April 19, 2007Economy

Another tilt at the neo-liberal’ windmills

The Financial Times should get better columnists on India

This is an archived blog post from The Acorn.

Anyone who writes about there being two Indias” is necessarily wrong. Anyone who describes India’s jettisoning of the licence raj in 1991 using words like neo-liberal” is necessarily confused. And anyone who writes about Indian agriculture quoting P Sainath and no one else is necessarily unbalanced. Rajinder Sahota, writing in the Financial Times (they actually published it) is all three.

As usual, poverty statistics are among the first to be thrown about. As many as 13m of the 18m of the new additions to the world’s hungry’ during 1999-2003, Sahota writes, were Indians. We are left to conclude that this is because of those neo-liberal’ policies that India has adopted. Never mind that the debate in India is no more whether poverty has declined since the early 1990s—it has by any estimate—but over how much. Contrary to what Sahota would have his readers believe, those reforms might actually have resulted in reducing the number of Indians in the world’s hungry (wherever he got that number from).

Sahota claims that by acceding to, well, the neo-liberal narrative’—the developed world’s this time—India has exposed 600m of its citizens to protected competition from the developed world. That’s true in theory, but developed world subsidies are nowhere as responsible for the plight of India’s farmers as India’s inability to prepare them for globalisation: markets, infrastructure and information are all missing.

What comes next is bizarre. Following a neoliberal agenda’ the Indian government scaled back provision of water, seed and credit, driving farmers to gamble on export crops like genetically modified cotton”. That puts an ideology (neo-liberalism, of course) to the government’s sheer incompetence and neglect of investing in the provision of basic public services. But it does not prove that water, seed and credit would have reached farmers had there been no reforms.

The tale of India’s billionaires, Sahota writes in conclusion, is also the story of her suicides, as if one were responsible for the other. To mix the two is to commit a double offence: first, it demeans the achievements of those who have risen to the top of the economic heap in the face of global competition and often in spite of the government. Second, it distracts attention from the real reasons why the suicides still happen: criticism of theoretical constructs that ignores the actual policies and their implementation, usually by those whose only contribution to the battle against poverty is their propensity to indulge in—and send the government on—wild-goose chases. The title of his article is A lie that drove 1m poor farmers to kill themselves”.

Related Links: It might be Neelakantan’s fault that we are seeing such articles in print. Amity Shlaes and Baldev Raj Nayyar have taken on the critics recently. EPW featured a paper recently on preliminary results on recent povery and inequality statistics.



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