| Chapter 10 |
The Narashima Rao Years |
|
Narashima Rao is an enigma. A soft spoken, cultured man, who rose by a twist of fate to become Prime Minister of India, just as he was getting ready to retire with his books and family. The man was chosen by the Congress elders, because they thought he could be easily manoeuvred; but for a while, he outsmarted everybody, until Congress lost the elections so badly in 1996, that he was replaced as Congress President by the wily Sitaram Kesri. Was he then a man of indecisiveness, as he has often been portrayed? Or was he the clever manipulator, who quietly waited for his hour, the politician who symbolised best the Congress' totally centralised power: one man at the top, deciding everything, keeping everything to himself, through whom everything goes, without whom nothing is done ? At any rate, one can safely say that the decline of the Congress party started with Narashima Rao. Economics however, is the bright side of his tenure; history will remember him as the man who really opened up India's economy, who had the foresight to name a non-politician, Manmohan Singh, as his finance Minister, who signed the GAAT agreements. 1) THE ECONOMICS OF GAAT Did Rao have any choice when he signed the Uruguay accords? Probably not. With the crumbling of the Soviet Union, went India's principal political ally and main economic partner. The heavy borrowing from the IMF and the United States' intense political pressure, both economic and on Human Rights in Kashmir, probably did not leave much leeway to the PM. Nothing, except Ayodhya, seems to have divided the country so much, as the GAAT agreements. Opposition parties, particularly the Communists, have lamented about "the shameful surrender to the capitalistic forces of the West", but could India really have afforded to stay out of GAAT? The arguments advanced against the Uruguay round might be valid: it is true that India had its back to the wall, although its leaders pretended that they signed it under their free will. It is even truer that its terms are mostly dictated by the industrialised nations to suit their own needs and to open markets which have been hitherto closed to them. It is also true that it is a form of economic neo-colonialism and that once again, it is the poor nations which are at the receiving end, even if this time the gun is held by businessmen. But once more, can India afford to be left out of such a stupendous effort at globalisation of trade, even if the impetus is given by the West ? The answer is NO, for three reasons. The first and most simple one, is that everybody is in it and it would make no sense for India to stay out and thus miss the benefits it might entail. Not only India might be boycotted by the industrialised nations and suffer, but smaller and less relevant countries than her might profit from the accords and overtake India, which then would have to put double efforts to catch up with the rest of the world. The second reason is that India has got to get rid of the leftovers of 45 years of socialist policies. Socialism, as well as Communism, did once symbolise a wonderful ideal: that of a sharing the earth's wealth with everybody, that of equality -nobody is richer or higher than the other. But in reality, man's greed, his natural tendency to pervert whatever comes in his hand, his Asuric thirst for power, have made a sham of Communism in general and Socialism in particular. Nehru probably thought that Socialism was best adapted for India, a nation of monstrous inequalities and with its majority of uneducated, poor people. But the reality turned out to be quite different from what he had envisioned. It spawned an octopus-like bureaucracy, which has its tentacles everywhere and bogs down in paper work and pettiness whatever lofty ideas emanate from the top. It gave birth to colossal projects, such as the big dams, which have already proved a failure in the West, but which India is still trying to push forward. It triggered a tremendous parallel market of black money -one third of the economy, it is said, although things have improved since Manmohan Singh came to power. And more than anything, Indian industrialists shamelessly took advantage for 40 years of India's closed doors policies, often producing the most substandard quality products, which they peddled as the latest technology and sold at outrageous prices. There can be no better example of this syndrome, than India's famed Ambassador "the sturdiest car made for Indian roads". The Ambassador must be one of the heaviest, clumsiest and slowest cars ever built on this earth; it was bought cheaply in the late fifties by Hindustan Motors; yet today it is still advertises as "the latest in technology" and sold at an exorbitant price, with a waiting list of three months! But there are hundreds of brands of foreign made cars today which are a hundred times more robust than the Ambassador, cars who race in rallies in the harshest conditions for hours at full speed and still survive. But as long as there is no substitute for the Ambassador (you cannot really call the Maruti, a car most unsuited for Indian roads, a substitute), Hindustan Motors will still be able to pitch that most unfortunate car. The same can be said of Bajaj, who sold millions of outdated, scooters to gullible Indians and still does it. But these scooters were seen in the fifties on the Italian roads and today's European scooters have nothing to do with what Bajaj still advertises as the "latest in technology" No survey of the private enterprises can be complete without a word about the top of the range: the five star hotels. Nowadays you cannot get a single room in a five star hotel in any of the metropolitan cities for less than 5000 rupees. Their managing directors want us to believe that these are still "cheap prices" compared to international rates. But why don't they make instead a comparison with Indian standards of living, where a labourer sometimes earn 20 rupees a day, a middle class bureaucrat 5000 rupees and even a top executive will not earn more in a month than three nights' stay in a five star hotel. How much does the President of India earn by the way? What these Taj, Oberoi and others do not say, is that In Europe and the United States you can find very good 3 star hotels, whose facilities are as excellent as Indian 5 star palaces, for half their price. Certainly in France you can get a room in a very decent semi-luxury hotel for 500 francs, that is 3000 rupees. The public sector is no better. It should be enough to mention two of their white elephants: banks and airlines. Many banks in India are so hopelessly obsolete, that they have been used for 40 years to treat their customers as if they were doing them a service and not vice versa. The State Bank of India, that symbol of Indian socialist banking, is the best representative of that attitude. Take the State Bank of India Auroville International Township Branch, for instance, which has because of the presence of so many Westerners, one of the highest turnover of foreign exchange in the Tamil Nadu State. Yet after fifteen years, not a single rupee overdraft is allowed if a cheque for collection comes in and one rupee is missing in the account; they will not even bother to call you, but will send back the cheque. Yet, nobody wants to accept their cheques in Pondichery itself, which is only 7 kms away from Auroville, because they take weeks to clear them and charge incredible amounts for it... Something there has to change too. The other example is Indian Airlines, who continue to charge whooping amounts for their tickets, and like five star hotels, get away with it, by saying that theirs are still the cheapest fares in the world. But they are conning the customer, because what they are talking about is full fare, which amounts to business class fare. They conveniently forget to say is that in the West, there are all kinds of cheaper flights, night flights, weekend fares, return fares. You can fly from Paris to New York for as cheap as 250 $, less than 9000 rupees for a 12 hours flight. Compare this with the more than 13000 rupees for a Madras/Delhi/Madras flight, which lasts only 5 hours. And the worst is that Indian Airlines forces the other Airlines to align themselves on their fares... And what about the shameful practice of having one fare for Indians and one fare for foreigners, both in hotels and airlines. Foreigners are not cows to be milked, but honoured guests to be treated courteously ! Since 1995, Indian skies have supposedly been opened to private airlines. But this is another scam; for in reality, private airlines such as Modiluft, possibly the best one, were so strangled by exhorbitant airport charges, taxes, uneconomical routes imposed upon them, that it ultimately went bankrupt. Unless prices come down, the enormous middle class market will never be tapped properly. The third reason is less obvious, but India should take it in consideration. Western civilisation is struggling, its economies are in a bad shape, they have lost the supremacy that they used to enjoy for centuries. The Japanese, and lately, the so-called Tigers of Asia, Hong-Kong, Taiwan, South Korea, China and soon, it is to be hoped, India, have often overtaken the world Giants, particularly the United States. Thus it may be that the GAAT agreements have been formulated in the West as a last resort measure to save its imperialism and to preserve its ranking as the domineer of the world. But ultimately it is the developing nations, such as India, who will benefit from it, because tomorrow the sun is -at last- going to rise again in the East. Thus even though it might look disadvantageous for India in the initial years, in the end the GAAT accords are going to turn to her advantage. And definitely the free market economy that they are going to usher is going to benefit her, because it will bring some balancing in her industry, eliminate the inefficient and force those who have abused the Indian customer, whether in the private or the public sector, to become more competitive and offer better goods. Nevertheless, it should not be forgotten that Socialism has its good side. The caring for the poorer section of society, the subventions, the loans to farmers, the help to students, represent its more human aspect. Unbridled capitalism has shown that it has no such humanity and often makes the tiny minority of the rich, richer - and the great majority of the poor, poorer. Witness the United States or Mexico. But if India is going to succeed in her liberalisation drive, if she is going to utilise the GAAT accords to become a major industrial power, achieving modernity and affluence, she will face a much graver danger than bureaucratisation, statism, or even corruption... Will she have by then lost her soul to modernity, as some say that Japan did - where spirituality today is only a few external rituals and society has become so robotised that Japanese have lost all sense of initiative? Listen to what Sri Aurobindo, the mighty prophet of the future, had to say in 1948: "There are deeper issues for India herself, since by following certain tempting directions, she may conceivably become a nation like many others, evolving an opulent industry and commerce, a powerful organisation of social and political life, an immense military strength, practising power politics with a high degree of success, guarding and extending zealously her gains and her interest, dominating even a large part of the world, but in this apparent magnificent progression, forfeiting her swadharma, losing her soul. Then ancient India and her spirit might disappear altogether and we would have only one more nation like the others and that would be a real gain neither to the world nor to us". The " middle of the road economy ", for India, means that the country always preserves her Dharma, her special spiritual genius, that this Dharma guides her through the pitfalls of the GAAT accords and through the dangers of liberalisation and modernity. That it preserves her from becoming contaminated by the invasion of a foreign culture, be it MTV, Rayban glasses, or Jurassic Park, which have killed the soul of so many other nations. |
To continue with Chapter 11.... |
|
|
Introduction Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9 Chapter 10 Chapter 11 Chapter 12 Chapter 13 Chapter 14 Chapter 15 Chapter 16 |