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India’s growth rate cannot be made a national objective

24 February 2011

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The Telegraph, January 13 , 2011


India’s growth rate cannot be made a national objective

Prabhat Patnaik

While there will be general agreement that the judgment in Binayak Sen’s case represents a gross miscarriage of justice, most people will attribute it to the overzealousness of a lower judicial functionary, or, at the most, to the prevailing atmosphere in the state of Chhattisgarh. If the trial had been held elsewhere, they would argue, Sen would not have got the verdict he did. They are probably right, just as those who attribute the bringing of sedition charges against Arundhati Roy and Syed Ali Shah Geelani to the overzealousness of the Delhi police, and against Sudhir Dhawale to the overzealousness of the Maharashtra police, may well be right. But such overzealousness, instances of which are multiplying alarmingly, thrives within, and derives sustenance from, a certain ambience. This consists of the increasing tendency, under the current neo-liberal dispensation, to see any basic ideological opposition to the parameters of official policy as anti-national. The tendency, in short, is to criminalize ideological dissent. Of course, one must not cry wolf, but one must not ignore this tendency either. To do so will be fatal.

No less a person than the prime minister, while speaking to probationers of the Indian police service in the capital the other day, invoked a curious argument against the Maoists. He did not just make the usual criticism — that Maoists were attempting to overthrow the constitutional order by violent means. He went on to add: “If we don’t control Naxalism, we have to say goodbye to our country’s ambition to sustain a growth rate of 10 to 11 per cent per annum”. And this, he clarified, is because central India is where the bulk of the country’s mineral wealth lies. In short, 10 or 11 per cent growth rate is elevated to the status of a national goal. Anyone who opposes policies that seek to achieve this goal is therefore acting against the national interest, and is ipso facto anti-national.

The reification involved in this piece of reasoning, as Karl Marx would have noted, is astounding. A nation can have objectives, such as the eradication of poverty or the elimination of hunger or the removal of illiteracy or the maintenance of full employment or the achievement of an egalitarian order. But the mere rate of augmentation of the mass of goods and services produced cannot possibly be a national objective. True, some, including the prime minister, would argue that this rate of augmentation holds the key to the achievement of the national goals just listed, but this is a particular ideological position. Others may have a different position on the relationship between growth and poverty. To posit the growth rate as a national objective is to sanctify one particular ideological position above all others as a nationally accepted one, and hence to decry anyone who opposes it as anti-national. Decrying those who oppose a particular ideological position as being anti-national is to implicitly criminalize dissent.

The prime minister, let us not forget, was not talking to a group of his party functionaries, but to budding police officers, whose job consists of identifying what constitutes criminal activity. He was, in short, articulating an official position. Besides, given his intellectual eminence, what he says both expresses and sets the trend for the thinking of the entire establishment. His remarks, therefore, have to be taken very seriously.

More than a century-and-a-half ago, John Stuart Mill, while theoretically anticipating a “stationary state” (that is, zero growth economy), had nonetheless remained unfazed by the prospect. He had declared that he would not mind a stationary state as long as the working people were better off in it. Mill had thus implicitly advanced two propositions. First, the condition of the working people did not depend upon the rate of growth of the economy, that it could be better even in a stationary economy than in a growing one. Second, what mattered to him, and hence, by inference, what should matter to society according to him, was not the rate of growth per se but the condition of the working people. Both these propositions of Mill, a liberal, are diametrically opposed to what the official neo- liberal argument advances today and wants to elevate to a national consensus.

The fact that Mill was right, that high growth may be accompanied by increasing poverty, is amply demonstrated by the recent Indian experience itself. Indeed, the empirical evidence for absolute impoverishment in the recent period of high growth is overwhelming. Let us briefly look at this evidence. The official criterion for the identification of poverty (until it was changed recently after the Tendulkar committee report) has been the intake of 2,400 calories or less per person per day in rural India and 2,100 calories or less in urban India. By this criterion, poverty has certainly increased. Direct measurement of calorie intake suggests that 74.5 per cent of the rural population was “poor” in 1993-94, and 87 per cent in 2004-05. The corresponding figures were 57 per cent and 64 per cent respectively for the urban population. (These figures, based on National Sample Survey Organization data, are from Utsa Patnaik, Economic and Political Weekly, Jan 23-29, 2010, and their veracity cannot be questioned.)

Foodgrain absorption figures confirm this conclusion. Per capita foodgrain absorption (defined as net output minus net exports minus net increase in stocks) which, in round figures, was 200 kilogram per annum in British India at the beginning of the 20th century, declined drastically to less than 150 kg by the time of independence. Strenuous efforts by successive governments in Independent India raised it to 180 kg by the end of the 1980s. But there has been a decline thereafter, marginal at first but precipitous after the late 1990s, so much so that per capita foodgrain absorption in 2008 at 156 kg, according to the estimate of the Food and Agriculture Organization, was lower than in any year after 1953. The period of high growth is precisely the one associated with reduction in foodgrain absorption, and hence with significant absolute impoverishment.

But the official position apotheosizing growth as a national goal and vilifying any opposition to it as anti-national, is not only a reification, and a vacuity, it is also dangerous. This is both because it criminalizes ideological dissent, and because it implicitly justifies corporate control over the State. If 10 or 11 per cent growth is elevated to a national goal, then obviously the agents through whom this goal is to be achieved — especially in the neo- liberal era when the public sector and public investment are frowned upon, namely, the domestic and foreign private corporations and financial interests — must be kept happy. The State must cater to their caprices, so that their “state of confidence” is kept high, and they undertake the investments necessary for high growth.

Since the alternative approach, of taxing the corporate and financial interests and using public investment as the means of raising growth, has been eschewed (even as growth itself has been apotheosized as a national goal), the achievement of this goal necessarily requires appeasing these interests by putting the entire State machinery at their disposal. It necessarily means corporate control over the State machinery. And when the prime minister talks of the need to get unhindered access to the mineral wealth of central India as the means to achieve the “national goal” of 10 to 11 per cent growth rate, he obviously means ensuring unhindered access to this wealth by corporate interests.

This is precisely what has been happening. The series of scandals that the nation has watched with stupefaction over the last few weeks is only one manifestation of the extent of this corporate control.

Such corporate control inevitably brings forth resistance. All such resistance necessarily threatens the “national goal” of growth, and hence is labelled anti-national, that is, criminal. The criminalization of dissent is immanent, therefore, in the corporate control over the State machinery, and the reified view of “national goals” is a justification for such control. Many have rightly attacked the draconian laws which have been introduced in the statute books in many states and under which protesters are punished. These laws, which are often attributed to the authoritarianism of this or that political formation, really spring from the authoritarianism inherent in the corporate control over the State. The renowned economist Paul Samuelson, a political liberal, had reportedly remarked that economic liberalism can be practised only under political authoritarianism. Contemporary India testifies to the truth of this remark.

The author is professor, Centre for Economic Studies, Jawaharlal Nehru University, New Delhi