Some think, in my opinion wrongly, that this problem can be addressed purely by more reforms. The more India opens itself to foreign money, the more transparent its systems of government are, the more efficient and less corrupt its bureaucracy, the better for its economy. That is the logic. None of this is exceptionable, though all of it assumes that the high growth path is something for which only the government is responsible.
I think we should also look elsewhere to seek an answer to why we cannot grow. I did not write about why this was so in my earlier piece because this brings us into the realm of culture. Economists have little regard for this sort of thing and their work assumes that the environment is everything.
There are almost no studies (Harish Damodaran’s is one) on India’s mercantile culture and the baniya ethic. Though it is often said that India’s entrepreneurial base is big, the evidence is that it is caste based and small. Among Muslims, it is even smaller, and that explains to me the sorry state of Bangladesh’s and Pakistan’s economy.
The second aspect of India’s economy is the lack of mobility. Being middle class in India is essentially a lottery of birth.
This is, of course, true of most nations and most cultures. Europe has an aristocracy, most obviously in England with its landed rich.
But in few places, is it as pronounced as in India. Here, fate doesn’t land us either in wealth or in the middle class. It sends us directly into a hell with almost no access to escape. The state has no resources to help you get out.
Even if you believe the government’s figures, a third of India is poor. The fact is that the government’s numbers are based on calorie consumption for immediate sustenance and food. Indians who earn Rs23 a day in villages and Rs29 a day in cities are not poor. A monthly income of Rs674 in villages and Rs860 in cities is thought to be sufficient. This compares with Rs22,000 a month in the United States.
In that sense, the poverty line of India is cruel. It is merciless and doesn’t allow the majority of Indians any money for shelter or access to education or health care or sanitation or anything else that civilised nations would consider as essential as food.
You could not have access to and money for any of those things listed above and still be considered not poor in India. You could have no money to travel anywhere for work or education and not be considered poor in India.
The argument people who draw this line have is that if it were raised to a more humane standard, perhaps 70 per cent of Indians would be regarded poor. But what is wrong with admitting that?
Peter Ong, a friend of mine from Australia, who consulted a newspaper in Mumbai, would often notice the poor of the city. “What’s her future?” he would ask of some urchin on the road as we drove past. At first, I was defensive and would mumble something about how it was all changing in India. But that was not the right answer. The child had no hope and would spend her life and die in poverty of a truly frightening kind.
Almost none of the work done historically by the church in Europe on poverty and education is done by religion in India. Our wealthy have little interest in philanthropy, though Azim Premji and Nandan Nilekani can lead us to think this is changing.
And the truth is that the Indian media is totally disinterested in poverty. This is because the reader has no interest in this — and as someone who has edited newspapers in three languages for many years, I can speak with some authority. To assume that, in such a place, politicians can legislate us back into the high-growth orbit is, to my mind, delusional.
Published in The Express Tribune, May 19th, 2013.
COMMENTS (16)
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@gotti:
I do not see the relevance of your post. Unless you are suggesting that Modi somehow is secretly amassing wealth. In which case you need to present some proof.
@gotti: When you say “family”, are you including the familial ties between the BJP and VHP?
-- You got me wrong. I am a Congress voter. But for the first time I feel I have to vote BJP. This is purely based on the way Congress has managed the economy. I have a big problem with Gandhi-Nehru family illegally squatting at Congress HQ. (I am referring to the way the Family goons physically ousted Sitaram Kesari.
Congress offers only one choice: vote us for "secular" (don't forget Sikh carnage 1984) incompetent, corrupt crappy governance or vote communal one. Time to call its bluff. For your information I voted for congress (no caste reasons - you seem to be a JNU analyst!) for the recently concluded state elections of Karnataka. Till now congress has played it right by appointing a decent chap Siddarammaya as CM (I repeat no caste reasons - you seem to be a JNU analyst!). Come parliamentary elections at center, I am going to vote BJP.
@Author: A good read. No doubt, class at birth is the single biggest predictor of life/mobility chances in India.
@Jackdaw: Not so quick to trash author's argument based on misleading comparison with China. Almost all the progress in education and health indices of Chinese population was made by 1980s, long before Chinese economy was opened up. Even now China enforces several restrictions on FDI, depending on type, and there is no dearth of bureaucratic maze. But the real progress, in health and education, happened because CCP since inception concentrated resources on education and health. Is that true for government of India? No. Is the media interested in highlighting/correcting the issue? No. No doubt foreign investment has its place, but providing 100% access to education and health to all citizens is the job of the government and civil society.
@Akar Patel: There are better ways of making money in India. Better use your skills here as opportunities are endless instead bashing india on Pak site.
@prashanth aka upkamath: When you say "family", are you including the familial ties between the BJP and VHP? And, by that I mean the two maternal first cousins, Narendra Modi and Praveen Togadia, who are heads of the two said organizations, respectively. If not, are you ignoring that, like with the Sicilians, these Gujarati mafia lords have also helped their supporters amass great wealth at the barrel of a gun, or more appropriately, at the tip of the trishul? Lastly, I would request you, very humbly, to research information regarding the ties Mr. Thackeray had with Haji Mastan, a Tamil leader of the Muslims and Dalits in Maharashtra with whom the late Mr. Thackeray had dined with, despite accusing him of being a Congress tout or even a smuggler/criminal. BTW, it is Interesting to note that Sonia doesn't need anyone from outside the community or even outside the home to further the "Islami-Isai" cause amongst the Marathis now that Raj has obliged, so generously. PS. #FreeSanjayDutt (husband of Dilnawaz Sheikh Dutt and son of 'Nargis' Fatima Rashid Dutt)
Aakar Ahmed Patel appears to have missed two important point purposely:
He does not want to talk about the explosion of population, more specifically of poor sections of the society. Bihar populaton increase was highest at 25% (at 110 million)while UP was only next as a biggest state with more than 200 million population and these two states alongwith WB makes up 2/3 of the population living below poverty in India. The rate of increase of Muslim population is almost double of the rest. The policies of CONgress which has ruled almost 60 years out of 65 years after independence of India in 1947, which could not eradicate poverty but made politicians rich. Aakar does not want to criticize the congress for the poor state of India today when the current government is thinking of food subsidy for 800 million Indians (70% population) and direct cash deposit to the accounts of 700 million Indians. This is a bribe to their vote bank of poor and minorities as they tend to vote CONgress in bloack.The article was quite good in that it highlighted many of India's economic problems. However, how does one solve them? I would estimate that they never will be. Poor people everywhere keep on having children they cannot afford, and people who are doing relatively well do not wish to share their hard-earned income with people in debt or, can I say it, who are relatively low functioning or basically lazy. I am absolutely certain that there are many young Indians who would work hard, but are not given the opportunity to do well. Unfortunately, that is the way of the world, and young ambitious people everywhere are not given the opportunities they deserve. In India, the magnitude of the problems are so large that they stand out glaringly. However, at the end of the day India's problems can only be solved by India, and they do appear to be working on them even though many are tragically slipping through the cracks.
@Ali tanoli: " ... what a irony ... is great indus civilization is dead dog nothing else. ... "
It is how you view things. I say, if we could do great things then, we can do great things again.
Tried, tested and failed socialist crap again. I am not a supporter of unrestricted capitalism. But now that ten years of socialist congress regime is failing in providing decent livelihood for Indian population, they find problems with Indian society. Rules make a society, not the other way around. For example, gold smuggling had completely vanished after liberalizing import of gold. Like a dog that goes backs to its own puke, congress miss-managed national finances - high inflation, low interest rates, high deficits, despite a rising tax GDP ratio - after reduced tax rates. People shifted to real estate and gold as a hedge against inflation. Gold import soared to $ 60 billion a year, about 900 tons! Congress government imposed import duties of 6% on gold. Gold smuggling is back. We are having that 70's show again, with Haji Mastana and what not. Similar is the case with real estate. My town's population is around 1,35,000. One of the neo-rich of our town is a gangster. He has amassed a wealth of around Rs. 2,000/ crore in a matter of ten years, dealing in land with political patronage. Down town land sells at around rupees twenty lakhs a cent - 40 sq m, i.e. about 5,000/ a square feet. Families are not just bad for Italy and Sicily, they are bad for Congress and India as well.
No, no, Mr. Patel, we are all very "rich" nations. Just ask a Pakistani or Iranian, they'll tell you that their nations are rich and some men from Mars have ruined everything. Arabs, on the other hand, are not smart enough to realize any of the above. Afghans are barely even humans (like the Arabs). In short, its just not Indians, its the same from the edges of Africa and the Mediterranean to the Bay of Bengal. East Asia and Europe, however, where the said geographical regions end, is where things change, and that is because of the change of attitudes, less hoarding of wealth, and as you said, less insecurity when it comes to admitting realities, which quite different than ignoring or "defending" them.
@Ali tanoli This is not a Pakistan vs India cricket match. Stop scoring points. We are no better than India. We care little for the poor either. Lets give Indians their due they have taken some positive actions in this area while we have been stalling for the last sixty years. Read Tariq Ali.
Dear Aakar,
It will be great if you remain a journalist and try not to become economist(comparing poverty line in India and Us). There is a book called 'India's Tryst with destiny' by two eminent economist, try and read it. Stop lamenting as you do this most of the times.
Mr. Patel's blinding obsession with religion and caste obfuscates subjects of which he knows little - one of them being macroeconomics. Some think, in my opinion wrongly, that this problem can be addressed purely by more reforms. The more India opens itself to foreign money, the more transparent its systems of government are, the more efficient and less corrupt its bureaucracy, the better for its economy. That is the logic. None of this is exceptionable, though all of it assumes that the high growth path is something for which only the government is responsible. First, your opinion is not worth much in this case. The role of Government is to improve the lot of its citizens for which it needs to bring in investment or make the money on its own. We have tried the latter for 40+ years with little to show for it. The other way is to make it easy for businesses to raise capital in a legitimate manner and to encourage their participation in strategically important sectors. With a population of 1.2 B, we are responsible for less than 2% of global trade. The reason for that is that it is notoriously difficult to do business in India, precisely because of the bureaucracy, inefficiency and lack of transparency that plagues the system. This can only be fixed by the Government. Mr Patel speaks of the poverty rate - the fact is that China was worse off than India during the Cultural Revolution and Great Leap Forward - today 500 M people have been pulled out of grinding poverty through reforms, many of which are yet to be implemented in India.
India or south asia whole cant reached the even closed to american shoes where wellfare is for every poor and poor means in america well feeding peoples they get monthly food stamp check, free medicaid card and even free medicine some time free rent too what u got in india u.tube is clear picture.
Azim premji a Khoja cult member and Nandan nilekani a Bunya money worshiper can not change the india and mentallity of lands lords and busniessmen never changed after we lived through kings and Rajay Mahrajay princelly states and opressive Raj law what a irony is great indus civilization is dead dog nothing else.