Those selected affluent people of India who move around the world and love only foreign goods demanded the Govt. withdraw all restrictions on import. G-7’s puppet pocket organizations like International Monetary Fund (IMF), World Bank (WB) and World Trade Organization (WTO) insisted from day one that Govt. of India withdraw all restrictions on import of goods and services. This was also a major precondition for loan from the developed world represented by G-7. They pressurized the third world countries through their World Trade Organization (WTO) to withdraw all restrictions on import and for Govts. to have no role to play in production and distribution of goods and services. The main theme propagated by these G-7 countries in 21st century is ‘Globalization’.  It is being globally challenged from the initial stage, though in some unorganized forms, throughout the world. It started in Seattle with WTO meeting which it was forced to be cancelled, and subsequently protesters in larger number followed these capitalist gangsters wherever they went – Washington, Bangkok and latest in Genoa in Italy. They refuse to see the writing on the wall, which clearly shows that the day is not far away when militant human protests both in the north and the south of the globe will compel these world exploiters to wind up their destructive business. World’s hungry and deprived billions will give a final burial to much maligned and discredited ugly capitalism.

Supporters of World’s ‘Globalization’ understand that today only finance capital is fully ‘globalized’;  by the click of a mouse in a fraction of a second ‘capital’ of International Financial Institutions (IFI) can fly from one continent to another and make and destroy any  region. It hates to restrict its destructive operation to one or two countries. Target of IFIs is a whole region. It happened  in Latin America a number of times and four year back it was repeated in South East Asia and this may happen any moment in Indian subcontinent. International rating agencies have given sufficient hint in advance. Can global people move an inch freely? Rather they are brutally tortured if they enter any country without permission. Surplus labour is bottled up in respective underdeveloped countries to die from hunger and diseases. Wealth too is never globalized, rather it is more and more concentrated in the hands of a few. Three men – Bill Gates, Paul Allen and Warren Buffet – own assets equivalent to those owned by 600 million people in world’s 48  least developed countries. 90 percent of the world’s patent rights are held in the richest countries and poor countries are heavily charged for any use of so-called ‘technology’. Even elementary seeds traditionally used from previous year’s crops are banned now under Intellectual Property Rights rules of WTO, which their forefathers used without any hesitation. Announcement of US Govt.’s permission to produce and sell MNCs ‘terminator’ seeds will cause disaster to third world’s cultivators. The United Nation’s Development Programme reports that the richest 20 percent of world’s people account for 86 percent of global consumption; naturally children of the poor have to die due to acute malnutrition. In the ‘Globalized’ village being developed by G-7 countries, 49 of the 100 wealthiest and most powerful institutions in the world are not Governments but Corporations and they control 70 percent of world’s trade and 80 percent of the world’s foreign investments.

I

Graveyard of Capitalism – India’s Lead Role

The  Approach  Paper to the Tenth Five Year Plan (2002-07) prepared by Hindu fundamentalist party- BJP- admits that ‘the economy is currently in a decelerating phase and urgent steps are needed to arrest the deceleration and restore momentum. This reversal is all the more difficult because it has to take place in an environment where the world economy (led by USA) is slowing down.’ (p. 2). USA Labour Dept. reports that unemployment insurance claims increased to 4,32,000 by the week ended June 2, 2001 from 4,19,000 in the prior week. Claims have not been at this high a level since the week of Sept. 19,1992. (ET, 8.06.01). The Indian agents and brokers of international capitalism use the word ‘growth’ to prove that Indian economy is moving in the right direction and foreign investors should bring in more and more US dollars as purchase consideration of our economy. Since fifties we are having a conventional ‘Hindu rate of growth  of 3.5 to 4 percent per annum’ and since 1980s it has crossed 5 percent growth rate with the help of an artificial invisible sector called tertiary sector or services. GDP growth rate during pre-reform period (1980-'81 to 1990-'91) was 5.6 percent and in the post reform period (1990-91 to 2000-01) it went up to 5.9 percent. Such increase is possible only because of contribution by the ‘services’. In 1950-51, services contributed only 27.5 percent of GDP, in 1990-91 its share was increased to 40.6 percent and by 2000 it is virtually half or more than half (54 percent) of the GDP. Some selected people demand all types of communication systems, stock exchanges, ultra modern hospitals, five star hotels, cable T.V., credit and debit cards and other modern services but before all these facilities are provided to them, for the vast millions there should be adequate quantity of food to eat, clean drinking water, clothes to wear and reasonable shelter to live under. In the pre-reform period '80-'91 growth in commodity production was around 5 percent per annum and in the post reform period 1991-2001, it went down to 4.3 percent per annum. Thus during the Structural Adjustment programme period (1990-91 to 2000-01) dictated by World Bank, it only increased the share of tertiary sector – cellular telephone, foreign entertainment programmes by cable TV, credit and debit cards and tele-banking etc. All these are meant for that affluent section of population  who can pay for these services. It is peculiar that share of service sector in GDP is increasing but widespread retrenchment is also being carried out mercilessly in this sector. Real growth of commodities, both in agriculture and in industry, instead of increasing during this period of reform rather declined and this downhill journey is still continuing. In real terms this is called ‘structural adjustment programme’ dictated by World Bank, introduced by Narasmiha Rao and now taken up by Atal Behari Vajpaee. G-7 masters are more than confident that Mr. Vajpayee’s Govt. will fulfill its obligation.

Destruction of Indian Agriculture

Today  FCI godowns are overflowing with around 60 million tonnes of foodgrains against the economic holding requirement of only 16-17 million tonnes. But this huge stock is a wrong signal and does not mean that everything is rosy on the agricultural front. The growth rate in agricultural production during 1980 to 1991 was 3.84 percent but it declined to 1.24 percent during 1990-91 to 2000-01. Do we require the existing elaborate Agricultural Ministry to continue without any responsibility and accountability to the nation? The ruling clique has inducted a new Minister whose father used to call himself a great leader of the rich and powerful landowners of western UP. Around two–third of our work force till today depends on agriculture for their meagre existence but Govts. have failed miserably to develop this vast economic area. Not only ‘food security’ is absolutely uncertain but also supply of raw materials for the various industries cannot be assured when Govt. is bent upon destroying agriculture. Its performance in the last decade is shameful for the entire country. It is hoped that the rainfall in 2001 will be good and uniform throughout the country and agricultural production may be better than previous years, but without basic land reforms and institutional financing arrangements for the lakhs of small and marginal farmers, long term agricultural production growth can not be sustained. In the same manner foodgrains production growth in pre-reform period was around 3.46 percent per annum and in the post-reform period it went down to 1.22 percent. With population growth rate slightly less than 2 percent per annum, what will happen with such insignificant rate of growth of foodgrains. Govt. itself says 26 percent, or 260 million people (equivalent to total population of USA), are below the poverty line and they don’t have purchasing power to purchase grains from the Public Distribution System.

World Bank’s ‘structural reform’ has virtually destroyed our rural economy. WTO’s insistence to remove all restrictions on import has resulted in unemployment for millions of cultivating families. MNCs are flooding Indian market with cheaper edible oil, green coconut, milk, tea, fruits etc., etc. Even imported wheat and soybean meal is cheaper than that of our own country. There is huge direct and indirect financial aid given to these MNCs engaged in agriculture by the developed countries which WTO tactfully ignores but it raises objections to our paltry subsidies for agriculture.

II

Industry in India is in Shambles

Sales of FMCG companies like Hindustan Lever are  below normal during so many months. In the same manner consumer durable producers, who are mainly foreigners, are observing the movement of clouds in the sky in this rainy season; tractor and other agricultural equipment producers are all keeping their fingers crossed. Share prices in the Mumbai stock exchanges refused to wake up even after ‘dream budget’ show was organized in Indian Parliament in February, 2001. The big bulls like Ketan Parekh are in jail after looting public money in banks and mutual funds. The largest Govt. Mutual Fund Chairman is also in jail. Major industrial and financial decisions  of this country are in the hands of criminals and agents of FIIs. Rate of growth in industrial production in the pre-reform period (1980-81 to 1991-92) was around 7.8 percent but it declined to 6.0 percent in the post-reform period (1992-93 to 1999-2000 ). The slowdown in the production of capital goods was particularly sharp, from 9.4 percent to 5.9 percent, showing total unwillingness of all industrialists to invest in capital goods sector, rather they found imported capital goods more economical. This is the main strategy of W.B dictated ‘New’ Economic Policy – destroy all types of indigenous production capacity, specially its capital goods sector which is the backbone of any country and make developing countries permanently dependent  on the developed ones. A new craze is visible among Indian manufacturers – not to make any fresh investment in plant and machinery in India. They are going for joint ventures abroad and will produce their branded products there and import them to India as their manufactured items. That is why Indian tariff rate should be reduced to nil to destroy our own industrial capacity. In this way India’s industrial production capacity may go down in near future.

In the Economic Advisory Council of the present Prime Minister, there are eminent industrialists and representatives of all the three Apex Chambers of Commerce – FICCI, CII and ASOCHAM. Despite their presence the core sector of Indian industry is getting weaker and weaker; there is no plan discussed before the country of how Indian products will compete in the international market. The following Table shows  performance of some core sector industries in recent period.

Growth in Industrial Production in Core Sector

(in percent)

Sectors                         December 1999           June 2000         June 2001

Coal                              7.5                               5.5                    - 3.9

Steel                             13.4                             12.0                   - 0.1

Cement                         9.0                               7.0                    - 0.1

Electricity                      2.6                               5.1                      1.5

Overall                          8.1                               8.7                      0.3

                            ( Economic Times dated 23.1.01 and 5.7.01)                             

Thus it is amply clear that, except electricity, other three industries showed not only declining growth trends since December, 1999, they showed negative growth in June 2001. Only electricity showed 1.5 percent growth in June 2001 against 5.1 percent growth one year back. On the whole, growth rate in the core industrial sector in June 2001 was only 0.3 percent against 8.7 percent in June 2000. Growth rate in first 3 months of this fiscal year is equally dismal at 1 percent compared to 9.3 percent in the first quarter of the last year. The vocal Bombay Club of our industrialists who demanded liberalization and privatization in early '90s and had doubts about globalization, are finding it difficult to survive in the market. All attempts are made to retain control over their individual empire and save it from foreign acquisition. Buy back of own company’s share is going on at full speed. On their order to create ‘level playing field’, Govt. is reducing interest rate structure at a speed faster than expected but unsold stock is piling up in the godowns as the demand is virtually drying up. Companies are offering various allurements to sell their products. Selling and advertisement cost is rising higher and wage bill is being reduced every day by retrenchment and layoff. Loss of employment is reducing further the demand for goods and services. Business winding up is going on at a fast speed. Govt. is being pressurized to amend labour laws and give up all protections now assured to industrial labour and to make closures an easy task. Senior citizens, widows and poor, who kept money in post offices and whose main source of income is from interest on past savings, find it very difficult to meet minimum requirements when interest rate is going down every day to help the rich and affluents. Some of them have already started starving and many of them may be compelled to commit suicide in future. Mutual Funds were brought in to save small savers from manipulative stock exchange dealings, but now UTI experience clearly shows that no one bothers about the interests of the millions of small investors who deposit money with these Mutual Funds. So the signal from Indian capitalists is clear and unambiguous – there is no one to save those who are old, weak and poor in India. Before economies of the G-7 countries caught the cold, Indian economy was already flat with severe pneumonia.

III

Workers are the Worst Sufferers

Our worries are that in this devastating situation of the country where will the millions of unskilled and semi-skilled workers go to earn at least one square meal a day for their family members! According to Economic Surveys, annual growth rate of jobs in the organized sector- which never employed more than 10 percent of the total workers – during 1990 to 1999 was only 0.77 percent. In terms of absolute increase, in number of employment during the above period was around 1.96 lakhs per year against 70 to 80 lakh new job seekers every year assuming 2 percent growth in labour force per annum. During 1998 and 1999 there was no increase in employment in the organized sector; rather through various schemes there was  a mad competition to hand over pink slips of retrenchment from jobs to the workers. Fifth Pay Commission was ordered to recommend 10 percent reduction in Central workforce. Since early nineties all vacancies created due to retirements and resignations in Central Govt. offices were never filled up and from the current year, so says the Finance Minister in his budget speech, out of 3 percent vacancies in Govt. Depts each year due to retirement, only one percent will be filled up. Thus in next five years 10 percent reduction in Govt. employment will take place. On the other hand every day Cabinets, both at the Centre and in the States, are expanding  shamelessly unmindful of the fact that each minister is provided with a large team of officials just to serve and wait.

Note: The growth figures are from Economic Surveys of Govt. of India