India in the recent past has been a country of socialist and contentious politics, sluggish economic growth, and numerous poor and illiterate people. Beginning around 1980, India's political economy started moving in a new direction. Over the next three decades Indian democracy put down firmer roots, socialist rhetoric was discarded for pro-business policies, and the economy grew rapidly. Unfortunately, this “new” India remains a country of numerous poor, illiterate, and unhealthy people. Significant pockets of violence also continue to dot the political landscape. How the apex of the political economy in India, but not the bottom half, has undergone some basic changes since 1980 is the subject of this book. A central theme of the book is that the pro-business tilt of the Indian state is responsible both for the progressive dynamism at the apex and for the failure to include India's numerous excluded groups in the polity and the economy.

One has only to recall the decade of the 1970s to underline some key features of the “old” India. During that decade Indira Gandhi sought to move Nehru's socialism in a populist direction, committed the Indian state to alleviating poverty, mobilized the poor, and centralized power in her person. Opposition forces undertook their own mobilization against Indira Gandhi. Political polarization produced a series of rapid political changes in the late 1970s: the proclamation and rescinding of a national Emergency, Indira Gandhi's electoral defeat, the inability of opposition forces to provide stable government, and the return of Indira Gandhi to power. Populism and instability hurt economic growth, leading to a lackluster decade for the economy. Moreover, Indira Gandhi's rhetorical commitment to the poor was not translated into meaningful outcomes; a sluggish economy and an organizational inability to intervene on behalf of the poor remained major obstacles.