The Role of the State in Modern India

The state in India is not a static institution – it has shifted its shape, priorities, and reach over decades. From a minimal authority concerned mainly with law and order to a vast welfare machinery running employment guarantees, food security programmes, and digital public infrastructure, the state’s journey mirrors the country’s own political and social transformation. Understanding what the state does today, and why, requires tracing how classical ideas were reshaped by electoral politics, constitutional vision, and economic reality.

From the minimal state to the welfare state
The shift driven by democracy and electoral pressure
The birth of the Indian Constitutional State
Federalism and the division of powers
Secularism, equality, and dignity
The Directive Principles: blueprint for a welfare state
Socialist directives in action
Gandhian and liberal-intellectual strands
How the state’s role has actually evolved
The contemporary state: enabler, regulator, provider
Tensions and continuing debates
Why this matters

From the minimal state to the welfare state

The earliest liberal thinkers imagined the state as a “necessary evil.” For classical liberals like John Locke and Adam Smith, individuals were rational, autonomous beings whose freedoms had to be protected from interference. The state’s job was narrow – secure peace, enforce contracts, protect property, and otherwise stay out of the way. Adam Smith’s famous “invisible hand” captured the spirit: leave markets alone, and prosperity would follow naturally.

This night-watchman state had a short list of duties: national defence, law enforcement, courts, and basic infrastructure. Anything beyond this was considered overreach. The minimal state was philosophically elegant, but it ran into a stubborn problem – industrial capitalism produced wealth alongside severe inequality, unemployment, and human misery that markets alone could not resolve.

The shift driven by democracy and electoral pressure

Two forces pushed the state to expand. First was the gradual spread of universal adult franchise. Once the poor, the landless, and industrial workers gained the right to vote, political parties could no longer afford to ignore them. Every manifesto had to promise something – jobs, food, housing, pensions. Second was the rise of positive liberalism through thinkers like T.H. Green and John Stuart Mill, who argued that liberty was not merely absence of interference but the actual capacity to live a meaningful life. Freedom to starve, they pointed out, is no freedom at all.

The Great Depression of the 1930s and the writings of John Maynard Keynes finished the argument. Governments around the world accepted that they had to intervene in the economy to prevent collapse and ensure employment. The welfare state was born – a system where the government actively provides for the social and economic well-being of its citizens through education, health, social security, and redistribution.

The birth of the Indian Constitutional State

When India gained independence in 1947, its founders did not choose between the minimal state and the welfare state – they designed something more ambitious. The Constitution, adopted on 26 November 1949 and enforced on 26 January 1950, created a state that was sovereign, socialist, secular, democratic, and federal, committed to securing justice, liberty, equality, and fraternity for every citizen.

The framers were consciously building a welfare state, not a police state. As legal scholars have noted, the framers of the Constitution were inspired by the welfare state idea – the state was given a negative duty through Fundamental Rights (what it must not do to citizens) and a positive duty through the Directive Principles (what it must actively work towards).

Federalism and the division of powers

A country of India’s size and diversity could not be governed from a single centre. The Constitution therefore established a federal structure, distributing legislative power across three lists in the Seventh Schedule. The Union List covers areas like foreign policy, defence, communications, currency, and railways, where only the central government can legislate. State governments have exclusive power over subjects such as law and order, public health, local government, and taxation on agricultural income. The Concurrent List contains subjects where both can legislate.

This division was not just administrative convenience. It recognised that a Tamil fisherman’s concerns differ from a Punjabi farmer’s, and local problems are often best handled locally. At the same time, the Constitution tilts toward a strong Centre – the Union can redraw state boundaries, create new states, and dominate in areas of national importance. This quasi-federal design has allowed the state to hold the country together through decades of linguistic reorganisation, regional movements, and crises.

Secularism, equality, and dignity

The Indian state is secular in a distinct sense. It does not mean the state is irreligious or hostile to faith; it means the state keeps equal distance from all religions and intervenes to reform practices that violate human dignity. This is why the state can abolish untouchability, regulate temple entry, and pass laws on personal practices when they conflict with fundamental rights.

At the heart of the constitutional state lies the commitment to dignity of the individual. The Preamble promises justice – social, economic, and political – to every person. Article 14 guarantees equality before law; Article 21 protects life and personal liberty, a right the Supreme Court has expanded over decades to include shelter, privacy, a clean environment, and dignity itself.

The Directive Principles: blueprint for a welfare state

If the Fundamental Rights tell the state what it cannot do, the Directive Principles of State Policy (Part IV, Articles 36 to 51) tell it what it should actively pursue. The Constitution directs the state to promote the welfare of the people by securing a social order in which justice – social, economic, and political – permeates all institutions of national life. These principles are not enforceable in court, yet Article 37 declares them fundamental to governance.

Dr. B.R. Ambedkar described the Directive Principles as a novel feature of the Constitution, providing social and economic democracy as distinct from the political democracy delivered by Fundamental Rights. Political democracy without economic justice, he argued, would be meaningless.

Socialist directives in action

Several articles embody the socialist vision. Article 38 asks the state to minimise inequalities in income, status, facilities, and opportunities. Article 39 directs that material resources be distributed to serve the common good, wealth should not concentrate, and men and women should get equal pay for equal work. Article 41 calls for the right to work, education, and public assistance during unemployment, old age, and sickness. Article 43 demands a living wage and decent standard of life for all workers.

These are not just paper ideals. They have shaped concrete policy – the Minimum Wages Act, the Equal Remuneration Act of 1976, the Maternity Benefit Act, the Bonded Labour System Abolition Act, land reform legislation across states, and more recently the Mahatma Gandhi National Rural Employment Guarantee Act, which guarantees rural households a certain number of days of paid work each year.

Gandhian and liberal-intellectual strands

Not every directive is socialist. A Gandhian cluster draws from Mahatma Gandhi’s vision of decentralised, self-reliant villages – Article 40 on panchayats, Article 43 on cottage industries, Article 46 on protection of Scheduled Castes, Scheduled Tribes, and weaker sections, Article 47 on prohibition of intoxicants. A liberal-intellectual cluster reflects modern governance ideals – Article 44 on a uniform civil code, Article 45 on early childhood education, Article 50 on separation of judiciary from executive, and Article 51 on promoting international peace.

How the state’s role has actually evolved

The story on the ground has moved through distinct phases. From 1950 to roughly 1990, India operated a mixed economy with the state dominating key sectors – heavy industry, banking, insurance, steel, power, telecommunications. The Planning Commission and Five-Year Plans directed investment. Public Sector Undertakings (PSUs) were expected to drive industrial growth and provide secure employment. Nehruvian socialism, influenced by Fabian ideas, placed the state at the commanding heights of the economy.

By the 1980s this model was straining. Fiscal deficits rose, PSUs often underperformed, and the balance-of-payments crisis of 1991 forced a reckoning. The economic reforms of 1991 opened markets, reduced licensing, welcomed foreign investment, and began privatising state enterprises. The Supreme Court in Modern Dental College and Research Centre v. State of Madhya Pradesh itself observed that India’s economic policy had moved from laissez-faire to welfare state to a liberalised economy.

The contemporary state: enabler, regulator, provider

Today’s Indian state plays several roles at once. It is a protector – guarding borders, maintaining internal order, running the criminal justice system. It is a provider – running the Public Distribution System, Ayushman Bharat health insurance, old-age pensions, and housing schemes. It is an entrepreneur through remaining PSUs in sectors like railways, oil, and defence production. It is a regulator through institutions like RBI, SEBI, TRAI, and CCI that supervise markets. And it is an arbiter through the judiciary and quasi-judicial tribunals.

A fresh role has emerged in the digital age – the state as builder of digital public infrastructure. Aadhaar, UPI, the CoWIN platform, and DigiLocker represent a new kind of state action: not owning the economy, but providing universal digital rails on which private actors and citizens transact. This is neither pure laissez-faire nor old-style socialism; it is a distinctly Indian synthesis.

Tensions and continuing debates

The Indian state’s expansive role creates ongoing debates. Can a country with limited fiscal capacity sustain universal welfare? How should it balance growth with redistribution, central authority with state autonomy, majoritarian democracy with minority rights? The Supreme Court’s Minerva Mills judgment in 1980 held that the harmony and balance between Fundamental Rights and Directive Principles is itself part of the basic structure of the Constitution. Neither individual liberty nor collective welfare can be sacrificed for the other – the state must pursue both.

Academic observers argue that the state today wears different faces, choosing which to adopt as its goals and circumstances shift. This adaptability has been both its strength and a source of concern.

Why this matters

Understanding the role of the state in modern India is not an abstract exercise. Every welfare scheme, every regulatory decision, every tax, and every law flows from how we collectively answer the question: what is the state for? The Constitution’s answer – a welfare state that guarantees dignity, secures justice, respects federalism, and balances liberty with equality – remains the north star, even as the practical shape of the state keeps shifting with economic realities and political choices.

What do you think? Has the Indian state struck the right balance between its welfare obligations and the need for economic efficiency, or should it lean more in one direction? And in an age of digital public infrastructure and private-sector dominance, what should the state’s core role look like over the next twenty-five years?

References

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Table of Contents

From the minimal state to the welfare state 🔗

The shift driven by democracy and electoral pressure 🔗

The birth of the Indian Constitutional State 🔗

Federalism and the division of powers 🔗

Secularism, equality, and dignity 🔗

The Directive Principles: blueprint for a welfare state 🔗

Socialist directives in action 🔗

Gandhian and liberal-intellectual strands 🔗

How the state’s role has actually evolved 🔗

The contemporary state: enabler, regulator, provider 🔗

Tensions and continuing debates 🔗

Why this matters 🔗