Author: MV Kamath
Publication: The Free Press Journal
Date: November 14, 2002
URL: http://www.samachar.com/features/141102-features.html
Nothing is more sickening than for
some of our own intellectuals comparing the economic progress made by China
in recent years with that of India, just to show how superior the Chinese
are. And to add insult to injury we have the U.S. Ambassador to India Robert
D. Blackwill joining the chorus. Addressing the Federation of Indian Chambers
of Commerce and Industry in New Delhi recently Ambassador Blackwill pooh-poohed
the idea that China has made impressive economic gains because it has an
authoritative form of government that can easily change policy and redirect
resources.
``What troubles me about this line
of argument is that it seems to advance the notion that democracies cannot
achieve economic reform rapidly leading to much greater prosperity'' he
told the FICCI. To a certain extent, yes, he is right. A democracy CAN
achieve great economic heights and as Blackwill himself admitted ``India
is capable of high growth rates without compromising its democratic governance''
and ``the values of democracy and free markets are mutually reinforcing''.
But that is scratching the surface.
It is not enough for a nation to
practise democracy. It is necessary to control population growth, encourage
work ethic, get constant infusions of foreign investment and keep down
wages while enforcing long working hours. Blackwill told the EICCI that
a decade ago India and China had close to the same per capita income while
today China's per-capita income is about $ 900, roughly twice that of India.
Blackwill went on to provide a wide range of statistics showing India in
a very poor light.
Last year, he said, China attracted
$ 47 billion in direct foreign investment nearly 21 per cent of the world's
foreign investment going to developing countries, while India's FDI was
about $ 4 billion, less than 2 per cent of that total. As for China's exports,
Blackwill added, today it is over $ 266 billion or about 5 1/2 times India's
current exports.
Why, one may ask, are foreigners
rushing to invest in China? Why is the per capita income much higher in
China? Why are people allegedly working so hard? How come population growth
in China is under control?
Blackwill did not deign to answer.
But here are some facts: Over 300,000 officials are employed by the family
planning services in China to try to ensure that the number of people born
each year is according to a pre-conceived national plan.
An upper age limit is set for young
people to get married. No couple can have more than two children. Should
a third child be conceived, the woman is forced to go in for abortion.
Should India resort to such tactics, Blackwill will be the first to damn
India for contravening Human Rights.
Should India even make an effort
to control polygamy strictly, there will be a hue and cry that Hindutva
forces are trying to hurt the minorities. Sure, China is attracting a lot
of capital. In his book `The Chinese', Jasper Becker, a resident corre-spondent
in China for a decade and currently the Beijing Bureau Chief for the `South
China Morning Post' writes: ``Attracted by low wages and low taxes, small
and large manufacturers from Taiwan, South Korea, Italy, the United States
and elsewhere eagerly cooperated in providing the necessary equipment,
capital, brands and marketing...'' It was exploitation of the worst kind;
but such was American greed that Washington turned a blind eye to what
was going on.
American-financed companies were
making huge profits by exploiting cheap Chinese labour. The great champions
of labour in the United States looked the other way; it was okay for Chinese
workers to be underpaid and over-worked, as long as American companies
made a fast buck. But then, thanks to over- production, demand slumped
and, as a result Chinese manufacturers were faced with staggering amounts
of unsold goods. Around 1999, hardly three years ago, unsold goods were
as follows: 1.5 billion men's shirts, 300 million pairs of leather shoes,
20 million bicycles, 10 million watches, 700,000 motor cycles.
Faced with colossal losses, China
has been trying to push these goods illegally into other countries, thus
to India through the porous Nepal border and an equally porous Bangladesh
border. Labour in China has no freedom. In Shenyang, according to Becker,
workers were forced to subsist on handouts of just 129 yuan ($ 15 or Rs.
750) a month. Shenyang lies at the heart of China's rust-belt with a concentration
of heavy industries and linked to the country's massive industrial- defence
complex. Here, State-Owned Enterprises (SOEs) had gone on a spree manufacturing
all sorts of goods and borrowing heavily from State Owned Banks (SOBs).
Debts accumulated. The Non-Performing Assets of these banks presently total
``hundreds of billions of dollars enough to cripple the entire banking
system''.
No doubt production figures show
that China is far ahead of India. In addition half of China's loss-making
S0Es are reckoned to be former defence plants, which went bankrupt forcing
``tens of thousands'' of unpaid workers, into idleness. The government
strategy to convert these plants into consumer product manufacturing units
failed. Becker writes that at this stage two American companies, Caterpillar
and ASIMCO got into the act to help some of the plants. The objective was
obvious: use low-paid forced labour to manufacture goods that could then
be sold in the international market for huge profits. This is supposed
generosity; it is an example of cynical and shameless exploitation.
Blackwill in his speech made no
reference to the all-embrasive corruption in China. he should read the
latest issue of `The Economist' (2 November) for more facts. The journal
speaks of ``economic crimes'' committed by ``several prominent businessmen''
who had close links with Chinese officials. Such things pass for ``business
acumen''. The rich get away fairly easily though presently there seems
to be a crackdown. For the poor the laws are strict.
Becker reports that ``throughout
the 1990s more people have been executed or sentenced to death in China
than in the rest of the world put together and that experts outside China
estimate that anything from 1.5 to 4 million people are in prison at any
one time''. Under such conditions people surely will do anything the state
orders them to do. In 1978 the Indira Gandhi government was thrown out
for acts committed under the Emergency like forcible sterilisation. In
China in 1989 the state launched a big drive in which 10 million people
were sterilised in just one year.
In China, apparently, there is a
permanent state of Emergency of which Blackwill seems to be unaware. Or,
like his fellow Americans Richard Nixon and Henry Kissinger, unwilling
to face. It is easier to lecture to Indians than to face grim facts.
Again, according to published reports
conditions in the villages are so bad that one out of four adult males
are migrating to the cities to get work and keep the people back home alive.
The cities are thriving, but the peasant workers are kept under close observation.
Behaviour is monitored. A police
chief in Yanshe told Becker: ``We are very tough. Anyone caught smoking
on the street is fined and has to stand there wearing a yellow garment
until he catches someone else violating the regulations''. Villagers just
cannot misbehave.
Writes Becker: ``The national model
for the urbanisation of the peasantry is Zhangjiagang, a county in southern
Jiangsu. Here everyone must memorise and apply the detailed rules and advice
laid out in a `Civilised Citizen Study Book'. It lists `six musts' and
ten `must nots'... Inside every house, a framed list of rules hangs on
the wall.
Every household is regularly inspected
to see if it passes muster and neighbours are obliged to report (on their
neighbours)''. If such rules prevail in India Blackwill will be the first
to criticise India.
Yes, China has done well and we
wish it luck. True, Indian cities are dirty, the peasants who have flocked
to the urban centres observe no rules. But it is very hard in a democracy
to enforce rules. Perhaps India should change its ways. ``To fight corruption
the country needs men of character, not charlatans'' wrote Jay Dubashi
the other day (2 Sept.) in this very paper. Quite true, but in a democracy
things move slowly and law enforcement takes months if not years. This
is not to say that the law does not work in India; it does, howsoever slowly.
It does not mean that Indians are not corrupt.
Goodness knows corruption is rampant
in the country. But in a democracy it is not very easy to nail the corrupt.
But we do it in the United State, Blackwill will no doubt say. India, Mr
Blackwill, is not America.
Much needs to be done in India to
raise the country to greater economic heights. Addressing the Third India-US
business sumit, Prime Minister Vajpayee admitted as much. But he pointed
out that Indian economic reform has a human face. He said: ``The Indian
economy is often identified with the elephant.
I have no problem with this analogy.
Elephants may take time to get all parts of their vast bodies moving forward
in unison. But once they actually start moving the momentum is very difficult
to slow down, stop or reverse. And when they move, the forest shakes''.
There, Mr. Blackwill, is the answer
for your doubts. Spare us your lectures.
