WORRYING DISPROPORTIONATE

GROWTH

India's economic boom continues unhindered. Together with

China, it is emerging as the most important nation that will keep the
economic wheel spinning at a time when the developed world slows
down to re-examine what capitalism-led economic reforms have
done to its human capital and social well-being.
The growth of India has been indeed
phenomenal. The Forbes magazine noted this year that India has
the highest number of billionaires in Asia Â- 36 -Â exceeding the 24
billionaires in Japan. Together, the Indian billionaires hold among
themselves assets worth $191 billion. India, after all these years of
economic reforms, is at the crossroads. While one road leads India
to economic prosperity and glory, the other road leads it to social
inequality. Presently, as India is one of the fastest growing
economies in the world, the social aspects have been ridden
roughshod by the economic benefits. While this growth is laudable,
there is another India or Bharat for some, which escapes attention.
India's unquestioned acceptance of neoliberal policies and the
resultant prosperity has largely bypassed the nation's poor ÂÂ- a
reaffirmation of the trend of the rich getting richer and the poor
getting poorer.
What has been conveniently forgotten or
suppressed till date have been the disparities, mainly the socio-
economical issues. This has led to growing discontent among the
population and it has gathered momentum since the reforms began
15 years ago. It will very soon reach a critical point wherein the
very purpose for which the reforms were started, will start to lose
their significance rapidly and throw the country back into the
‘license raj’ and ‘unionist’ era.
India's agrarian crisis has successfully
dismantled the rural infrastructure and hastened the migration of
those dependent on farming to cities in search of jobs.
The migration of the rural poor to cities in
search of jobs has created frequent skirmishes between city dwellers
and migrants of different economic, social and cultural
backgrounds. Another problem is the packaging of these issues as
cultural conflicts without looking at the economic crisis that is
driving this antagonism.
India's agricultural crisis continues to
aggravate and the economic reforms initiated in 1991 under the
P.V. Narasimha Rao government and accentuated under the NDA
government led by A.B. Vajpayee have eroded the agricultural
infrastructure of India. The current UPA government led by
Manmohan Singh has been of little help, a fact made obvious by the
heightening plight of cotton farmers in Maharashtra and Andhra
Pradesh.
Another worrisome aspect of India's
economic growth is that it is mainly led by the service sector,
particularly IT and IT-enabled services, in which the country has
emerged as a force to be reckoned with. But this also raises the
question of sustainability of growth in this sector. While agriculture
has been systematically altered to meet the dictates of neoliberal
policies, the secondary sector has also experienced a steady setback
with the major growth being realized in what academician David
Harvey calls as FIRE: Finance, Insurance and Real Estate. With
these sectors emerging as the major areas of growth in the future, a
prominent feature of all neoliberal economies, India's embracing of
the free market is almost complete. But what is alarming is the set
trajectory of India's economic growth, with most of it being realized
in areas that are driving the world economic order. The rise of
information technology as an integral tool through which economic
growth is managed, the steady abandonment of agriculture for
corporate takeover, the ignoring of the industrial sector and
increased dependence on export-oriented growth - all features
conducive to and dictated by Western economic forces - places India
in a peculiar position and intertwines its well-being excessively with
global economic conditions.
The chasm between the rich and the poor
has increased so vastly that the rich are just getting richer and the
poor are just getting poorer. The real benefits of the economic
reforms have rarely percolated to the lowest strata of society. Just to
illustrate the same with an example, most of the states today vie with
one another to grab a project of any significance, be it chemical,
auto or even IT. In doing so, the benefits they are offering, right
from free land to tax sops are being given on a platter. But the
benefits or savings that a company gains from this does not affect
the lower strata of management, but remains in the hands of the top
management, thus depriving the former of the economic benefits.
Also, most of the labour laws in the country are outdated and have
not kept pace with economic reforms. Thus, the exploitation of the
working class becomes much easier. A classic example is the BPO
industry in our country. While most of them work in the nights, the
pressure each employee faces to deliver results and the working
conditions are appalling, to say the least.
The agricultural sector has also seen this
disproportionate growth, as it is a field that has been left high and
dry in the pursuit of agricultural reforms. The sector has been
opened up to the multi-nationals, without having evolved a
comprehensive cover for our farmers, most of who are poor and
own very little land of their own. A case in point is the spate of
farmer suicides that our country has witnessed in the past few years.
The developed countries, which clamour for open-ended policies,
have, in fact, some of the fiercest protection policies when it comes
to their agricultural sector. Small scale industries (SSIs), the heart
and soul of many towns and villages, have been virtually ignored.
More than half of them have closed down in the last few years in
the face of intense competition from multi nationals who have
unmatched financial and political muscle.
This dependency, though desirable as it
promotes global harmony, may place India in the hands of
dominant economic forces that have a vested interest in promoting
the global integration of economies.
The fear that globalization is the next
phase of capitalist expansion is not totally unfounded. While India
needs to be a part of the global economic apparatus, allowing the
latter to control it excessively would hurt its interest. The only way
out would be to create a self-sufficient India, a condition almost
impossible if the primary and secondary sector continue to be kept
out of the policy makers' priorities.
On a parting note, what are essential for
India are economic reforms with a social face. The economic
policies and their subsequent reforms must be accompanied by
suitable clauses to benefit the economically weaker sections.
Various schemes must be thoroughly scrutinized and efforts must be
made to see that the rewards must reach everyone. Then India will
not only be economically prosperous, but will also forge ahead
towards its goal of world dominance.

ABHISHEK RANJAN
IMED, PUNE