The Specifics of the Relationship between the State and Business in Modern India

Abstract

India, a member of the BRICS and the SCO, can play an important role in deepening Eurasian integration. However, in order to make possible the use of its integration potential, it is necessary to fully understand the specifics of this country, the nature of its existing political and economic system, which, in particular, is determined by the established model of relations between the state and business.Aim. To identify the features of the system of relations between the state and business, which has developed in India during the period of economic reforms and determines the potential and specifics of its political and economic development.Tasks. To trace the main stages of the evolution of relations between the state and business in the Republic of India, to assess government policy in relation to the main types of business and various business structures, to identify the degree of influence of private business on the policy and dynamics of economic development of the country.Methods. Systematic and comparative analysis, scientific generalization, expert assessments. Results. The article provides a scientific generalization of the evolution of models and methods of interaction between the state and business of the Republic of India, an assessment of their effectiveness from the point of view of socio-economic development of the country.Conclusions. The formation of the system of relations between the state and business in modern India was determined by the needs of the economic and social development of the country, the essence and forms of which were determined by the dominance of the relevant political forces and ideologies. At the initial stage, the use of repressive and coercive regulatory methods led to the establishment of a patron — client relationship between the state and business in all industrial sectors, focused on obtaining rent. However, subsequently, the growing inefficiency of the Indian economy and the growth of corruption forced the country’s ruling elites to reconsider their political and economic views and switch to a policy of economic liberalization, as a result of which India began to acquire the characteristic features of a “development state”. Currently, in a regulated market economy, the state, on the one hand, seeks to ensure greater freedom of the market, private entrepreneurship, promote greater openness and internationalization of the economy, on the other hand, weaken and limit large capital to protect small and medium-sized enterprises. At the same time, the relations between the state and business continue to be largely clientelistic, which, according to many experts, hinders further economic liberalization and increasing the global competitiveness of the Indian economy.