‘‘No Reason for Panic’’

Barun Das Gupta

The national economy is going downhill. The rupee is having a free fall against the dollar (it hit Rs 68.80 against the dollar on Aug 28) with all its consequences: cheaper exports, costilier impots, widening trade deficit, increasing current account deficit, depleting foreign exchange reserves and generally giving a push to prices due to a mulitiplicity of factors, each reinforcing the others. The two men who should have been most disturbed by these developments are the Prime Minister and the Finance Minister. But both are totally unfazed and unconcerned. Both are nonchalantly claiming that there is nothing wrong with the economy and there is no reason for panic.

As usual, the Prime Minister addressed the nation from the ramparts of the Red Fort on the Independence Day. Reading out from a written speech in his dull, monotonous and uninspiring voice, Manmohan Singh said:
"In recent months, there has been much discussion on the fact that last year our growth rate came down to 5 per cent. This is indeed true and we are trying out best to remedy the situation. However, it is not only our country that is facing economic difficulties. The last year has been difficult for the world economy as a whole. Major European nations are experiencing a slowdown these days. All over the world there has been a slump in export markets. All developing countries have slowed down. I believe this phase of slow growth in India will not last long. In the last nine years, our economy has grown at an annual average rate of 7.9 per cent. This pace of development is the highest in any decade so far."

So, people are being asked to believe that like corruption, economic crisis is also a global phenomenon and in a globalized world this is but natural and there is nothing for India to worry about. Forget that half a decade ago when the sub-prime crisis had hit the advanced capitalist countries and Indians were comparatively unsinged by it, these very gentlemen had prided themselves on the fact that under their wise management the Indian economy had escaped unhurt by the global crisis. Manmohan Singh also did not explain the basis of his optimism that "this phase of slow growth will not last long" when hard facts and rude economic realities held out no such hope.

The next day, August 16, saw (1) the rupee depereciate to 62 a dollar; (2) the index of industrial production register -2.2 per cent in June; (3) consumer price index (CPI) hit the lowest in the last two years at 9.64, (4) food inflation index rise to 11.24 points; and (5) foreign investors withdraw investments worth $11.58 billion from India. And the last at a time when the Finance Minister is saying almost every day that unless much more foreign investments flow in, the moribund economy cannot be kick-started.

In the midst of all these doldrums, the Government of Manmohan Singh is trying to pass the Food Security Bill which will bring about two-thirds of the people—rural and urban—under food security. Singh was never enthusiasitc about the programme which he thought was 'populist' but had to give in to it under the constant prodding of party president Sonia Gandhi who, having more political acumen than the Prime Minister has, sensed that the so-called 'reforms policy' of the UPA Government was alienating ever larger sections of the people from the party and the government and making it more and more difficult for the party to come back to power again in 2014. Earlier also, several recommendations of the National Advisory Council headed by Sonia Gandhi were turned down by the Government for being 'populist'.

In fact there seems to be a cold war going on under the surface between the organizational and governmental wings of the Congress. The party realizes that the so-called 'reforms policy' of Manmohan Singh, adopted under the pressure of the World Bank and the International Monetary Fund, the two main agencies of Washington to exploit the third (or is it now the second after the dissolution of the Soviet Union?) world countries and open up their economies, is relentlessly costing it public support and therefore pushing it to eventual loss of power.

The 'reforms' policy can be summed up as being the policy of dismantling the public sector and handing over as many PSU units to the private sector as posible; opening up the country for the freebooting mulinationals of the US and other metropolitan countries; allowing private capital—indigenous as well as foreign—to all sectors of the economy including those like defence and telecommunications which have a direct bearing on national security; and formulating the Government's economic policies to benefit the corporate sector. There is no doubt that if the UPA comes back to power for the third time with Manmohan Singh playing yet another innings, India will meet with the same fate as has befallen Greece.

But if the Congress/UPA tally falls so pitifully low in the Lok Sabha elections next year that it cannot stitch together even a loose front of parties that power can attract and hold together, what then? Obviously, it will be Narendra Modi committed to his hard Hindutva line who will be the BJP/NDA's candidate for prime ministership. The ascendancy of Modi in the BJP hierarchy has been accompanied by another phenomenon: the RSS openly bossing it over the BJP.

No doubt the BJP has always been the political front of the RSS but both the RSS and the BJP had kept up the pretence that the two had no formal relationship. RSS was an organization imbued with 'nationalism' and devoted to 'character building', not indulging in politics, while the BJP was a political party. But lately, this pretence is being given up. The RSS domination of the BJP is now open. Modi is more the nominee of the RSS rather than of the BJP. The large-scale corruption indulged in by the Congress and its policy towards China and Pakistan, perceived by many as soft and weak-kneed, may help the BJP.

But if the BJP/NDA comes to power, it will follow the same Congress policy of Liberalization, Privatization and Globalization as it had followed during its previous stint in power at the Centre from 1998-2004. It is to be noted that while going hammer and tongs at the Congress for its corruption the BJP has not attacked the globalization and liberalization policy of the Congress/UPA. It has also carefully avoided making public its economic agenda and what alternative economic policy it wants to follow if voted to power. As far as the tens of millions of farmers, factory workers and white-collar job holders are concerned, there will be no change in their conditions—falling living standards, deteriorating quality of life, shrinking job opportunities and a pall of all-enveloping gloom staring them in the face.

The Left—as it was once known to be and stood for—is nowhere near power. The Establishment Left could never break out of the two-and-a-half States they had (West Bengal and Kerala, Tripura being just half). They have lost power in Kerala and West Bengal and just managed to hold on to Tripura which sends only two members to the Lok Sabha. As things stand there is little possibility of their recovering lost ground as they have neither honestly tried to find out how they came to be totally alienated from the people of West Bengal and Kerala nor shown any willingness to do serious self-criticism and learn from their past mistakes and making a conscious effort to rectify them. They became so much dependent on power, on the bureaucracy and the police that they lost touch with the people and was not worried about it either. To top it all, they have also accepted that there is no alternative to globalization.

Outside the Establishment Left, there are the smaller Left parties and groups which are not a countable force. If they could come together on the basis of a minimum common programme, they might have been able to build up mass movements on popular issues in different parts of the country, thus paving the way for a bigger and better consolidation of genuine Left forces at the national level. But there is no such possibility in the near future. So the common man—the much-hyped aam admi—will fare no better whether it is a re-run of the Congress or a long-awaited second innings for the BJP.

Frontier
Vol. 46, No. 10, Sep 15 - 21, 2013

Your Comment if any