This article examines the apparent paradox of India’s combination of durable democracy and electoral accountability with a capable bureaucracy, coinciding with a deficient development trajectory. It outlines the nature of the conceptual problem, where India is an outlier in global patterns. Then it compares different conceptual approaches to drawing connections from governance institutions to development outcomes. Next, it reviews some of the contributions to understanding India’s political economy in recent decades. Finally, it draws lessons from India’s experience for the appropriateness of different theories of governance and development. One conclusion is that the paradox recedes when attention is paid to the subnational level, where India’s states encompass considerable variation in initial societal and economic conditions and in development outcomes, and a sufficiently rich theoretical framework, that of limited access orders, is used to situate and encompass the different subnational experiences.