India's Swadeshi economics: The whole story

On May 24, representatives of the Swadeshi Jagran Manch (SJM) met commerce minister Suresh Prabhu with a complaint that global retailing giant Walmart’s proposed acquisition of homegrown online multibrand retailer Flipkart violated Indian laws and regulations. Four days later, the foreign direct investment (FDI) section of the Department of Industrial Policy and Promotion sent out a memo to three top regulatory and enforcement agencies to investigate the deal and take action.The SJM, which attacked Walmart’s deal to buy 77% stake in Flipkart — calling it “unholy” and a backdoor entry into India’s multibrand retail trade that is closed to foreigners — describes itself a “forceful mobilisation, with a vision and action plan for a truly self-reliant Bharat and equitable world order.” Swadeshi, or an indigenous economic system “based on Indian values,” is a recurring theme with the Rashtriya Swayamsevak Sangh, ideological mentor to SJM as well as the ruling Bharatiya Janata Party (BJP).Its contemporary expression is more a strategic opposition to market-driven capitalism as well as Marxian and socialist frameworks rather than an alternative economic system. They see foreign capital, big companies and multilateral trade agreements as inherently depraved concepts designed to control and profit from developing and poor nations. A key requirement of the swadeshi philosophy is a selfless human being operating swadeshi socio-economic environment, instead of people driven by incentive and deterrence.PUTTING IT INTO ACTIONThe Swadeshi Jagran Manch has also been at the forefront of fighting against several issues such as genetically modified crops, decontrol of drug prices and the international patents regime. Last year, it had accused economic policy think-tank Niti Aayog and its members of serving corporate and multinationals’ interests. SJM national coconvenor Ashwani Mahajan had then accused the Aayog of colluding with pharma companies to sabotage the drug price control regime.It had alleged that the think-tank chief executive and secretaries of three other ministries had planned to delink drug price control from the essential medicines’ list and wind up the National Pharmaceutical Pricing Authority after the regulator had reduced prices of medicines and stents. Its activism was seen as one of the reasons for the Aayog to back off. Soon after, the Aayog lost vicechairman Arvind Panagariya, who quit to return to the US academia.Current Niti Aayog vice-chairman, Rajiv Kumar, who sees the Walmart-Flipkart deal as an opportunity for India’s retail sector to modernise, described swadeshi economics as “generating enough good quality jobs for our young people.” In an earlier interview to ET, he had said it also meant generating sufficiently high growth to create jobs, irrespective of the source of capital and technology. Saying that SJM did not need sermons, Mahajan joined issue with Kumar on microblogging site Twitter, saying that a “friendly Niti Aayog is not going to help this friendly deal.” The SJM is adamant that it will not let the deal go through.“There is no such thing as Swadeshi economics. They (Swadeshi advocates) don’t have any theory or framework,” says Abhinav Prakash Singh, who teaches economics at Delhi University. Singh, who describes himself as a conservative, says insisting on indigenisation or local control may have uses from a strategic perspective (curbing foreign influence and control of domestic assets and institutions) but it is not an economic philosophy. SJM, which has ideological kinship with BJP, believes India should have a swadeshi economic framework that shuts out foreign investment and technology, which push the country into a trap. Proof? India spent more than $18 billion in royalties and technical fees after it removed caps on them in 2009, as per Mahajan.“We are not against trade, technology or even FDI. What we want is a production structure that guarantees and facilitates employment through decentralisation and localisation,” he told ET. In his worldview, the individual should be subservient to the interests of the society or community. The Swadeshi dream is a country growing at a steady pace, gently powered by the sweaty labour of man and beast in self-sufficient villages of happy citizens content with measured consumption.EARLY PROPONENTSOne of the early proposers of this notion— a sort of status quo ante — was Mahatma Gandhi, who considered the Railways an evil and a curse of modern civilisation. “We have managed with the same kind of plough as existed thousands of years ago… It was not that we did not know how to invent machinery, but our forefathers knew that, if we set our hearts after such things, we would become slaves and lose our moral fibre,” Gandhi wrote in Hind Swaraj or Indian Home Rule.This thread was taken forward by Deendayal Upadhyaya, RSS ideologue and president of BJP predecessor, the Bharatiya Jana Sangh. Upadhyaya envisioned an economy where every person had a job. He said only a decentralised economy with thousands of family-oriented small industries situated in villages — where workers will seamlessly move from farm to factories and back — was suited to Indian conditions. “In big industries, the human being is reduced to a component in a heartless machine,” he had said. Writing in the late 1950s, Upadhyaya opposed foreign capital, arguing that it would come bundled with foreign machines and technology, which may help industrialisation in the short term but would fail to lay the foundation for longterm development.He, too, was against expanding the Railways, believing that it promoted centralisation. Instead, he said, India should promote road and air transport like the US. Although Upadhyaya’s thesis of integral humanism with focus on antyodaya or the uplift of the last person is also the basis of BJP’s economic policies, the actual practice is anything but what the ideologue visualised. Writing in the RSS weekly, Organiser, on July 23, the 63rd foundation day of labour union Bharatiya Mazdoor Sangh, its president CK Saji Narayanan said India is vigorously following the capitalist system “in its extreme form of corporate capitalism.” The Indian work culture is where the employer and employee sacrifice for each other and together for the nation, Narayanan wrote.BONE OF CONTENTIONUpadhyaya’s philosophy, or the departure from it, was the whole point of the Sangh Parivar’s opposition to many policies of the AB Vajpayee government and now the Narendra Modi government. It continues to divide the family even today, as is evident in the Walmart-Flipkart deal and the trenchant criticism of top policymakers such as chief economic advisor Arvind Subramanian and Rajiv Kumar. The BJP was founded in 1980 with Gandhian socialism as its founding principle but shifted to Upadhyaya’s integral humanism six years later.RSS leader Dattopant Thengadi, who spearheaded attacks on the Vajpayee government, was vehemently opposed to computerisation and India’s membership of the World Trade Organization (WTO). Interestingly, their fellow travellers at the time were communists and socialists. “The globalisation we saw was a conspiracy,” says Mahajan. “The patents agreement (WTO’s agreement of trade-related aspects of intellectual property rights or TRIPS) had no rationale and it was an attempt to control others.”In his book, A New Paradigm for Development: Sumangalam, former Reader of Delhi University Bajranglal Gupta defines the concept of swadeshi as awakening of the ‘self’ of the society. Gupta, currently north zone chief of the RSS, proposes that the central direction of the development paradigm should be gross social happiness, where not only are the necessary material goods and services made available to a man, but also provisions are made for the satisfaction of his mind, intellect and soul. He too puts the village and its community at the centre of the swadeshi structure of development.Gupta’s approach to development is more holistic, including the protection and preservation of the environment and ecosystems and the spiritual progress of citizens. The idea, though lofty, has not attracted any policymakers and virtually depends on a sociocultural and behavioural revolution. Delhi University’s Abhinav Prakash Singh considers the whole idea of romanticising villages regressive. “Swadeshi is a sociological construct rather than an economic concept. It evolved because money liberated the Dalits and oppressed in village economies.”

from The Economic Times https://ift.tt/2LV1Ylu