Big Ticket Reforms II – A New Collision Course

In less than a month’s time, the Congress – the party of the big business and the multi-national corporations, has introduced the second dose of poisonous neo-liberal reforms, of which the most controversial being FDI in insurance (from 26% to 49%) and pensions. This will mean more and more aggressive reforms are on their way and an all out war against the working people and other poorer sections in India, who constitute the overwhelming majority in the country

While the new set of reforms introduced recently will require a formal parliamentary approval, the UPA government is now all set for a new collision course with the opposition parties and thus putting into question once again whether they will have the necessary backing from their own allies and outside supporters. A no confidence motion is likely in the next winter parliamentary session, as threatened by Mamata Banerjee (Trinamool Congress), which can topple the Congress government. On the surface a gloomy future haunts the Congress, its prospects of getting re-elected
is being discounted by the pundits.

Can the opposition get its act together?

But given the mood amongst the main opposition parties, who are themselves facing corruption charges or pursuing a neo-liberal agenda in their respective state governments and do not have the confidence to face the electorate, the Congress still has some ground for manoeuvre, to play its usual dirty political games with those on the fence such as Samajawadi Party (SP), Mayawati‘s Bahujan Samaj Party (BSP) or the Janata Dal factions. The government may even secure the backing of the main opposition party – the right wing BJP especially on pensions and insurance, as it was BJP’s NDA that first introduced FDI in insurance during its tenure.

All in all, even if the Congress party manages to keep its flock together for the time being, they will come under more and more pressure from the Western powers, MNC’s and the India Inc. to introduce more such fast track reforms. This only means more instability in the government and more likelihood of people coming out on the streets to protest against such brazen attack on people’s livelihood.

Corporate driven Corruption

Committee after committee constituted by the parliament and the government is roiling out figures on corruption in which corporations and big business is involved neck deep. If the latest report released on 4th October by the Deepak Parekh Committee on Financing of Infrastructure (mostly comprising of unelected, big corporate board members) is anything to go by, it suggests complete subservience to the neo-liberal agenda such as steep increase in power and rail fares, promotion of Public Private Partnership’s (PPP), privatization of all PSU’s, expedited land acquisition (read forceful acquisition) and environmental clearance (meaning going ahead with all environmentally destructive technologies).

The Vijay Kelkar committee report on fiscal consolidation that was released at the end of last month called for complete elimination of the so called subsidy on diesel & LPG, immediate hike in the prices of food grains in ration shops, diesel, kerosene and LPG, and slew of other immediate reform measures relating to infrastructure. With the Finance Minister P Chidambaram (a staunch neo-liberal) talking of more reforms in the future, banking and labour reforms will definitely be on their target list. These reforms, if implemented will mean a disaster for the Indian working people and peasantry, and has to be opposed tooth and nail.

The latest revelation in The Hindu on the opposition within the government itself, over fast tracking approvals for mega projects worth over Rs. 1000 crores, through the National Investment Board (NIB) is another in the latest series of pro-reforms proposals. The proposal seeks to virtually overlook all the environmental and human rights issues, and bypass all the established norms of the land in granting clearance for mega projects.

For every job that Walmart creates, 17 will go!

The argument being made out for introducing these reforms by the govt., the mainstream media and the corporates, is the supposed urgent need for improving the investment climate and once again re-starting the growth momentum that was supposedly lost because of policy paralysis in the govt. decision making. The Sensex, for instance, crossed the psychological barrier mark of 19,000 in the Bombay Stock Exchange (BSE) on 5th October when the govt. announced its latest decision on introducing more reforms.

This dubious argument about the need for achieving 9% growth and satisfying the stock market or a threat of downgrade by the rating agencies, as being peddled out by these staunch neo-liberals, has absolutely no grounding even in mainstream economics. The fact remains that, while the growth in the last decade has benefited the MNC’s, the Indian Inc. and the upper sections of the Indian society; but this has not benefited the Indian working people in any tangible way. The liberalization of the economy in the last two decades has not improved any of the social indicators or the agricultural sector that has been characterised by low growth and farm suicides (250,000 in the last 15 years), and India having more poor people than all of sub-Saharan Africa. India’s growth story, if anything, has been anti-people and anti-poor.

But the Machiavellian argument of the Indian corporates, on the other hand, reminds us constantly of going back to the pre-90’s era characterised by low growth and red tape which they typically brand as Socialism (which it was not). They in fact advocate more aggressive neo-liberal reforms in the hope that it might finally trickle down in bits and pieces to the poor! What they conveniently forget is that the low growth rate (ranging between 5.2% to 6.5%) and 0.1% industrial growth rate over the past one year is precisely because of the failure of these reforms and dead end bankrupt policies of the Indian ruling class.

It is hard to imagine how on earth FDI in either insurance, pensions or retail is going to benefit the the ordinary working people where the sole objective for the foreign companies investing in India is based on how much profit they will making in the end. FDI in pensions/ insurance is no solution to the lack of comprehensive government sponsored pension/ social security plan that has been denied to the majority of the Indian people for so long. Private pensions plan in the US is no success story either with millions of ordinary Americans still remaining unprotected and is nothing more than gambling on the workers’ entire lifetime savings. FDI in insurance will only benefit the big MNC insurance companies that were responsible for the 2008 economic meltdown. No amount of regulations will be barrier once the fox is in the chicken’s coop.

Wanting LEFT, but it is pathetic

While the left parties, on the other hand, have opposed the new reform measures by the government, but are offering no opposition by mobilizing the people around the country to defeat these slew of economic measures. Instead they are busy cobbling up a coalition in the parliament with other mainstream pro-capitalist parties (including indirectly with the BJP) in trying to defeat the government in the parliament without bringing the people’s pressure to bear on the on these so-called elected representatives. This will only be giving undue advantage to the ruling party to outmanoeuvre the left parties given the resources at their disposal. Even Mamata Banerjee is talking more to the left of the left parties, like bringing down the government, unlike the CPI(M) that has restricted itself to merely opposing these reforms without offering any concrete measures to oppose it.

While the decision of the Joint Committee of Trade Unions (comprising of the 5 major Central Trade Union) early last month to have 2 day general strike on 20th and 21st February, 2013 is a welcome step. But it is too long way off and needs to be organized much earlier before the winter parliamentary session to bring the working class pressure to bear on the Indian ruling class. The demands should call for not only complete revocation of FDI in all sectors but also needs to reflect on the real ground situation faced by the Indian working class, particularly amongst the unorganized workers that comprise over 90% of the total workforce.

The New Socialist Alternative (CWI-India), demands a complete roll back of all neo-liberal reforms and generous tax subsidies that have extended to the big multinational corporations. We believe only a systematic building of the opposition amongst the working class based on a genuine socialist platform will it be possible to build an alternative against the system based on capitalism and landlordism.