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Saturday, December 17, 2011

United we vote, divided let's shop

By Swapan Dasgupta

In one of the few meaningful interventions on the state of the economy in this disrupted winter session of Parliament, Leader of Opposition (Rajya Sabha) Arun Jaitley imagined he put the Prime Minister in a spot by referring to his expressed opposition to foreign direct investment in multi-brand retail in 2002, when the Atal Behari Vajpayee government was in power. In stressing that Manmohan Singh is as governed by expediency as any lesser being Jaitley was undoubtedly making a powerful debating point. Yet, in his speech he deftly avoided a more obvious question: Why do politicians across the board behave one way in government and the opposite way in opposition?

The question is relevant in the context of both the Congress and the BJP. The idea of opening up India’s protected retail sector to some form of foreign competition was an idea that was first mooted by the DMK’s Murasoli Maran when he was Minister of Commerce in the NDA Government. It wasn’t an idea that found enthusiastic support from everyone: the Bharatiya Mazdoor Sangh led by the uncompromising RSS leader Dattopant Thengdi was vocal in its public opposition, as were politicians belonging to the ‘swadeshi’ camp in the BJP. But the idea was sufficiently attractive to be included in the 2004 election manifesto of the NDA—although not in the BJP’s Vision Document. If it was the coalitional imperative that scuttled the scheme this month, it was coalitional enthusiasm that put the scheme in the NDA manifesto.

The inconsistencies don’t stop here. Mamata Banerjee was viscerally opposed to FDI in retail and was even willing to vote against the government in Parliament if it came to the crunch. The Congress in Kerala was similarly discomforted by the government initiative.  At the same time, the Shiromani Akali Dal, which has experienced the benefit to farmers from organised retail was enthusiastic in its support. So apparently was Gujarat Chief Minister Narendra Modi who, however, bowed to the party line and put his preferences on hold. It also seems that many BJP MPs were dismayed by the party’s unequivocal opposition and preferred a more nuanced position. They were struck by the absence of any discussion within the parliamentary party before the BJP firmed up its position. Congress MPs would doubtless have the same complaint about its government’s unilateralism.

The point I am emphasising has, however, less to do with the lamentable secrecy and lack of consultations that surround most executive decisions—the retail liberalisation may well have gone through had it not happened in the midst of a Parliament session. What I find interesting is that, political considerations apart, the government’s decision had supporters and opponents cutting across the political divide. More significant, the broad support for corporatizing retail trade appears to have come from states which are either relatively better placed in the GDP—states such as Punjab, Haryana, Delhi, Gujarat and Maharashtra—or smalt gains from an efficient cold chain—as, say, Himachal Pradesh, Sikkim and Arunachal Pradesh.

For West Bengal, Mamata’s unrelenting opposition was quite understandable. Having lost its manufacturing base during the 34 years of Left Front rule, the unorganised retail sector is one of the largest sources of livelihood for a large range of people from the very lowest strata of the middle class to the rural poor. The relative lack of other opportunities has made retailing the only possible source of livelihood for many people. A shrewd politician, Mamata would not meekly have handed over such a large and vocal community to the Left. For her, opposition to organised big retail made a lot of economic and political sense.

The real problem that the government faced was a conceptual one. There was just no way in which a momentous decision over retail trade would have a uniform effect throughout India. In certain states the benefits to both farmers and consumers would far outweigh the threats to the local kirana shop or middlemen. In other states, however, there would be disruption of local communities which had the potentiality of triggering social unrest.

The question that needs to be asked is: should, say, Gujarat or Punjab be denied the opportunity of becoming more integrated with the world market for the sake of West Bengal and eastern Uttar Pradesh? The concentration of power in the Centre makes this inevitable and forces absolutely local considerations to become pan-Indian impediments. Logically speaking it seems absurd that the decision to allow a Tesco to operate a chain of supermarkets in Delhi should invite a veto from a Tamil Nadu-based regional party. But that is how India has organised its politics and separation of powers. In a genuinely federal state, such decisions should be taken at the state level and be governed by mundane considerations such as municipal planning permission. Instead, it became a test of the Union Government’s credibility.

The simple truth is that the idea of a redistributive Centre which was at the heart of the socialist planning process has run its course. In today’s India, it is the centralisation of power on crucial issues such as labour, power, infrastructure and environment that constitute obstacles to growth.

Uneven development is a fact of life that cannot be controlled by bureaucrats and politicians. There is often talk of a twin-track Europe. In India, we need to acknowledge the necessity of a multi-track, federal India.

Deccan Chronicle/Asian Age, December 16, 2011 


tris91 said...

i cannt help but laugh
as much as logical u make it sound it fails to be anything like it (unfortunately)

Jitendra Desai said...

Economy has been completely politicised.How will BJP, when in power, improve supply chains for food articles?
BJP while opposing FDI has not provided any alternate model which is different from existing retail model,which has been there and has been evolving before Chanakya's Arthashashtra.
Will some one stop Modi from inviting Wal Mart in Gujarat?
Time has come to redraw the boundaries of states and the powers that the states should have.
We have had enough of Nehruvian centralisation.
Time to redefine center state relations in terms of economy,cultural identities and lot more.
Delhi should collect taxes needed for both external and internal security, foreign relations,constitutional proviso, and national infrastructure like railways, ports, air ports, telecom,high ways etc.Every thing else should be devolved to the states, numbering about 50.

Anonymous said...

Very well written Swapan Dasgupta !

In hypocrisy no one can surpass Indians. This swadeshi vs videshi discussions induce instant sleep in me. Thank God , I happened to watch Sathyajit Ray's " Ghare Baire " recently that really puts things in the proper perspective.

Indians settled abroad have had no problems shopping at Walmart. Consider Middle Eastern countries for instance. Their rulers have wisely invested in infrastructure letting in various foreign retailers. China is another country known for its pragmatic approach.

Indian effete doddering anachronistic "elected leaders" have nothing to offer other than petty politics to its people so overzealously governed. It is time they are forcibly retired.

Anonymous said...

" But that is how India has organised its politics and separation of powers. In a genuinely federal state, such decisions should be taken at the state level and be governed by mundane considerations such as municipal planning permission. Instead, it became a test of the Union Government’s credibility ".

Worth pondering over Swapan Dasgupta!

How many of us know that Indira Gandhi who most Indians are so fond of apotheosizing bought an iceberg blasting contraption from Russia to be used in Tamil Nadu ?

Several such wasteful expenditure incurred by Congress party never reaches the public.Nobody holds them accountable.

On the contrary we are making a big issue out of Bhagavad Gita proscribing by Russia. So what? It is certainly not a loss for Indians. Let them shun Ramayanam & Upanishads too. Why should Indians be bothered AT ALL ??

When the going gets tough , the hitherto mighty & tough start frenzied Temple visists. Indira Gandhi came imperiously seeking Kaanchi Seer's Blessings.

Sonia has already visited not just Thirupathi but Shirdi Sai Baba Shrine , Maelmaruvathur AadiParasakthi. Now SATURN makes a lot of people jittery.

Anonymous said...

This Jitendra Desai prolific inane comments writer is the typical jingoistic BJP type of people. And there are plenty of Indians like him which is extremely detrimental to none other than Indians all over the world & INDIA.

He thunders >>>retail model,which has been there and has been evolving before Chanakya's Arthashashtra.
Will some one stop Modi from inviting Wal Mart in Gujarat?>>>

It would take less than a second for Walmart all over the world ( why only Walmart all of their well known retail shops & very specialised niche marketing ones included ) to ban entry of Indians & even deport them enmasse.

Bollykollywood's arrogant supercilious stars shop at JC Penny , Marks & Spencer etc. Karishma Kapoor & her mother Babita "shopped & shopped till "we dropped" in London. Several times.

The way Idi Amin drove out Indians can be emulated in a far more effectively calibrated way so that Indians are left with no fangs to bare AT ALL.

This rattling of names like Chanakya & Swami Vivekananda by the likes of RSS Gurumurthys & Murli Manohar Joshis provide very pathetic useless slapstick relief.

Bollywood's Shakti Kapoor provides much more wholesome entertainment in movies like Chaal Baaz etc compared to this RSS erudite eloquent mathamotas.

I personally know of plenty of Indians abroad who simply love to shop at Walmart for various reasons.Indians are not renunciates as they attempt to mislead all. Kollywood's tambram wannabe Al Pacino ( Ek du je ke liye actor a notorious pornstar which is an open secret) owns a German Auddy car.

Many Indians ( particularly brahmins) cannot survive without being a proud possessor of "at least one car".