To be fair, one can say the jury is out on this Yadav. On the other neighbouring Yadav, the ex-compatriot in Bihar, the jury’s verdict is clear. He has failed to make use of the decade that he secured from the electorate to turn the ‘‘Republic of Bihar’’, as the late Arvind Das put it, around. This Yadav is an altogether different phenomenon.

His reformist credentials were once certified by none other than the true blue liberaliser, Jairam Ramesh, of the Congress party. From his vantage location in the personal secretariat of former Union finance minister P. Chidambaram, Ramesh told me once that he saw Yadav being more supportive of economic reforms than most of his fellow Congressmen. So why then the scepticism about Mulayamji? His economics does not yet sit very comfortably with his politics.

Yadav suffers from all the failings of most north Indian politicians — casteism, linguistic chauvinism, cronyism and populism. In his political past he did not keep particularly good company and this almost became an impediment to his becoming the defence minister in 1996. This may explain, in part, the more credible company he has kept since! But scepticism about Yadav’s chances is not encouraged by his weakness for cronyism or concerns about corruption.

Be it in southern and western India or in east and south-east Asia, these two Cs of capitalism have not been hurdles to economic modernism and development. They may even have been facilitators!

The real question is, if Yadav wants to be the Chandrababu Naidu of north India, does UP have the economic and social wherewithal to enable that transition from the feudalism, peasant populism and cultural chauvinism of the past to modern capitalism in the future. It is a question that prospective investors will ask.

When Naidu chose to switch policy in Andhra Pradesh from the Congress party’s Nehruvianism and N.T. Rama Rao’s populism to market-friendly capitalism, the ground had already been prepared in the state to enable that transition. While Naidu did woo Reliance and Ratan Tata, McKinsey and Microsoft, his developmental agenda was built on the foundations of local enterprise, created by the Kammas, the Rajus and the Reddys, and an emergent middle class. And AP is no exception.

Where there is local enterprise, originating either from agrarian transition or from the educated middle class professionals, there government intervention has helped create the basis for urban development and private enterprise. Where governments from above have tried to foster development in policy hothouses without the social and economic ground below being fertile and hospitable for such development, there the ‘‘state capitalists’’ of the past have failed.

In short, the ‘‘state’’ can succeed in enabling development when there is a growing ‘‘market’’. Sounds paradoxical, but that is what has happened in so many Asian countries to our East.

Does UP have the fertile ground of an emergent local enterprise, a local urbanising middle class, a professional class that is willing to try its luck in a competitive market place, or do UP’s educated citizens still want assured government jobs handed down by a ‘‘mai baap’’ sirkar? By inviting the nation’s most prominent business groups to invest in UP Yadav is signalling that UP is ripe for market-oriented private enterprise. But if this metropolitan business is not able to strike roots in a fertile ground of local enterprise, the experiment can wither.

So one must wait and see if the Ambanis, the Godrejs and the Bangas of Mumbai can do for Mulayam’s UP today what the Singhanias, the Jaipurias and the Shrirams couldn’t do for Nehru’s UP in the past. Take UP from semi-feudalism to capitalism.

There is bitter sweet irony in the fact that chief minister Yadav is today seeking to privatise the very sugar mills that the anti-Nehruvian Chaudhury Charan Singh nationalised in the 1960s. If chief minister Charan Singh sought the nationalisation of sugar mills in UP because their owners were ‘‘outsiders’’ from Kolkata and Delhi, Marwari and Punjabi businessmen, and drove many business groups out of the state’s sugar mill industry in the 1960s, chief minister Yadav wants those very same business communities to return to the state and industrialise it! The mills that turned sick due to the flight of capital from UP are to be now re-privatised and revived by a return flight!

If Yadav has to succeed in attracting investment into UP, however, his politics must encourage and give confidence to local business and the professional middle class. The record of the past half century shows that developmental interventions from ‘‘above’’ or ‘‘outside’’ succeed when the ground ‘‘below’’ is prepared and the environment ‘‘within’’ is conducive. If Naidu did not inherit a state in which local enterprise had come into being, and a professional middle class was seeking avenues for enrichment, he could not have succeeded in the modernisation and development of Andhra Pradesh.