The contradictions are deepening in the polity and distress and discontent are spreading in the economy, particularly in the rural sector, the objective situation is now ripe for launching a broader political initiative, an initiative which should extend beyond the electoral calculus, an initiative which should provide a platform for bringing together the wide spectrum of political forces, activists’ organizations and concerned citizens who are opposed to the onslaught of the process of globalization and the so-called “economic reforms

Appeal for launching National Campaign against Globalization

Attached is the Appeal for launching National Campaign against Globalization. The Appeal is the product of a series of discussions and consultations with a number of like-minded friends and activists including Vandana Shiva, Srilatha Swaminathan, Ashok Rao, Probir Purkayastha, Dinesh Abrol, Yogendra Yadav, K.N. Kabra, M.S. Randhawa, Rajaram, B. Sivaraman, Vijay Pratap, Surendra Mohan, Dipankar Bhattacharya, Ashok Mitra. Some others including D. Badopadhyaya, Amiyo Bagchi, Nirmal Chandra, Ratan Khasnabis, Sucha Singh Gill, Tarsem Jodha, V. Laxminarayana, P.K.Murthy, Pradhan H.S. Prasad, Ishwari Prasad, Shyama Prasad Mukherji, Jagjit Layalpuri, N.Vasudevan, Suhas Paranjape, Ashok Manohar, Sudhir Bedekar, Anand Patwardhan, Sulabha Bramhe, Manoranjan Mohanty have endorsed the initiative.

We seek your endorsement of the initiative and co-operation and support to the proposed National Convention in New Delhi on 21-23 March 2001.

S.P Shukla
31 December, 2000

In a few months’ time we should be witnessing completion of a full decade of the so-called economic reforms. The proponents of the reform were promising a definite turnaround in a five years’ time and India entering the new millennium on a strong base, with a high rate of growth, rising employment, globally competitive industries, accelerating exports and balanced budgets. And incidentally, faster eradication of poverty, albeit as a by-product of the accelerated growth. Promises have remained undelivered. On the contrary, what we are witnessing is a faltering rate of growth, burgeoning unemployment, debilitating competition from abroad, stagnating industries, retrenchments and closures, mounting trade deficit, and persisting and large revenue deficits. What is more, agriculture has been starved of public investment, the policy of state intervention to guarantee remunerative prices has been virtually abandoned and agricultural products have been exposed to unfair and sudden import competition resulting in widespread and unprecedented distress in the rural hinterland. To compound the misery of the common man, the public distribution system has been rendered meaningless for vast sections of the low-income population in urban and semi-urban areas. The increasing costs of electricity, transportation, kerosene, cooking gas, staple food and accommodation have made the life of even the lower middle classes an unending, losing marathon to make both ends meet. And there is evidence that in the initial years of reforms, the proportion of population living below the official poverty line had, in fact, increased.

The decade of reforms has increased the vulnerability of the economy and deepened the duality within the polity. Finance, food and energy typically illustrate the increasing vulnerability. As a result of a deliberate policy, the ratio of direct tax revenues to the GDP has been brought down. The saving potential of the economy has not been fully tapped. The globalization of economy and increasing incomes and wealth in the hands of the richer sections of the population have resulted in increasing trade gap. The situation thus created is being met through increasing dependence on largely speculative inflows of external capital, propitiating which has become a major, if not the main, objective of the financial policy. The relative isolation of the Indian financial system had played a major role in saving us from the fate of the South-East Asian tigers a few years ago. But it seems that the lessons have not yet been learnt by the policy makers. And the vested interests of the ruling elite are unlikely to allow them to imbibe the lessons.

Agriculture which was insulated from the forces of notoriously volatile global market has been suddenly exposed to global competition. Distress has seized various sectors such as oilseeds, horticulture, sugarcane, plantation crops such as tea and coconut, and even dairy industry and the problem is not far off in respect of staple food crops of rice and wheat. Unremunerative prices and heavy indebtedness have driven scores of peasants to suicide. In the name of reducing fiscal deficit, subsidies to the food supplied through the public distribution system have been reduced or eliminated. The off-take has naturally slackened and the Food Corporation is reluctant to procure food-grains on one pretext or the other. The faith of the farmers in the procurement system which was the cornerstone of the policy aimed at food self-sufficiency has been shaken. This coupled with the declining rate of public investment in agriculture, which again is a direct consequence of the deliberate policy of reducing government expenditure and investment, is threatening the return of the nightmare of food shortages and dependence on imported food grains which marked the 1950s and 1960s.

The energy sector has been subjected to fundamental changes, institutional, technological and economic. Increasing dependence on imported energy has been accepted as the basis of perspective planning. Dependence on imported capital and management in the energy sector has been encouraged. One third of the extractive capacity is lying unutilized in the oil sector. The hydroelectric potential is not being fully tapped. The alternative of bio-mass produced energy is not even being seriously explored. The pricing of electricity is being determined to guarantee high returns to private producers, both indigenous and foreign. The state electricity boards which, over years, have created a reservoir of technical and managerial competence, and which were denied financial support they were entitled to under the statute, are being decimated systematically. The indigenous power equipment industry is being starved of orders and rendered helpless in the face of unfair and state-aided competition from the multinationals.

Economic reforms have deepened the duality within the Indian polity. There has emerged a class of not more than five percent of the Indian population which has never had it so good. They have experienced an unprecedented rise in their income and wealth, thanks to the entry of multinationals, particularly in the financial sector. Another contributing factor has been the boom in the information technology industry. The tax relief generously bestowed on the rich in the name of new economic policies ensured that rising income remained in their hands. And the liberalized import regime provided them with the imported goodies. The inevitable counterpart was increased burden of indirect taxes, including inflation, on the poor and not–so-well-off sections. Closures and retrenchment which followed in the wake of the pursuit of “ efficiency