Is the India Story over for Singh and company?

Tweet

INDIA DIARY by COOMI KAPOOR

IT has turned out to be the worst year for the ruling United Progressive Alliance Government of Prime Minister Manmohan Singh. Everything that could go wrong, went wrong.

As the year draws to a close, the public image of the Congress-led coalition was at its nadir, with the Government scoring a series of self-goals. Indeed, such was the disenchantment with Singh that in certain sections of the ruling alliance there was hush-hush talk of replacing him with a far more politically savvy leader.

The latest fiasco that further damaged the standing of the Government concerned the unilateral decision a few weeks ago to allow majority Foreign Direct Investment in multi-brand retail. Once the announcement was made, all hell broke loose, with members of the ruling coalition itself opposing the entry of the western supermarket chains to set up shop here.

The timing of the FDI move was all wrong. The Government was mired in corruption cases of its key members. The Gandhian activist, Anna Hazare, was mounting public pressure through his hunger fasts for creating a strong and effective anti-corruption ombudsman (Lokpal). Food inflation was running high in double-digit numbers. And the stage was being set for crucial Assembly elections in UP and four other States.

Under the circumstances, the Government invited trouble by opening itself to the combined attack from the Right and the Left when it unilaterally decided to allow majority FDI in multi-brand retail. And a disaster it turned out to be.



When the Parliament opened, the Government resisted any move to debate the FDI decision on a motion involving voting. For more than a week, there was a standoff.Finally, the Government wilted under the combined pressure of the Opposition and its own allies. Finance Minister Pranab Mukherjee, virtually the lone trouble shooter for the Government, ensured the return of normalcy in Parliament by categorically stating the FDI proposal was put on hold. The Government, he admitted, did not want to debate the matter since it did not have the requisite numbers in the Lok Sabha.

Significantly, the Prime Minister, who personally pushed the FDI decision, not only spoke forcefully in its favour but also ruled out its rollback at a rally of the Youth Congress at which both Sonia Gandhi and son, Rahul were on the dais. Neither Gandhi said a word in favour of the FDI, a broad hint to the Congress troops not to go out on a limb to back it. Observers noted that increasingly the PM and the Gandhis were no longer on the same page on key issues.

That the Americans were pushing hard for opening up multi-brand retail was widely known, especially after the recent publication of the leaked US cables by WikiLeaks.

In one of these cables, US Secretary of State Hillary Clinton, a one-time board member of Wal-Mart Inc, is quoted asking a high-ranking US diplomat in New Delhi about the position of key members of the UPA Government vis-à-vis multi-brand retail.

On its part, the Prime Minister justified the decision on grounds of potential benefits to consumers, farmers, etc. Also, it was meant to boost the economic sentiment and foreign investment into the country. Politically, the Government believed that the decision would counter the common criticism that it suffered from policy-paralysis.

But sheer movement is a poor substitute for a purposeful and thoughtful action. Virtually rolling back the FDI decision pulled the image of the Government several notches down. Besides, it proved that despite their inherent differences, the Left and the Right could jointly mount pressure on the Government.

The FDI fiasco was the latest in a long series of rebuffs suffered by the Government during 2011. In a year in which key members of the ruling alliance were arrested in corruption cases, when there was record food inflation, more than 16% depreciation of the rupee against the dollar, and overall growth declining sharply, the Government had very little credit to show.

That was not all. A bigger crisis lurked in the corner, with the Gandhian leader Anna Hazare threatening to sit on another indefinite fast at the end of the on-going winter session later this month if a strong and effective Lokpal Bill was not passed by Parliament. A standing committee of Parliament had not embraced main points of the draft Bill presented by Team Anna, leading the Gandhian to accuse the Government of its wanting to pass a toothless law which would completely fail to check rampant corruption.

Given that the Government was busy fire-fighting round the year, captains of industry expressed concern that the policy paralysis would cripple the economy.

In such a gloomy scenario, it should not come as a surprise that many observers believe that the India Story is already over.

Singh, critics insist, does not have the skills and the temperament to manage a difficult coalition. Even his USP that he was personally clean is no more an advantage, with people saying that he has presided over the most corrupt government since Independence.

Of course, his fate can be decided only by Sonia Gandhi. Should she find a better alternative, or her son, Rahul, is ready to take over as prime minister, there is now little doubt that Singh will find himself eased out.

Rage of the youth is growing !

Tweet


By Pankaj Mishra, Guardian News & Media Ltd

Even in the West there is little chance of stable jobs or affordable education. A secure and dignified life seems even more remote for most. Across the world, the rage will grow.

Image Credit: AP

• Supporters of Anna Hazare wave Indian flags and shout slogans during 12th day of Hazare's fast against corruption in New Delhi on Saturday.

In India, tens of thousands of middle-class people respond to a quasi-Gandhian activist's call for a second freedom struggle — this time, against the country's venal "brown masters", as one protester told the Wall Street Journal. Middle-class Israelis demanding "social justice" turn out for their country's first major demonstrations in years. In China, the state broadcaster CCTV unprecedentedly joins millions of cyber-critics in blaming a government that placed wealth creation above social welfare for the fatal high-speed train crash last month.

Add to this the uprisings against kleptocracies in Egypt and Tunisia, the street protests in Greece and Spain, and you are looking at a fresh political awakening. The grievances may be diversely phrased, but public anger derives from the same source: extreme and seemingly insurmountable inequality.

As Forbes magazine, that well-known socialist tool, describes it, protesters everywhere are driven by "the conviction that the power structure, corporate and government, work together to screw the broad middle class" (and the working class too, whose distress is not usually examined in Forbes).

For years now, the mantra of ‘econ-omic growth' justified government interventions on behalf of big business and investors with generous tax breaks (and, in the West, the rescue of criminally reckless speculators with massive bailouts). The fact that a few people get very rich while the majority remains poor seemed of little importance as long as the GDP figures looked impressive.



In heavily populated countries like India, even a small number of people moving into the middle class made for an awe-inspiring spectacle.

Helped by a ‘patriotic' corporate media, you could easily ignore the bad news — the suicides, for instance, of hundreds of thousands of farmers. However, the illusions of globalisation shattered when even its putative beneficiaries — the educated and aspiring classes — began to hurt from high inflation, decreasing access to education and other opportunities for upward mobility.

False promises

Economic growth is no defence against the frustration of the semi-empowered. The economies of both India and Israel have recorded dramatic growth in recent years. But inequality has also grown spectacularly. The Financial Times, which recently compared India's oligarchic business families to Russia's mafia-capitalists, pointed out two weeks ago that "the 10 largest business families in Israel own about 30 per cent of the stock market value" while one quarter of Israeli families live below the poverty line.

Last month the Indian supreme court blamed increasing social violence in the country on the "false promises of ever-increasing spirals of consumption leading to economic growth that will lift everyone".

Obviously it is not the supreme court's remit to define India's economic policies. Nor should Anna Hazare be entrusted with establishing the office of an anti-corruption ombudsman, a mission that amounts to nothing in a country littered with compromised and impotent institutions.

Still, they respond, however incoherently, to a crisis of legitimacy afflicting their country's highest institutions, and their supposed watchdog, the media.

In the last decade, billionaires, ‘billionaire-friendly' legislators and CEO-worshipping journalists have together constituted what the political economist Ha Joon Chang calls a "powerful propaganda machine, a financial-intellectual complex backed by money and power".

Nevertheless, the real facts about ‘economic growth' are getting through to those most vulnerable to it in both the east and the west: the young.

Denouncing "the corruption among politicians, businessmen and bankers" that leaves "us helpless, without a voice", the manifesto of the Spanish indignados could have been authored by the Indian supporters of Hazare.

Even as they export jobs and capital to Asia, economic globalisers in the West continue to preach the importance of upgrading skills at home. Yet the dead-end of globalisation looms clearly before Europe and America's youth: little chance of stable employment, or even affordable education.

The violence in European cities this year comes at the end of a long cycle of steady socio-economic growth. In postcolonial India and China this cycle had barely begun before it began to splutter. A secure and dignified life seems even more remote for most.

Worried by the prospect of social unrest, China's leaders frankly describe their nation's apparently booming economy as "unstable, unbalanced, uncoordinated and ultimately unsustainable".

The Chinese philosopher Zhang Junmai once wrote that an agrarian country has few ‘material demands' and can exist over a long period of time with ‘poverty but equality, scarcity but peace'. Returning to an austere age of wisely managed expectations is no longer possible — even if it was desirable. It remains to be seen what political forms this summer's unrest will take. But there is no doubt that many more people across a wide swathe of the world will awaken with rage to what Zhang warned against: "A condition of prosperity without equality, wealth without peace."

Pankaj Mishra's new book The Revenge of the East will be published next year