How can Indian Economy become “Self-Reliant” without having an Alternative National Economic Policy?

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  Just a few days back on 11th June 2020, PM Modi has addressed 95th annual plenary session of Indian Chamber of Commerce, (ICC) via video conference in Kolkata. While addressing the members of the ICC, he stressed the need for building a Self-reliance economy in India including in the case of Kolkata in the post-COVID-19 world. Our Prime Minister asserted strongly that Kolkata has to develop now in becoming self-independent in all fronts (Atma Nirbhar Bengal) and must produce essential commodities by revving manufacturing sectors and the local economy to push the supply chains. Rather than relying on the import-based economy, we have to become a self-reliant economy, so that we can soon become exporting Nations in the world in the coming future, he added. While speaking with reference to Kolkata, PM said that it is now time to revive the manufacturing sectors like jute industry (which were mostly closed down during the long tenure of the Left Front rule, emphasis added). In so doing, Kolkata can again become the ‘leader of the East’, said PM Modi.

While addressing the Nation on 12th May 2020, PM Modi had announced Rs 20 lakh crores as an economic relief package to push confidence among the citizens of India and said that we have to fight with odd situations created by Covid-19 and converts present adversity into opportunity in days to come. Through the commitment and hard worker by the people at large in difficult times, we can soon become Self-reliance economy (Atam Nirbhar Bharat) and export-based economy by pushing supply chains rather than to rely on standing in the cue of importing economic countries.

To understand the present crisis and challenges confronted by Indian society and marginalized social groups more deeply, let us look at the historical context of India carefully and see what kind of alternative economic models had been put forward by our founding Fathers like Jawaharlal Nehru, Mahatma Gandhi and of course by Babasaheb Ambedkar during the formative age of nation-building project. While looking at interesting debates that took place among the makers of modern India  before independence; It will  really help us and give insights to revive and build up self-reliant economic India ( Atma Nirbhar Bharat), which PM Modi is talking about today’s context especially in the post-Covid-19 world.

Let me first highlight the Nehru vs. Gandhi’s model of economic debates. To be very precise, Nehru was interested to develop an Indian economy through the process of centralization with Indian State having a commanding height in dealing with economic and social development. In so doing, he had adopted top-down approach (known as the trickledown theory in economic terminology). In this respect, Nehru had concentrated to develop firstly megacities located in some pockets of north India through the process of industrializations and scientific development, as western advanced countries went through in distant past. We cannot forget that during the formative age of restructuring of the Indian economy at that time, Nehru had also stressed on reforming the agrarian economic structure, however, limited to some regions of northern India. In short, albeit Nehru had a progressive vision about modern India especially on social and cultural problems, but on economic fronts, his approach (trickledown theory) had not yielded desires result in especially vis-a-vis subaltern masses like in the case of Dalits, tribals, women and oppressed minorities.

On the other hand, Gandhi was deeply committed to develop the village and local economy by using the potentials of locally skilled people and indigenous knowledge systems.  Broadly, it refers to produce essential commodities and basic needs of local people by using the traditional knowledge skills often inherited from older generations which must be rooted in local environments and very close to nature. Take for instance; Gandhi was in favor of protecting and promoting cottage industries, small scale and handicrafts by using local and indigenous knowledge systems, as stated above. In short, Gandhi’s model of economic and social development was based on self-reliance ( as elucidated in his much-cited text like Hind Swaraj) by using local knowledge and economy rather than excessively dependent on modern industrialization and machines/technology based on modern development often at cost of environment and nature.

In short, both Gandhi and Nehru were in the polar opposite, as far as the development of the Indian economic and social development is concerned. Gandhi had focused especially to develop the village and local economy through the method of decentralization of power (embedded in the village Panchayat). While Nehru including Ambedkar had adopted a centralized approach of economic and social development in which state must play a vital role and remain at the commanding height of the economy.

Dr. Ambedkar was not quite different from Nehru in terms of thinking about development and modernity but, his agenda of ‘State Socialism’ (it was proposed around 1947 before the Constituent Assembly, however, unfortunately, it had not been accepted by the upper caste members of then the Congress party) was more having an egalitarian approach to deal with questions like social and material the prosperity of lower strata of Indian society. It was a kind of socialism (not much different from Marxian socialism especially in the realm of economy) which talked about the distribution of resources and nationalization of basic facilities like health, industry, insurance including collective method of forming at local level. Keeping the insights of Gandhi, Nehru and of course Dr. Ambedkar‘s ideas on economic and social development in mind, one could argue that to bring out the Indian economy on right track and save from current downturn their insightful ideas are needed to be freshly read before chalking out any kind of alternative economic and social policies. In this respect, it is not suggested here that we have to blindly follow and uncritically accept economic models presented by makers of modern India. However, their insightful ideas can help us to conceptualize a concrete national economic strategy in post-COVID-19 world. In this respect, the current ruling establishment must seriously explore an alternative model of economic development rather than to celebrate the success stories of 6 years of Modi-2.0. To address the genuine issues of toiling masses, the ruling establishment must come out with concrete economic strategy at national level (however, it should be done while keeping the regional and cultural diversity in mind) rather than remain merely a regulatory body for maintaining the law and order issues and act as the role of an umpire, as the proponents of neoliberal economic policy (NEP) have had suggested time and again.

The Left-leaning economists have consistently argued that the current model of neoliberal economic policy (NEP, which was adopted in 1991 by the Indian state to save the economy from crisis) have had widened the gulf between haves and have-not and produced the ‘gated colony’ (who are living luxuries lives in the megacities), which is now passing through a huge crisis and challenges after the unplanned lockdown imposed across the world to contain the threat of Covid-19. India is no exception in this case and in fact has adopted most stringent unplanned lockdown, leading to the mass exodus of migrant workers and India’s poor struggling class (as witnessed during the time of India’s Partitions) from  the big megacities like Delhi, Gujarat, and Maharashtra.

Given the deep crisis and challenges after COVID-19 lockdown especially in health and economic sectors, progressive-minded economists have said that after four decades of neo-liberalism  based on unrestraint crony capitalism, as economic policy in most of the countries including in the case of India, will be no longer further sustained in post-COVID-19 world. For a section of economists, we are witnessing perhaps the most difficult times, even the world had not experienced in the 1930s (during the Great Depression) and 2007-2008 recession. Therefore, it is necessary that we have to search for an alternative model of economy. While keeping the current massive crisis and challenges in mind in all fronts, most economists have said that the ruling government must adopt the robust welfare measures, as a policy mechanism to put the Indian economy on the right track and mitigate the sufferings of India’s poor and the plight of migrant workers rather than to again rely on the four-decades-old decadent model of neoliberalism, as economic policy based on crony capitalism.

Besides, economists have also given the opinion that to save India’s poor from huger and problems of unemployment, the government must increase expenditure on  social welfare measures as sated earlier by raising the level of taxations (especially follow the path of the progressive method of taxations to address massive economic and health crisis) on corporate and great India’s middle class(who have had accumulated unprecedented wealth and economy since the implementations of the neoliberal economic policy from 1991 onwards) rather than to rely on the charity/philanthropy, donated by a tiny section of social and economic elites to mitigate huge sufferings of toiling masses.

However, while addressing the members of the ICC in Kolkata, PM Modi has not talked about what kind of appropriate and concrete measures will be taken by his government at the national level to address current problems faced by marginalized in times to come.  Besides, he has not underlined any concrete proposal to address the economic slowdown and save the sufferings of millions of migrant workers from the vicious cycle of poverty trap, as a result of the loss of their jobs after the announcement of unplanned national lockdown from March 24th, 2020 (as also taken by PM Modi in case of demonetizations earlier). It has to be noted that subaltern masses like Dalits, Tribals and religious minorities especially Indian Muslims (who are doubly discriminated because of being materially deprived and belonging to lower caste/class strata of Indian society) are continuously targeted by communal forces and faced massive socio-economic exclusion because of having different castes, ethnicity, and religion. Instead of doing self introspections, after completion of 6 years, the BJP leaders are busy in celebrations and underlined the achievement and the success of government under the leadership of PM Modi-2.0.  It is to be noted that especially in last one year, his government had passed a series of legislations such as abrogation of Article 370, Citizenship Amendment Act, Triple talaq, Besides, they have made more stringent UAPA (Unlawful Activities of Prevention Act) and finally able to resolve the long-standing controversial issues like building the Ram Temple at Ayodhaya in the future.  However, if you critically look at the performances of government in sectors like health, educations, employment on one hand and the rise of caste atrocities, violence, and rape against the women, increasing incidents of mob-lynching especially minorities and Dalits, on the other; we the people of India have nothing to celebrate and point out achievements of government as the BJP leaders have put forward in the public domain. Besides these issues, their claim of dealing the threat of Covid-19 pandemic is not worthy to celebrate because the cases of corona patients including death tolls are rising exponentially every day mainly in megacities, as pointed out earlier. However, the rate of recovery has also increased and went on 48 percent as pointed by medical professional experts.

Here question must be asked that without having a concrete national strategy and conceptualized alternative economic policy mechanism, based on strong and robust welfare measures, as suggested by the economists and proposed by Dr. Ambedkar, long way back in the form of ‘State socialism’ around 1947; we would not be able to address the current challenges posed by the Covid-19 lockdown. Take for instance, the MNREGA (Mahatma Gandhi Rural Employment Grantee Act, launched by the UPA) to some extent have had provided relief and enhance the purchasing power of millions of rural poor people in some pockets of India especially where it has been implemented fairly without corruption and leakages.

In this respect, Kerala (currently ruled by the Left front government) can be cited as a case in point that has taken appropriate welfare measures to address the concern of marginalized social groups. It has to be noted that labour wage is relatively good if we compare it with other states. Kerala is currently giving Rs 380 per day as a minimum wage to unskilled labour. However, the Central government is only giving Rs 202 per day those who are working under the MANREGA. So there is a reduction of wages and labour laws (already diluted in the last few years) that are not implemented honestly at the grass-root level. Due to relatively good and effective social policy in health and economic sectors, Kerala is being seen as a successful model to contain the threat of Covid-19 pandemic in comparison to other megacities like Gujarat, Maharashtra and Delhi. However, due to corruption and lack of political will on the part of the current ruling establishment, flagship programmes like MNREGA launched during then the UPA regime has not so far yielded desire results at the grassroots level in the Hindi heartland. It is ironical to note that ever since PM Modi government came to power in 2014 onwards at Centre, budgetary allocations on several social welfare measures including that expenditure on the MNREGA has been further reduced.

To conclude, it is here argued that merely giving and delivering rhetorical speeches on several occasions by PM Modi devoid of concrete national economic strategy is not sufficient to address the genuine problems faced by millions of migrant class, as hinted by economists too. So far economic relief packages announced by the Central as well as State governments mostly ruled by the BJP are not sufficient to address the questions of lives and livelihoods of millions of migrant workers.

As scholars have suggested that in vibrant and inclusive democracy, we have to overcome the problems of marginalized groups rather than fulfilling the demands of tiny corporate elites. The Indian State and current political dispensation has to take responsibility for underprivileged and provide basic minimum rights and ensured the dignity of labours, as enshrined in our Constitution. In other words, the responsibility of a truly democratic state is to protect the rights of subaltern masses by adopting strong welfare measures, as envisioned by our founding Fathers during the formative stage of the nation-building project. It can be done through increasing the purchasing power, social and economic capacities of the poor by providing employments and livelihoods through the strong welfare measures like MNREGA and by strengthening the PDS in days to come.

The BJP leaders recently claimed that we are comparatively in better situations to fight against the threat of Covid-19 pandemic, because during the last 6 years under the leadership of PM Mod, the government has achieved a lot of success and had done good works. However, in the matter of fact, the cases of corona patients and death tolls are rising day by day exponentially in megacities as said earlier. Besides, rather than giving the relief packages to poor and migrant workers (so that the effective demands should be created) who have lost their jobs and as a result forced to return their homes. Instead of addressing the plight of migrant workers, the ruling government is giving stimulus economic packages to business classes for increasing the level of investment in manufacturing sectors in the name of creating supply chains. In other words, instead of strengthening the functioning of public sectors to deal with health and economic crisis, economists have suggested that the government is giving more packages to business class under the pretext of reviving economic and manufacturing sectors. In doing so, the ruling government has weakened the already fragile conditions of the PSUs, as underlined by the economists.

Despite the claim of BJP leaders about the good performance of government for the last 6 years, it is not entirely wrong to say that instead of addressing the genuine concern of subaltern masses, it has aggressively promoted process of privatization and handed over several efficient public sectors to the private players under the guise of the so-called PPP model (Public-private partnership) for reviving the economy and creating employment opportunities. Instead of addressing the socio-economic problems of marginalized, the BJP leaders often reminded that citizen of India must follow duties rather than demand rights, as mentioned in the Constitution of India.

Let me end here by saying that if the current ruling government is committed to addressing the current crisis and challenges faced by subaltern masses, they must adopt concrete national economic strategy rather than delivering rhetorical speeches often with the empty slogans (like Sabka Sath Sabka vikash and Sabka vishwash including recent one like Atam Nirbhar Bharat, Atam Nirbhar Bengal) especially for the sake of getting electoral benefits in the context of Bihar and Bengal assembly elections in the days to come. For addressing the genuine concern of millions of migrant workers and India’s poor, the ruling government especially in difficult times must forget reaping the electoral gains and adopt strong welfare measures along with this, imposing strict norms of ‘progressive taxations’ on corporate and India’s elites, as suggested by economists rather than letting the marginalized groups die of hunger and extreme socio-economic exclusion in the larger public domain.

The author is a Research Scholar at the University of Delhi.




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