Globalization and the Problem of India

Bernard D’Mello


Towards the end of last year, evidence on poverty in the so-called ‘reform years’ came in. Even though this data shows a decline in the incidence of urban poverty, the rural poverty ratio, which was on a declining trend from the latter half of the 1970s up to 1990-91, stubbornly refused to come down statistically any further. The absolute number of the poor in India has increased very substantially in the 1990s, from 293.7 million persons in 1990-91 to 327.2 million persons in 1997, and to 376.8 million persons in the first half of 1998. In May this year, India officially declared that her population has touched one billion persons. If we assume that the proportion of the poor has remained the same as in 1997, then the number of India’s population in poverty today is 349.2 million persons. It is indeed a very grim picture. This dramatic increase in rural poverty suggests a traumatic turn for the worse as far as the problem of India is concerned. That problem may be defined as the problem of poverty, misery and degradation of the majority of her people, with the ‘chosen few’ wallowing in wealth, luxury and anomie, secure in their “securitized” islands of “civilization”. What Dadabhai Naoroji and Rajni Palme Dutt understood as the problem of India, then a colony, we think, is still with us in these movingly cruel times at the dawn of the 21st century. Tragically, the force of continuity, in this respect at least, is stronger than the force of change, with the “new” beneficiaries of “the system” not yet exactly about to light their own funeral pyres!

The Political Context

In 1940, at the beginning of the decade that would witness the emergence of a politically independent India, Rajni Palme Dutt stated the problem of India in a manner that has still (at the dawn of the 21st century) not lost its poignancy:

The problem of India can be very simply stated. It is a problem of 370 million human beings who are living in conditions of extreme poverty and semi-starvation for the vast majority ....  (They are) at the same time living under a foreign rule which holds complete control over their lives and maintains by force the social system leading to these terrible conditions... These hundreds of millions are struggling for life, for the means of life, for elementary freedom. The problem of their struggle, and how they can realize their aims, is the problem of India.

If I were to paraphrase Larry Liftshultz, a friend of Frontier, ‘the statistics and some of the magnitudes have inevitably changed; tragically, ‘the ugly contours’, and, I may add, the cant and hypocrisy of the power elite, remain. Indeed, some may say that they have worsened, at least absolutely. The descent of the rural poor was halted, at least relatively, by the latter half of the 1970s.  Indeed, the meticulous work of some economists at the Indian Statistical Institute, Nikhilesh Bhattacharya, et al, seems to suggest to me that the incidence of rural poverty began to show a downward tendency from the time the Naxalbari (March 1967) and After rural (and urban) insurgency. The Naxalite revolt seemed to have shaken the power elite and forced some relief, with a steep fall in percentage of the rural population in poverty between 1970-71 and 1983, and a slow decline thereafter until 1990-91. The movement of the incidence of rural poverty estimates is of three well-known Indian economists, B S Minhas, L R Jain and Suresh Tendulkar. According to an Indian economist working at the World Bank, Gaurav Datt, this declining trend in rural poverty seems to have been halted in the 1990s. In other words, the percentage of the rural population in poverty seems to have remained more or less unchanged or, as an economist at India’s Planning Commission, S P Gupta holds, even increased in the 1990s. Has the process of change towards a neo-liberal regime of accumulation since 1991 halted the “ascent” of the rural poor (the earlier declining trend in the proportion of the poor in rural India)?

For the moment, let us dwell on the link between knowledge and power, where we should be grateful to Arup Sen for reminding the readers of the Economic & Political Weekly (EPW) of this link. (The younger readers of that journal now definitely need to be reminded of that link). The revival of the importance accorded to poverty studies in academic and power elite circles in the latter half of the sixties and in the early seventies has to be viewed in the context of the upsurge in the political situation at the time. Professor P C Joshi mentions the threat posed by the rise of “Naxalism” and the return of the question of land reforms in power elite discourse. For instance, the Report on Current Agrarian Tensions, released under the aegis of the ministry of home affairs, the apex internal security agency, locates the main cause of agrarian tension in the agrarian structure and recommends land reforms in the interests of the rural poor. Well, that represents the view of the internal guardians of the status quo. How did some of the imperialist guardians of the Indian ruling classes view the situation? Robert McNamara, who left the headquarters of the Pentagon to head the World Bank, too called for a reorientation of the Bank’s policy and programmes to concentrate on activities that directly “target” the poor. In his annual speech to the board of governors of the Bank in September 1972, McNamara said:    

The task, then, for the government of the developing countries is to reorient their development policies in order to attack directly the personal poverty (our emphasis) of the most deprived 40 percent of their populations.... Such a reorientation of social and economic policy is primarily a political task....When the highly privileged are few and the desperately poor are many - and when the gap between them is worsening - it is only a question of time before a decisive choice must be made between the political costs of reform and the political risks of rebellion.

Dadabhai Naoroji made an essentially passionate intellectual appeal to the British for responsible governance by linking the problem of poverty to the drain of wealth from colonial India. In an India now independent, it was the apex internal security agency, the home ministry, and a World Bank president, having perceived the threat to the privileged, that saw the need for the power elite to reorient its programmes and policies to keep the poor from revolting. Indeed, a resuscitation of poverty studies in post-colonial India was nucleated by a patronizing grant from the Ford Foundation, which helped the post-independence pioneers of poverty studies, professors V M Dandekar and N Rath, to produce their 1971 monograph, where, in concluding, they stated : Communism offers a classic solution to the problem of poverty .... its political costs (are) so high that it is worth exploring another path if it is available. This has been a major preoccupation of the present study. Hopefully, the rich, the vested interests and the policy-makers who represent them will also see the point and concede the claims of the poor. If they do not, the poor in their desperation will soon come to the conclusion that justice and fair-play is not possible within the framework of private ownership of the means of production and proceed to take the classical path, of which there are beckoning examples around, whatever the political costs.

The debate on Indian poverty then seemed to be clearly influenced by the tumult in Indian politics during and after the first phase of the Naxalite rebellion. The Vietnamese people’s war of liberation against US imperialism, and the Cultural Revolution in China, where the authority of the ‘new ruling class’ was being challenged, presented images of a possible alternative. People could contrast this alternative to their presently consigned roles of battered wage-slave, broken unemployed, hopeless destitute or tamed housewife. In contrast, the political situation today seems to generate the feeling among people that “there is no alternative” (TINA).