Introduction THE post-independence Indian economy witnessed rapid economic growth during the first 15 years of planning, as a consequence of massive public investment and expenditures. Since then, however, the economy has been in the grip of a deepening crisis. The major features of this crisis have been a deceleration in agricultural production, stagnation in industrial production and an acceleration in the overall rate of inflation. This is reflected in an overall deceleration in the growth rate of real national and per capita incomes during the seventies when compared with the sixties and fifties. The annual compound growth rate of Gross National Product (GNP), at 1970-71 prices, declined from 3.83 percent during the fifties to 3.66 percent in the sixties and to 3.05 percent in the seventies.1 Any serious explanation of tho» crisis would have to view it against the contradictions inherent in the path of capitalist development itself rather than on purely random factors like weather fluctuations and so on. Moreover, all indications point towards an accentuation of this crisis on account of the deepening recession in the advanced capitalist countries which are expected (o show near zero rates of growth during the early eighties. These advanced capitalist countries, in turn, will pass on the burdens of the