THE BILLIONAIRE RAJ

A report from the front lines of inequality and corruption in India, one of the world’s rising economies.

It’s not the Taj Mahal, but it’s got two-thirds of the floor space of Versailles—and on a footprint of just an acre. Former Financial Times Mumbai bureau chief Crabtree considers the Mumbai apartment tower built by billionaire Mukesh Ambani to be the pre-eminent symbol of “the power of India’s new elite,” one that pointedly emphasizes the sharp divide between rich and poor in the country—and indeed, the divide between the merely rich and the superrich. The creation of a class of hyperwealthy commoners owes at least in some measure to domestic economic reforms meant to advance a free market but that, instead, in combination with modernization and globalization, ushered in an era of staggering corruption, with the government machinery simply unable to keep up with a wave of crony capitalism. “The 1991 reforms,” writes the author, gave “Indians a taste of a new world of mobile phones, multi-channel television and foreign consumer goods.” They also inaugurated an enthusiasm for globalization that is largely unmatched; most Indians, Crabtree asserts, are all for it. However, support for globalization does not necessarily mean support for the greatest beneficiaries of it; anti-corruption campaigns are increasingly commonplace. Yet state apparatus is too inefficient to do much about it. As Crabtree notes, there are so many layers of bureaucracy that a would-be entrepreneur has to negotiate that it’s only natural for a businessperson to try “to strike a deal towards the top of the decision-making chain.” Corruption has not moderated under the “big-government conservative” Narendra Modi, who, Crabtree foresees, will in his second term yield to the temptation to substitute nationalism for economic reform, following the path set by Putin in Russia and Erdogan in Turkey. Even so, writes the author, it is not inevitable that India become “a saffron-tinged version of Russia.”

Solid reading for students of economic development and global economics.