KingMakers IAS Academy logo

Lee Kuan Yew and Gandhi – Human centric economy

Lee Kuan Yew and Gandhi – Human centric economy

UPSC CSE Mains Syllabus: GS-3- Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment.

GS – 2- Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and Bodies constituted for the protection and betterment of these vulnerable sections. 

GS – 4 – Contributions of Moral Thinkers and Philosophers from India and World.

Lessons from the Lives and Teachings of Great Leaders, Reformers and Administrators

Globalisation and migrants:

  • The rules of globalisation have made life easy for migrant capital, not for migrant labour.
  • They make it easy for migrant capital to come into a country, make profits, and leave when it wishes to.
  • It has been hard for migrant labourto join the global party.
  • They have died in hundreds while crossing the seas to Europe, and walls are shutting them out from the U.S.
  • Tragically, even when they leave India’s globalising citiesto go back to their villages, they are struggling on the way out too.


  • The world has been ‘deglobalising’since the financial crisis of 2008. Many countries have raised barriers against migrants from other countries.
  • The World Trade Organizationis under contention.
  • COVID-19 has sharply accelerated a trend towards localisation that was already under way.
  • Supply chainshave broken up. Barriers against movement of people have gone up everywhere.

Lee Kuan Yew: First Prime Minister of Singapore from 1959 to 1990

  • Lee declared that Singapore would become the first ‘developed’ countryin Asia.
  • His measure of development was the per capita incomes of Singaporeanswhich would rise to the same levels as citizens in more advanced economies.
  • Singapore did not have any natural resources, like oil or minerals.
  • All that it could offer large Western companies to use was its strategic location on shipping routes between the East and West, and its people.
  • Lee invited companies from the U.S., Europe, and Japan to set up manufacturing facilities in Singapore and use Singapore labour.
  • The companies were attracted by the large pools of low-cost labourin ASEAN countries. Amongst these countries, Singapore was the most attractive for its location.
  • He did not want them to merely set up labour-intensive assembly factories.Lee wanted wages to rise in Singapore, so that per capita incomes would rise. Therefore, he wanted the companies to train Singaporeans to do higher-value work.
  • Lee promised the companies world-class infrastructure, an efficient administration, and low taxes.
  • In return, he wanted the companies to help the government by investing in continuous upgradation of their employees’ skills, so that Singaporeans would earn more and Singapore would become fully ‘developed’.
  • The companies were not willingto make such long-term investments in Singapore’s people.
  • Lee turned to R.D. Tatato set up a training centre and a precision tool room in partnership with the Singapore government, and help build foundations for Singapore’s industrial growth.

Mahatma Gandhi

  • Migrants are returning from India’s cities to villages in U.P. and other States. They are returning to a world Gandhi knew well.
  • Gandhi said that unless people in India’s villages have economic and social freedom, India cannot be a free country.
  • This was his vision of ‘poorna swaraj’.
  • For him, political freedom from the British was a step on the way.
  • Gandhi also knew the potential of India’s poorest people.
  • Above all, he believed that the economy must serve human needs, rather than human beings becoming fodder for the GDP.
  • This was a vision that Lee Kuan Yew had too: for him, the ultimate measure of Singapore becoming fully developed was not the size of its GDP, but the incomes of its citizens.

Gandhian’ economics:

Gandhian’ economics, which E.F. Schumacher (author of Small is Beautiful ) and J.C. Kumarappa (sometimes referred to as Gandhi’s Planning Commission) articulated very well, is based on simple principles.

  1. Human beings and local communities must be the means for human progress— and their well-being must be the purpose of progress too.
  2. Governance must be strengthened at the local level, in villages and cities.
  3. Wealth is good, but wealthy people must be only trustees of a community’swealth, and not its owners.
  4. The alienation of owners from workers must be reduced with the creation of new models of cooperative capitalist enterprises,where the workers, not remote capitalists, or the state, are owners of the enterprises.

All citizens of the State (and India too) deserve jobs, livelihoods and a good life with dignity, whether they are migrants or not. The test of public policies must be not what is good for investors and for the GDP, but what is good for the people, especially those who are the most powerless. In Lee’s, Tata’s, and Gandhi’s books, diluting the rights of workers to make life easier for investors was not done.

Road ahead:

  • Governments must listen to and care for their citizens and workers more than to investors.
  • They must encourage only those investors who care as much for citizens and workers where they invest as for their own investors back home.
  • Economists who advise governments must be clear that humans are not tools to produce returns for investors; rather, money is a tool to produce benefits for humans.

Source:” The Hindu“.


“Economy must serve human needs, rather than human beings becoming fodder for the GDP”. Analyse the statement considering Gandhian village economics.