INDIA DURING THE THREE PHASES OF GLOBALISATION

Mukul Sinha

In the first phase, i.e. from 1600 to 1947, the Indian subcontinent has been either under the Mogul rule or the British rule. The last hundred year of the British rule completely ruined the economic development of the country as it was used the Indian resources and labour for its own capitalist development. At the end of their rule, the Britishers left India with GDP consisting of just about 5.8% industrial income and around 70 to 75% of agricultural income; the rest came from small scale and cottage industry. India was but a very poor under developed semi-feudal country.

The second phase saw India adopting a secular democratic polity accompanied by a “mixed economic” policy, experimenting with the public sector undertakings with the help of Soviet union to build the infra structural industries. In the domain of foreign policy, India adopted the non-aligned policy sending a confused message that it was going to chart out a path independent of the on going process of globalization.
In the third phase however, starting from about 1990, alongwith the collapse of the Soviet Union, the Indian ruling classes integrated itself within the global capitalist network. Strangely, it did gain in the bargain for a peculiar reason. The use of the computer in every possible sector increased the demand for the trained and computer skilled labour and the Indians with their good back ground in mathematics and English, did extremely well in adopting the computer. Thus started rise of the service sector with the Indian companies leading the pack. Today, we have still 25-30% income coming from the traditional industrial sector but over 62% of the income coming from the service sector; the rest come from the agricultural sector (17 to 18%).

While on one hand, the IT companies started contributing to the national GDP by 1990s, the existing major players also gained from the access to the global market. Reliance, Tatas, Adanis etc enriched themselves from the new equation. But all the enrichment took place at the cost of the Indian working people.

Be that as it may, the Indian economy seems to have gathered some momentum and the ruling classes are losing no time to sing paeans for Globalization. A little scrutiny would show that the claim of the Indian ruling class regarding the advantage of its integration with the global capitalism is totally hollow. The Indian economy does not contribute the value addition (except in a few sectors) but is actually helping the global players to substitute higher wage labor by the Indian lower wage labor. Outsourcing is being done to cut down the cost of production and increase the profit levels of the multinationals. The Agricultural production has in fact become stagnant at the year 2000 level. To enrich the Indian monopoly Capitalist class, Special ecomomic zones, Special Investment Zones etc have been created, where the Industrial houses are exempted labour laws and payment of taxes; where the land for such purpose is forcefully acquired at the cost of the peasantry.

The worst feature of the third phase is the complete reversal of the constitutional goals. Despite adopting the capitalist mode of production as the fundamentals in 1949, our constitution did envisage a secular, egalitarian and an equitable society. By making the equal treatment under law as a fundamental right and the Directive principles to guide the making of statutory law, the founding fathers had perhaps hoped for welfare state where the rights of the weaker sections, minorities and marginalized would be protected. But alas! Globalization trampled all such fond hopes. Instead, a violent communal politics gripped the country ever since mid-eighties.