The Current Economic Crisis and the People's Movement in Sri Lanka: Prospects and Challenges

On July 14, 2022, Sri Lanka’s parliamentary speaker announced that he had accepted the resignation of President Gotabaya Rajapaksa, sent by email from Singapore where he had fled via The Maldives.[1] That this former military commander – known as ‘the terminator’ due to his propensity to get critics assassinated[2] – was forced to resign by an overwhelmingly non-violent mass movement marks this as a major episode in Sri Lanka’s protracted democratic revolution.[3]

Nightmare's End?

I am not in Sri Lanka, and I feel torn about what is happening there. Acute anxiety about how millions of people will survive the dearth of food, fuel and medicines nestles alongside a glimmer of hope that this crisis could be the beginning of the end of a decades-long nightmare. Since the country gained its Independence in 1948, various sections of the population have been targeted by its ruling bloc: threatened with losing their homes, livelihoods and often their lives. They have fought back, but each section has been isolated and crushed by an increasingly centralized and ruthless state. Now, for the first time, the vast majority of the population has risen in revolt. Criticism of the dictatorship is widespread, and divisions between working people may finally be healed.

The Politics of Globalisation: Theoretical Debates

 Defining globalisation

Globalisation has become a buzz-word, yet there are widely differing conceptions of what it means. Part of the problem is that those who use the word seldom bother to define it. Prima facie, it would appear that a globalised world is one in which there are no barriers (other than purely natural and technological ones) to the movement of people, products, money and ideas around the world. But globalisation in this very general sense pre-dates capitalism and the formation of nation-states. Clearly, this is not the subject of current debates about globalisation, although it is not irrelevant to them. It is presumably in order to clarify this point that various adjectives are used to qualify ‘globalisation’, such as ‘capitalist’, ‘imperialist’ and ‘neoliberal’. However this creates new problems, because these adjectives have their own meanings. When they are combined with ‘globalisation’, where do these meanings end and the meaning of globalisation begin? 

Labour and Globalisation: Union Responses in India

 Introduction

The first major shock of what subsequently came to be called globalisation in India was the economic liberalisation programme initiated in July 1991. The Congress government headed by Narasimha Rao, faced with a crisis resulting from foreign exchange reserves sufficient for just a fortnight’s imports, undertook some of the measures recommended by the International Monetary Fund (IMF) and World Bank in the late 1980s. The new policy included abolition of licensing procedures for manufacturing investment (which had popularly come to be known as a corruption-ridden ‘license-permit raj’), reduction of the high import tariffs on most goods (but not consumer goods), liberalising terms of entry for foreign investors, and liberalising capital markets (Balasubramanyam and Mahambare, 2001). It would be a mistake to see these changes simply as being imposed on India. Many of them were designed to encourage the expansion of big business after what were perceived as decades of stagnation, for example by removing restrictions on mergers and acquisitions, encouraging businesses to seek finance abroad, and sparking a wave of expansion into new sectors which had either barely developed (e.g. telecom), or had until then been reserved for the public sector (e.g. banking). 

The next milestone was the birth of the World Trade Organisation (WTO) on 1 January 1995, with India being a member from the beginning. This involved new pressures, for example to eliminate quantitative restrictions on imports, simplify and reduce tariffs, reduce export constraints, reduce the number of activities reserved for the public sector and small-scale sector, further liberalise the Foreign Direct Investment (FDI) regime, and address the fiscal deficit (cf. WTO, 2002). The process of integrating India more closely into the world economy has been more or less continuous since 1991, despite changes of government, and the world economy itself has globalised rapidly during this period.

Women Workers and Neoliberalism

Book review of Women Workers and Globalization: Emergent Contradictions in India, by Indrani Mazumdar, Stree, Kolkata, for Centre for Women’s Development Studies, Delhi, 2007. xxiv + 349 pages.

The bulk of this book consists of four sectoral studies of women workers in Delhi and its satellite townships of Noida and Gurgaon, through a combination of structured questionnaires and individual and group discussions conducted in 2002-2004. 

Fine-Tuning the Linkage Proposal: Commentary

A cross-country comparison which finds ‘Strong evidence that countries with open trade policies have superior labor rights and health conditions and less child labor’ (Flanagan 2004: 26) suggests that openness to the world economy does not undermine workers’ rights and may even enhance them. However, the finding that in any particular country openness to the world economy can go with high labour standards is not incompatible with the proposition that globalisation as a process undermines labour rights globally.

One process by which this could and does take place is by the transfer of production from countries with higher labour standards to countries with lower standards, leaving workers in the former unemployed. Thus in developed countries, jobs in the labour-intensive textile and garment industries have been decimated as production shifted to developing country export sectors (Williams 2004; Narendranath 2004). This has also caused job losses in developing countries, when production moved from higher-wage countries like Korea to lower-wage ones like Cambodia. Outsourcing in the service sector led to further transfer of employment from developed to developing countries, leading to calls for a curb on outsourcing in the US (Alden 2004).

A less obvious, more insidious way in which labour standards are undermined is by the spread of low labour standards to countries which did not formerly suffer from them, or at least not to the same extent. The global expansion of informal labour – workers who do not have any formal employment contract with an employer and therefore are extremely vulnerable to abuse – is a case of this. Informal labour was always preponderant in India, but the expansion of homeworking, sweatshops, and the hiring of workers through intermediaries (‘labour contractors’, ‘agencies’, ‘gangmasters’ and so on) in countries which were formerly free of these problems (Mather 2005) has caused serious concern within the ILO in the 21^st century (ILO 2002).

In this context, the publication of International Trade and Labor Standards, with its carefully crafted proposal for a linkage between trade and labour standards that is both feasible and capable of stopping the downward pressure on labour standards, is of great importance. The authors have taken up objections to linkage in a step-by-step manner in order to formulate a proposal that meets almost all the arguments against it that are commonly put forward. This paper is an attempt to strengthen it by tackling some of the few remaining weaknesses.