Playing Blind

Updated: Sep 29 2004, 05:30am hrs
There are none so blind as those that will not see. That truism comes home forcefully in the context of the on-going controversy over foreign experts on Planning Commission committees.

And is reinforced in a recent interview of the CPI leader, Gurudas Dasgupta with a business daily.

The veteran communist party leaders arguments are so riddled with fallacies as to make it worth addressing them one by one.

To begin with, contrary to what Mr Dasgupta seems to believe, the experts in question are not joining the Planning Commission.

And much as we would not like to disappoint Mr Dasgupta, sorry, we do not have the answers to everything.

Three, seeking advice does not make us any less self-reliant. Our fetish for self-reliance in the years immediately after Independence cost us dear.

Worse, it went completely against the logic of comparative cost advantage, under which countries produce items where they have a comparative advantage and then trade these to acquire other goods in exchange.

Four, foreign direct investment (FDI) flows the world over are driven by profit considerations. To say, therefore, that we do not want FDI coming in for mercantilist reasons is to live in a fools paradise.

As for the argument that overseas investors must submit to the rule of the country, no one is saying there should be a different read favourable set of rules for them.

All foreign investors seek is national treatment ie, no discrimination against them, a perfectly reasonable demand.

Take the next proposition our huge market. Sure, overseas corporates need markets no less than we need investments.

But to assume that one, India is the only place they can go to or to delude ourselves that our middle-class enjoys the kind of purchasing power needed to make India an attractive destination for FDI is to be naive beyond belief.

If that were the case, India would not be attracting $ 4 billion of FDI a year as against Chinas $40-50 billion. Last but not the least, where is the question of illicit love for MNCs In such matters, there is neither love nor hate; just rational economic thinking that the Left, unfortunately, seems incapable of.