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PUBLIC: new article on India

IPI members will be interested in the following article, I think.
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Professor Prabhu Guptara
Director, Executive and Organisational Development
Wolfsberg Executive Development Centre
(a subsidiary of UBS AG)
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Subject: PUBLIC: new article on India
Author:  Mangalwadi (Mangalwadi@compuserve.com) at unix,mime
Date:    02.01.99 22:43

India is poor, but the Indians are second to none - if they are given the=
opportunity. And Amartya Sen, the Nobel Prize winning NRI Economist has 
become the latest demonstration of that fact. Yet, one of India's central=
problems is that the nation of India does not facilitate the people of 
India to excel. The Vajpayee Government illustrated that sad fact was onc= 
again on December 15, 1998, when it shoved the Insurance Regulatory 
Authority (IRA) Bill into parliamentary cold storage.
The last decade of the century began with the promise (in 1991) of 
liberalization and economic reform. The energies of the people were to be=
liberated from the stifling grip of "the nation". The world watched to se= 
if our political leadership was serious about our economic liberty. Their=
flip-flops during the decade did not display understanding, courage and 
vision. As a result, for many international investors the IRA bill became=
litmus test - does the government have the desire and the courage to end 
the corrupt and inefficient monopoly of official giants such as the Life 
Insurance Corporation? The bill sought both to end that monopoly and to 
force the insurance sector to give world class service to our people. Tha= 
was the primary purpose of allowing 40% foreign investment into the 
insurance sector.  =
Of course, the insurance industry does not require foreign investment. An= 
of course, it is undesirable to allow the profits generated in India to b= 
spent outside. But is the "Swadeshi" (indigenous) meant to serve the 
interest of our people or to hurt them? It may be bad for an NRI to take 
the profits earned by legitimate investment out of India. But is it bette= 
for the clerks and officials of national monopolies to earn illegitimate 
profit? Or, for their national boards to mis-invest legitimate profits? 
What is better for the nation may be relative and debatable. But what is 
better for a citizen is beyond discussion. The present dispensation place= 
a widow at the cruel mercy of callous agents, greedy clerks, and heartles= 
officials. Two ex-Finance Ministers, both from the Congress party, had 
backed the IRA bill supported by the BJP Prime Minister and Finance 
Minister. The RSS - the custodian of our traditional culture - opposed th= 
bill because it rightly understood that the bill was not merely about 
inviting 40% foreign investment into India's insurance sector. It implied=
inviting an alien culture on to our soil. =
Allow me to illustrate this foreign culture, which is so dreaded and 
despised by our "Swadeshi" brigade. Ruth Sunwalia, an Indian from Bareill= 
(U.P.), was married to Bob Nave - an American who founded the Nave 
Technical Institute in Shahjahanpur (U.P.), introduced the high-tech Soya=
bean industry, and village level appropriate technology for dehydrating 
potatoes in North India. In November 1998 Bob and Ruth driving down from 
Minnesota in the North to Miami in the South. En route they stopped in 
Atlanta (GA) where Bob was hit and killed by a speeding car. Ruth was too=
shattered to call anyone or to organize transporting his body to their 
hometown in Minneapolis (MN) for his funeral. Insurance was the last thin= 
on her mind. Six weeks later she still has no clue as to how their 
insurance company discovered within 12 hours of the accident that her 
husband had been killed. What she knows is that the company tracked her 
down in Atlanta and at its own initiative called her to say that she did 
not need to worry about anything. With the help of a funeral home the 
company would airlift the body and cover the entire cost of the funeral! =
The question that the IRA bill raises is this: does an Indian widow deser= 
similar treatment in her home country? Or, should we guard our culture of=
corruption that allows our companies to violate her dignity and add to he= 
wounds, simply because the profits LIC earns from her husband's investmen= 
serve some impersonal "national" interest?
It is sad that even after a decade-long debate the Indian media and the 
political class still do not understand the essential nature of our 
economic options. Although the issues are often articulated in terms of a=
choice between Marxist socialism and capitalism, in fact we have three 
options, not two. =
Marxist theory sees economic conflict as a "class-struggle" - a clash 
between the interests of the workers and the owners of the capital. Marxi= 
calls for "the workers of the world" to unite, across the "artificial 
national boundaries". 

In opposition to Marxism, Fascist ideology in Europ= e
saw the economic conflict as a clash, not of classes, but of countries or=
nation-states. Fascism, that is, the "National Socialism" of Italy and 
Germany sought to serve the interest of their nations, giving birth to th= 
two World Wars. 

Capitalism does not see economic struggle as a competition
between classes or countries, but between people - as individuals, as 
families, or as free, voluntary, and limited associations (companies). Th= 
academic socialists have succeeded in portraying capitalism as a pursuit = 
unbridled self-interest. Historically, however, capitalism was the econom= 
child of the Protestant Reformation - a spiritual movement. It encouraged=
economic development via free competition in excellence. Capitalism said 
that in the economic sphere (as in an Olympic village) one's class, 
country, or creed would be deemed irrelevant; the winner would be the 
individual (or the team) who offers the best goods and services, to the 
maximum number of people, at the lowest possible prices. =
Why did the IRA bill allow 40% foreign investment in the insurance=
sector? Isn't it enough to force the LIC - a government monopoly - to 
compete with private insurance companies owned by Indians who will reinve= 
their profits in India?  The appropriate question is: What will force the=
nation of India to render to the people of India a quality of service tha= 
matches their God-given dignity?
The standards of our private bankers and educators are in some (not all) 
instances better than their public counterparts. But we do need to face 
facts: the cases of private financiers and educationists cheating or 
shortchanging their clients and students also abound. Why didn't India 
develop a culture of economic excellence? Because, our caste-system 
pre-empted development of capitalistic competition. Caste ensured that a 
person could acquire status, wealth, power and knowledge on the basis of 
birth, without excellence in service. Caste did not allow us to learn the=
lesson, "Now, that I, your Lord and Teacher, have washed your feet, you 
also should wash one another's feet". And again, "whoever wants to become=
great among you must be your servant, and whoever wants to be first must = 
your slave - just as the Son of Man did not come to be served, but to ser= 
and give his life as a ransom for many." Mr. Ashok Singhal, the President=
of the Vishwa Hindu Parishad, may be wrong in his suspicion that Amartya 
Sen's Nobel Prize is a "missionary conspiracy" to smuggle Christianity in= 
India. However, Mr. Singhal, and the Swadeshi Jagran Manch are quite righ= 
in understanding that liberalization involves cultural transformation. It=
means consciously choosing a new and alien cultural climate - one that 
would force Indians to serve each other as well as foreign investors woul= 
serve them (in order to make money).
The Swadeshi economics is anything but indigenous. It was articulated and=
tried by the Fascists and Nazis in Europe, and its catastrophic 
consequences are well known. The RSS' idea of the "nation" itself is a 
European invention. The "Nation" idea is both good and necessary. But we 
must remember that it is only an idea - which keeps changing. What is 
Bangladesh today, was Pakistan yesterday, and British-India the 
day-before-yesterday. Prior to that it was simply Bengal and before that = 
was a part of the Moghul Empire. The idea of a nation becomes strong only=
to the degree it is able to empower a particular people with dignity: tha= 
is with justice, honor, liberty, prosperity and peace. As Amartya Sen 
insists, our nation must choose to put people first - above our caste, 
culture, creed or so called "national interest".
(Vishal Mangalwadi the author of "India: The Grand Experiment" has recent= 
co-authored "Corruption Vs. True Spirituality" - Goods Books, Ivy Cottage= 
Landour, Mussoorie (U.P.), India)


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