Tuesday, October 27, 2009

Globalisation: What it has brought to us and us to?

Globalisation was a term much dreaded by the middle class folks and was introduced by our current PM and then FM Manmohan Singh in the early 1990's.

He is credited with opening up the economy and is regularly lauded by Congressie sycophants. Although it brought about a huge change in the way India was seen as a market by the world, it was more of a compulsion than a choice.

India did not have enough Foreign Exchange to survive for another 15 days and ONGC had famously not bid for a contract in the Far-East since the government could not lend $7000/- as the bidding fees.

Under these circumstances the IMF had put conditions for India to open up before asking for any loans. India got loans and then had to open up.

It brought a change and change is always uncomfortable for humans.

Globalisation has definitely opened up more avenues than our earlier generations had. The feeling is summed up in the statement that 'I am doing what my father would not even had dreamt of'. This is more or less applicable to every successful person in India today.

What our earlier generation did at the age we are today, is quite different from what we are doing and quite possibly, they may not even had dreamt of a lifestyle like ours.

But then we are counting upon a little percentage of been-there-done-that's. There is a heap of talent unsourced. A good 25% of India which is below the age of 25 years and has its own aspirations. Oppurtunities for all of those is very important or we are sitting on a time-bomb of criminalisation of society.

The trickle down effect, that was so widely believed would happen, has just been busted. The wealth from the top just does not seep until the bottom.

It was advocated that the market economy would make rich people gain wealth, which would be distributed locally which would make prosperity reach the rural part of India.

But when we think of this, another event is reminded when Mukesh Ambani led Reliance had made huge profits owing to the high oil price which had driven profits to the petroleum products made by his group.

Mukesh Ambani had visited the PM and Congress President Sonia Gandhi in relation to a constitutionally valid tax that he was supposed to pay. It was called a Windfall Profit Tax which a businessman has to pay in lieu of a humongous profit acquired by his organisation. Ambani had made a request to relax that tax.

What happened to his request, the media did not highlight nor was reported anywhere. But if we are allowing businessmen to pay lesser tax, then what is the use of the whole trickle down theory?

We are breeding terrorists in the form of Naxalites and Maoists. The have-nots in India are far more in percentage than the 'have's'.

No wonder we had 28% people below poverty line in 1991, now we have 38%


  1. I agree with you Amit. The opening up of economy has brought goods in general, but at micro level it has not improved much. The theory is good, but it has not been put in practice the way it should have been. More focus is required on this from the 'Man' in control. There are miles to go before jumping on raising claims on the partial improvements.

    Another aspect you could have highlighted is that there isn't required fairness in the system even by the so called 'open' countries. These countries often provide subsidies to their producers and make hue and cry when 'closed' countries do that.

  2. Thanks for your comment Chintan. You are right, there is no completely open economy. It is an utopia to have one.