A FLOOD OF FAILURES- AN INTROSPECTIVE DELIBERATION

TERMINAL DEPRESSION
July 26th the day when Mumbai and its neighbouring areas got rains of the century causing immense dislocation and infrastructural damage should prove to be the proverbial straw that broke the camel’s back. If this does not spur the authorities into corrective action, then I am afraid nothing will! The story of Mumbai floods is symptomatic not just for the city but for the whole of India. Not a year goes by without man-made or natural disasters striking some part of the country and causing immense grief and economic loss. Every year, since we can remember, has had its share of any of these: - train disasters, fires, riots, landslides, floods and earthquakes (of late we also had a tsunami). Disasters happen all over the world, no one can deny that; but it is the manner in which the authorities spur the citizenry towards rehabilitation and normalcy that sets the bar for a responsible democracy. In this respect, we have failed badly and repeatedly. It seems lessons are learnt only to forget them so that they be relearned ad infinitum. The purpose behind setting up various investigation committees, it seems is only to give jobs to members of the judiciary. Is good governance obsolete? In the absence of any sound executive management are Public Interest Litigations (PILs) the only corrective way forward? These are questions which haunt any sensible consumer/citizen of this country.

ECONOMIC ATHEROSCLEROSIS
The Consumers International 17th World Congress stressed that “corrupt practices and poor standards of governance severely reduce the welfare of all consumers and compromise the attainment of their rights. Governments must commit themselves to effective measures (such as enhanced transparency) to eradicate corruption and strengthen governance. The consumer movement must form alliances with national and international organisations of civil society dedicated to the control of corrupt practices and improvements in governance.” Every relief effort in the wake of any disaster to put it mildly suffers from want of coordination and from corruption on the part of the administrative machinery be it the Goswami flood relief scam in Bihar or the tsunami relief scam about food grains in Chennai or the latest Mumbai floods where the Lokayukta’s office in Mumbai was flooded with complaints of mismanagement in flood relief operations. According to a report prepared in 2004 by the Transparency International-a transnational NGO spearheading the anti-graft fight, India scores just 2.8 points out of 10 on honesty. The report further states that Indian tax-payer loses a whopping $7 billion per year in bribery and a slew of scandals. No wonder then that our antipoverty schemes and yojanas which have been going since so many years now have not resulted in any significant gains on the ground! One of our earlier prime ministers had said that out of every rupee spent on development and poverty alleviation programs only 15 paise or less reached the target for which it was meant! Against the background of such an undesirable legacy how can we ever hope to see a happy future for our citizens/consumers?




COMMON MINIMUM DOGMA
Dogmatic political models for development delinked from market economics or consumer needs and based on foreign experiences were thrust upon the nation in the wake of our freedom. It was a time when the “everything belongs to the state” model was taken up. Antiquated planned economy in the form of 5 year plans for attainment of economic targets which was then adopted still continues to be the blue print for development. The first five year plan just about met its target the subsequent plans resulted in carry-over of planning targets in to the “next” five year plans! From the “garibi hatao” of the seventies to the rural employment guarantee plan of today which envisages social security – the picture remains the same. The honorable prime minister has estimated conservatively that for the employment guarantee scheme to succeed the annual GDP must grow at the rate of at least 8% each year - right now we are barely managing a 7% GDP growth. Further, the honorable prime minister lamented the obstacles to FDI and stressed the need to go ahead with disinvestment required for attaining a high GDP rate! Thus, whether the employment guarantee scheme will be sustainable is anybody’s guess.

A vast majority of our labour force lies in the unorganized sector. More than 50 years after our independence the miniscule organized labour sector continues to be overprotected in the name of preservation of jobs! Such ill-conceived ideas lead to stagnation that discourages investment both FDI as well as local and therefore creation of industrial jobs. Nowadays the whole world is agog with India’s potential and comparisons with China inevitably come about. How do we fare with China in job creation - India has produced only about 10 million industrial jobs — a pitiful performance in a nation of a billion people! By contrast China produced 200 million industrial jobs in a comparable period.

THE PROMISE OF REFORMS
The liberalization of the 90s created an atmosphere of renewal that saw the blossoming and flourishing of Indian entrepreneurial and managerial skills that continues till date. Self-doubt perished and India emerged as a leader in IT, in automobile ancillaries, pharmaceuticals to name a few sectors. Indian entrepreneurs have carved out niche areas of excellence which no one imagined possible not so long ago. Thanks to the efforts of our free enterprise an annual GDP rate of 7% is now thought of as being normal. PCs have witnessed a fair amount of penetration even in rural and semi-urban townships replacing the ubiquitous typewriter of yore. Mobile telephony thought to be a status symbol of the rich when it was introduced in the mid nineties is today a necessity and is witnessing penetration even in rural areas. Today, around 27 persons in hundred have access to phones in cities and towns whereas in the villages the figure is between 1.5 to 2%. With increased private competition increased penetration in the rural market is only a matter of time. The era when we had to wait in long queues for getting telephone connection is a distant bad memory.

Policy decisions which will bring economic freedom in the lives of Indian consumers and thus enrich and strengthen our democracy are badly needed to be sustained; any slip-up at this stage of our economic development will mar our prospects. We must take care of the weaker sections of our society, we must ensure social security but this can only happen with generation of wealth. Any continuation of policies that espouse the goal to give money but not teach the recipient how to earn it will prove disastrous. India needs to create wealth; the engine to do so is ready and eagerly awaits the next phase of reforms. But thanks to the compulsions of coalition politics involving parties that are prisoners of their dogma, reforms seem frozen in time. Today our development strategy under the pressure of the common minimum program seems to increasingly mimic our pre-liberalisation policy of putting the cart before the horse. To make matters unbelievable we hear statements from people at the helm of affairs like “the scourge (poverty) would be eliminated within five to ten years through the implementation of various beneficial schemes”- political satirists would surely smile.

THE ROAD TO SUPERPOWERDOM
The first phase of our reforms brought us world attention and on to a platform where global think tanks see us becoming the world’s third largest economy by 2015-20. Imagine where a carefully calibrated second phase of reforms can lead us! A liberated economy will unleash the creative energies of a youthful India creating wealth, competitiveness will increase productivity, generate jobs, improve internal trade, improve education and awareness, improve tax collection, improve transparency which in turn will lead to better infrastructure and an empowered class of consumers who will be an effective part of that system of checks and balances that is so very necessary in a market economy. In such an India there can be a redistribution of wealth through various schemes instead of the redistribution of poverty that we seem to be doing now. And from all this you will find a resurgent India on the move with a seat in the security council of the UN, people with pride in their achievements; and who knows, maybe we will start making our presence felt even in the Olympics. More importantly it will bring about a degree of maturity and urgency in our responses to disasters due to better disaster management. Everything will pretty much fall in place.

In short, unbridled productivity and wealth generation are the components of growth that are needed to kickstart the process of poverty alleviation in India. But, for this to happen the second phase of reforms must begin. Unfortunately for the sake of India’s citizens and consumers, this does not seem to be happening – at least for now.
-Dr. V.R. Shenoy.

Post a Comment

0 Comments
* Please Don't Spam Here. All the Comments are Reviewed by Admin.