Globalizing India and Challenges Ahead

India is known for its long history of knowledge, learning and innovations.  It is also proud of its rich ancient civilization. The only source of Diamonds in the world until 1896, India was one of the richest nations till the early British rule. Its contribution particularly in developing the 'Decimal System', 'place value system; Surgery and Ayurveda is also historically known. Not only Algebra, Calculus and Trigonometry originated in India, India was the birthplace of four chief religions – Buddhism, Hinduism, Jainism, and Sikhism, which are followed by about one-fourth of the world population. India was the first to create the Martial Arts and Yoga, which has existed for over 5,000 years. India can also boast of having established the world's highest cricket ground in Chail (Himachal Pradesh), world's highest Baily Bridge in Ladakh Valley and world's first university in Takshila in 700 BC.

The independent India also has a reason to be proud of consolidating democracy in the ethnically and socially most heterogeneous country of the world particularly after withstanding the trauma of the partition and undertaking the gigantic task of integrating more than 500 Princely States after achieving independence1. India's journey for economic transition and development since independence (1947) has been mixed. Its economic policy is characterized by an active role of the state with public sector as a leading investor up to 1980; and qualitative changes in controls under MRTP Act to moderate bias against the private sector, and the Indian industry gearing up for up-gradation/ modernization to take on the growing competition during 1980s. This resulted into improved GDP growth of 4-6% over the decade, check on the burgeoning fiscal deficit and initiating structural reforms meant to improve delivery systems and raise efficiency levels.

Interestingly, all along with the change in government in power, there has been no sudden drastically disruptive policy reversals. Such a policy regime though created a new space for India in the world geopolitics and global economy and facilitated global capitalism, neo-liberalism. It also helped it to become world's fourth country in the world to launch a rocket to Mars with 'Mangalyaan'.  But it also brought a serious need for inclusive and peaceful sustainable human development for all.

With about 1.3 billion people constituting around 17.5 per cent of world population, out of which about 2/3rd being in the working age, India has the potential to be the future human resource supplier.  India also made creditable progress on the economic front and achieved high growth rate, raised foreign exchange reserves and remittances, reduction in poverty and mortality rates. The sun-rise sectors (Information Technology & Enabled Services) and a new set of entrepreneurs (e.g. Dalit Indian Chamber of Commerce and Industry) also emerged.

However beneath this glitter, challenges are daunting and the government of India should make all its efforts to take on these. These challenges come from the following:

1. Economic contradictions are turning out to be serious. Indian Agriculture contributes 24 % of the GDP, but employs 60% of the population. The tax base is so skewed with top 5% taxpayers pay 90% of Income Tax and top 0.01% contributes 50% of the Income Tax collections.  India is shining for the rich with top 10% saw 376% growth and bottom 50 % recorded only 97 % growth.

2. India's ranking in HDI position is quite low (131 out of 188) countries indicating India has to work hard in the field of education, health and inclusive growth with job creation.  Based on under-nourishment and child wasting, stunting and mortality under 5, global hunger index finds India at 100 out of 119 countries.  Though it has improved over the years.  In the inclusive development index, India is ranked 62 out of the 74 countries for which it was calculated.

3. About one-third of 132 crore Indians still remain under extreme poverty and mass deprivation. The official figure of poverty 22 % measured with per capita income per month at Rs.1000 in urban areas and Rs 816 in rural areas is not acceptable even for survival because minimum living requires Rs.10, 000 per month.  As per the Labour Bureau Survey (2016): about 85% of Indian workers earn less than or up to INR 10000 & Only 1% of working households are able to earn just a required decent living of INR 50000.  All put together vulnerable Population turns out to be around 67% with 40-50 million migrant workers engaged in precarious conditions.

4.The youth disenchantment is on the rise. About 12 percent of its youth population is unemployed (12 million people seeking work against 0.13 million generated besides under employment and disguised unemployment). Depressingly, a large educated pool about 80% are non-employable by Industry About 86% of India's work force employed in informal sector (unincorporated enterprises with less than 10 workers); and 90% employment is informal and such people lack any ensured social and employment security.  80% of educated are non-employable by Industry

5. Economic inequalities have reached intolerable levels with top 1 % receiving a higher share of total growth than the middle 40% (29% vs 23%). of population having about 80% of national income and such inequities further rising. In the post-globalization period, market forces continue to be harsh to the have-nots, excluded classes and people living at the margin.

5.We live in the most expensive Democracy. As reported in media, the per minute cost of running the Parliament turns out to be about Rs.2.5 lac  and every Lok Sabha election costs not less than 10000 crores. A recent study quoted by the former Chief Election Commission of India points out that in both the 15th as well as the present Lok Sabha, almost 30% of the members have one or more criminal case registered against them and half of these are for heinous offences (HT, Dec 26, 2017, p.12).

6.Indian cities make up more than half of the world's 20 most toxic cities. Environment Performance Index (EPI, 2012) ranked India 125th out of the 132 countries. Estimates show that about 45% of land resources require special treatment on account of water, wind, salinity, alkalinity; & river action. Our current forest area of 21% fall short of the required 33%.  The plants and animal's endangered species are constantly rising.

7.Black economy is estimated to be at horrifying levels. One estimate by a Professor from IIM (B) put this figure at Rs. 70 lac crore against the GDP figure of 43 lac crore in 2007-08.  Panama paper exposes 147 Indians out of 426 with Rs.792 crore undisclosed amount. In the post demonetized phase, the government pointed out 17000 crore suspicious deposits; 58000 suspicions transactions; and 22,400 struck-off firms; 35000 shell companies and 3 lac disqualified directors.

--------------------------------------------

1Inputs taken from a book: Globalising India: Political Economy Dimensions, Readers Paradise, Delhi, written by Guljit K. Arora are gratefully acknowledged.  We also thank Mr S P Singh, a government official for providing ideas about India's rich history and civilization. 

......To be continued on next issue or see the complete article at http://vaahdelhi.blogspot.com