Does India have a world view which it pushes in forums like the G20? In the Non Aligned G77 years the country was pushing a global anti-colonial agenda and building coalitions for development of the poor. India participated fully in global debates and developed ideas and strategies?-poverty is the biggest pollutant (Indira Gandhi) at the first Environment Conference in Stockholm, 25% of world industry in the third world at the third UNIDO at Lima in 1975, population and development at Bucharest and so on. By the end of the eighties, development and security paradigms were changing and there was a reinvention of the perception of India?s role, which underlines the country?s attitudes abroad. Rajiv Gandhi, while introducing his vision of India in the Eighth Plan in 1989, was to lay down the new vision and develop the idea that India would pursue its global goals in a policy of ?concentric circles of influence?.
In the second half of the eighties, Gandhi was to develop the concept that India would grow fast as a part of a globalising world. There was a refreshing youthful emphasis on technology and the newer organisations and social institutions in which it would be embedded as the flip side of the problems of low growth, poverty and shortage of renewable resources. There was a break with the past in operationalising decentralising paradigms of growth. In fact India did grow fast in that period and that reinforced the world view at home.
The argument that the policy systems of the eighties were designed to establish a cosy relationship between the capitalists and the establishment, through tariffs and directed credit was factually incorrect. Firm level price and output controls were abolished and there was a policy of relaxing investment and foreign exchange controls. These were replaced by tariff and tax policies. In the eighties around two thirds of Indian industry was freed from output and price controls.. But since the reform was not designed by the Brettonwoods institutions, it was ignored abroad. The fact that it was broad based and had a paradigm behind it, was shown by academics like Lance Taylor, Robert Wade and my own work at WIDER. More important, it was to power India?s stance at institutions like the G20.
India pursued three objectives. The first was stability for reform. The second was improving the global and national architecture to deepen financial markets for inclusive growth. The third was the links of these two with trade policy. Its phased process of reform ending with the goal of complete capital account convertibility, stated initially by your columnist as Planning Minister in the Ninth Plan, was to be protected from the wild swings of global financial markets particularly evident after the East Asian meltdown
When the G20 or the Review Committees of the WTO were to admonish it for not reforming fast enough, it wanted the rules to be clear but the paths flexible.
A major problem for India was the harmonisation of financial rules with the development process. In a global expert meeting organised by the UNDP at New Delhi this stance was spelt out and informs India?s interventions in the G20 as also the WTO.
When it is energy, water and sustainable development, it shows with its technical work and experience the need to think dynamically since growth produces quantum breaks, and is not simply more of the same (Y.K.Alagh, 1991a,2001, UNU,.2001, 2006). According to its spokesperson, India is using maximum flexibility and creativity so as to leverage the international environment for its domestic economic transformation. It is increasingly integrating knowledge-based initiatives, science and technology, and business in its goals. Besides, given the nature of new global challenges, deployment of soft power assets and involvement of civil society are becoming as important as the hard power to ?win the peace?. As Sonia Gandhi put it recently ?seek an open and inclusive world order?. That?s what India seeks do at G-20.
The author is a former Union minister. Email: yalagh@gmail.com