Open Forum

New Delhi, 6 May 2014

‘Development’ Models

SAME OLD NEO-LIBERALISM

By Chanchal Chauhan

In the present scenario of electioneering we hear various leaders promising or asserting their kind of ‘development model’. Sometimes they sell their wares in the same manner as the advertisers of a washing powder showed a caption, “My shirt is whiter than yours” and with their detergent they wash the dirty linen in public. If we analyse these ‘development’ models with a little insight we can easily grasp their essence.

There is a ‘hype’ created by the media in general, electronic media in particular presenting a ‘strong’ leader who is selling his model as ‘Gujarat model’ of development. The public is shown a posture as if this development model is different from the one that was followed by UPA regime and earlier rigorously implemented by the NDA. The policies followed by both the regimes are in essence the same policies known as ‘neo-liberal policies’ dictated by the international finance capital through their ‘humpty dumpty sat on the wall’ of the world economy and Indian economy is no exception.

One can ask: ‘Is there no economist in India to assist the elected government in economic affairs and why are only those economists posted on key positions of the Indian economy who have been associated with the World Bank or the IMF?’ We have seen this happening at key-posts such as the Prime Minister, the Planning Commission and the Reserve Bank of India.

Now, some economists from abroad are offering themselves to assist the new regime, in case, the person who is portrayed as the Prime Ministerial candidate accepts their offer. If we read their statements closely, we can understand that they serve the same forces that dictate the world economy and the same development model that created havoc ruining the lives of millions of the poor worldwide. One of the two economic advisors-in-waiting to the new Prime Minister-in-waiting has expressed his views without mincing words that advocate the same ‘neo-liberal’ policies serving the interests of the international finance capital.

One is the US based Indian-born economist Jagdish Bhagwati, who has offered his services to Narendra Modi, the BJP nominee Prime Minister-in-waiting who is offering to the people of India his ‘model’. According to the media reports this economist ‘would urge him to allow more foreign investment and trade to spur slow growth and curtail government spending.’  One wonders, what is new about it? It is the same prescription advocated by Manmohan Singh and his team. 

For the first time addressing his potential role as economic adviser to the BJP PM-in-waiting, Bhagwati, told Reuters “I'd be glad to chair something like that, and I think that's what they might do,” he said. The wire agency has also reported on the possibility of another economist. Arvind Panagariya to be preferable to Bhagwati, ‘In a possible sign of the influence of Bhagwati's brand of free-market thinking, he said his pro-growth protégé Panagariya was a strong candidate for the more hands-on role of chief economist to the prime minister, if Modi is elected.’ Although, the BJP is silent on the issue of any plans to invite Bhagwati and Panagariya to become economic adviser to Modi, yet the game-plan of the powers-that-be is clear.

The problem with the BJP and its top brass is that they have, at present, no Indian economist of high repute on their side. Amartya Sen had openly shown his dislike for the BJP nominee propped by the RSS for leading India. Their leader is not as highly educated as Manmohan Singh and his team of economists. At the most, they will have to depend on some ex-bureaucrats who have always served the interests of various corporate houses and international finance capital.

It is this paucity of economists that caused worries at the level of satraps of international finance capital and they prompted the two economists to fill the vacuum, if created by the defeat of their present guards, Manmohan Singh and his team. However, they are in favour of retaining one guard in the new regime and that is the RBI Governor Raghuram Rajan who has also worked with the World Bank, an important wing of the international finance capital. This despite rumours of there being differences between the top brass and Rajan, which he dismissed as media creation. However, Finance Minister P Chidambaram is not too sure as the other day he stated that the “new Government must respect his (Rajan’s) appointment”.

Meanwhile, Bhagwati has suggested to Modi in advance, ‘To enhance growth, he will need to promise that India will open more to trade and FDI (foreign direct investment). His most urgent policy prescription, however, is to slow government spending, which he blames for high inflation. “On the financial side his best bet is to stick with Rajan,” Bhagwati said. In fact, Finance Minister P Chidambaram has stated that the “new Government must respect his appointment”. ‘We really need to ‘brake’ the economy, try to put a stop to its fiscal profligacy.’

Bhagwati had a public academic spat over India's welfare policies with Nobel laureate Amartya Sen. While both men agree on the need for social spending and economic growth to fight poverty, Bhagwati accuses Sen of not backing reforms needed to stimulate growth, including in tax, labour, privatisation and foreign investment.

One can easily see this is nothing but the same old model that has been in practice for the past two decades and once clearly announced by an earlier, PM-in-waiting that the Congress plagiarised the BJP’s economic policies. So whatever, models proffered in the rallies and written in the election manifestoes, the Indian poor are destined to live in the same vain hopes of betterment of their life.

The international finance capital earlier set its humpty-dumpty on the Indian wall, but now they have a great fall, new humpty-dumpty are going to be set up again by the same forces, and one can safely predict that they too will have a similar great fall and all the king’s horses and all the king’s men will fail to put humpty-dumpty again.

The two development models that are being proffered to the Indian electorate in the elections 2014 are nothing but a blueprint to serve the interests of the same corporate houses that are subsidiaries of the international finance capital advocating the same neo-liberal policies that have caused unbearable misery to the poor who are now expressing their anger by rejecting the Congress’s rule.

But it will be naive to think that the BJP will reject the policies dictated by the World Bank and the IMF, the two pillars of the international finance capital. Even Aam Admi Party chief Arvind Kejriwal, who is considered to be the vanguard of the poor is supportive of the same policies, only he is opposed to a few ‘crony capitalists’. If they are reformed, then, God’s in his heaven and all’s right with the world! ---INFA

(Copyright, India News and Feature Alliance)