intellectuals associated with Indian economics asked: Why was India still far away from transitioning from a backward to a modern developed nation? Why had the economic distance between India and Britain widened instead of narrowed? Why did the Indian economy not generate progress when economies like America, France, Germany, Canada, Italy, Russia, and even Japan did? (See, eg., Naoroji Reference Naoroji1901, p. 136; Ray Reference Ray1895, p. 66; Joshi Reference Joshi1912, pp. 749, 808, 886; Dutt Reference Dutt and Adams1904a, pp. 122–125; Iyer Reference Iyer1903, pp. 104–107, 130–131. For secondary literature on Indian economics, see Goswami Reference Goswami2004, ch. 7; Dasgupta Reference Dasgupta1993; Chatterjee Reference Chatterjee, Porter and Ross2003; Chandra Reference Chandra1966, ch. 41; Gopalakrishnan Reference Gopalakrishnan1954; Omkarnath Reference Omkarnath and Reinert2016; Bayly Reference Bayly2011; Kapila Reference Kapila2010; Ganguli Reference Ganguli1977.) The answers, the Indian economists hoped, would result in the implementation of better imperial policies that would harness much-needed progress in India.

The debates on Indian progress and development emerged in the public sphere in the 1870s with Naoroji’s paper entitled “The Wants and Means of India” presented on 27 July 1870 at a meeting of the Society of Arts, London (Naoroji Reference Naoroji and Parekh1887, pts. 97–111; see also Wilson Reference Wilson2016, pp. 335–337). In the paper, Naoroji concluded that India was not able to produce enough to supply all its wants. The paper spurred an intensive investigation into the poor economic conditions in India, which resulted in economic issues dominating all newspapers, political literature, and academic lectures (Chandra Reference Chandra1966, p. 5). Naoroji then read his paper on the “Poverty of India” in 1876 before the Bombay Branch of the East India Association, Bombay, first published with Ranima Union Press, the same year (later published in his collected work, Naoroji Reference Naoroji1901). Ranade founded the Quarterly Journal of the Poona Sarvajanik Sabha in the late 1870s to spread a better understanding of India’s poor economy and to create a space for Indian intellectuals to publish their research (Chandra Reference Chandra1966, p. 4). The economic inquiry into these matters hit a peak with Romesh Dutt’s two-volume Economic History of India (Dutt Reference Dutt1902b, Reference Dutt1904b).

The research in Indian economics was disseminated through lectures at universities and various societies and conferences as well as in published books and articles largely in English. Yet, these texts existed almost exclusively in India, and when they were available elsewhere, they were predominantly consumed by Indian and anti-imperialist audiences in Britain. For instance, a large number of the articles were published in the journal that Ranade founded. The Indian economists were not getting published in British economic journals or even treated as economists. According to many imperial officers and British intellectuals, the Indian economists were political activists fighting for Indian self-rule, not political economists creating knowledge. I therefore see the idea of development within Indian economics as coming from and existing at the margins, both because the Indian economists were situated at the margins of intellectual circles and because the thinking of Indian economics contributed to the dominant idea of development at the margins.

Some scholars maintain that although Indian economics identified British rule as a barrier to economic development, the economic thinking did not find solutions to generating economic growth, and neither did Indian economics create alternative economic tools to analyze economic development. For example, the Times and the Times of India reviews of Dutt’s volume on Indian history wrote: “The literary skill and research which he has devoted to his object, prove Mr. Dutt to be capable of writing history if he could for a moment put his politics aside. But the work before us is not a history, it is merely a collection of historical arguments for the use of a political sect” (reprinted in Gupta Reference Gupta1911, p. 294). Similar conclusions can be found in later scholarship (e.g., Gopalakrishnan Reference Gopalakrishnan1954; Chandra Reference Chandra1966, Reference Chandra1968). The studies seem to focus on the discursive and material constraints imposed upon imperial subjects. For instance, the research often concludes that the British dominant discourse such as political economy categories and norms taught at the imperial universities made discursive innovation difficult for Indian intellectuals. Indians were taught a Western curriculum and blamed for only regurgitating existing ideas from Europe and neglecting to transform ideas into original thought (Seth Reference Seth2007). India’s imperial status and extreme poverty are said to have made Indian intellectuals preoccupied with urgent political and economic needs, rather than knowledge creation.

In contrast, I find the Indian economists’ multi-discursive and multi-spatial contexts, although some of which were constraints, left room for imagining a new configuration of the global political economy of development. By “multi-discursive,” I mean the traces of various discourses, world views, ways of seeing, voices, etc., identified sometimes through citations, other times through the use of similar wordings seen in other texts. “Multi-spatial” highlights the international, multi-institutional, and contextually diverse nature of these Indian economists’ writings—i.e., they were Indians who traveled and studied in other countries, especially Britain. I employ a dialogic theoretical framework operationalized through Positive Discourse Analysis (PDA). Mikhail Bakhtin’s dialogic approach to analyzing discursive practices enables me to theorize how discourses simultaneously constrain and facilitate meaning making (Bakhtin Reference Bakhtin, Emerson and Holquist1986, Reference Bakhtin and Michael1981). My method, PDA, operationalizes the dialogic approach into a more concrete step-by-step process of defining my Indian interlocutors’ multi-discursive and multi-spatial contexts, and how these contexts affected the particular discursive practices and knowledge created in specific utterances. PDA is also specifically designed to focus on discourses from and at the margins.

The historical, political, and socio-economic context offered the discursive possibility necessary for the Indian economists to rearticulate and redefine existing economic thinking, rather than only reproducing existing dominant economic theories. As many historians of ideas theorize, ideas are necessarily transformed when passed from one interlocutor to another (Goswami Reference Goswami2004; Zachariah Reference Zachariah2019; Sartori Reference Sartori2008). I have been able to expose the discursive innovation in Indian economics by systematically uncovering the link between context and discourse. My investigation moves back and forth between context (by examining secondary economic history literature and my primary sources) and the discursive practices (by analyzing my primary sources). I emphasize that discourse can both constrain and facilitate social actions. Our field of perception is limited by the discursive resources at our disposal, but those resources simultaneously offer meaning and understanding of our context (Bakhtin Reference Bakhtin and Michael1981; Zachariah Reference Zachariah2019). The Indian economists were taught discursive practices (i.e., concepts, frameworks, and tools of analysis) from their imperial university education and existing literature, which were primarily based on another regional context—as articulated by the Indian economists themselves (e.g., Govindarajan Reference Govindarajan1969; Ranade Reference Ranade1906, p. 2). They used these imported and imposed discursive practices to understand different regional circumstances in the South Asian subcontinent. I want to avoid overexaggerating the fact that Indian economics and dominant ideas were always in different spaces—even though these protagonists inhabited, for the most part, different physical spaces. I merely want to acknowledge and understand the varied spaces within which my protagonists spoke and wrote. The idea of development that emerges is from and at the margins.

First, however, I want to discuss the key terms used in my analysis: “development,” “industrialization,” “progress,” “regress,” and “Eurocentric.” Some terms—such as “progress,” “regress,” “industrialization,” and “universalism”—are found in the primary sources. These terms have naturally changed meaning over the last 100 years, so the definitions of these words will belong to the Indian economics texts and, in some cases, to the sources the primary material cites.

The other terms—“Eurocentric” and “development”—are almost absent in my protagonists’ texts. Nevertheless, in my view these terms can be used alongside the ideas found in Indian economics. I use the term “Eurocentric” to reflect the arguments by Indian economics that global history was based on the European experience of progress. Economic policies, therefore, were also founded on theories and ideology that were created by European scholars about European history. While the term “Eurocentric” may not appear much in this period, the idea that the world evolved around European ways of knowing and doing things was ever present—not least in India where Britain was imperializing its political, economic, and educational systems.

Existing conceptual histories of (economic) development argue that development is a post-World War II phenomenon (e.g., Arndt Reference Arndt1987). Literature that focuses on the broader concept of development in and outside of the economics discipline, however, traces development back to the early nineteenth century with the Saint-Simonians, the French group of scholars (Cowen and Shenton Reference Cowen and Shenton1996). While progress was seen as inevitable processes that occurred automatically without intervention, development was the intentional plan to harness progress (Cowen and Shenton Reference Cowen and Shenton1996, p. 22). My dialogic approach provides my research with the concept of speech genres—which embed particular social values, world views, and intentionalities, and space-time reference points (Bakhtin Reference Bakhtin, Emerson and Holquist1986, p. 69). Development is one such speech genre—the components seen in my primary sources mirror the norms, assumptions, and theories present in later development discourse. Moreover, there are several instances in the primary material where the terms associated with development were used: e.g., “progress”Footnote ² and “growth.”Footnote ³ In another instance, Ranade used the phrase “the Progress of Wealth” (Ranade Reference Ranade1906, p. 12). There are a few instances where Ranade used “development”: e.g., in Ranade’s lecture on Indian economics he said that “even [the assumptions in orthodox economics] furnish no suggestion as to its dynamical progress or development” (Ranade Reference Ranade1906, p. 10), and then again later in the same lecture, he discussed “stages of development” (Ranade Reference Ranade1906, p. 30). (For further discussion, see Bach Reference Bach2018.)

We should take caution in the history of ideas to not impose our own ways of seeing the world and our boundaries on ideas. As Benjamin Zachariah writes, ideas have no borders (Zachariah Reference Zachariah2019). Ideas spread with no rigid or final form; they exist within certain contexts and time periods, ever unstable. Zachariah suggests considering “a model of ideas gravitating towards each other,” rather than pulling out individual words (Zachariah Reference Zachariah2019, p. 135). While I do this above to persuade my readers that development is an appropriate and meaningful term to use in late nineteenth-century India, throughout my analysis I take care to quote sentences and establish the meaning of words within full extracts, etc. Even Zachariah mentions that the term “development” existed in India, including terms such as “progress,” “development,” “modernization,” “industrialization,” and “backwardness” (Zachariah Reference Zachariah2019, p. 139). Like Zachariah, I also find that these terms dealt with wider economic, political, philosophical, and social concerns and norms. Understanding these variations is where my focus lies. The ideas about development in this period created words for my protagonists to express their concerns about existing problems in India and what prescriptions they thought were necessary to bring about desired change. As Zachariah insists, when ideas come to another space, the protagonists demand that variations are created (Zachariah Reference Zachariah2019). While scholars such as Zachariah and my own dialogic approach caution us to use words across time periods because the same term means different things to different people, my method of contextualizing the texts under analysis can systematically expose ideas not previously taken “seriously” (Zachariah Reference Zachariah2019, p. 133). Ultimately, using these complex terms, despite their varied meanings and built-in contradictions, provides an overarching framework within which I can tease out discourses from and at the margins that are overshadowed by dominant or more “successful” ideas (Zachariah Reference Zachariah2019, p. 133).

I analyze these ideas and parallels in the following section, taking into consideration the varying contexts within which the scholars found themselves. In so doing, I give agency to a set of economics writings from and at the margins, ultimately finding that Indian economics discursively contributed from and at the margins of dominant development discourse.

III. DISCURSIVE INNOVATION FROM AND AT THE MARGINS

My focus in this section is to tease out the discursive innovation found in the Indian economics idea of development. What ideas were unique at the time and how do they relate to later economic thinking? I find three distinct components: first, Indian economics popularizes a rereading of global history, debunking the dominate idea that progress originates in Europe and rejecting the dominant theory of comparative advantage, or, as Ranade labels it, the “international division of labor,” which assigned raw material production to the East and manufacturing to the West, enabling them, in turn, to use European theories that were considered inapplicable to Asia. Second, Indian economics conceptualized a dependent political economy that explained India’s extreme poverty and worsening economic conditions, not due to some inherent weaknesses but due to the imperial drain. Third, Indian economics was then able to imagine and prescribe a win-win model of development whereby universal industrialization could be beneficial to all. This model necessitated a reconciliation between nationalism and universalism, which was and is often deemed to be impossible in economic thinking.

A dominant reading of global history, particularly in the nineteenth century but also present today, argues that progress originated in Europe and would then spread to the rest of the world. The dominant reading of global history associated with terms like “historicism,” “Eurocentrism,” and “universality” assumes that a) Europe is the birthplace of progress, modernity, capitalism, industrialization, or enlightenment, making it superior to the rest; b) progress was constructed with institutions and practices destined to become universal; and c) progressive change unfolds in stages (Matin Reference Matin2013, p. 354; Ferguson Reference Ferguson and Oz-Salzberger1995; Fukuyama Reference Fukuyama1992; Mill Reference Mill1817; Rostow Reference Rostow1960). As Dipesh Charkrabarty argues, it was historicism that allowed Karl Marx to argue that the “country that is more developed industrially only shows, to the less developed, the image of its own future,” and enabled historians such as Phyllis Deane to identify English industrial growth as the first industrial revolution (quoted in Charkrabarty Reference Charkrabarty2000, p. 7). The dominant reading of global history created a timeline that measured the assumed cultural distance (at least in institutional progress) between the West and the rest, legitimizing the justification for imperialism. All countries would reach the same end point, but some would get there earlier than others.

India was considered to be different from those countries and at an earlier stage of progress, enabling early nineteenth-century intellectuals and imperial employees to define imperial rule as a civilizing mission—e.g., Edmund Burke, James and John Stuart Mill, Charles Grant, and Thomas Babington Macaulay (Burke Reference Burke, Marshall and Todd1981, p. 383). The imperial administration disseminated the civilizing mission primarily through James Mill’s History of British India—a core text for all Indian civil servants. Mill read accounts of chaos and disorder in India’s legal system and social relations. Imperialism, Mill claimed, would civilize the half-civilized natives of India, simultaneously justifying British imperial rule (Metcalf Reference Metcalf1995; Wilson Reference Wilson2016). Two later texts that became influential after the Indian Mutiny were Henry Maine’s Ancient Law and Village-Communities in the East and West (Maine Reference Maine1861, Reference Maine1895). Maine theorized that law was inherently linked with society’s progress, and that communal law preceded private property. As he found communal property in India, he considered the subcontinent as traditional (as opposed to modern) or at an earlier stage of progress than Europe (Maine Reference Maine1861; Mantena Reference Mantena2010, p. 14). These texts created a vision of India as backward and at an early stage of progress.

Indian economics argued that the dominant version of global history clouded the understanding of history. Western superiority ignored Eastern agency and did not take into account the role that the East played in constructing the West (Hobson Reference Hobson2004; Chatterjee and Hawes Reference Chatterjee and Hawes2008; Said Reference Said1978). Indian economics was first to gain traction with its alternative version of global history, by rejecting the dominant idea that Europe continuously progressed like the inevitability of a human growing. Countries could go through periods of both positive and negative change, meaning that countries could fall in and out of a role of economic superiority. Indian economics did not reject universal development or the existence of stages of progress but rather critiqued the order or sequential understanding of those stages—which placed India at a lower stage and did not let it pass to a higher level. Indian economics claimed that India had a progressive past and could therefore skip a stage and transition to the adult stage of industrialization.Footnote ⁴

It is important to acknowledge here that describing a progressive past was and is a vital part of nationalist movements throughout global history. To some extent the Indian economists, as active members of the nationalist movement, were using the discourse of a glorious past as a tool to unite Indians and fight against imperial rule. Yet, the nationalist use or reasoning is only one interpretation of Indian economics’ rereading of global history. As Sabyasachi Bhattacharya has documented, the Indians started talking back to the monologue of British discourse on Indian history at the end of the nineteenth century (Bhattacharya Reference Bhattacharya2014).

Contextualizing Indian economics further debunks the idea that Britain was ahead of the rest even before the Industrial Revolution, because it ignores India’s and China’s previous progress. The Indian and Chinese economies were superior to many others up until the end of the eighteenth century. For instance, England was importing Indian textiles in return for gold and silver looted from America. Moreover, Akbar, the sixteenth-century Indian emperor, spoke of tolerance, rights for women, and universal religion called sulah kul during the same period that Prince Philip II of Spain was part of the Spanish Inquisition (Mukherjee Reference Mukherjee2010; Hobson Reference Hobson2004; Chatterjee and Hawes Reference Chatterjee and Hawes2008). History is more complicated than what the dominant reading of global history portrays. It is too simplistic to affirm that progress and modernity started in Europe.

The Indian version of global history then enabled Indian economics to effectively assimilate theories from Europe, despite those theories’ explicitly stated inapplicability to Asia. For instance, Friedrich List denied the possibility of Asian progress: “Hence the entire dissolution of the Asiatic nationalities appears to be inevitable” (List Reference List1856, pp. 419, 126–127). Theorists like List who came from Germany, a country that was industrializing after Britain, argued that their countries should and could also industrialize like Britain, but not Asia (Helleiner Reference Helleiner2015, p. 992; Boianovsky Reference Boianovsky2013, pp. 658–662). The Indian economists disagreed, because their new reading of global history showed that India was not undeveloped and instead was capable of progressing like Europe.

Indian economics’ rereading of Indian history also enabled a conceptualization of the Indian economy as a dependent imperial economy by uncovering the intentional extractive nature of imperial policy. The extractive imperial policy is most commonly known as the “drain.” The Indian economists understood that the drain caused a poor Indian economy, dependent on foreign capital, industrial goods, and public administration skills from advanced countries. For instance, the Indian economists asserted that imperialism in India had created a “dependence” on Britain (Ranade Reference Ranade1906, p. 24) and wrote how the “[g]overnment forg[ed] stronger chains for us” (Naoroji Reference Naoroji and Patwardhan1977, p. 43; see also Dutt Reference Dutt1902b, p. 333). There was a common use of the term “Dependencies” to label territories under Crown rule in this period, which shows how a term already in use was remade into a different variant (Ranade Reference Ranade1906, p. 14).

Indian economics gave a few examples of how imperial actions produced a dependent imperial economy. First, Indian industrial progress was stunted by British actions. From the very start of the British presence in India, the British East India Company discouraged the manufacturing of silk by India’s industry, by demanding raw silk and forcing Indian weavers to work in their factories. “In their general letter to Bengal, dated 17^th March 1769, the Company desired that the manufacture of raw silk should be encouraged in Bengal, and that of manufactured silk fabrics should be discouraged” (Dutt Reference Dutt1902b, p. 45). Throughout the nineteenth century the European “factories demanded raw produce, the people of India provided the raw produce, forgot their ancient manufacturing skill, lost the profits of manufacture” (Dutt Reference Dutt1902b, p. 276; see also p. 423).

The imperial promotion of free trade led to deindustrialization in India. Indian economics argued that the British promoted free trade only when it was in their interest (Dutt Reference Dutt and Adams1904a, pp. 122–125; 1897, p. 81). For instance, Dutt explained:

The global trade flows subsequently shifted, making India an exporter of raw materials instead of industrial goods (Dutt Reference Dutt1902a, p. 108). Then once the power-loom was adopted in India, the British put excise duties on their goods (Dutt Reference Dutt1902b, p. viii; Reference Dutt1902a, pp. 43–46). Similarly, Iyer added an appendix with protectionist policy examples from Germany and America to show that economic policy was created by national needs and not by economic theories (Iyer Reference Iyer1903, pp. 104–147). India had been made into an exporter of raw materials, dependent on Western demand.

Free trade could be effective in certain circumstances and not in others. Romesh Dutt turned to List, who, he thought, would be less biased as non-British, to help explain how free trade was not used to boost Indian industrial growth. For instance, List noticed that Britain did not want to become subservient to India and strove for commercial supremacy (Dutt Reference Dutt1902a, pp. 123–124). Britain consequently imposed tariff barriers on Indian imports, which List considered detrimental to Indian industry (Dutt Reference Dutt1902b, p. 300; Reference Dutt1902a, p. 123). The thinking here is also similar to the idea of backwardness, according to Alexander Gerschenkron, where state intervention is necessary to compensate for inadequate supplies of capital, skilled labor, entrepreneurship, and technological capacity found in late developers like India (Gerschenkron Reference Gerschenkron1962).

The increasing port and railway capacity did not mitigate regressive forces in India, especially because the British had monopolized maritime and railway transport and mercantile trade (Ranade Reference Ranade1906, p. 199; Chaudhary et al. Reference Chaudhary2015). (India’s banking sector was also under foreign control although primarily funded by native capital; see Ranade Reference Ranade1906, p. 199.) On the contrary, the railways increased foreign competition for India’s manufacturing industry as British goods became easier to deliver throughout the subcontinent (Ranade Reference Ranade1906, p. 93).

The theory of dependent imperial economy could be a precursor to twentieth-century dependency theory. Dependency theory emerged in the mid-twentieth century with Raul Prebisch, Hans Singer, and Paul Baran. They argued that integrating periphery countries (primarily current or former colonies) into the world market made them poorer due to the dependent nature of these weaker economies in the current global, political, and economic framework; e.g., Britain forced free trade onto India (Prebisch Reference Prebisch1950; Singer Reference Singer1975; Baran Reference Baran1957). Likewise, Indian economics maintained that India was becoming more impoverished while Britain became richer. Twentieth-century dependency theory was a response to modernization theory, according to which societies progress through similar stages. The Singer–Prebisch thesis, one of the main models in dependency theory, rejects that view and instead argues that periphery countries are not just primitive versions of the core (more advanced) countries because they have their own unique structures and history. Similarly, Indian economics was responding to the dominant reading of global history where Europe was the first to progress and to the comparative advantage model that prescribed agricultural production to the East, arguing that India had its own history and was capable of progress and industrialization sooner than the European thinking stipulated.

The rereading of Indian history and the uncovering of dependence in India enabled, in my view, Indian economics to reimagine the global political economy of development. Indian economics reconstructed a universal idea of development, theorizing that global industrialization would bring greater growth to all countries, thanks to increased potential for capital accumulation (leading to more investment and production) and greater aggregate demand (due to higher employment in newly industrialized countries). Previous theories associated with classical political economy such as David Ricardo’s were Eurocentric, justifying a zero-sum game world view that enriched Europe while impoverishing the rest of the world.

Ricardo may seem to have thought about a global framework of progress. The comparative advantage was first formulated by Robert Torrens, then further elaborated by Ricardo. John Stuart Mill also analyzed the theory, arguing for its many benefits (Mill Reference Mill1848, pp. 387–390). Asia was considered to have a comparative advantage in agricultural production, whereas Europe had a comparative advantage in manufacturing. Ricardo’s model envisaged and ultimately forecasted the world he observed: the West as industrialized and the East as agricultural. “England may be so circumstanced, that to produce the cloth may require the labour of 100 men for one year; and if she attempted to make the wine, it might require the labour of 120 men for the same time. England would therefore find it in her interest to import wine, and purchase it by the exportation of cloth” (Ricardo Reference Ricardo1817, p. 135). In sum, the model is based on the premise that countries have different natural comparative advantages.

However, Ranade claimed, the comparative models of trade advocated an international division of labor that kept the rich countries rich and the poor countries poor (Ranade Reference Ranade1906, pp. 27, 388, 411). If “economically backward races must submit to such an arrangement, … it is fairly open to question whether there is any such inevitable necessity which justifies a line of separation, which has a tendency to accentuate natural deficiencies, and make them a source of permanent weakness” (Ranade Reference Ranade1906, p. 26). India’s comparative advantage in producing raw cotton, for example, would not yield the benefits Ricardo’s model predicted because profits from the prescribed industrial production in the West were much higher than the profits from agricultural production prescribed in Asia. The law of diminishing returns in agricultural production meant that India remained capital-scarce and made industrialization unlikely in at least the near future (Ranade Reference Ranade1906, p. 27). Ranade used a comparative analysis of imperial policies in British North America, Dutch Java, in today’s Indonesia, and India to prove his point (Ranade Reference Ranade1906, pp. 338, 411; Goswami Reference Goswami2004, p. 211). While Ranade found that regressive Indian imperial policies had caused deindustrialization, British North America and Dutch Java had been allowed to industrialize and hence harness progress.

I find that Ranade’s critique uncovered the Eurocentrism present in these existing models or theories of development associated with European political economists such as Ricardo’s. Other secondary literature agrees that these development theories are Eurocentric (Mehmet Reference Mehmet2002; Chang Reference Chang2002). Indian economics was able to critique the model because its protagonists had wider discursive possibilities. The Indian protagonists could not imagine a world without an industrialized Britain, but they could imagine a global political economy where both Britain and India were industrialized. As nationalists, the Indian economists desired an industrialized India, justified through the different reading of global history. India had previously been progressive with a large manufacturing sector, and therefore had the potential to reach the same level of industrialization as Britain. I find, then, that Indian economics’ idea of development is more universal than those associated with classical political economy, e.g., Ricardo and J. S. Mill, or List.

The Indian economists argued that India should return to its former position as a global supplier of manufactured goods. For example, Ranade called to “restore India to its proud position as the garden and granary of the world” (Ranade Reference Ranade1906, p. 176; Reference Ranade and Kolasker1902, p. 148). Naoroji urged India to be “restore[d] it to its former health” (Naoroji Reference Naoroji and Parekh1887, p. 36). Dutt asserted that India should return to its equilibrium when India was a global supplier of goods (Dutt Reference Dutt1902b, pp. 92, 202; Reference Dutt1897, p. 40). Naoroji, as well as Dutt and Ranade, maintained that “India is capable, under natural circumstances, of providing twice, three times or more the expenditure, as the improvement of the country may need, in attaining all necessary progress”(Naoroji Reference Naoroji1901, p. 365).

Indian economics argued that India’s return to a global exporter of manufactured goods would lead to perpetual global progress. Dutt and Naoroji claimed that the whole world, including Britain, was worse off as long as India was waiting to industrialize (Dutt Reference Dutt1902b, p. 263; Reference Dutt1902a, p. 82; Naoroji Reference Naoroji and Parekh1887, pp. 354, 516; Reference Naoroji1901, pp. 125, 216, 338). Indian aggregate demand would increase if India could restore its industrial powerhouse by lowering the drain on Indian resources and boosting investment in industry. Naoroji cited J. S. Mill to argue that foreign exchange brought progress: if India demanded more foreign goods, Britain and other nations would have even bigger trade potential (Naoroji Reference Naoroji and Parekh1887, p. 101). As Mill wrote, “It may be said without exaggeration that the great extent and rapid increase of international trade, in being the principal guarantee of the peace of the world, is the great permanent security for the uninterrupted progress of the ideas, the institutions, and the character of the human race” (Mill Reference Mill1848, p. 390). Note here that one of the prescribed textbooks during Naoroji’s degree at Elphinstone College in Bombay was J. S. Mill’s Principles of Political Economy (Khodaiji Reference Khodaiji2017). The increased aggregate demand would increase demand for British (as well as other exporting nations’) goods. England’s trade, reasoned Naoroji, would increase by £250,000,000, if each member of the Indian population could buy English goods worth only £1 per year, assuming a population of 250 million (Naoroji Reference Naoroji and Parekh1887, p. 329). The increase in exchange would boost the capacity to further invest in industrial growth, thanks to higher levels of capital accumulation. Indian industrialization would have beneficial outcomes to their trading partners’ progress—a win-win development model.

Indian economics’ idea centers on the need for enough domestic demand to sustain industrialization domestically and internationally. One solution, argued Naoroji, was to employ more natives in the administration, for example, to boost domestic income spent and capital accumulation in India (Naoroji Reference Naoroji1901, p. 49). Similar to twentieth-century dependency theories, domestic demand had to be developed to sustain industrialization. Naoroji theorized that India’s lack of production was primarily due to insufficient income—including a lack of capital to invest in new production ventures and a lack of domestic demand that would make the investment viable and profitable (Naoroji Reference Naoroji and Parekh1887, pp. 42–45). Indian economics maintained that domestic demand could be developed through increased employment in the industrial sector, which had a higher potential to employ larger proportions of the population and would raise average income, thanks to increasing returns (rather than the overcrowded and lower paying agricultural sector dictated by decreasing returns).

Contextualizing these theories, recent scholarship identifies the lack of demand as the major cause of why India did not industrialize. The rural state of India’s economy in the late nineteenth century meant a low aggregate demand because peasants tended to produce enough for their subsistence needs. For instance, the imposition of British cotton products is much smaller than many think—only about 25% to 30% of British cotton exports in 1900 at the peak of cotton exports to India (Washbrook Reference Washbrook, Peers and Gooptu2012, p. 64). Perhaps what was really necessary was a social revolution to restructure demand, which would not have been allowed by the imperial rule. Indian economics had already realized the need for more demand in India.

The idea that universal industrialization would lead to perpetual progress was uttered by thinkers before and after Indian economics. Before, List argued that it would be mutually beneficial for Britain and Germany if the German Customs Union was introduced due to higher demand (Wendler Reference Wendler2014, p. 245). As cited by Naoroji, Macaulay asserted that “to trade with civilized man is infinitely more profitable than to govern savages” (Naoroji Reference Naoroji and Parekh1887, pp. 42–45). Additionally, Italian city states in the sixteenth century also constructed an idea of progress within a positive-sum game, and that society could always get better (Jomo Kwame Sundaram and Reinert Reference Sundaram and Reinert2005). Indian economics reinstated the idea that global progress was mutually beneficial for all parties involved. Interestingly, similar ideas emerged in China in the 1920s, after the first generation of Indian economists had passed away. For instance, Yat-sen Sun argued that Western governments should help harness progressive forces in China through injecting foreign capital, technology, and expertise into state-owned enterprises in order to also harness more progress in Western capitalist powers (Sun Reference Sun1920). Although no connection has been found between Sun and the Indian economists, Sun saw that Chinese, like the Indian economists saw Indian, development would create a bigger market for surplus capital and goods from the West. In sum, the late nineteenth-century Indian economists, in my view, were taking part in a global debate about the benefits of universal industrialization that existed before and after the first generation of Indian economists passed away.

The idea of universal development in Indian economics does raise a couple of questions. Although there is little discussion in the writings of Indian economics on how to boost Indian domestic demand to sustain its industrialization, Ranade discussed the need to develop a middle class by incentivizing production in goods catering to the middle classes and not the upper classes (e.g., Ranade Reference Ranade1906, p. 24). This, argued Ranade, would sustain industrialization. I could also extrapolate that Dutt was theorizing that if peasants had lower taxes and therefore more incentive to improve their production techniques and increase capital accumulation, they would also contribute to increased aggregate demand (Dutt Reference Dutt1902b, p. 179; Reference Dutt1901, pp. 3, 58). Dutt was not, however, explicit about that link. The lack of discussion on domestic demand may hint at their emphasis on Indian exports as a means of development. In other words, Indian progress could be fulfilled (only) through increasing exports, while domestic demand was less essential.

Moreover, if indeed Indian industrialization expands aggregate demand, which in turn increases demand for imports, then what impact does international competition have on progress? Indian economics answers the question in only a couple of instances. First, there is a need for balanced growth and a diversified economy in case of turbulent international demand. For instance, Kashinath Telang warned against a country being reduced to a single-industry country, since any change in international demand would threaten it with disaster (Telang Reference Telang and Gadgll1916b, pp. 36–37). International competition therefore necessitated a diversified economy. Second, perhaps the Indian economists assumed that India would recapture its former dominant and prosperous position in the global market, and, if successful, then India would be the most competitive. Overall, however, global economic competition was not thoroughly dealt with in Indian economics.

The nineteenth-century Indian win-win model of development requires a focus on both the national and international spheres. However, there is a tendency in economics and political economy to view a nationalist focus as opposite to an international outlook that often assumes universalist processes across regions. Economic nationalism is generally seen to place the nation as the unit of focus (the nation’s needs, interests, and identity) and, consequently, sees the possibility for a different path of progress and development for each nation (List Reference List1856; Helleiner Reference Helleiner2002, Reference Helleiner2015). Universalism, or the argument for universalist processes of development, places the individual at the center of society, instead of the nation, and assumes that all countries progress through the same stages (see, e.g., Reinert et al. Reference Reinert2016, p. 213). The purpose of economic nationalism is to maximize the nation’s well-being, implemented through policies that harness progressive forces within the specific domestic economy. Universalism seeks to allow individuals to reach their full potential, most efficiently achieved through individual liberty and the same recipe for development regardless of context. Is the Indian win-win model, therefore, at odds with the dominant distinction between the local versus the international, the national versus the universal? In my view, the model is not contradictory in this way because it was able to combine nationalism with universalism.

Indian economics theorizes a continuous flow of positive and negative societal change that spreads unevenly around the world. During some periods, the East is progressive, and during others, the West is progressive. As described by Dutt:

In late nineteenth-century India, imperialism was not bringing the necessary amounts of progressive forces. Indian economics therefore conceptualized an idea of development that adopted universal criteria of progress and development within a nationalist perspective that could cater to the local, historical, social, economic, and political contexts.

Bipan Chandra’s seminal work on Indian economics was one of the first to formally label it as “economic nationalism” (Chandra Reference Chandra1966). Recent scholarship has also found a strong resemblance between the works of List’s National System of Political Economy, Giuseppe Mazzini (an Italian politician), Otto von Bismarck (a Prussian statesman), and Indian economics (Chatterjee Reference Chatterjee1993; Goswami Reference Goswami2004; Singh Reference Singh1975; Ganguli Reference Ganguli1977; Bach Reference Bach2018).

The context of Indian economics was, however, the local site of an imperial economy. As scholars such as Robert Young, Allan Luke, and Homi Bhabha explain, imperialism makes imperial subjects both invisible and different, rendering Indians simultaneously absent and present (Young Reference Young1990; Luke Reference Luke1995; Bhabha Reference Bhabha2013). The imperial rulers had to simultaneously make Indians different, therefore present, to legitimize the control over its people and resources, and invisible to justify the extractive nature of imperialism. Analyzed within this context, it seems obvious why Indian economics chose to accentuate the difference in their discourse: to make India present Indian economics demonstrated India’s difference. Indian economics discourse persuaded imperial rulers to concentrate on the presence of Indians by advocating for a distinct economic thinking.

Indian economics was a discourse at the margins attempting to educate India’s foreign rulers to implement a development plan that would harness much-needed progress. Indian economics’ idea of development was both nationalist in that its content was about India and universalist in that it identified certain universal criteria that brought about societal change in many different societies. As Eric Helleiner argues, economic nationalism is an ideology that is defined by its nationalist content, rather than a form of realism or protectionism, and can be related to several different institutional frameworks, including liberal economic policies more commonly associated with universalist economic thinking—e.g., classical political economy (Helleiner Reference Helleiner2002, pp. 307–308).

There is a poignant example in the primary material. To explain Indian economics’ balanced growth argument, Ranade cited Smith and List, while Dutt cited only List. However, the consensus is often that either the economy is analyzed through different stages of historical development—e.g., Smith identified “stages of improvement” most often associated with classical political economy (Smith Reference Smith1776, p. 187)—or the system is analyzed from a nationalist perspective such as List did, which brings out the specificities of individual economies in a given period (Reinert et al. Reference Reinert2016, p. 213). My analysis shows that Ranade and Dutt were merging nationalism and universalist views on development by using theories from both approaches.

The so-called nationalist approach was not constructed in a vacuum. Meaning making constrains discursive practices within certain limits. Both List and Indian economics were addressing followers of classical political economy and universalism and needed to use the same discursive practices to increase their chances of being listened to and understood, and of persuading other interlocutors to rethink and rearticulate the dominant discourse. Meaning is created through dialog (whether verbally or between texts), leading to traces of existing theories, even if criticized, in the newer discourses. The discursive resources available were pre-established before List’s national system and even longer before Indian economics. There is a canonization of ideas and discursive practices. Canonization “is the mechanism through which classic status is ascribed to a text, but then the meaning of the text is increasingly simplified in the interests of producing an easy-to-grasp reading of its allegedly core claims” (Brown Reference Brown1994, p. 84). As a result, it is far from straightforward to distinguish between different schools of thought and views on development. Universalism—a stagist theory of progress and development—is not necessarily incompatible with a nationalist approach.

Unfortunately, simplification often entails distortion (Tabb Reference Tabb1999). List’s economic thinking is found to be more similar to classical liberal ideas associated with classical political economy and particularly Smith (Watson Reference Watson2012, pp. 463–464; Harlen Reference Harlen1999). Similarly, Helleiner finds a misreading of List’s work (Helleiner Reference Helleiner2002). Matthew Watson concludes that the misreading of Smith in List’s work can be traced back to Dugald Stewart, John Ramsay McCulloch, Georg Sartorius, and the Earl of Lauderdale’s readings of Smith. Interestingly, Ranade cited McCulloch (Ranade Reference Ranade1906, pp. 8–9). Nationalism, in List, is not only about policies. Economic nationalism is a nationalist ontology, rather than prescriptive policies such as tariffs. Yet, much of the traditional literature has missed the nationalist ontology and defined economic nationalism in terms of non-liberal policies (Helleiner Reference Helleiner2002, p. 235).

“Economic nationalism” was used widely in the twentieth century, yet its meaning was often unclear and/or poorly articulated. The term was often employed by its opponents where liberal economists would label policies they disliked as being “nationalist” (Heilperin Reference Heilperin1960, p. 17; Helleiner Reference Helleiner2002, p. 308; Koffman Reference Koffman and Szlajfer1990). By the late twentieth century, economic nationalism had become tied to the mercantilist doctrines of the seventeenth and eighteenth centuries, unlike List’s or Indian economics’ definition of economic nationalism (Gilpin Reference Gilpin2001, pp. 14, 31). Economic nationalism is not like mercantilism: mercantilism is statist, while economic nationalism focuses on the role of national identities and nationalism in shaping economic policy (Shulman Reference Shulman2000; Abdelal Reference Abdelal2001, p. 19; Crane Reference Crane1998, p. 55). Interlocutors can be identified as nationalist, therefore, without having to impose certain economic policies. Policies need to be examined separately—economists can be pro-free trade and nationalist, as Naoroji was. Economic policy prescriptions simply change to fit the new economic landscape, such as globalization along a nationalist agenda to increase power, prestige, and wealth (Shulman Reference Shulman2000; Crane Reference Crane1998; Pickel Reference Pickel2003). Ranade declared the role of the state similarly: “The function of the State is to help those influences which tend to secure National Progress through the several stages of growth, and adopt Free Trade or Protection as circumstances may require. In this view Free Trade may be good for a Country like England, but not for America and Germany” (Ranade Reference Ranade1906, p. 20).

Context dictates policy prescriptions. Naoroji’s and Indian economics’ goal was to improve the “material and moral condition of India” (Naoroji Reference Naoroji and Parekh1887, p. 502) because a government should always implement measures that increase the well-being of its people (Naoroji Reference Naoroji1901, p. 286). Dutt’s emphasis on self-sufficiency, national insurance, and rural development reflected the priority on the people. In case of disaster (whether a famine or invasion), India needed the capacity to supply its immediate needs—e.g., sufficient food supply to feed the Indian population (Dutt Reference Dutt1901). Ranade’s emphasis on social and religious reform, including caste and marriage reform, reflects a focus on the local and specific conditions in India (Ranade Reference Ranade and Kolasker1902).

The focus on context in Indian economics fits into its use by List. In the preface to List’s National System of Political Economy, List is cited to have said that he did not need to bring any of his books with him to America, because “[n]owhere are modes of communication for trade and travel, and their influence on the moral and material life of the people, better appreciated. That book I have read earnestly and assiduously, and lessons drawn from it I have tried to compare and arrange with the results of my previous studies, experience, and reflections” (List Reference List1856, p. xii).

The world was best understood, according to List, by the farmers and people, not by some learned cosmopolitans. Similarly, the first English translator, G. A. Matile, of List’s book asserted that List’s theory was “at least not founded upon a vague cosmopolitism, but on the nature of things, upon the lessons of history and the wants of nations” (List Reference List1856, p. xii). Matile claimed that List’s “system offers a mode of reconciling theory with practices” (List Reference List1856, p. xii). Like List, Indian economics attempted to explain India’s societal change and find an appropriate development plan by reconciling the European theories taught to them, and the local, specific, and nationalist practices present in India.

As discussed, meaning making is produced within specific contexts. Naturally, then, the configuration of economic nationalism in Indian economics includes two distinct elements: development should be collective and equal, and the long-run goal is a universal society of free trade. First, the nation should be prioritized over any individual. It was important to implement a development plan that catered to the well-being of the collective and minimized inequality. For example, Ranade cited Jean-Charles Sismondi to explain the role of the state: “the State was not merely an agency for keeping peace, but … it was an organization for securing the progress of the people as widely as possible, and for extending the benefits of the Social Union to all” (Ranade Reference Ranade1906, p. 18).

The need for a strong central order with a balanced and united power (Ranade Reference Ranade1900, pp. 58, 62, 93, 95–96) was paramount in India because there were centrifugal tendencies (Ranade Reference Ranade1906, pp. 24, 29, 58) and “separatist elements” (Ranade Reference Ranade1906, p. 92) that damaged the prospects for development. Indian economics advocated for a collective development outlook because there were instances when the collective capacity of the state was more effective than the capacity of individuals (Ranade Reference Ranade and Kolasker1902, pp. 103–104). Examples include the judicial system, education, sanitation, factory legislation, postal service, subsidies for railways, and commercial development. There were two central doctrines to Indian economics’ theory of state intervention: first, the state had a right to interfere; and, second, communal welfare was more important than industrial interest. Accordingly, Indian economics advocated for direct, deliberate, and systematic promotion of balanced growth.

Indian economics had a nationalistic view of development that concerned itself with the general welfare of society. For instance, Ranade attempted to represent all classes of Indian society, arguing for an “equitable system of taxation” that would charge those who could afford the tax burden—e.g., Ranade advocated for a decrease in land and salt taxes, which disproportionately burdened the poorer classes (Ranade Reference Ranade and Kolasker1902, p. 749). Moreover, as noted above, Ranade and Dutt promoted rapid industrialization to be realized through protection, because industrial growth would bring about higher wages due to increased demand for manufactured goods, leading to a more equitable distribution of income. Economists, Ranade argued, should not focus on the agent’s interests but the collective defence, well-being, social education, and discipline, and the agents’ duties. Additionally, Iyer criticized Smith for ignoring the fact that man cultivates sympathy with his neighbors, nation, and humanity, much like the German Historical School and List (Iyer Reference Iyer1903, pp. 130–131). (It could be argued that Iyer misread Smith or failed to read his earlier work Moral Sentiments; see Smith [1759] Reference Smith1853.) Chandra asserts that “this notion of subjecting economic thinking and policy to socially integrated goals perhaps forms the specific core of what is known as Indian economics” (Chandra Reference Chandra1966, p. 732).

Still, Indian economics was not socialist. For instance, Ganesh Joshi wrote in 1890 that his policy plan was not socialistic (Joshi Reference Joshi1912, p. 819; see also Ranade Reference Ranade1906, pp. 89–90, 169, 190, 193–194). Indian economics simply saw the need for state intervention to transition India from a backward agrarian economy to industrial capitalism. The state should be restricted to a certain scope and time frame, as Ranade and Joshi believed state actions would crowd out private enterprises if not kept in check. For instance, in the report of the Finance Committee (Government of India 1886, p. 407), Ranade objected to the removal of restrictions on jail manufacturers as it undermined private competition and crowded out private manufacturing. However, Joshi and Ranade disagreed on the limits of intervention. Ranade saw no theoretical limits with state intervention and said instead that the national needs were the only criteria worth considering (Ranade Reference Ranade1906, pp. 193–208). Joshi, on the other hand, believed that the intervention should be restricted in order to avoid state action overtaking private competition and, as a result, suppressing it (Joshi Reference Joshi1912). The Indian economists were also against the state monopoly of land and wished for it to be privatized so that the landlords did not have to pay extortionate government rents (Chandra Reference Chandra1966, p. 721).

The second element of Indian economics’ economic nationalism was the long-run liberal perspective. It was important that state intervention was considered as “crutches to teach the Nation to walk, and that they should be thrown away when the necessary advance had been made” (Ranade Reference Ranade1906, p. 15). Abuses of state intervention should be avoided by removing the intervention when it was no longer needed—e.g., when a nascent industry had become competitive enough to compete on the international market. Ranade theorized that monopolies—e.g., the several European East Indian companies—had triggered scholars such as Thomas Hobbes and John Locke to criticize mercantilists, who argued for an overly strong state, and to conceptualize an idea of natural liberty. Natural liberty was destructive for nations still developing, such as India, because, according to Ranade, natural liberty assumed that any state intervention into the market was regressive (Ranade Reference Ranade1906, pp. 15–16). Indian economics saw the need for temporary state intervention until it was no longer needed.

Indian economics’ long-run goal of global free trade is similar to List’s ideal to harness national growth in order to “prepare it for admission into the universal society of the future” (List Reference List1856, p. 142). The universal society of the future included free trade among all industrialized nations of the West. Ricardo’s trade theory also aimed to maximize the world’s economic efficiency for the betterment of mankind through free trade. James Mill saw free trade as a way to keep peace and spread civilization, ensuring a peaceful cosmopolitan global society (Helleiner Reference Helleiner2002, p. 313). List and Indian economics did not, however, advocate free trade in the short term, as Ricardo and James Mill did. The difference between the classical political economists (who are also generally labeled “liberals” and are seen as universalists) and Indian economics is when and where the universal society of free trade and industrialization should and could be realized.