Above all, more Indians must develop a stake in the reforms. Economic change must reach the ordinary Indian; it must, as it has done in Malaysia and Indonesia, result in a visible improvement in the standard of living of the overwhelming majority of the people, including the poorest of the poor. This means that liberalization must produce not only shinier foreign cars for the affluent, but jobs for the unemployed, food for the hungry, and spending money in the hands of the needy. Otherwise the political support for economic reforms will melt away. The market will hold no magic for those who cannot afford to enter the marketplace. Conversely, if liberalization comes to mean the libetating of the creative energies of the Indian people, involving them in the grand adventure that development can become, it will have the effect not merely of producing growth and prosperity but of giving Indians of all classes and backgrounds a psychological stake in the new India — an India that they see as serving their interests.
This could be the key that opens the door to more generalized prosperity for Indians as a whole. The Indian businessman and writer Gurcharan Das argues that “even if we do nothing else but merely ensure that we don’t close the economy — don’t reverse the reforms we have made-and improve the quality and quantity of education, the momentum of the global economy will carry us on its shoulders.” Self-reliance as an end in itself is increasingly irrelevant for economies in today’s interdependent world; but individual self-reliance in a free and fair economic environment could yet transform the lives of India’s people.
But who is the “us” this momentum will carry forward? As Das implies, it must apply to Indians as a whole, not just a favored and opportunistic elite. Sundeep Waslekar has suggested, in his South Asian Drama, that the subcontinental elites were historically largely intermediaries rather than producers, men who earned their living in colonial times through rents and commissions acquired through managing and trading the wealth of others, rather than by generating profits and wages or creating their own wealth. As a result, Waslekar argues, these intermediaries preferred, when they came to rule in postcolonial times, to acquire coercive instruments of state control, giving them power over the repressive mechanisms of the state and thereby over the sources of wealth generated within it. The political systems of the subcontinent reflect this economic pattern in that “democracy has been used as a set of procedures to acquire control of the institutions of governance by the same set of people who could in any case acquire such monopolist control in other systems merely because of their position in society by birth.” Though the argument is a little overstated — the dramatic changes in the social composition of the Indian Parliament since independence, for instance, do not suggest the perpetuation of a ruling class that could have acquired such power in any other system but the democratic — Waslekar is right to point to the connection between an economic policy of controls and a political ethos of control. The corruption that has become so widespread in India reflects this reality; it is spawned by a politico-economic culture that rewards access over action, and permits over-production and influence over investment. Waslekar puts it trenchantly:
If people can generate wealth on their own, they will be happy to do so. But if they have to depend on those who manage wealth for licenses, quotas and subsidies, they will consider the management of wealth more attractive than its creation. Under such circumstances, competition for management is bound to take place to the detriment of wealth creation.
There is clearly, therefore, a vital need to reduce the role of the state in the economy as a precursor to improving the political con tent of Indian democracy. The task is hardly comparable to that which the countries of the former Soviet Union have undertaken; after all, Bombay’s stock market was established in 1875, and Indians have long experience in capitalist modes of doing business. Capitalists less dependent on favors from the state are, one might suggest, also likely to forge a more creative partnership with labor, whose value in the productive equation will rise as the importance of bureaucratic management declines. It is interesting that the economic consensus has shifted visibly. The Common Minimum Program (CMP) agreed upon in mid-1996 by the thirteen-party left-of-center coalition known as the United Front, which included two Communist parties, suggests that a new bottom line has been drawn in economic policy, incorporating the reforms adopted since 1991. The fact that these parties have all agreed to the reform-oriented CMP suggests that the country is no longer likely to return to the unproductive self-sufficiency of the past, even under parties whose rhetorical commitment to the poor echoes the justifications for the old approaches. (The decade that followed the CMP experience has vindicated this judgment.)
Meghnad Desai, the expatriate Indian economist (and British lord), has written that the economic reforms have indeed helped only the rich. “But,” he adds, “it is more accurate to say that the reform has cleared a space in which business can grow and the middle classes will benefit, and that the reforms have not gone sufficiently deep in removing older vested interests — of the subsidized farmers, the loss-making public enterprises, and the interest-subsidized industries — in order to create room for redistribution to the poor.” That must be the ultimate yardstick for judging the effectiveness of India’s economic liberalization.
To make this work, India will need to maintain a system of governance that incorporates both the responsiveness of democracy and the imperative of stability — one that brings along all those who benefit directly from the reforms (businessmen, traders, private-sector employers, professionals, service providers) and those who will benefit indirectly in the longer term (the salaried middle classes, the general consumer, the prospectless unemployed, and eventually the poor, who have no better alternatives under the old system) into a “grand coalition” against the vested interests. Because economic progress requires time, and a degree of immunity from short-term political calculations, it is difficult to see such a process occurring amid the expediency and opportunism that characterize India’s electoral politics. With one state or another going to the polls practically every few months, Indian politics offers a shifting kaleidoscope of short-term alliances, unprincipled compromises, and the sight of governments forming or falling on the basis of caste and personal considerations. This is hardly propitious ground for the kind of sustained political commitment that economic reform requires. “Right now,” declared Lord Desai, writing just before the 1996 elections, “the political system is too fragile, elections occur too often, and cause far too many reversals of policy. This is a very big obstacle to fundamental and irreversible economic reform.” It may therefore be time to look at a possible reform of the system, and we will do so shortly.
But it is important to stress that any systemic reform must not favor stability at the expense of democracy. It is true that democracy works in some ways against the larger, long-term national interest in economic policy. It privileges short-term consideration, like the populism that infected the Andhra polls of November 1994; the attitude is to seek licenses or benefits now, not to sacrifice for long-term development. It makes hard choices difficult, because of the political consequences of such necessary decisions as public-sector layoffs or the elimination of subsidies. Equally, however, it involves all shades of opinion in the problem by obliging them to exercise power in the states or the Centre and to confront the same choices in the process. No wonder all the three governments that have held national office in 1996 remained committed to the same basic consensus around economic liberalization. And democracy sometimes serves as a force for responsible governance by placing restraints on how far politicians can go in their profligacy; if they are so spendthrift as to provoke high inflation, voters will turn them out. As Manmohan Singh, the architect of reforms under Prime Minister Rao, put it:
In the short term, democracy may be an impediment to growth, but it is not a disadvantage in the long run. Political pluralism is the wave of the future. . . . Political societies that are rigid and monolithic are like command economies. The
y can produce very rapid growth in the short term, but in the long run it’s not sustainable.
This is a message that is being heard in influential Western circles. Karen Elliott House, international president of Dow Jones, wrote in The Wall Street Journal in early 1995 of the importance to future investors of India’s democracy and traditions of the rule of law:
While democratic systems like India’s or the U.S.’s frequently seem less decisive and act more slowly than authoritarian ones, when policies are vetted and voted they have a durability that authoritarianism’s arbitrary moves can’t match . . . What India has to recommend it [over China] is a future based on longer trends, deeper traditions and more profound tensile strengths.
Before reexamining the system, it is also essential to accept that any political system in India must take into account the diversity of the country. The vexed question of identity is one from which there is no escape in today’s developing societies, and India is no exception. The plethora of sectarian agitations, religious clashes, and movements for secession or autonomy reflect periodic breakdowns in the ability of the state to convince sections of its people that their economic and political aspitations are being (or even can be) met within the state structure. Sometimes conflict arises from the competition for resources, at other times from contention for power (though power is not merely an end in itself, but a means to control the distribution of resources); but it is always predicated on the assertion of identity, a particularist identity distinct from that of the test of the nation. Problems arise when the identity that is sought to be asserted is rigid and nonnegotiable, rather than one that is divisible (into alternative political loyalties) or fungible (through accommodation into the regional or national mainstream). The demand for a distinct territory — whether for an autonomous region, as with the Gurkhas of northern Bengal; for a separate state within the Indian Union, as with the Jharkhandis; or for complete secession and independence, as with Kashmir and some of the northeastern insurgencies — is symptomatic of this desire for self-realization, rather than an ultimate objective in itself. Each group is saying, “Give us our own space, in which we can feel we belong, we call the shots, we determine our own fate.” For India to survive as an effective democracy, it has to be able to acknowledge and accommodate the various identities of its multifaceted population. Yet to give in to each demand, it to generate new victims and new minorities.
There is no easy answer, but democracy is the only technique that can work to find one. In a pluralist state it is essential that each citizen feels secure in his or her identities (and, as I have explained, there will always be more than one identity for each citizen). Indians have to come to understand that while they may be proud of being Muslims or Marwaris or Mallahs, they will be secure as Muslims or Marwaris or Mallahs only because they are also Indians — in other words, that it is their Indian identity that gives them the framework within which to satisfy their material needs, to compete and coexist with other members of the broader society, to work and trade in a larger marketplace, to contend for political office and feel physically secure behind defensible borders. The institutions of political and economic democracy are the only ones that can provide each Indian with the sense that his interests can be pursued fairly and openly alongside those of others. Strengthening those institutions is the vital task of the next fifty years.
Recent trends may in fact give heart to those who believe that economic liberalization and political democracy will inevitably make sectarianism and bigotry impossible. Market forces militate against fundamentalisms; the rupee, though not quite yet as almighty as the dollar, does not recognize the faith of the man making or spending it. Many a Hindu businessman depends for his profits on a Muslim worker or tailor or weaver, who in turn depends on the Hindu for his employment; they thus develop a vested interest in keeping each other safe. A riot against the Muslim artisans of the Hindu sacred city of Benares (Varanasi) would deprive Hindus of the traditional masks and paraphernalia required for their annual Ramlila; without those industrious and experienced Muslim hands, Benares Hindus could not celebrate their own religious epic, the Ramayana. A compelling study led by Harvard’s Ashutosh Varshney of six pairs of Indian cities — each city comparable demographically to the other in the pair, but one prone to communal riots and the other not — has recently established that the prior existence of social networks of civic engagement across communal lines is the key to preventing violence. Where Hindus and Muslims work together, interact together, and need each other, they tend not to attack or harm each other. This insight suggests that a governmental policy of actively encouraging the establishment of intercommunal associations (club, unions, committees, trade arrangements) could help promote communal peace even in the most riot-torn environments. Civic action is the key, more so than political conciliation.
But politics also provides a dynamic toward cooperation. “The majority of our people understand that the country has to be run on the basis of consensus, not confrontation,” said Atal Behari Vajpayee, even before his BJP government’s inability to find support from the “secular” parties spelled the end of his brief first stint as prime minister. The BJP’s experience in power (1998-2004) has confirmed that the only way it can hope to lead India is in coalition with secular parties and within the pluralist governing consensus, or on the basis of a program attracting secular voters and appealing to India’s minorities. Yet such an expansion of the BJP’s sources of support will simultaneously dilute the threat its extremist wing poses to the pluralist governing consensus.
At the same time, there is no cause for complacency about Indian democracy, which some critics have suggested merely reduces the population to “election fodder.” There is no doubt that electoral democracy is one of India’s greatest political achievements, and that the sight of the rural poor turning out in vast numbers to vote is an extraordinary affirmation of human political freedom. But democracy is a process, not an event; elections alone do not a democracy make. The great socialist leader Jayaprakash Narayan once compared Indian elections to sheep choosing a shepherd, and it sometimes seems as if our political system merely perpetuates the abuse of the people, for the people, by the people. All too often the electorate seems to have a choice only amongst recurrent agents of misrule. What is vital in India, as elsewhere, is not just to hold free and fair elections, but to create and sustain institutions that entrench democratic habits in both the rulers and the ruled.
It is arguably of equal importance that political democracy needs economic content, and even more that it gives a sense of involvement and belonging, as well as empowerment, to all Indians. The processes of electoral democracy have mobilized the country’s “backward” castes to great effect, but our political, economic, social, and administrative structures do not always help ensure the efficient delivery of results. Change is therefore necessary, though in India it is rarely unavoidable.
In a country as diverse as India, the interests of various groups of Indians will tend to diverge, and political contention is inevitable. The major challenge for Indian democracy is therefore to absorb and resolve the clashes that may arise between contending interests, while ensuring the freedom, safety, security, and prosperity of all Indians. A paradox is that the state reaches deep into the lives of most Indians, but the effectiveness of its structures is still weak and its capacity to mobilize the people for common endeavors is limited. Equally, too many citizens feel powerless, unable to influence the direction of the system. If the failings that undoubtedly exist in Indian democracy — particularly those relating to corruption and to the criminalization of politics — are not dealt with rapidly, there is a great danger that the public at large could lose faith in democracy itself. At one point in September 1996, the presidents of all three of the country’s leading political parties — P. V. Narasimha Rao of the Congress, L. K. Advani of the Bharatiya Janata Party, and Laloo Prasad Yadav of the Janata Dal — were all simultaneously under indictment for alleged crimina
l wrongdoing. (They were all eventually acquitted.) Every country, no doubt, gets the quality of political leadership that it deserves, but (even without implying the guilt of any of these indictees) it is difficult to imagine the sins that have made Indians deserve the level of venality, bigotry, dishonesty, incompetence, and just plain criminality they have had to put up with from some of their political representatives in recent years. The forms of our democratic institutions may have had their origins in the West, but their content and the culture that underpins them are firmly rooted in Indian society. We cannot escape our responsibility for what we have made of our democracy.
Africa has responded to the dangers of political divisiveness by resorting to the non-Indian solutions of the one-party state and, more recently, the no-party state. The one-party state worked more or less successfully in Tanzania, where, under Julius Nyerere’s enlightened and statesmanlike (if economically unsuccessful) leadership, it became a force for uniting a disparate congeries of tribes and clans into a viable nation-state. The no-party state is being tried in Uganda, where President Yoweri Museveni has argued that political parties are dangerously divisive because they function differently in Africa than in Western democracies. In the West, he suggests, parties draw from all sections of society, since they are organized around issues of principle or to defend class interests; in Africa parties are organized on a tribal, ethnic, or regional basis, therefore do not draw from all sections of society, and as a result threaten societal cohesion. Museveni’s answer was to ban all political parties in Uganda, permitting opposition by individuals rather then groupings. But while aspects of his analysis are relevant to India — for there are communal and regional parties that represent impermeable and therefore divisive identities — India also has parties that are organized ideologically on Western lines and transcend such division, so the Museveni analogy does not apply. And in any case it is inconceivable that any Indian government could deny its citizens the fundamental right to organize politically on whatever basis appeals to them, including those of caste, religion, or region. The country already has more than five hundred registered political parties, and while some critics suggest these merely exaggerate the fault lines in Indian society, one might see their profusion as evidence of the contrary, for not even plural India has five hundred credible sources of serious political division.
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