AIFB for Netaji’s India ---

a Socialist India :

1.         With the historical resolution adopted at the All India Forward Bloc, National Council meeting held in Calcutta in 2003, the Party gave the clarion call to Rebuild India in Netaji's way. To elaborate the idea of "India" that we are aiming at to rebuild through our relentless struggle under the leadership of the working class people, aided by the active participation of the progressive intellectual elements, we have been all along emphasing that, that new India must be a "Socialist India" as had been dreamt of by Netaji Subhas Chandra Bose. Right from the end of twenties of the last century, Netaji Subhas started advocating for establishing Socialism in India which he later clarified as Socialism in Indian way under Indian conditions. With this innovative approach towards Socialism, Subhas Chandra emerged as a distinctive personality in the arena of Indian politics and gave his bold and dynamic left leadership to the country to achieve the goal which he uniquely coined as the "socialistic reconstruction" of the country to be initiated immediately after obtaining freedom.

            Subhas Chandra didn't rest only after giving the call for socialistic reconstruction, but he started advocating and elaborating the concrete ways in which the planning and implementation should proceed for solving the age-old fundamental problems' of the country and building a 'New Order' in the society.

            But the whole scenario had changed with Netaji's unprecedented revolutionary move to leave the country for launching a bigger armed struggle from outside with his INA for emancipation of the country. But during his physical absence from the Indian soil, the left forces in India failed to rise unitedly up to the desired level to further Netaji's planned anti-imperialist struggle. The right reactionary nationalist bourgeoisie took advantage of the situation and conspired with the imperialist force to acquire power, at the cost of partition of the country.

            The way in which this 'transfer of power' was effected, the real 'power' was not handed over to the 'people', and the obvious results followed. With the pro-capitalist anti-people policies of the ruling parties, the basic problems and miseries of the majority of the people have not been solved, rather aggravated during the last couple of decades after independence.

2.         In the backdrop of this historical perspective, in our 2003 National Council document, we analysed in detail the reasons of failure of the ruling parties tied up with capitalist and imperialist forces, and highlighted how they have deviated from the socialist reconstruction path shown by Netaji Subhas Chandra Bose. The obvious conclusion of the '2003 National Council' was that we must continue our relentless efforts for the success of a 'second revolution' that would materialize the socialist reconstruction programme conceived by Netaji. With a brief introduction of Netaji's unique concept of Socialism, the '2003 National Council', therefore, gave the clarion call to 'Rebuild India in Netaji's way.'

3.         With the passage of time since the '2003 National Council', India's ruling class moved further with their Second generation Economic Reforms, and thereby plunging the country in deep-rooted miseries and inequalities with increasing gap between the limited 'haves' and a vast majority of 'have-nots'. On the other hand, during this intervening period, India has been further pushed towards the imperialist clique headed by America. The economic imperialism in the name of globalisation has overpowered most of the developing countries including India. In fact, due to pro-imperialist policy of the ruling party, India is now forced to face the onslaught of the world imperialist and capitalist powers headed by the USA. Imperialist capital and MNCs are intruding the vast Indian market which they are lavishly exploiting under the patronage of the govt. of India, and repatriating the huge amounts of profits to their homeland. Big Indian corporate houses are very often joining hands with the foreign capital and sharing the profits indiscriminately. This intrusion of foreign capital and joint exploitation of India's resources, in collusion and partnership with the big domestic capital, are coming in the shape of Special Economic Zone (SEZ) or Corporate Entry in the retail market, causing ousting of millions of poor farmers and small traders of our country. We need to formulate our strategy of total opposition to this devastating aggression of Foreign and big domestic capital. We also need to analyze how our economy, our health, education and other social services, our culture and heritage have been disastrously affected by the anti-people and pro-capitalist imperialist policies of the ruling party. We can substantiate our point by showing how the poverty and unemployment indices have gradually gone up and how it has facilitated an 'exclusive' growth of the rich at the cost of millions of hungry people, and thereby forcing the government now to talk of 'inclusive' growth in the approach paper for the 11th Five Year Plan.

            In the backdrop of the aforesaid analyses, we can further develop what Netaji Subhas Chandra actually conceived about his Socialist India and how widely his Socialist Reconstruction Plan fundamentally differed from the measures taken under the last Five Year Plans. Our Alternative proposals based on Netaji's ideological directions may also highlight how and why the Centre's eleventh Five Year is deemed to meet the same miserable failure to ensure socio-economic emancipation of the millions of downtrodden Indian people.

            The present document is prepared on the aforesaid step by step approach and political analysis and will thus be a supplement to our earlier '2003 National Council' document giving the historical call to 'Rebuild India in Netaji's way'. The present '2008 National Council' document will envisage a landmark peoples alternative for 'Building a Socialist India' as conceived and advocated by Netaji Subhas Chandra Bose.

4.         What India is today after completion of ten Five Year Plans :

4.1       We have seen ten Five year plans, amendments of Constitution more than 100 times, number of commissions on different subjects, policies and programmes, experienced different political ideologies and economic models and systems but the plight of the common people of India remain as same even after all these exercises.

4.2       India is under the strong grip of globalization. It has extended its tentacles to every sphere of common man’s life. Globalization facilitates accumulation of capital by Indian corporates and creating band of capitalists. The advocates of liberalization are projecting the so called bright spots of the Indian economy, such as high growth rate of GDP, massive build-up of foreign exchange reserves, booming capital markets, rapidly growing services sector, rising imports, creeping inflation as an exercise to conceal the grim and worsening reality.

4.3       The UNDP’s annual Human Development Report, for instance, is enough to interpret the growing gap between the rising fortunes of the billionaire brigade of Shining India and the pathetic human development indices that characterize the real India. The human development index of the UNDP is a combined factor like life expectancy, school enrolment, public hygiene and standard of living. According to the UNDP report of 2006, India is at the 126th position in a list of 177 countries. This is the irony that the country accounts for the three among the world billionaires, remains home to half of the world’s poor and the starving people, while nearly half of India’s children below five remain suffering from malnutrition.

4.4       Under the impact of economic reforms of last fifteen years, the rupee got devalued to the extent of 91%. This devaluation has increased the costs of import of oil, fertilizers etc, and thus pushed up the prices of all commodities in the domestic market. The economic reforms have substantially reduced the subsidies on petroleum products. The cross–subsidy-pricing policy (more subsidy to the items useful to the poorer sections than to the items used by the richer sections) has been abandoned. Of all the petroleum products, the price of diesel, which affects the cost structure in agriculture, transport and freight, and of kerosene which is used by poorer sections have been raised. Therefore, after implementation of economic reforms, due to devaluation and reduction in subsidies, the transport fares and freight have gone up steeply. Further reduction or withdrawal of subsidies on water, power, fertilizers, pesticides etc have increased the cost of agricultural production. Both these factors are causing substantial increase in prices of all the essential commodities, food grains, oils, vegetables, pulses, salt etc and bus/rail fares.

4.5       The government always projects some figures about declining inflation, rising Foreign exchange reserve, FDI and so on. But in reality more than 300 million people live below the poverty line of Rs. 10 per day, 450 million live below poverty line definition of World Bank i.e. $1 per day. 700 million people live below poverty line of $ 2per day. These millions of people go to bed hungry every day. The average earning of an Indian is $1.44 per day (about Rs.65). At the same time prices of essential commodities are skyrocketing. The prices of Petroleum products have increased several times under the pretext of international market volatility.

4.6.      The practice of NEP has created a new phenomenon of ‘Jobless Growth’. The net result of the NEP is that India has become the country of Asia’s biggest club of billionaires and half of the world’s poor as well. The latest Forbes list of global billionaires gives us the clear picture about this new India. According to this list there are 946 billionaire families in the world today and there are as many as 36 Indian names in this club of the world’s wealthiest. This is 14 more than the number of Indians who had made it to the Forbes list last year, and the combined wealth of these 36 families amounts to $191 billion, which is one – fourth of India’s GDP. The new billionaires have amassed wealth from media to computer software, from real estate to liquor. This stunning accumulation of private wealth is dividing the country into two, i.e. the shining billionaires and the suffering Indians. The much publicised reforms have increased discrimination in income and living standards both class-wise and region wise.

4.7.      According to World Wealth Report, in 2006 India had 1,00,015 people with a personal wealth in excess of at least $1million (Rs. 4.1 Cr) each. In 2005, there were just 83000 such people.. What it means is this that in one year, the number of Indians getting richer grew at 20.5%, as against the Chinese at 7.8%. This inequality draws the emerging picture of how India is doing under liberalization after the so-called reforms have held sway over the economy for the last 15 years.

4.8.      Corporate houses are now moving forward to assume many traditional functions and responsibilities of the state, including those in sensitive areas like higher, professional and technical.

4.9.      It has been noticed that through privatization, liberalization and globalization, an attempt has been made to change the very character of our polity and the concept of welfare state is being pushed into the garbage tank. The government has tried to disown its responsibilities in the field of education, health, employment, food and nutrition, social security and such type of essential services and leave it to the private sector. It has created tremendous insecurity and instability in our country leading to growing poverty and suicides.

4.10     The ruling class is blindly following the reforms agenda suggested by the World Bank, International Monetary Fund and the World Trade Organisation. Due to this policy change, the rural India is languishing in severe unemployment and stagnant agriculture. The government records say that India’s foreign exchange reserve has crossed 210 billion dollar, the rate of annual growth of exports exceeds 25 % and the FDI has touched the figure of 15 billion dollar in 2006-07. But all these ‘developments’ did make no change in the general plight of the common man of India and raising a valid question that these so-called developments are for whom? The main features of the developments and industrialization must be employment generation and economic growth with equity

4.11.    The Indian corporate sectors (like Mittal, Tatas, etc) have started to purchase big industrial and trading units in foreign countries. Several Indian companies have grown so strong that they have acquired several companies in developed countries and acquired the status of MNCs. If we calculate thoroughly, the Indian corporates are investing more in foreign countries compared to their domestic investments now-a-days. These capitalists are using the Indian infrastructure, enjoying tax holidays on various counts and accumulating huge profit. But they are not re-investing these capital in India rather they are exporting. Due to this huge accumulation of profit they are acquiring high level of confidence to bid major companies over the globe. As a consequence of globalization, Indian MNCs are spreading over the globe and sharing economic power in the world. This out flow of Indian capital must be restricted.

4.12.    The study conducted by National Sample Survey Organisation (NSSO) reveals that overall poverty in India in 2004-05 was 28.3%. The rural poverty was 29.2% and urban was 26%. The same study says that the per capita monthly income of rural Indian is Rs.356 and the urban Indian is Rs.538.6

4.13.    Another development of great significance is the growth of the Indian Middle class. During the last six decades, Indian middle class, which is growing in number, has created a new circle in the society. The emergence of middle class paved the path for rapid consumer culture. The demand of the middle class for consumer durables viz., refrigerators, washing machines, micro ovens, vacuum cleaners, coolers, air conditioners, home theatres, DVDs, motor cycles, cars etc. has prompted the industrialists, particularly MNCs and monopoly capitalists to make a systematic study of the size of the middle class. It was revealed that the middle class is growing at the rate of 15% per annum. The notable development due to the growth of the middle class is the creation of a new life style based on new socio-economic culture. A major section of this class is falling in the trap of private banks and money lenders due to greediness and to keep the social status. This rapid growth of Indian middle class is confined more to the cities and metros. So it does not adequately promote inclusive growth, rather it leads to greater concentration of income in the urban areas vis-à-vis rural areas.

4.14.    Census data on living conditions indicate that the rural-urban divide is widening. Regarding housing facilities, urban areas have 79 percent houses, whereas this proportion in contrast is only 41 percent in rural areas. Moreover, temporary houses account for only 5 percent in urban areas, but their proportion is as high as 23 percent in rural areas. Drinking water within the premises was available to only 25 percent of rural population, while the figure of urban areas was 65 percent. In urban areas, 88 percent of households are electrified and only 12 percent use kerosene. In rural areas, only 43.5 percent of households have electricity and 55.6 percent depend on kerosene. Bathroom facility was available to 70 percent of urban households, but merely 23 percent rural households had this facilities. Only 26 percent of urban households had no latrine, but as against it, 78 percent rural households did not have a latrine. In rural areas, only 4 percent of households had closed drainage, 30 percent open drainage and 64 percent had no drainage. In urban areas, 19 percent of households did not own any of the specified assets, such as radio, television, telephone, bicycle, scooter/motor cycle/moped, car/jeep/van, but in rural areas this percentage was 41 percent. Census of India (2001) has given a wake-up call to the Government that the development process has strengthened living conditions in urban India to a much greater extent than in rural-India. The situation in some of the poor and backward states is appalling. It is needed to direct the development process to strengthen rural-India and bridge the rural-urban divide.

5.          Impact of globalization

            The Indian experience of globalisation is :-

            *           Small scale and tiny industries are either wiped out or taken over and converted into production units of MNCs.

            *           The application of high technology for the interest of corporate houses tends to reduce employment possibilities.

            *           Indiscriminate production and profligate consumption associated with the principle of liberalisation results in a rapid degradation of the environment.

            *           A kind of cultural homogeneity based on western fads and fashions has already started flourishing in Third World countries, including India.

            *           Inequality tends to increase at all levels and this has far reaching socio-economic and political consequences.

            *           Globalisation has put constraints on the capacity and scope of governments to control national policies.  The dominant ideology of reliance on free market forces frowns upon the direct efforts of the state to improve the quality of life of its citizens.

*           TNCs, which know no accountability, are determining the pattern of production and consumption as well as flow of capital information.

            These imperialist designs have put the country’s economic sovereignty in to deep crisis. Liberalized globalized and private oriented economic policy of the Union government has brought the country into the brink of collapse.

6.         Declining role of Govt. in Social Services :

6.1.      In the era of globalization the role of government is declining in all social sectors. The government sources are proudly reporting about the declining growth of agriculture and escalating growth of services so far as GDP is concerned. More earning from service sector means the government is imposing more taxes and levies on services like education, health, transport, telecommunication, post and telegraph, water, electricity, etc. It indicates that the government is relinquishing its responsibility to provide minimum needs of the people and handing over these sectors to the private capitalists. Privatizing social sectors is leading towards high rate of commercialization.

6.2       During the sixty years of capitalist development, India has the shameful distinction of having 32.88 crore illiterates, who constitute 50% of world’s illiterates. Only 3% children of the relevant age group are provided with facilities to pursue higher education in India. Without rectifying the above position, the privatization policy has made education a business preposition. Public investment in education is declining even after collecting special cess for education. Education for all is still a dream for Indian masses. But education at a high cost is being available to a handful of privileged class.

6.3.      The ILO report notes that in Asia, unemployment and poverty is higher than in any other region of the world, and that almost two thirds of the total estimated 1,3 billion poor people in the world, live in that region, mostly in South Asia.  In the same report, it is also noted that conditions in the work market in Asia could deteriorate even further if the external economic environment turns hostile. In India unemployment has taken a menacing turn. The educated young people of India are reeling under utter frustration and falling into the trap of anti-national forces. The figures from the employment exchanges are not reflecting the real picture of unemployment. Rural unemployment and under employment are also to be considered while calculating the real figure of unemployment. Under employment is more serious and pervasive problem prevalent in India. It is unfortunate that in India, there is no linkage between education and employment. We are producing IT technicians and engineers as per the demand of MNCs. But we are not giving training for carpenters, blacksmith, masons, mechanics, repairers etc. The Economic Survey 2006-07 reveals that the public sector was shedding the load of surplus workers and this resulted in a decline in public sector employment but it was expected that the private sector, the so-called flagship of economic reforms would generate high rate of employment, but as facts reveal, private sector employment marginally increased from 0.44% to 0.61% per annum. It failed to compensate for the decline in public sector employment, resulting in negative growth of employment in organized sector from 1.20% in 1983-84 to 0.38% during the period of 1994-2004.

6.4.      In health sector, the government is criminally ignoring and making the way for indiscriminate privatisation. The costly private hospitals and nursing homes are mushrooming throughout the country and exploiting the people without any limit. No state and central government is making appropriate legislations to control the private health centres. In the name of specialty clinics, the private corporates are taking advantage of ignorance of the people about medical sciences. The condition of the government hospitals and health care institutions are pathetic. Due to this negligence, India has become a land of all epidemics. We are unable to control even general diseases. Dengue, Chikungunea, Cholera, Malaria etc are becoming common phenomena in different states. The medicines for all these diseases are produced by the MNCs and most of the medicines are patented. Pharmaceutical companies are making huge profit as they got Exclusive Marketing Rights (EMR) on their products.

6.5.      The rural India is suffering in comparison with urban areas. More than 70% of the people are living in the rural areas but the entire developmental programmes are concentrated in urban areas. Hundreds of villages in India do not have proper roads, drinking water, electricity, education, health facilities, transport and nutritional food. This disparity creates social tension, which leads to extremism and even terrorism.

6.6       In respect of social development, tribal welfare and development, empowerment of women, child development and development of the physically and mentally handicapped people are to be considered as priority areas. But sixty years of our experience shows that the government is making only cosmetic policy announcements. Public policies in their areas should be framed in consultation with the experts in these fields and implementation must be entrusted to dedicated and qualified administrators.

6.7.      The state structure of India is federal one. But in practice, most powers and resources are concentrated in the hands of the Union government. Each state has its own culture, wealth, historical and geographical specialties. Therefore, the states need more autonomy. But the Article 356 of the constitution of India is hanging as a Damocles’ sword over the states, which poses a serious threat on the autonomy of the state. More devolution of power, autonomy, adequate revenue share and unbiased approach on all interstate issues are necessary for maintaining a strong and healthy centre-state relation.

6.8.      The globalization and liberalization process has created serious impact on culture of India. The MNCs sponsored new consumer culture and fast life system which are destroying the very basic fabrics of Indian Culture. The communication and technology revolution has penetrated into the drawing room of each and every Indian family. But unfortunately along with minimum positive aspects, this revolution is making a new society devoid of any national and human feeling. The powerful media is acting as a second fiddle for the MNCs and imperialist forces for financial benefits. Diversification of culture is the strength of India. Any monolithic approach will destroy the very fabric of unity in diversity.

6.9.      The total planning process must be revamped. It is unfortunate that no serious attempts have been made to dig out the reasons for non-implementation of government schemes within the stipulated time. The government is accepting and encouraging the development programmes proposed by the conglomerates of Indian capitalist such as CII, FICCI, ASSOCHAM etc. the common people are not getting an opportunity to take part in the process of planning. Thus a vast majority of Indian mass has been deprived of their democratic rights. People’s participation in the local area development must be ensured. India need a peoples’ democratic planning instead of capitalist model of planning.

7.         Faulty Planning ---- Wrong Approach :

7.1       Stagnation in Agriculture :

            7.1.1.   Indian agriculture is facing severe crisis. Low public investment and inadequate price realizations relative to rising input costs –leading to stagnant capital formation even at the farmer’s end- over the last one and half decades are the main reasons behind this crisis. The government target of agricultural growth during the Ninth and the Tenth Plan was at 4% per annum, but in practice realized 2.7% in the 9th Plan and only 1.7% in the Tenth Plan.

            7.1.2.   Close to 70% of India’s population is dependent on agriculture. In 1981, 25% Indians were landless agriculture workers. In 2002, this figure stood at 40%. This means millions of poor farmers have been forced to become landless workers. Farmers who owned smallholdings have had to give up their land. In 1981 the average workdays available for agriculture worker was 123. In 1999 it was down to 100. It plummeted to 72 in 2003. In the rural agriculture economy there is an alarming decline in the average workdays. For marginal farmers agriculture has become non-profitable. This is reflected in the absolute increase in the number of agriculture workers between 1993 and 2003, from 7.46 crore to 10.46 crore. There is more hunger in rural India and consequently more migration of the landless agriculture workers to the cities. 

            7.1.3.   The agriculture sector, which contributes a quarter of the gross domestic product (GDP), provides direct employment to about 57% of the total workforce and supports two-thirds of the total population, receives just 1.3% of the total investment in the economy. The most worrying fact is that the public sector investment has come down from 17.7% to 6.1% during this period. Declining public investment in the agriculture sector is a serious issue because it is not only critical for the development of the agriculture infrastructure but also for attracting private sector investment in the sector.

            7.1.4    The number of agriculture labourers has increased from 27 million in 1951 to 107 million in 2001, a nearly four-fold rise. Consequently their share in the total workforce has also increased from 19.5% to 26.7% during the same period.

            7.1.5    Investment in agriculture has also been reduced in every plan period. It was 6.5% in 6th Plan, 5.8% in 7th Plan, 5.2% in 8th Plan and only 5% in 9th Plan. The budgetary support for agriculture is only 2.6% in the year 2002-03. The agriculture department had sought an outlay of Rs.18, 233 crore for the Ninth Plan but was provided Rs. 7813 crore, only 43 %. Again during the 10th Plan, as against a demand of Rs. 25,000 crore, Rs. 13000 crore was given, a little over fifty percent. Further, against the projected demand of Rs. 5164 crore for 2002-03, Rs. 2167 crore was allocated.

            7.1.6    In 1950-51, agriculture contributed 61% to India’s GDP. In 2001-02 it was down to 24.2%. In 2005-06 it was further declined to 19.6%. The dependence on agriculture as source of revenue has declined because of the increase in the contribution of manufacturing and services sector, but the number of people who are dependent on agriculture has only declined marginally from 77% to 69%. While the pressure on agriculture as an employment generation sector for rural India has increased, the rural economy has almost collapsed.

            7.1.7    Agricultural policies that push the small farmer to destitution on the one hand, and promote cash cropping on the other, have resulted in lowered food production. There has been a steady decline in food production since the early ’90s, as a result of the thrust towards export-oriented agriculture.  The collapse of domestic support for food production (through dismantling the MSP, rising costs of inputs, crop failure due to uncertified seeds) in the late 90s has intensified this shift, as farmers are desperate to recover their losses.  The country is already facing a decline in food production to the order of 12.8% in just one year.

            7.1.8    Between 1996-97 and 2001-02, the government increased the Minimum Support Price of paddy by 39.5% and wheat by 30.5%. In comparison, the government increased the cost of electricity by 73.1% and price of diesel by 108.1%.

            7.1.9    Still the agriculture is dependent on rainfall, only around 40% of the total cropped area in the country is irrigated, hundreds of villages do not have access to electricity and drinking water, lack of proper remunerative prices, etc. are making ugly the face of rural India.

            7.1.10  The impact of the new agriculture policy has been to promote a shift from food grains to vegetables and perishable commodities.  While grains can be stored and consumed locally, potatoes and tomatoes must be sold immediately.  A vegetable centred policy thus decreases food security and increases farmer’s vulnerability to the market.  While this promotes monocultures of perishable commodities, the word used for these monocultures is “diversification” in typical globalisation doublespeak.

            7.1.11  The NSSO data shows that over 40% of the farmers are keen to quit farming. It is a continuation of the tragedy of rural distress that has been driving about one lakh farmers over the last eight years to commit suicide as the way out of their interminable woes.

            7.1.12  India is losing its biological and genetic resources, the basic wealth of our country, and the biodiversity based knowledge of our local communities mainly through biopiracy. The piracy and patenting of our rich biodiversity by the MNC’s, institutions and individuals especially from the Western world is inflicting great injury to the natural resources of our land and people. If this is not arrested by appropriate legislation or other policy measures, there would be incalculable damage done to the nation and the coming generations.

            7.1.13  Three core areas of policy shift are destroying the fragile fabric of ecological security, livelihood security and food security creating ecological devastation and deepening hunger and poverty.

            7.1.14  India joined the WTO in 1995. Since then, Indian agriculture has been subjected to a number of policy changes such as reduction in import duties on agricultural products, removal of minimum export price, lifting of Quantitative Restrictions (QRs), entry of foreign direct investment (FDI) in food processing and marketing up to 100% equity, direct involvement of the corporate sector in highly capital intensive farming like floriculture, private sector participation in agricultural R&D, technology transfer, extension and marketing, changes in the laws of tenancy and leasing of land in order to achieve economies of scale, rationalization of stamp duties on agricultural land transactions and promotion of contract farming. All these policy changes have impacted our farmers and farming processes.

            7.1.15  On 1st April 2001 India completely removed the Quantitative Restrictions (QRs) on imports from all 1429 items as per the bilateral agreement with the United States. Quantitative Restrictions on imports in respect of 714 items have already been removed with effect from 1/4/2000.

            7.1.16  QRs were being maintained ever since 1947 on balance of payments (BOP) grounds under the General Agreement on Tariffs and Trade (GATT) to which India was a signatory. India participated in the 7-year long Uruguay Round Negotiations (1986-1993) which culminated in the signing of the Uruguay Round Agreement in April 1994 and became a founder member of the World Trade Organisation (WTO), which came into being in January 1995. India subscribes to all the WTO Agreements, but continued to maintain QRs on BOP grounds as per the provisions of Article XVIII-B of GATT.  Till 31st March 2000 the quantitative restrictions were maintained on balance of payment ground on 1429 items out of which 700 items were under Restricted List, 685 items were under SIL (Special Import License) list and there were 44 items under canalized list.  In April 1999 about 1285 items were already shifted to the open general license (OGL) list.

            7.1.17  Transnational agribusiness giants are, in fact, the only beneficiaries from the liberalization of imports and removal of import restrictions in agricultural products. They benefit both from using their immense financial clout to depress world prices during procurement and hike it during sales, as well as from the various subsidies that are given to them for both exporting as well as importing, from both the countries which export and the ones that import.

            7.1.18  A major impact of trade liberalisation policies has been a general lowering of food consumption. The per capita cereal consumption has declined from 17 kg per month in the 1950s to 13.5 kg per capita per month in the 1990s. The National Nutrition Monitoring Bureau data shows a declining trend in consumption in Rural India, particularly in cereal and millets, the main source of energy for the poor. The most important reasons for the decline are:

                     Rising food prices

                     Destruction of livelihoods

                     Destruction of the PDS system

                     Shift to export oriented agriculture

            7.1.19  The reduced consumption on the one hand, and the decline in agricultural production and procurement on the other are directly linked though the Food and Agricultural policies of the government. Colonialism had destroyed the food sovereignty of the country, forcing changes in cropping from food for local and regional food security to commercial crops. Each period of large exports has been followed by acute food shortage, and India has had to import the same grain again, often at higher prices.

            7.1.20  Commercialization of agriculture through contract farming is a new policy initiative in the country. In the present era of trade liberalisation and expanding agri – business, the small and marginal farmers in India may find themselves incapable of participating in the market economy due to constraints such as lack of essential inputs, scarcity of reasonable credit, technical guidance and marketing support. In India several big companies, such as Pepsi Foods, Kellogg, Cadbury India, ITC, Reliance and Cargilll have already entered into contract farming. As contract farming is an agreement between unequal partners, there is always the possibility of exploitation of farmers by the big companies. This must be stopped.

            7.1.21  Therefore, in order to make the small and marginal holdings economically viable and to provide productive employment to farmers, we have to evolve a farming system, which is better than corporate and contract farming. Effective participation of cooperative institutions in various facets of agriculture may be a better option. Another alternative could be the promotion of collective farming among small and marginal farmers through self-help groups.

            7.1.22  The policy changes induced by trade liberalisation include:

            ·           Dismantling of the FCI and reducing its role in procurement from farmers;

            ·           Removal of Quantitative Restrictions on imports of food and agricultural products;

            ·           The amendment of the Public Distribution System, to cater only to the ‘Below the Poverty Line’ (BPL) category of the population;

            ·           Increase in the central issue price, from Rs. 450/quintal in April 1995, to Rs. 682 quintal in April 1999, and to Rs. 900/quintal in 2000; and

            ·           Increased price of food available through the Targeted PDS to the BPL as a result of transferring 50% of the procurement and distribution costs of the government to this category.

            ·           Government procurement centres refusing to purchase food grains from farmers.

            ·           The refusal of the government to enforce Minimum Support Price (MSP) on private traders and corporations, forcing farmers into distress sale of food grains at costs far below production costs.

            ·           Dumping of cheap subsidized agricultural products by other countries in the Indian market, lowering farm prices.

            ·           Increasing price of farm inputs, including seed.

            ·          Liberalizing seed regulations to allow private seed companies sell uncertified seed.

            ·           Deepening of farmers’ debt, increased mortgages and land alienation, increased destitution, suicides and sale of body parts among farmers.

            7.1.23              The Approach Paper to the 11th Five Year Plan (Planning Commission, Govt. of India) rightly admits the crisis situation and gives the caution note :

                        "The crisis of stagnation in agriculture needs urgent attention. This sector still provides livelihood to nearly 60 percent of our people and remains vital for food security. To ensure a better life for women and men engaged in agriculture, it is necessary to double the growth rate achieved in 10th Plan and put agriculture on a growth path of around 4 percent. To do this and at the same time maintain prices and profitability, a corresponding increase in demand for agricultural output matched with the supply side response based on productivity improvements is required."

            7.1.24              The aforesaid paper further states ---------- "In recent years our farmers have been hesitant in expanding production because (a) per capita domestic food consumption has stagnated in recent years and (b) world prices turned weak for many crops. Consequently agricultural product prices received have failed to keep pace with overall inflation and production costs, thus reducing farm profitability."

            7.1.25              We may also quote from the document of 2002-03 ----- Farm Survey, which says 94 percent of the farmer households belong to holdings of less than four acres. This is the fate of the 'aam janta' of agriculture. More alarmingly, institutional credit generally does not reach the marginal and small farmers. The rich farmers are only benefited. To make the situation still worse, only 1.8 percent of the total investment in India goes to agriculture. When the total investment in the country is 34 per cent of GDP, out of that only 1.8 percent goes to agriculture and only one quarter of that is public investment. Only this meager public investment may reach the large section of small farmers holding below 4 acres of land. Hence, they are in deep crisis. Agricultural crisis is entirely created by faulty government policies. As Netaji Subhas Chandra called for (as early as in 1938) development of 'scientific agriculture', the UPA government must use the social benefit aspect of public investment by investing more in irrigation, water management and land development.

            7.1.26              We may quote firm 'Economic Survey 2006-07' figures on Annual average growth rate of agriculture, which show how miserable is the present agricultural performance :

 

 

                                    Total : Annual average growth rate (per cent)

Five Year Plan

Overall GDP growth rate

Agriculture & allied sectors' growth rate

Seventh Plan(1985-90)

6.0

3.2

Annual Plan (1990-92)

3.4

1.3

Eighth Plan (1992-97)

6.7

4.7

Ninth Plan (1997-2002)

5.5

2.1

Tenth Plan (2002-07)

7.6

2.3

2002-03

3.8

-7.2

2003-04

8.5

10.0

2004-05

7.5

0.0

2005-06

9.0

6.0

2006-07

9.2

2.7

 

7.2       Industry : Jobless Growth

            7.2.1    It is true that industrial sector has grown in many ways during the last fifteen years. But this growth has not helped growth in employment, thereby causing livelihood crisis of millions of poor people. Organised manufacturing sector, although produces two-third of whole production, employs only 12% of the whole workforce engaged in manufacturing. Labour intensive mass manufacturing based on relatively lower skill levels may provide an opportunity to expand employment in the industrial sector. China has done exceptionally well in this area and has opened up the world market.

                        The Eleventh Five Year Plan approach Paper has assessed the situation as such : "Indian manufacturing is highly dualistic, with the organised sector producing 67% of manufacturing value added but employing only 12% of all workers in manufacturing. Unfortunately, although employment in the unorganised manufacturing sector has expanded, it has not increased at all in organised manufacturing after mid - 1990s. At the same time labour productivity has hardly increased in unorganised manufacturing while organised manufacturing has increased this at about 10% per annum by increased use of capital but with fewer employees".

                        Incidentally it is noted with concern that the Planners are advocating to amend some of the existing labour laws as they think those to discourage the creation of employment opportunities in the organised manufacturing sector. But we warn, again this would be a wrong approach, as it would open the flood gate for more exploitation and depriving the workers of their hard-earned rights.

7.3.      Falling Employment and Increasing Povety.

            7.3.1    Falling rate of employment :

                        'The Economic Survey 2006-07' reveals that ------- "Employment growth in the organised sector, public and private combined, declined during the nineties. Annual employment growth in establishments covered by Employment Market Information System of Ministry of Labour decelerated from 1.20 percent during 1983-1994 to -0.38 percent per annum during 1994-2004, as is shown in the following Table":

Table : Annual Growth of Employment in Organised Sector(in per cent)

 

1983 - 1994

1994 - 2004

Public Sector

1.53

-0.80

Private Sector

0.44

0.61

Total Organised

1.20

-0.38

 

                        'The Economic Survey 2006-07' further reveals ---------- "Net annual addition to employment on Usual Principal Status (UPS) basis went up from 5.47 million during 1993-94 to 1999-2000 to 9.58 million during 1999-2000 to 2004-2005. Simultaneously, however, according to the 61st round estimates, during 1999-2000 to 2004-05, labour force grew even faster at an annual 2.54 per cent compared to annual employment growth of 2.48 per cent. As a result, despite the faster growth of employment, unemployment (on UPS basis) was higher at 3.06 per cent of the labour force in 2004-05 compared to 2.78 in 1999-2000, as is indicated in the following Table :"

Table : Employment and Unemployment (in million)

 

1983

1993-94

1999-2000

2004-05

Labour Force

277.34

343.56

377.88

428.37

Workforce

269.36

334.54

367.37

415.27

Number of Unemployed

7.98

-9.02

10.51

13,10

As a proportion of labour force in per cent

Unemployment rate

2.88

2.62

2.78

3.06

                        The 'Economic Survey 2006-07' highlights another important aspect. It states that to absorb all new entrants into the labour force every year, non-agricultural employment is needed to increase at over 6 per cent per annum during the 11th Plan. It poses a major challenge, and the present trend of generating non-agricultural employment hardly gives us any hope to meet this challenge. The Survey report says --- "As per the figures published by Annual Survey of Industries, there was a decline in the absolute number of persons engaged in the organised manufacturing sector between 1987-88 and 2003-04. ... Profitability (i.e. share of profits in the net value added) during the period 1987-88 to 2003-04 increased substantially from 11.6 per cent to 45.5 per cent, while share of wages came down from 56.4 percent to 35.7 per cent. With a bias towards capital- intensive technology, there was a drop in total employment in the sector. The trend of sluggish employment growth in organised manufacturing is also corroborated by the lackluster performance of the historically labour intensive manufacturing sub-sectors like leather, food products, jute and jute product in more recent years."

                        Precisely, it can be said that unemployment is increasing. From some corner it is wrongly claimed that the overall rate of growth of employment is about 2.3 per cent. But it is very important to note that the rate of growth of employment in the organised sector is negative. In the organised sector, manufacturing sector is growing at a fast rate of 10 to 11 per cent. But this growth in manufactures takes place with negative growth of employment. In reality, employment is increasing in the unorganised sector. And what is this unorganised sector. It is the sector where there is no minimum wages, where there is no labour laws, where there is no social security. People are working there without water, without light, without shelter. They are working in such adverse situation, because without working they would starve. This is the fallacy of growth publicized by the government. To sum up the situation, 11th Plan Approach paper says ------ "Employment growth accelerated to 2.6% during 1999-2005 outpacing population growth. But the average daily status unemployment rate, which had increased from 6.1% in 1993-94 to 7.3% in 1999-2000, increased further to 8.3% in 2004-05."

            7.3.2.   Increasing Poverty

                        The provisional data of the latest National Sample Survey (NSS) 61st Round for the year 2004-05 indicate that the poverty ratio at the national level was 27.8 percent if the Uniform Recall Period (URP, in which the consumer expenditure data for all the items are collected from a 30-day recall period) is used, and about 22 percent if the Mixed Recall Period (MRP, in which the consumer expenditure data for five non-food items, namely, clothing, footwear, durable goods, education and institutional medical expenses, are collected from a 365-day recall period) is used.

 

 

7.4.      Education & Health Services : Far from Necessity Target

            7.4.1.   The UPA Government has on them three main commitments in respect of Education : one, at the international level, 'Education for All', under the NCMP, increasing public expenditure on education to 6 percent of GDP; two, universalizing elementary education and three, under the Constitution's 86th Amendment, making available free and compulsory education to all children in the age group of 6-14 years. The government has failed to fulfill all the three commitments. Moreover, they have levied special education cess twice, at the rate of 2% and then 1%, and still lagging behind to raise education-expenditure up to 6% of GDP, which was 3.74% in 2003-04. State/UTs have reported that as on March 31, 2006, there were 70.5 lakh children in the 6-14 age-group who were not enrolled in a school. The goal of the National Literacy Mission (NLM) to achieve sustainable threshold literacy rate of 75 per cent by 2007. The 2001 Census Report indicates the literacy rate as 64.84 per cent. The situation is made still worse due to distressingly growing trend of commercialisation and privatisation of education, which has deprived the millions of poor people access to quality education. The 'Economic Survey 2006-07' states -------- "As per NSSO survey (55th round 1999-00), there were in-equalities in enrolment in higher education across various social groups in rural and urban areas, and also in terms of gender. Women belonging to SCs and STs and those living in rural areas are the most disadvantaged."

            7.4.2.   The position of Health Services in India is equally far from satisfactory and in comparison to other countries, India's status in Health Services is quite disappointing. 'Economic Survey 2006-07' highlights ------ "India's position on health parameters compared even to some of its neighbors continues to be unsatisfactory. India compares poorly not only with China and SriLanka, but also Bangladesh and Nepal with respect to some indicators."

                        In his 'socialistic reconstruction' plan, Netaji Subhas repeatedly emphasised that alleviation of poverty & unemployment, illiteracy and ill-health should be of priority necessity for our country. But unfortunately, even after 60 yeas of independence India failed to achieve necessary success in these priority areas. This failure is due to faulty planning and wrong approach to our priority problems.

8.         Further anti-people measures only to facilitate pro-rich 'Exclusive' growth: