1991 heralded the end of ‘the licence raj’ in India and the beginning of the free market economy with an inflow of foreign capital to steer it. Within a decade India had begun to shine. A couple of years later the Indian miracle of a near two-digit growth rate had become the talk of nations throughout the world. Soon predictions were being made of the distinct possibility of India becoming one of the three super powers in the world by the middle of the century. Towards the end of the decade it could be proudly proclaimed that India could withstand the global meltdown.
A couple of years later, end of 2011, clouds began to appear on the horizon. And, just a few weeks back a commentator wrote: “The worst economic situation that this country has seen”. “Industry growth grinds to near zero” proclaimed the media. An international rating agency threatens to downgrade India's economy for the second time in 2012, this time to the lowest investment grade, lower than even that of beleaguered Spain’s, putting the blame on policy paralysis. India Inc concurs and a highly respected business leader confesses: “I feel sad we have come to this state”.
Reform regime
What has gone wrong? Turn to Aseem Shrivastava’s and Ashish Kothari’s book. It argues that the set-back has not been sudden or a recent event, but the inevitable result of the faulty step, haltingly started in the 1980s and dramatically inaugurated in the 1990s — the handing over the Indian economy to global capital, global finance capital, to be more specific.
The book is a well-documented, cogently argued and clearly presented people’s audit of the Reform Regime. To sum up in a single sentence: An economic regime dominated by global finance capital can benefit only that small segment of the population whose activities are directly or indirectly linked to finance, but is detrimental to the vast sections whose livelihoods are precarious and rooted in land and nature’s endowments.
At one stage of its evolution capitalism’s unquenchable quest for profits was routed via the increase in technological progress and the resulting increase in the productivity of workers. Global finance capital looks for and moves about in search of quick profits. “Gambling on everything — from currencies, companies and real estate to natural disasters and pension funds — has become the norm in global financial markets, turning capitalism into what traditional economic wisdom used to fear: a casino.” And for those who have big funds to play with the returns can be as high as 50 or even 100 per cent.
But the bulk of the people — anywhere in the world — are excluded from the game. In the U.S., the base of finance capital, it is admittedly the top one per cent versus the ninety and nine. According to data put out by the United Nations, the richest 1 per cent of adults around the world now own 40 per cent of global assets while the bottom half owns barely 1 per cent.
In India between 2003 and 2007 there was an increase in wealth of over $ 1 trillion (more than a year’s GDP) of which more than half was held by domestic share- holders who constitute a mere 4 to 7 per cent of the total population. In the meanwhile per capita availability of food grains has been coming down during the period of ‘national’ prosperity and 77 per cent of the population live on Rs. 20 a day.
The crisis is not only economic, but ecological as well. In general, “currency devaluation lead to greater pressure on the environment, as an exporting ‘developing’ country necessarily gives up more of its resources … Cheaper credit or tax incentives for investment usually accelerate the pace of incremental damage … When financial markets are opened up to trading in commodities and commodity futures … metals and other non-perishable raw material become very attractive as items to hoard, speculate and make money on.” It is not surprising, therefore, that since 1991 some of the world’s largest mining companies from the U.K., U.S., Canada, Norway, South Africa have invested in India. And corporates, bureaucrats and politicians all converge on this symbol of international cooperation as it was during the colonial period!
Economic aggression
Land also comes to be grabbed for ‘public purposes’, authentic, or more often as favours to those who matter — to corporate bodies for their business purposes, to the affluent for their lavish living — in practically all instances by removing and dispossessing the poor, both in urban and rural areas. Of special concern is the acquisition of large areas of land to set up Special Economic Zones (SEZ) formally meant to increase production and encourage exports, but which invariably confers variety of concessions to the business class who set them up and make the working class totally defenceless against those who make profits and ruin the ecological balances. The denuding of vast tracts of forests, driving out the original settlers and in many ways adversely affecting the environment is another standard pattern of market driven economic aggression that is hidden by the appealing appellation, ‘development’.
Thus globalising India is in a state of rapidly deteriorating social and ecological health indicating the erosion of ‘the moral commons’, point out the authors, as seen from the staring inequalities and ruthless exploitation of human beings, land and nature’s endowments. More globalisation is not the answer.
Without attempting a detailed road map to what they designate the ‘newhere’ of happiness, freedom and shared prosperity, the authors put forward a Radical Ecological Democracy (RED) as the alternative. It is not produced out of thin air either. As their audit is based on factual material, their alternative is also derived from actual experiments at local levels initiated by individuals and communities to deal with felt needs — in Rajasthan, Maharashtra, Andhra, Gujarat, Madhya Pradesh, Tamil Nadu, Kerala and many more from India as also from other parts of the world — all with emphasis on ecological sustainability and human equity. The message is that genuine globalisation of people all over the world is possible only by localisation of where they are. For, “perhaps for the first time in history, there is both a local and global mindset, a sense that we are both individual human beings and communities, as also one humanity — and one with other life on earth. There is a growing sense that we are part of our local ecosystem as well as of one global ecosystem.” A “must read” book for all concerned citizens.
CHURNING THE EARTH — The Making of Global India : Aseem Shrivastava, Ashish Kothari; Penguin Books India Pvt. Ltd., 11, Community Centre, Panchsheel Park, New Delhi-110017. Rs. 699.
