Coming from the chief architect of India's disastrous neo-liberal reforms since 1991, the PMs words sound hollow, superficial and guilt-ridden. In 1991, his neo-liberal reforms resulted in the scrapping on India's previously state-managed economic development with unfortunate consequences. For the period from 1996 to 2005, the annual agricultural growth rate fell to 1.1 percent from an average annual growth rate of 3.2 percent during the 1980-96 period. The 1.1 growth rate was barely a quarter of the 4 percent agricultural growth target that the government had set for the 10-year period of 1996-2005.
During the 1990s the World Bank pushed large loans making India dependent on foreign finance. World Bank loans are always accompanied by "reforms" and "structural adjustments" such as deregulation, privatization, tax cuts, the gutting of all restrictions on the laying off of workers and closure of plants, and the slashing of “non-productive” social expenditure. Indonesia and Argentina are but a few examples of the results of World Bank loans and "structural adjustments" and India is rapidly joining the ranks.
According to the The UN Human Development Index (HDI) of 2003, India ranks 127 (was at 115 in 2001). So clearly the "reforms" aren't working. In 2004, expressing clear displeasure with the so-called reforms, the ruling party was voted out of power. Privatization of water-supply and other crucial public services have resulted in price increases. Reforms require the dismantling of public and social responsibility and opening up domestic markets to transnationals. Debt repayment and military spending prevent the nation from focusing on resolving social issues.
P Sainath, an award-winning Indian development journalist who focuses on social problems, rural issues and poverty describes the magnitude of the problem (see http://www.indiatogether.org/opinions/talks/psainath.htm) below:
"The crisis states are AP, Rajasthan and Orissa. In the single district of Anantapur, in Andhra Pradesh, between 1997 and 2000, 1800+ people have committed suicides, but when the state assembly requested these statistics, only 54 were listed. [see April 29 and May 6 issues of The Hindu, for more details]. Since suicide is considered a crime in India, the district crime records bureaus list categories for suicide - unrequited love, exams, husbands' and wives' behavior, etc.; in Anantapur, the total from these categories was less than 5%. The largest number, 1061 people, were listed as having committed suicide because of "stomach ache". This fatal condition results from consuming Ciba-Geigy's pesticide, which the government distributes free, and is almost the only thing the rural poor can readily acquire."
"In India, people have the perception of "subsidies" being given to farmers, and this is one of the reasons why the urban folks think that farmers need to improve their act. But the vast majority of this subsidy is given not to the farmers themselves but to fertilizer producers. The "farmers" who get this subsidy are called Birla, Tata and Ambani! Also, this is given in such a way that the more you produce the lower the rate of subsidy, and the smaller amounts you produce, the more higher the rate of subsidy. In theory, this should support the "small farmers", but in fact the large producers overproduce and understate their output, just so they can avail of the higher rate of subsidy."
"The poor farmer is sometimes portrayed as uncompetitive, and that he lives off subsidies; many people take the view that if he cannot compete with global players, he should try something other than farming. But the reality is that Indian farmers are asked to compete with U.S. farmers who get $35,000 in subsidies per farmer! The European Union conducts its milk and cheese bonfire each year, destroying surplus which might depress prices if released in local markets instead. With markets forced open by trade agreements, that produce is dumped in India (and elsewhere), and it kills the livelihood of the everyday milkman."
In India, the reforms only benefit the upper echelons with income inequality skyrocketing. India now has the fourth largest number of billionaires in the world (36, compared with Japan's 24) with a significant portion the population living in villages or in wretched city slums. The CEO-average worker income differentials in India now stand at a mind-boggling 500:1 or 1,000:1.
In a devious move, Manmohan Singh announced a Cabinet shuffle in February 2006 (ostensibly to broaden regional representation). However if you look closer, this was at the same time as the negotiations on the Indo-US nuclear agreement. The two most significant developments associated with the shuffle were the demotion of Petroleum Minister Mani Shankar Aiyar and Manmohan Singh's decision to retain in his own hands the post of External Affairs Minister. In all probability, this was concession to the US to further the agreement . Mani Shankar Aiyar (Left) was a vocal proponent of the scheme to build a pipeline to deliver Iranian gas to Pakistan and India. The Bush administration repeatedly made clear that it is adamantly opposed to the building of such a pipeline, which would undercut its efforts to isolate the Iranian regime. Aiyar also championed the development of an Asian energy grid to lessen Asian dependence on western-based oil companies, and promoted cooperation between India and China in overseas energy exploration and production. Needless to say, The Unites States was not pleased.
The shuffle was also used to push through a number of right-wing measures (speeding up the pace of "reform" via more privatization, more deregulation, redirection from income-support programs to defense spending) indicating a clear right-wing shift in the Congress party which is prostituting itself to US interests and violating India's traditional non-aligned movement. Note that Manhoman Singh already has a large number of other posts besides that of prime minister. These include head of the Ministry of Personnel, Public Grievances & Pensions, Ministry of Planning, Department of Atomic Energy, and Department of Space and External Affairs (sound like a power grab ?)
Also, see Mani Shankar Aiyars speech to the CII here
I've commented in more detail on the various problems with the Indo-US nuclear agreement here
Being the architect of disaster, could it be that the PM is feeling guilty for wreaking havoc on the country ? Its blindingly obvious that his very own policies have caused the very problems that he's now asking corporations to cooperate with the government in solving. Or is it because he sees a huge increase in domestic unrest (quickly getting uncontrollably out of hand) as a result of social inequality and brutal oppression and is switching panic mode ?
Unfortunately, "corporate social responsibility" is a myth. The capitalist model is responsible solely to its shareholders and is motivated only by profit and greed and is inherently self-destructive and inhumane, so voluntary social responsibility is not going to happen. If Manmohan Singh were really serious about corporate social responsibility, he would enforce government regulations to that effect. For starters, he can place a cap on CEO salaries but that's the least he can do. In fact, he has to start undoing all his own "reforms" by passing regulations to reign in corporations, increase (real) agricultural subsidies and increase taxes on the rich, increase spending on social programs and free India from debilitating World Bank loans.
Maybe, in the PMs guilty admission of the failure of his reforms there is still hope for real reform instead of relying on corporate social responsibility.
On the bright side, we're starting to see roadblocks in the Indo-US nuclear agreement with both sides refusing to yield. According to this very interesting update on the status of the Indo-US nuclear agreement:
"Any lingering doubts on the US stance can be said to have been resolved once and for all by the letter of admonition written to Prime Minister Manmohan Singh by a group of Congresspersons. Dated May 2nd, the letter authored by members of key Congressional foreign relations committees seeks—baldly stated--to browbeat the Indian government into dropping energy-based ties with Iran".
However, in a surprising twist, instead of buckling to US demands, "As recently as May 8 Petroleum Minister Murli Deora affirmed in Parliament that India would not surrender to US threats and that Energy Secretary Sam Bodman had been informed that US interference in the IPI project was unwarranted. The pipeline project could well be the barometer for a cooling off in Indo-US relations and an end to the period of abject submission to US requirements."Maybe things are looking up.
References:
New Maharajas
World Bank President Wolfowitz pledges $9 billion in loans to India The People who matter most
With cabinet changes, India's UPA government tilts still closer to Washington
Refusing to Pay the Price
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