The evolution of India's economic laws

For an economy to function optimally, participants must be certain of the outcomes - that the counterparty will perform its part, the wealth that one generates will remain with the creator, and that legal systems will ensure these. These attributes are a sine qua non for economic progress. Yet, as far back as 1793, Governor General Cornwallis rued that the “growing backlog of suits struck at the very root of the prosperity of the country”.

- V KUMARASWAMY

Law and the Economy in India traces the rationale, expedience and compulsions behind the evolution of key regulations that govern economic activity in the country. Part 1, covering the colonial period, is mostly on the development of laws relating to factors of production - land and property rights, labour and enterprises.

Land laws dominate the first part. With five major schools of Hindu Law, 34 compilations of these laws and a cobweb of practices specific to regions or religious sectors, it is a wonder that India has a common set of laws. The book skillfully walks us through the issues on land ownership, transfer rights, tenancy, occupancy rights, tax collection, registration, wills, joint property matters, and so on. It is interesting to learn, for instance, that the societal restraints on widow re-marriage had more to do with the question of property right inheritance rather than any religious rule.