The Permit
Raj is a
satirical term used to describe the massive amount of
red tape that developed in India after independence (i.e., the exit of the
British Raj). India's drive to become self reliant and root out the influences of
colonialism lead to the creation of a centrally planned economy like no other. India, an extremely well-educated nation with numerous British and domestically trained scientists and
economists, tried to leverage its educational advantage and apply science and economic theory to the real
economy. Cheeky monkeys! Nothing was done without careful study of the data and tight control over the course and
pace of development. Control and data collection was via the issuing of
permits.
Does your company need to import a new computer? Well, take a trip to
Delhi, fill out the proper form, get it signed by three different officials, and you can import a computer. Oh you want to import
two computers? Well you better make another trip to Delhi.
The disadvantage of this system, besides the
glaringly obvious, was it proved open to all kinds of abuse like minor officials withholding permits and awarding them only to people willing to pay bribes. Of course it also totally stymied
free enterprise and prevented foreign investment to take up areas of development the cash-strapped government could no longer finance.
It wasn't until 1991 that the Indian government began to dismantle the Permit Raj system and allow business to thrive in a much more
unregulated environment.