I agree that the red tape hell started with Indira. But I can't agree with the bit about context. It's plain to see that inequality is considerably worse now. Only a small Elite were in any position to benefit from the liberalization and the rest have never been able to catch up. Overall, left leaning economic policies and communist influence have done enormous harm to this country.
The context is a historical fact. I think you mean the motivation. And that is a historical fact as well, actually.
The unfortunate fact is that the policies which India's leaders thought at the time would lead to better wealth distribution and economic growth didn't work as expected and economic growth was significantly impeded. India wasn't alone in this failure, China also suffered under the same problem, due to similar problems with a top-down command economy dominated by public sector.
> It's plain to see that inequality is considerably worse now.
Again, that's not an issue with the context, but with execution. And the inequality you see now is more because after the liberalization of 1990, while certain sectors and people working in them grew tremendously, others were left behind. And the tax system in India was broken, so wealth redistribution through taxation also did not happen as expected.
The whole point I was trying to make was, rather than learn from our own history and experience, the leaders chose to keep doing the same things the British did.
I look at Pre Independence India as a bunch of decentralised organizations/kingdoms/markets which were producing goods and maybe services that were sought after all over the globe. This is what made mercantilism and later colonialism attractive in the first place.
Then the British established controls which promptly destroyed Indian advantages in favor of their own.
These are the lessons which the post Independence governments should have carried forward. Gandhi understood these at a very deep level, and hence the satyagrahas. And the village economy model, which though unworkable, emphasized the central principle of decentralization. This understanding makes him stand out.
Whereas though Nehru has to be applauded for his efforts as prime minister, time has shown that he and his family never had the deep understanding about economics and history that Gandhi did.
