India is not a failed State. But it is a failing State with pervasive poverty, inequitable distribution of income and assets, stunted growth rate and numerous scams at the government level. No meaningful difference can be seen in the lives of the majority of the people. There is great disparity among the states. Also, some people are growing so rich and insecure that they do not want to accept even awards for high tax return.
Four states are doing well: Andhra Pradesh, Gujarat, Karnataka and Maharashtra. They have attracted 75 per cent of foreign investment. Bihar and Uttar Pradesh, with one-fourth of Indias one billion population, have hardly any outside investment. They have had zero growth in the last two decades. Punjab may soon become another Bihar if nothing is done to extract it from the present crop pattern of wheat and rice in which it is stuck with Rs 54,000 crore of rural indebtedness. The northeast cannot claim to have had even a single private project of Rs 5 crore in the last many years.
Villages, where 70 per cent of the population lives, have a slice of only 24 per cent of the countrys growth. Urban poverty is becoming more glaring. And only 10 per cent of our students go beyond the sixth class, although the countrys literacy rate is 62 per cent.
The unemployment problem is acute. Its yearly growth of 2.5 per cent has shrunk to 1.3 per cent. In the countryside, where the incidence of unemployment is the highest, the poor are getting increasingly marginalised. In the cities, a clerks post gets 200 applications. There are schemes to alleviate poverty or give doles for relief or other works. But no government, either at the Centre or in the states, has any scheme to create jobs. In fact, they are retiring employees compulsorily. Trade unions are understandably up in arms.
Once I told Prime Minister Atal Bihari Vajpayee that Lal Bahadur Shastri insisted on the Planning Commission spelling out projects in jobs, not allocations. Mr Vajpayee saw the point but said that the trend in the world was to have more and more sophisticated machines and less and less of hands. He expected other opportunities to come up. True, the service sector is expanding, but industrial growth is falling to 2.3 per cent from 9 per cent in the last few years. But without the solid ground of industry, the service sector will be hanging in the air.
Those who are beating the drum of globalisation should realise that the growth rate in the last decade, after the introduction of reforms, has been half of what it was in the earlier years. The International Monetary Fund, the World Bank and the World Trade Organisation were constituted to maintain financial stability and promote development and trade. For some time they did that when they built the capacity of the State. But the trend has changed to reduce the role of the State by going towards liberalisation and privatisation for the benefit of multinationals and the developed states.
Selling hotels or bread outfits makes sense. So does the disposal of loss-making public sector undertakings (PSUs). But New Delhis policy of disinvestment at any cost does not. At the recent disinvestment orgy, the government has made one PSU buy shares of another PSU at an enhanced price to keep out private hands. This was no sale; it was mere book adjustment, money going from one pocket of the government to another.
By dismantling partially or wholly what was laboriously built in the last four or five decades, the government is playing with the countrys future. The countries that are advanced today were economically better off in terms of per capita income before their industrialisation began. India needs to do her own thinking, profiting by the example of others but essentially trying to strike a path for itself. Fiats by Washington, which still wants us to pay Enron, an outright fraud, are not in our interest.
The political scene is more depressing. State elections in UP, Punjab, Uttaranchal and Manipur have shown how parochialism and patronage, either in the name of caste, religion or region, has come to enthuse people. Leaders have only played upon the differences to get vote. This happens when idealism loses its sheen. In such an environment, seedy elements come to the fore.
With a mediocre political leadership and an inefficient, corrupt bureaucracy, it is difficult to improve governance. The BJP-led government has devised its own way of governance by instilling fear. It is arming itself, weapon-wise and law-wise. No other administration has bought so many weapons in such a short time as this one has. New Delhi does seem to realise that the more strength it acquires in conventional arms, the bigger becomes the danger of nuclear warfare in the sub-continent. The whole strategy is faulty. I remember the remark made by Abdul Qadir Khan, father of Pakistans nuclear bomb, during an interview with me: If you ever drive us to the wall, as you did during the 1971 war, we will use the bomb. However suicidal, Islamabad may reach for the bomb if and when it meets reverses in any future confrontation.
Law-wise, too, the BJP-led government exudes arrogance of authority. The Prevention of Terrorism Ordinance (POTO) is an example. All the powers which the Vajpayee government wants to prevent terrorism or to meet it are available in the six Acts already in force: The Unlawful Activities (Prevention) Act, 1967, the Maintenance of Internal Security Act, 1971, the National Security Act (1980), the Essential Services Maintenance Act, 1981, and the Terrorist and Disruptive Activities (Prevention) Act, 1987.
The hard posturing by the BJP-led government has led to its being dictated by the fundamentalists. The RSS parivar, particularly the Vishwa Hindu Parishad (VHP), is sabre-rattling on the construction of the Ram temple on the site where the Babri masjid had stood before it was demolished. The same religious frenzy is whipped up that had triggered off the worst type of communal riots in 1992-93. The Muslims, though extremely concerned, are generally quiet. But they see in the VHP move another instance of the might is right dictum. The extremist fringe among the Muslims may retaliate if the temple is sought to be built without a mutual settlement or a judicial verdict.
My fear is that Mr Vajpayee might resign if the VHP tries to build the temple without any settlement on March 15, the date announced by it. Such a development is bound to heat up the cauldron of politics to a point where it can boil over. It is difficult to imagine the repercussions. But one thing is sure: economic problems, which already get less attention, may be pushed further into the background. In any case, national interest demands that pressure be put on the government to tackle the VHP so that things do not go out of hand. This happened when the Babri masjid was demolished, and may happen again.