Continuing Subordination to Global Finance, or Taking a Course of Democratic National Development


This article makes the following points.

  1. Even before the advent of Covid-19, India’s economy was in a depression. The condition of vast masses of people, particularly those in the unorganised sector, was grave.
  1. In its response to Covid-19, the Government imposed the most stringent lockdown measures in the world. Given the character of India’s economy, this had a particularly severe impact on vast masses of people.
  1. At the same time, the Government’s spending to cushion the impact of these measures on the people has been vanishingly small. In comparison with other countries in the world, the Indian government has committed among the least additional spending (as a percentage of GDP). While some further expenditures will no doubt be forthcoming in the coming weeks and months, it is already clear that, taken together, they will be abysmally low. As a percentage of GDP, the maximum expansion of spending being talked of is much below the expansion of India’s fiscal deficit in the wake of the Great Financial Crisis of 2008; whereas the crisis in the real economy now is far, far greater than it was in 2008-09.

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By Dr. Annavajhula J.C. Bose
Department of Economics, SRCC (University of Delhi)

(Reprinted from the Unravel Economics blog)

Suppose you are serious about understanding the economy and changing its functioning towards greater social well-being. And so, you have made up your mind to pursue economics after completing your school education.

You might regret later that you had innocently wasted your precious time doing economics as nothing but mathematics of maximization. Peter Radford sums up this regret thus: “Too many people are wasting far too much time talking about economists as if they study the economy. They don’t. They really and truly don’t…economists had been steadfastly denying fact, ignoring reality, and living in a wonderland of their own creation. Economists study economics. And economics is not the economy. It is a self-contained set of ideas, models, theories, mathematical intricacies, and axioms, that are designed to provide exciting intellectual sport for those so inclined to busy themselves with such activity…Another attribute of economists is their portrayal of the dispassionate observer of society gravely describing the ‘deep laws’ humans are foolish to push back against. They project the air of sober analysis. They attempt to inject a discipline and rigor into the messy pool of human interaction. They want us to believe that what they describe is inevitable. So they take upon themselves to act as caretakers of what ought to be…So: my advice is to study the economy by taking classes in politics, sociology, philosophy, business or organizational theory. Get steeped in information theory. Build those agent based models. Go and talk to workers, shopkeepers, and all the other people in the real world. But stay away from economics. Especially if you’re serious about the economy.”

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It is very unusual for Narendra Modi to praise his political rivals, but on April 27, during his video conference with chief ministers of different states, he lavished praise on the Congress chief minister of Rajasthan. According to news reports, he said:

Every state has some party in power, which realises that it has a chance to take the country forward…. Hamein reform bhi karna hai. Agar reform karne ki disha mein rajya initiative leta hai,aap dekhiye yeh sankat ko hum bohot bade avsar main palat sakte hain. Main Ashok Gehlotji ko badhai dunga. Unhone kai initiative liye. Unhone labour ke liye samay seema ki bhi badhotri ki hai. Theek hai alochana thodi hue hogi, lekin Rajasthan ne disha dikhayi hai (We have to carry out reforms too. If a state takes an initiative for reform, we can turn this crisis into a big opportunity. I want to congratulate Ashok Gehlot. He has taken several initiatives. He has increased the time limit for working hours as well. No doubt there must have been some criticism of this, but Rajasthan has shown the way).[1]

The Prime Minister was apparently referring to the Rajasthan government’s decision to increase working time in factories from 8 hours to 12 hours; he urged other states to follow suit. Indeed other states have already joined in this drive to extend working hours: Gujarat, Madhya Pradesh, Haryana, Himachal Pradesh, and Punjab have amended the Factories Act of 1948 through executive orders to effect this change. In several of these states, the overtime hours will not be paid at higher rates.

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The following translation of Rahul Varman’s article, “Citizenship and the Nation of the Rich in India” has been done by Vivek Mehta.

Citizenship and the Nation of the Rich in India_हिंदी

By Rahul Varman[*]
Kanpur, March 31, 2020

The following piece was initially drafted before the nationwide alarm and lockdown over Covid-19. However, the description it provides here of the ‘nation of the rich’ complements the description and pictures we now see of the nation of destituted labourers struggling to reach their homes in the villages. — Editor

I. Introduction

The idea of being a citizen perhaps has never in the short history of this nation been so much debated and discussed as the present times; from parks, to streets, to academic institutions, to the news rooms and drawing rooms, the ideas of citizenship and the Constitution are being contested everyday and almost everywhere.

In the wake of the devastation of World War II, the Bengal famine and the catastrophe of Partition, and as the culmination of the long striving and struggle of the Indian people against colonial rule, the Indian republic and a constitutional democracy came into being some 70 years back.  They came with a promise to wipe out the memory of colonial rule, in which most Indians were rendered as lesser beings in their own land. The new republic and its Constitution promised welfare and freedom for all, respect for life, liberty, dignity and opportunities for every individual to realise his/her potential without any discrimination based on the chance of birth. It promised the citizens equality, freedom to conduct their own affairs and speak their minds, as well as protection from discrimination and exploitation. In the form of ‘directive principles’, the Constitution proclaimed a vision of justice, development, welfare and prosperity for each individual, for which the new nation-state was supposed to strive after the war, famine, partition and the long period of colonial rule. It also provided for an elaborate structure of State machinery to achieve these objectives.

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There is a relentless drive by the rulers to privatise public transport.

  • We are now seeing the private take-over of individual trains of the Indian Railways.
  • The Metro Rail policy of 2017 makes private participation mandatory in order to receive funds.
  • The recent Motor Vehicles Act Amendment, 2019, is designed to push privatisation.
  • The workers of the Telangana State Road Transport Corporation (TSRTC) are facing autocratic repression in their struggle against privatisation; the chief minister has declared he will dismiss all 48,000 of them, and issue permits for all the routes in the state to private firms.

The authorities cannot state the real rationale for privatisation, namely, that it is merely a way of creating handsome profit-making opportunities for private capital. Hence they have to propagate all sorts of nonsense to justify this drive.

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The answer to both questions is: No. The real figures are only a fraction of these figures.

Who is putting out such high figures?
The heads of the automobile industry. Auto industry bodies claim that the automotive sector accounts for 7 (or 7.5) per cent of India’s GDP, 49 per cent of manufacturing output, and 37 (or 40) million jobs“directly and indirectly”.

Why are they propagating these false claims?
By inflating the contribution of the auto industry to GDP and employment, the auto barons hope to squeeze out even more concessions and subsidies from the Government.

These are the figures Anand Mahindra uses to demand tax concessions of the Centre, saying that “kick starting the auto industry with a few short-term measures will serve a greater national purpose”. The same figures are trundled out by the Maruti Suzuki chairman to demand that state governments do their bit to rescue the auto industry. Bodies representing automobile manufacturers, component makers, and car dealers have cited the same figures to the Finance Minister while pressing for a stimulus package. A Google search for these figures turns up innumerable citations in the media (for example, here,here,here,here,here, and here). Continue Reading »

Suvrat Raju

In the last week of June 2019, as this article was being written, tensions between the U.S. and Iranian governments escalated sharply. On June 20, 2019, in response to aggressive U.S. actions, including the mobilization of troops, naval forces, and aerial provocations, Iran shot down a U.S. surveillance drone flying  near the Iranian border.[i]  The U.S. government used this as an excuse to threaten to bomb Iran.[ii] The United States might implement this threat in the near future, setting off a wider conflict.

The origins of these tensions are often traced to the U.S. dispute with Iran on its nuclear programme. However, both the Iranian nuclear issue and the current war-tensions should be more properly viewed within the context of a four-decade-long effort by the United States to undermine the Iranian government and assert U.S. hegemony over West Asia.

In this article, I  will review the history of the Iranian nuclear issue from this perspective. This history is instructive because it sheds light on political trends both within the United States and Iran; it also reveals how arms-control issues have been used by Western nations to destabilize governments that they view unfavourably. I will conclude with some comments on the positions adopted by the Indian government, and a brief outlook on where these events might lead. Continue Reading »

By Manali Chakrabarti

By the sweat of your face you shall eat bread, till you return to the ground, for out of it you were taken; for you are dust, and to dust you shall return
— God, Genesis 3:19

We asked Didi if we could accompany her on one of her routine visits to the temporary schools she ran for the children of migrant workers. This is an account of that visit.

Didi is seventy-five years old, and has several chronic health issues. On top of that, her sciatica was playing up that day. She had a spine support, a knee band and an ice pack tied on the knee. We knew that the brick kiln where we were headed was beyond the city limits, so we were concerned–would she be able to take the strain? But then we were tagging along; she had to go anyway.

The car came, and we were off. Didi sat in the front next to the driver, and we piled into the back, jostling with piles of new T-shirts, apparently gifts for the children. The driver (who has also been a close associate in all of Didi’s activities for decades) was telling her about how risky it has been lately to drive around the city. Apparently the city administration has been confiscating private vehicles in large numbers and putting them on election duty. Yes, the five-yearly national carnival was just a few weeks away.

This note is not about Didi, but a brief introduction is in order. For over four decades, she has been relentlessly working with children of ‘migrant’ workers and their parents, and her primary interest is education. (While interacting with hundreds of children and others who know and love here, the fact never comes up that she is the daughter of a former president of this country.) Numerous associates have joined her, some stayed, some left, but Didi has continued. A,b,c,d,1,2,3,4, ka,kha, ga, gha, and their combinations, counting and numbers: Didi wants to make this accessible to all, in a loving, fun way. And because of her love for all children, she knows who has eaten, who has not, whose mother is not keeping well, whose father is an alcoholic, whose land has been mortgaged, who has lice in their hair…

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[Read complete article (as revised March 6, 2019) in PDF format]

According to the currently dominant ideology, privatisation is identified with greater ‘efficiency’ (the meaning of which term is kept vague). Privatisation may take different forms: the handing over of existing public sector assets to private investors; permitting private investors to enter sectors hitherto reserved for the public sector; opening up the exploration and mining of mineral wealth to private investors; promoting insurance schemes in place of universal provision of basic services; contracting out to private firms jobs hitherto done by the public sector; and so on.

But whatever the form, the dominant ideology claims that privatisation delivers the goods more effectively, and more cheaply. Private firms are said to be driven by the profit motive to lower costs and compete with other firms. Even if the activity to be privatised is a monopoly, it can be awarded to a private firm through competitive bidding, in which the State can specify the fulfilment of various criteria/targets as part of the contract. A firm which does not fulfil its contract can be penalised or replaced with another firm. In this way, we are told, the building of a public sector institution, with an experienced workforce developed over years of stable employment, is no longer necessary. The magic of the ‘market’ will do the job.

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