When the imperial capital was transferred to Delhi early last century, New Delhi was built as a modernist showpiece, with avenues and roundabouts and a mall sweeping up to the viceroy's house, now the president's residence in the world's most populous democracy. If the experience of colonialism was humiliating, this proud new metropolis would surely be enabling. On 15 August, 1947, it was the setting for Pandit Nehru's declaration of independence "at the midnight hour". It was also a façade behind which the majority hoped and waited, and still wait.

This notion of façade is almost haunting. You sense it in genteel Lodi Gardens and among the anglicised elites and their enduring ambiguity. In the 1990s, it became a wall erected by the beneficiaries of Shining India, which began as a slogan invented by an American advertising firm to promote the rise of the Hindu nationalist BJP-led government. Shorn of Nehru's idealism and paternalism, it marked the end of the Congress Party's pretence of class and caste reconciliation: in other words, social justice. Monsanto and Pizza Hut, Microsoft and Murdoch were invited to enter what had been forbidden territory to corporate predators. India would serve a new deity called "economic growth" and be hailed as a "global leader, apparently heading "in what the smart money believes is the right direction" (Newsweek).

India's ascent to "new world power" is both true and what Edward Bernays, the founder of public relations, called "false reality". Despite a growth rate of 6.9 per cent and prosperity for some, more Indians than ever are living in poverty than anywhere on earth, including a third of all malnourished children. Save the Children says that every year two million infants under the age of five die.

The facades are literal and surreal. Ram Suhavan and his family live 60 feet above a railway track. Their home is the inside of a hoarding which advertises, on one side, "exotic, exclusive" homes for the new "elite" and on the other, a gleaming car. This is in Pune, in Maharashtra state, which has "booming" Bombay and the nation's highest suicide rate among indebted farmers.

Most Indians live in rural villages, dependent on the land and its rhythms of subsistence. The rise of monopoly control of seed by multinationals, forcing farmers to plant cash crops such as GM cotton, has led to a quarter of a million suicides, a conservative estimate. The environmentalist Vandana Shiva describes this as "re-colonisation". Using the 1894 Land Acquisition Act, central and state governments have forcibly dispossessed farmers and tribal peoples in order to hand their land to speculators and mining companies. To make way for a Formula One racetrack and gated "elite" estates, land was appropriated for $6 a square metre and sold to developers for $13,450 a square metre. Across India, the communities have fought back. In Orissa State, the wholesale destruction of betel farms has spawned a resistance now in its fifth year.

What is always exciting about India is this refusal to comply with political mythology and gross injustice. In The Idea of India, wrote Sunil Kjilnani, "The future of western political theory will be decided outside the west." For the majorities of India and the west, liberal democracy was now diminished to "the assertion of an equal right to consume [media] images".

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