Neoliberalism Shaping Democracy - A Classical Theory and its Intersection with Democracy in India

Classical theories have been made after certain experiences of extremities, situations, problems, and their solutions, human behavior in a war state, and ideologies of people acting as a part of any major level happening.

Illustration by The Geostrata

Observing it all creates a conclusion in psychology, philosophy, social science, and strategy building which was scripted to shape the society into these same phases but with a better understanding this time and more perspectives of it.

Classical theories in the field of International Relations exist to understand a state's behavior and strategic brainstorming on a global platform performing a certain activity or action. It acts as a guide and influence in behaving both domestically and internationally.

It is followed by states and nations to achieve a target, growing, positioning on a global platform, enhancing the way of perceiving things and for such various purposes depending upon the needs and wants of the state.

Though classical theories reflect only one perspective as a whole at one point in time and are in the form of scripture, understanding the nature of it is such that it is being used through practical implementations. Classical theories and state are co-dependent and co-relate, both define the existence of each other over the period which gives birth to the evolution of thoughts and the state/ nation.

Origin of theories is not necessarily needed to come out of a war state or a state facing any dilemma, although it is near to impossible for a state to never face a dilemma.

Noble minds around the globe were thoughtful enough to share the perspective in a simpler word for others to understand and learn from the generic position to understand the mechanism of a state's behavior. 

Theories have been used by states since their origin to give out a framework for evolved thinking and shaping the state’s future and present into a productive light. When adopted by the state or a nation it acts as a primer to the fundamental blueprint of the functioning of the modern state in war and peace.

THE CLASSICAL THEORY

A classical theory of international relations emerged in the mid-20th century which advocated for limited government intervention in the economy, emphasising free-market capitalism and individualism.

Neoliberalism gained prominence in the late 20th century, particularly in the 1980s and 1990s, as a response to perceived shortcomings of Keynesian economics and a desire for market-oriented reforms.

It is one of the most evolved theories and the toned version of liberalism that focuses on the capitalism of the state and allows the government to be open to new ways to create a liquidity of capital, minimise the government’s spending on the market and invest in other ways which could result in the better state of living among people of the state, as it also opens up the options for employment, growth, and advancement of mind and state.

The following are a few features of Neoliberalism:

Free Market: Promotes the idea that free markets, unburdened by excessive government regulations, are the most efficient way to allocate resources and promote economic growth. The belief is that competition in the marketplace will lead to innovation and improved efficiency.

Limited Government: Advocates for a minimal role of the state in the economy. Governments are expected to enforce contracts, protect property rights, and maintain a legal framework conducive to market activities. Social and economic issues are often viewed as best addressed through market mechanisms rather than government intervention.

Deregulation: Often involves reducing or eliminating regulations that may impede business activities. This is done with the belief that a more flexible and responsive market will emerge when regulatory barriers are removed.

Privatisation: Involves the privatisation of state-owned enterprises and services. This involves transferring control and ownership of public assets, such as utilities and industries, to the private sector. Proponents argue that privatisation can lead to increased efficiency and competition. 

Individualism: Refers to individual freedoms and responsibilities. The philosophy holds that individuals should be free to pursue their interests and that this pursuit will collectively contribute to societal well-being.

Globalisation: Markets and economies become more interconnected on a global scale. This involves the liberalisation of trade and the removal of barriers to the movement of goods, capital, and labor across borders.

All of this represents the freedom and liberalism of human nature and the accommodation of its behavior in society as we know it today.

Neoliberalism is capital-centric liberalism defining the political approach to support free market capitalism which helps in dividing and reducing the government expenditure on investments and preventing from discriminated distribution of capital in the domestic and international platforms.

Neoliberalism has been influential in shaping economic policies in various countries, especially during the late 20th and early 21st centuries and it will continue to do so.

DEMOCRACY

India is a very diversified country located in South Asia. India has its own identity standing exceptionally in the world. It is known for its rich culture, remarkable revolutions, and unity in diversity, history, and civilisation. India is not only known for its social aspects but also for its geographic and demographic diversity.

As the most populous country in the world at present, India is rich not only in resources but also in politics and strategy building. Today, India stands at the pedestal of being one of the fastest developing nations, while indigenously enhancing its capability of defending its sovereignty and integrity.

Democracy is practiced in India allowing the nation to be open to various perspectives and opinions building onto the mutual goal of development and advancement of the country.

This practice is not only helping Indians in India but also the Indian diaspora all over the world and is gaining a certain amount of respect and impetus for the holistic rise in the weight of India in front of the international sovereign community.

However, given the challenges that come along with the democratic approach, we have already taken envisioned steps to minimise this strata by 2047 which will be the hundredth anniversary of the independence of India. And it is very much possible with the flow of things in the current situation. The growth of India is dependent on its exposure to the economy, its economic value, and its trade ties with other states and nations.

The Indian economy today bears no resemblance to the economy of several centuries ago. The cleavage between the agricultural interior and the cosmopolitan and outward-looking commercial towns continues to be deep, as in the past, and their politics remain divergent. Indeed, misaligned politics is a source of uncertainty for economic policy and the future of liberalism in India.

While the economic power of India had its fluctuation in the past, being a democracy it opens up the state to pros and cons. Democracy gives power to decision making and choice of execution which shapes the country’s value. India being one of the practitioners experienced fragments of democracy in capitalism as well, which allowed India to be liberal in capitalism in the 1991 economic liberalisation.

This opened India to a new path to grow and develop into a powerful nation as we know of today, as it attracted foreign investments, increased the ease of doing business, and stimulated various sectors of the economy, contributing to overall growth and development.

Liberalisation created a pathway to economic advancement and development which further evolved and created fragments leading to achieving the goal of stabilisation and a developed status. 

To accomplish the desired goal a lot was put into work and due to democratic ruling, there was a major variation in the investment of the government which used to depend on the ruling party in the period.

This gave birth to Neoliberalism that eventually made the fusion of economic liberalisation of 1991 and public-private relations happen with peace and ease.

Neoliberalisation allowed the government of India to reduce its sole spending on economic development and more on social development by allowing the market to open for private companies and corporates to invest and take over the market in both independent and collaborative ways with the public associations and tenders.

Amid the COVID crisis, India was proven to be unaffected by the pandemic and came out strong both socially and economically. One of the key aspects was neoliberalisation which helped India to withstand the possibility of growth in every condition that has been proved in the years 2020 and 2021. The Indian economy became vast due to its open market, capturing the essence of India’s capability to grow at a faster pace than most of the countries.

SOVEREIGNTY

Sovereignty is a term for having authority and freedom to deal with the situation, tasks, and any course of work with an open mind and the power to choose whatever way to execute to achieve desired results. It is one of the key features of a democracy as it provides the sole freedom of growth and development that is economic freedom. 

Sovereignty gives meaning to democracy. It gives power to liberalisation which shapes the decision-making of the country and creates the trajectory for the targets set for the development of the country.

Despite arguments liberalisation could not be summed up in one sentence or explanation that shows the beauty of it, it allows people to be open to perspectives, ideologies, points of view, and styles of strategy planning as well for the best result. Sovereignty somehow captures the essence of liberalisation with the hint of an authority-based power which makes the sub-division of liberalisation happen like Neoliberalisation.

Neoliberalisation became a success of Indian sovereign power as a democracy as it opened up the gates to privatisation in the capital market and helped India to grow in the fastest way in the modern world.

India is one of the most resourceful countries and has used its feature of sovereignty in democracy to push development on a large scale by opening its market to private industry and welcoming a well-respected fusion of capitalism in the country, this has led not just a successful self sustainable nation but also a reliable nation for other in the region and beyond creating a distinctive identity on a global platform that has spiked up the nation’s growth ever since.  

Neoliberalism has defined one of the powers of democracy and in terms of India which is known as one of the successful democratic countries today.

Capitalism and privatisation were done wonderfully in India over a period that opened a gateway for classical theories to become completely relatable and implementable in the evolution of India’s democratic system.

India is one of the most welcoming countries which is open to different perspectives and ideologies that promote the development and growth of the country, an example of the adoption of such ideologies is what makes Neoliberalism a part of shaping the Indian democracy.

---

BY RISHA SRIVASTAVA

THE GEOSTRATA

info@thegeostrata.com