Economic Highlights

New Delhi, 1 May 2009

All-Inclusive Growth

REAL ECONOMIC ISSUES ELUDE POLLS

By Shivaji Sarkar

 
The General election is entering the last phase. This biggest political process was expected to generate a debate on the country’s economy, rising prices, growing poverty and joblessness. Alas, only in the passing. The ruling alliance, in particular has been cautious and skeptical on these critical issues. When and if the opposition, be it the right or left has sought to raise the subject, it was either deluged under the so-called secularism vs communalism debate or camouflaged by the occasional antics of its leaders spending a night or two in a dalit home. Worse, a steady diatribe against a few leaders helped deflect the debate as if the economic crisis didn’t merit a discussion.

The UPA Government has been tom-tomming its ‘achievements’ and trying to project a growth figure, which is being constantly reduced by international and national organizations, including the Planning Commission. These figures vary from the Plan panel’s six per cent to RBI’s 5.7 per cent to less than 4 per cent of the International Monetary Fund. The absurdity should have led to a high-pitched war of words as to who is giving the correct or near-accurate figure. Sadly, this has not happened, raising a suspicion whether deflection from the real issue is being managed by certain vested quarters or not?

On the other hand, it also raises a moot question: whether those in power are capable of addressing the issues afflicting the nation? Today, poverty remains the prime concern. It hardly finds an echo. Recall that in 1971, the Late Indira Gandhi swept to power on her slogan of “Garibi hatao” alone. Since it has seemingly been taken as an essential of Indian ethos and the ruling party does not think it proper to harp on it - possibly because it brings the failure of the ruling clan in stark reality.

In 2004, as per official statistics there were 27 crore people below the poverty line. While analysing the figures of the National Sample Survey Organisation (NSO), the Indian Statistical Institute concludes that in 2008, the number has risen to 32.5 crore—an addition of 5.5 crore of people. The report of the Arjun Sengupta committee states that 77 per cent have a daily income of less than Rs 20. Clearly, the figures indicate that poverty is growing.

This also is an indicator that the measures taken have either gone awry or were ill-conceived. On top of it, the global integration has not addressed the vulnerable class of people. The growth was restricted to the rich but the meltdown has affected the poor the most. It is a lesson: that mindless globalization had developed into a tool of exploitation that allures people to invest in unstable instruments that lead to further crisis. The stock market was taken as an indicator, which it certainly was not.

That failure has led to job losses everywhere-- from Surat to Kolkata to Gurgaon to Bangalore. As per official statistics, there are six crore unemployed persons now against four crore in 2004. Obviously it’s easy to blame the global meltdown for this employment crisis. But all jobs have not been lost due to it alone.

The tragedy is that the working class is not protected. For them laws are subverted. The Government labour departments either do not function or not allowed to function by some powerful lobbies in the name of “labour reforms”. Such reforms only mean how to deprive the working class their legitimate due. It is happening with the powerful and profit-making IT companies, who are reducing wages to increase their profits without even a reference, forget about permission, from the labour department. And the Government is a mute spectator.

Starvation, which had rocked Parliament in the 60s and 70s, is also on the rise. The UN’s Food and Agriculture Organisation (FAO) estimated that 22 crore people are starving. India stands 94^th in the global starvation index among 119 countries. It further estimates that 56 per cent of Indian women suffer from anaemia and 50 per cent children are underweight. Worse, with the global “progress” in the 90s, food production has drastically reduced leading to higher food prices. This has further accentuated the conditions of the poor as their purchasing power has reached a critical phase. And this makes starvation a stark reality.

Politically the poor are used as vote-banks but as such there has not been any effective affirmative action to deal with the situation. The World Health Organisation (WHO) states that rising prices of drugs and medicines have increased the health expenses of the poor. It has pushed 16 per cent families below the poverty line and around 12 per cent families had to mortgage their properties to meet health expenses. Ironically, all pharmaceutical firms are raking in huge profits. The global crisis has not affected them. The Government has not taken steps to keep the prices close to their manufacturing cost. In fact, the pharma firms have been an uncontrollable entity for the past five years.

Farmers, largely the middle level and marginal, are too passing through a critical phase. Their investment has increased manifold and prices unremunerative. They are deep into the debt trap. The Kisan credit card has, if at all, been of very marginal help. In these five years, about 1.5 lakh farmers have so far committed suicide. More the so-called economic reforms, more the farmers have been at the receiving end. During off peak period, the farmers and their families used to engage in cottage and small industries, but official statistics show that about 33 per cent of such units have closed down.

Foreign investment and even the present foreign institutional investment in the stock market have not helped the rural economy. Rather entry of large corporate in this sector has added to further woes of the poor and small farmers. Urbanisation and large housing projects are eating into the fertile farm lands.

It is not that political parties are not aware of the situation. They are. However, so far none has tried to bring in a policy that is different. On the oft-repeated beaten track they choose not to change the fortune of this country. There is need to get rid of the foreign investment-oriented mentality and resuscitate the Indian ethos to give not merely a voice to the poor and the vulnerable but to make a country that can chart out a separate pro-people course. India needs to lead the world to free it of the malaise infected by the corporate centric economy. One only hopes that the new Government would usher in a change for all-inclusive growth.—INFA

 (Copyright, India News and Feature Alliance)