India’s Dilemma: Capitalism or Socialism

Capitalism is an economic system in which there is private possession and where there is a force to generate profit, and thereby wealth. Under capitalism, people invest money or property invested in a business to produce a product or service that can be offered in a market to consumers. The investors in the company are generally authorised to a share of any earnings made on sales after the expenses of production and distribution are brought out.

Socialism is also an economic system in which there is government ownership of goods and the production of goods with a force to interest work and prosperity equally among the members of society. Under socialism, the goods which are produced also including services, are assumed a social product. 

Meaning of Capitalism in India

Capitalism is an economic system in which businesses and industries that produce the goods and services for the purpose of profit are regulated by the private holders for profit rather than the state.

Capitalism, also known as a capitalist economy, in India implies that it is an economic system in which private businesses control and govern the factors of production such as capital goods, labour, natural resources, and entrepreneurship. The production of all goods and services in a capitalist economy is reliant on the market’s demand and supply. It is different from the main planning system, also known as an authority or planned economy. Capitalism in India has the most important role to play.

• Private ownership 
• Forces of market
• Profit is the main motive for production

Socialism

Socialism is a political, social, and economic belief that comprises a mixture of economic and social systems noted by social ownership of the means of production and democratic control or worker self-management of businesses. The objective of public ownership is to assure that output reacts to the common public’s needs and desires. 

India follows Capitalism and Socialism

India follows both capitalism and socialism because it is a mixed economy. However, capitalism gives a better result to the development of India.

Importance of Capitalism

1. Equality: Every person, regardless of their social background, will get the chance to compete. The fundamental principle is the harder you work, the greater you earn.
2. Freedom: Many people choose a line of business that they want; they have total freedom to choose. This is standard capitalism, freedom to do and prefer what you need.
3.  Innovation: Employees of the companies are searching for new ideas every moment pursuing to create and formulate new products that give more profit by the way of research and development.
4.  Efficiency: A company or firm based on a capitalist society overlooks incentives that prove efficient and do the production of goods that are in demand. These incentives build the strength to cut costs and ignore waste.

In socialism, socialist ideas have significantly influenced the Indian economy to make the objectives and policies. Because of public holding, there are a lot of rules and regulations and a lack of freedom so innovation and research are not included in socialism.

Drawbacks of socialism

• Economic liberals and capitalist libertarians recognize private holding of the means of production and the market exchange as normal human beings or moral rights that are central. 
• Lack of freedom and liberty. 
• Public ownership of the means of output or production, cooperatives, and the planning as violations of liberty. Some of the primary objections of socialism are claims that it builds distorted or absent price signals, results in reduced incentives, it affects reduced prosperity, has bad feasibility, and that it has unfavourable social and political effects.

Socialism in Indian Constitution

The phrase socialist was developed in the Preamble of the Indian Constitution by the 42nd amendment act of 1976, at the time of the Emergency. It indicates social and economic equality.  In this contest, Social equality means the lack of discrimination on the field only for caste, colour, ideology, gender, language, and religion. Socialism in the Indian Constitution removes all the problems of the people regarding their physical appearance of the people.

Conclusions 

Capitalism and socialism both are different words in the Indian economy. Capitalism is a big source of growth in the economy. Capitalism in India shows the businesses which are regulated and the production of goods are incurred in the country and helps to increase the economic growth.

Socialism does not play a big role in the Indian economy because of a lack of freedom, lack of innovative system, and public ownership. Socialism depends on the social system and also on the economic system.

But in India, both the systems follow capitalism or socialism not equally but follow because it is a mixed economy.