Booming economy with widening disparity – a dichotomy of India Inc.

[singhvp]

For more than two decades now, the country has been abuzz with fast economic growth with the government coffers brimming with stacks of hard currency. The third quarter of 2010 registering a growth rate of 8.9% in GDP, India is considered to be the second fastest growing economy after China and fourth largest economy(by purchasing power parity) of the world which is about to touch the mark of 2 trillion US Dollars volume in the coming 2-3 years. Since the beginning of liberalization process, the process of disinvestment of public sector enterprises has been relentlessly continued by the successive governments of different shades for the ease of FDI from MNCs as well as investment from indigenous corporate sector. As a result, Sensex has crossed a 20,000 mark, capital market is doing pretty well, and Indian marts are flooded with luxury goods and zing things. It is beyond doubt that the graph of Indian economy has been spiraling with phenomenal progress, especially in sectors like IT, manufacturing, automobiles, textiles, service sector and has benefited from outsourcing of business processing in a great way. Also, there can be no denying the fact that the opening of floodgates for MNCs and Indian Private Sector has given rise to the phoenix like emergence of IT Parks, BPOs, S & T laboratories and state of the art research centres offering world class facilities to our budding scientists, engineers and technocrats.

Inspite of the facts mentioned above, the benefits of this economic revolution do not seem to have percolated down to the vast majority of Indian masses upto the desired level. Not to speak of the rural areas, remotely located from the dazzling metropolitan cities and having a total disconnect from the metro culture, even the people dwelling in cluster of jhuggis and humble houses in big cities seem to be unaware of India Inc’s success story as the dividends of this much hyped progress are being reaped by only a few business tycoons and a little percentage of upper middle class of India. For the vast majority of countrymen it is a business as usual. The unregulated and uncontrolled economic growth has, perhaps, led to further widening of the already existing hiatus between rich and the poor. While on the one hand there is an infamous nexus of filthy rich corporate people and politicians who are plundering the national wealth with both hands for fulfillment of their sado-masochistic desires and flamboyance, on the other there is a major chunk of population which is virtually living from hand to mouth. Especially, no substantial change in the standard of living of small and medium range farmers is noticed. The unemployment figure in rural India also doesn't seem to have decimated consequent upon the so called economic boom.

How far do you agree with the above analysis? Please offer your comments.

[singhvp]

An interesting video of a lecture delivered by P. Sainath, Ruaral Affairs Editor of 'The Hindu'. The facts and figures presented by him about slumdogs and the millionaires substantiates the above analysis. The link was pasted by someone on facebook and I thought it worthwhile to share on this forum.

http://www.youtube.com/watch?v=xTGwSEQO1Vo&feature=related

[AbhikRana]

This is inspite of and despite the fact that the PM, the FM and other rankholders/seatholders/throne-holders of the govt. are portraying a very rosy picture of 9-10% growth of national economy, when the actual fact is that the common man has to cut corners in all spheres to make ends meet.

Mankind has three basic needs - food, clothing and shelter. Food and shelter in the times of the present govt. have certainly gone beyond the reach of the common man (what to say of those below the poverty line). The govt. has all the money (read tax-payers' money) to spend on commonwealth games and has got the guts to even talk of hosting the olympics, but acts miserly when it comes to feeding the impoverished millions (the proposed Right to Food Act).

The above mentioned three basic needs Food, clothing and shelter should never be commoditised at least in a developing and populous country as ours. By making them tradeable and investment commodities, the govt. lets the opportunists and the speculators play havoc with the prices of these basic things as is evident by the sky-rocketing prices of food items and even housing units. Governmental check and control is nowhere in sight - in fact it is a laissez faire (free for all). By talking of growing GDP and other economic growth parameters, the govt. is trying to compare its performance with the abysmal growth rates in the western countries. If these countries also have a free market economy, most of them also even have a social security system/mechanism where food and housing is provided to the needy by the respective govts.

Also, what good is this 9-10% GDP growth when millions have to go hungry? and for whom is this growth rate? - The politicians and the handful industrial bigwigs. It would be better if we had few billionaires instead and there would be more equal distribution of wealth. But it seems that that would not be possible at least for at least some more time to come.

[singhvp]

[QUOTE]The above mentioned three basic needs Food, clothing and shelter should never be commoditised at least in a developing and populous country as ours. By making them tradeable and investment commodities, the govt. lets the opportunists and the speculators play havoc with the prices of these basic things as is evident by the sky-rocketing prices of food items and even housing units. Governmental check and control is nowhere in sight - in fact it is a laissez faire (free for all).
Very important point. Government should not leave the common men to fend for themselves for possession of these three basic things. Black marketeers are let loose by the governments for minting money by artificially increasing prices of food, clothing and shelter disproportionate to their real value. In fact governments are being run by corporate people by proxy.


By talking of growing GDP and other economic growth parameters, the govt. is trying to compare its performance with the abysmal growth rates in the western countries. If these countries also have a free market economy, most of them also even have a social security system/mechanism where food and housing is provided to the needy by the respective govts.
Another very important point. Economies of most of the developed countries have reached a saturation point thereby stagnating the growth rate. But these countries have a very strong social security set-up for its citizens to guard them against the hazards of ailment, physical invalidity, unemployment, retrenchment, redundancy and old age. All the government as well as corporate organizations have to contribute a substantial amount as part of the salaries of their employees towards a national fund so created to meet the expenditure for such eventualities.