Alternatives to Neoliberalism in India

 

Introduction

Modern India’s relationship with the capitalist world economy has been through three broad phases. First, British colonialism ruined a flourishing textile industry in India and converted the country into a source of raw materials for its own manufacturing industry, forcing India into the position of a colony subordinate to an imperial power. Second, the post-independence Indian National Congress (hereafter Congress) government embarked on a process of industrialisation in an economy that was heavily protected though not completely cut off from global capital. The third period, globalisation and neoliberalism, is usually traced to the economic liberalisation of 1991, when India began a process of re-integration into the world economy 

This chapter will sketch an outline for each of these three periods, introducing the social forces and struggles that could constitute the basis for moving forward from neoliberalism to an economy where production is for need, not profit, and working people control their lives and work.

The Gujarat Model of Development: What Would It Do To The Indian Economy?

 

The cornerstone of Narendra Modi’s and the Bharatiya Janata Party’s campaign for the 2014 Lok Sabha elections is that the United Progressive Alliance (UPA) has ruined the Indian economy and the BJP led by Modi will make it boom. These claims have been reinforced by corporate adulation for Modi in his ‘Vibrant Gujarat’ summits (Times News Network: 2013) and surveys showing that almost 75% of top corporate CEOs want him to be the PM (NDTV Profit: 2013). How valid are these claims?

India’s economic performance since the 1990s

The economic reforms initiated by the Congress government in the 1990s raised the Gross Domestic Product growth rate from an average of around 3.5% per annum since independence to more than 9% between 2005-06 and 2007-08 (Planning Commission: 2011), before dropping to 6.7% in 2008–2009 as a result of the global financial crisis (Government of India: 2010). Global competition forced manufacturers of products like electrical and electronic goods to improve the quality and reduce the price of their products. Computers, internet access and mobile phones became much more widely available. 

However, neoliberal policies that were part of the changes had serious negative consequences. Privatisation was in many cases accompanied by massive corruption (e.g. the Commonwealth Games and 2G scams), as politicians and bureaucrats received kickbacks from the corporations they favoured. In other cases, even if there were no kickbacks, lack of adequate regulation allowed corporations to make windfall profits, while public sector banks offered them generous loans without exercising due diligence. The campaign by industrialists for the abolition of protective labour laws reached a crescendo during the National Democratic Alliance (NDA) regime. It stopped when the UPA came to power, but the anti-labour atmosphere had already influenced state labour departments and even the judiciary to such a degree that workers struggling for their rights were seldom successful. 

World Trade and Workers' Rights: To Link or Not to Link?

 

The saddest thing about the confrontation which took place at Seattle in November-December 1999 was the absence of any voice speaking for Third World workers, either among official delegates to the World Trade Organisation (WTO), or among the protesters outside. One reason could be that it would be difficult for workers or their representatives from developing countries to travel to Seattle. But at least a subsidiary reason is the failure of trade unions from our countries to articulate a clear and consistent standpoint which could be argued at such a forum. This is a lack we urgently need to remedy.

Before we look more closely at the issues raised by the meeting, I would like to make my basic standpoint clear. Very simply, as I see it, the present world system is a capitalist one, and capitalism is by its nature exploitative and oppressive. I would like to see it replaced by a more egalitarian, cooperative, compassionate and caring system. However, I do not think that this end can be achieved without the active and conscious participation of the vast majority of the world's working people. This is not possible in the immediate future since these protagonists have a long way to go before they can unite around such a common goal. We are therefore constrained at the moment to work within the capitalist system in order to create the conditions in which a revolutionary transformation of the world system can take place. So the question which confronts us is: given these constraints, what should our attitude be to the linking of trade agreements of the WTO with workers' rights?