Commentary/Ashok Mitra
Seeking the help of the helpless
The decrepit call to the decrepit.
Of all countries in the Western hemisphere, the United Kingdom
has the poorest rate of economic growth. The country, in fact,
is the prize exhibit of sustainable non-growth. The load of unemployment
in Britain, hovering around 10 per cent of the working force for
decades on end, has defied solution, the country's balance of
payments crisis is chronic, a massive programme of disinvestment
of public undertakings in the more recent period has not improved
matters.
The present prime minister presides over what by general agreement
is a decaying cadaver. He will, according to all indications,
be unceremoniously pushed out of office come May this year, when
the next elections are due.
The decrepit can, however, seek support only from the decrepit.
The assorted chambers of industry in India were unable to locate
any superior person to adorn their widely-trumpeted conference
on global partnership. To expect a British prime minister, heading
an administration riven by scandals and horrendous economic mismanagement,
to offer ideas contributing to India's growth was nothing less
than bizarre.
After all, he has not a clue about how to spark growth in his
own land. He, in any case, was clear in his mind on the role he
was to perform in India. He was here as a commercial traveller,
keen to see that India buys some more British merchandise, such
as the Hawk fighter aircraft, and lets the British insurance companies
in, thereby helping to improve British balance of payments. The
state of India's investmentless and sagging balance of payments
was the least of his concerns.
Forget the British prime minister, external entities of no other
genre too are apparently interested in investing in India's future.
The phenomena of sagging rate of both growth and capital formation,
gaping fiscal deficits, rising unemployment, soaring prices et al,
threaten to be endemic.
The principal postulate, forming the basis
of the promised miracle of milk and honey flooding the country
following liberalisation, was the gushing inflow of foreign capital.
The nation has now waited a neat half-a-dozen years; that kind
of inflow has not taken place. Prospects in the immediate future
are no better.
There is 'no alternative', crowed the pro-liberalisation lobby
in 1991. It is time to inform that lobby that the policies pursued
since 1991 have proved to be not much of an alternative either.
Polemics many ensue whether, had these policies not been pursued,
the economy would have been in a state healthier than she is at
this moment. But that hardly justifies the cynicism of the finance
minister, who presided over the affairs during 1991-96, to castigate
the present finance minister for the country's current travails:
his successor has only continued with the nostrum he had recommended.
There is actually total unanimity of views between these five
great architects of the country's future. Both think the onus
of lifting the country's rate of growth is on foreign investors;
the latter are a deviant lot, they got to China but forget India;
such conduct on their part is a mystery wrapped in an enigma,
or is it the other way round?
The native industrialists are an even sorrier lot. They cannot
make up their mind whether the non-arrival of the foreigners is
a good or a bad thing. A sense of trepidation, is pervasive: perhaps
these intruders will take a slice away from the home market; will
that loss be compensated by opportunities for new export earnings
that might be opened up? The local bourgeoisie do not know.
Meanwhile, their sentiments were hurt when those amongst them,
who rake up hundreds of millions of rupees as profit and have by
tradition paid no taxes from such earnings because of the unending
schedule of very convenient exemptions, were suddenly called upon
last year to, please, cough up cash for a minimum alternative
tax. This was unheard of stuff. A reverse take-off from John F
Kennedy has filled the air since: Ask not what you can do
for the nation, ask what the nation can do for you.
Other irritations such as high interests rates, etc, are, of course,
always there, but the first priority is to get rid of MAT, otherwise
the indigenous industrial community, the government has been informed,
will be in no position to invest in the nation's development.
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