Part 2 of a myth-busting.
In the olden days, military might should have augmented all other short comings but in the present, omnipotence comes closely associated with Economic might. Concept of an economic superpower emerged during the the renaissance period and gathered steam during the industrial revolution. Nations were looking for lucrative markets for selling the excess goods churned out because of the improved productivity bought along by the industrial revolution and also to buy cheaper raw materials for their industries. Britain emerged the clear winner during this period as it laid its hands on vast portions of territories all over the world and fortified these holdings with its military and cunning. That kind of economic might saw a change after the World wars with the US emerging a clear winner as European economies were shattered and US economy soared by selling war to both sides. Americas, with its abundant natural resources, a daring political leadership guided mostly by capitalist interests and the only strong economy after the WWII, made sure that it will create a new economic order in the world on the basis of dollar.
And it sure did and managed to keep that up so for the next 60 years or so. Even though it shows signs of weakness, there is no sight of a threatening force in the near future. To keep up this economic might they sure did use the military as well. Not long back American companies were in the forefront rummaging through the new nations and amassing profits. The treasury bonds purchased by the Asian tigers and the Dragon nation further enabled it to rise upon a credit based economy. The importance of oil changed the dynamics of the economics with US exerting all the influence it can over the OPEC to sell oil in dollars, which it just had to print up and other nations just bought it. In those countries where communism and leftism showed resilience against market forces, the US showed its economic and military might so as to scare off competition or to change even the rulers of democracies. After all democracies became just another name of a channel for capitalism. The economic might also served to buy off entire nations so that capitalism could thrive in them. And sure they did succeed. Well, for those who matters, it did.
To ask the obvious, where do we figure in this field? We have come a long way from those times; when the US gave us food grains in grant, when we had to sell bullion in the international market to sustain our imports, when our forex reserves came down all the way to $1 billion; to one of the largest producers of food grains, more than $300 billion of forex reserves and the fourth largest holder of dollar and ready to buy back gold from the IMF. But does these make us a so called economic superpower? We ourselves assign that term to us taking pride in the new found purchasing power of the great India middle class. It’s true we have huge remittances from our NRIs; we have a large export industry (although the import-export deficits are still on the darker side) and the purchasing power of the average Indian is said to be higher than say 20 years back. But what can we do with this economic might?
Power matters only as long as it is used; the muscle to flex and make other nations act to your will without resorting to arms. As a matter of fact the economic powerhouse status that other national leaders bestow on us is the power of the worlds biggest market for selling goods and services. Sure that's a power; that's the only power we have. But are we going to utilize that? When are we going to ask things to move our way when we have the power to do so? The pathetic state we are in is clearly depicted by our affairs in this realm. We are not able to influence even our neighbors to buy from us, we are ready to open up our markets, banking and insurance system and whatever we can without even the slightest compulsion or need. We allow foreign banks to work freely in India when our own State Bank has been denied permission to operate in areas with vast migrant Indian population. We have to push over selves to a corner and limit the liability of American companies in case of a nuclear accident (and with Bhopal like tragedies and the kind of treatment the victims have been receiving, i doubt whether there is any liability for a foreign company operating in India). We want to open our markets just for the sake of opening it up. We should seriously think where the priorities of our policy makers and the bureaucrats is. It’s as if we are selling ourselves to the bidders, rather than be the bidder in other world economies. Our hold on the SAARC countries itself is loosening.
China is flexing its economic power by influencing even India’s neighbors and surrounding us and choking us. We are still too complacent to do anything proactive. We take pride in our economics by stating that if we wanted we can reduce America to nothing by recalling our engineers and scientists (I laugh myself out of my senses) and all the [crappy meager] software that we produce [for foreign companies]. We fail to realize that our software power is only an illusion. It’s the foreign corporates that are still running the business and we are just tools. If they want they can make Mexicans or Chinese or Africans to do the same thing. As long as we don’t flex the economic muscle its useless. After all brains is all that matters and only if it is used. For our politicians the philosophy seems to be that of the cancer cell - growth for the sake of growth.
(to be continued)
In the olden days, military might should have augmented all other short comings but in the present, omnipotence comes closely associated with Economic might. Concept of an economic superpower emerged during the the renaissance period and gathered steam during the industrial revolution. Nations were looking for lucrative markets for selling the excess goods churned out because of the improved productivity bought along by the industrial revolution and also to buy cheaper raw materials for their industries. Britain emerged the clear winner during this period as it laid its hands on vast portions of territories all over the world and fortified these holdings with its military and cunning. That kind of economic might saw a change after the World wars with the US emerging a clear winner as European economies were shattered and US economy soared by selling war to both sides. Americas, with its abundant natural resources, a daring political leadership guided mostly by capitalist interests and the only strong economy after the WWII, made sure that it will create a new economic order in the world on the basis of dollar.
And it sure did and managed to keep that up so for the next 60 years or so. Even though it shows signs of weakness, there is no sight of a threatening force in the near future. To keep up this economic might they sure did use the military as well. Not long back American companies were in the forefront rummaging through the new nations and amassing profits. The treasury bonds purchased by the Asian tigers and the Dragon nation further enabled it to rise upon a credit based economy. The importance of oil changed the dynamics of the economics with US exerting all the influence it can over the OPEC to sell oil in dollars, which it just had to print up and other nations just bought it. In those countries where communism and leftism showed resilience against market forces, the US showed its economic and military might so as to scare off competition or to change even the rulers of democracies. After all democracies became just another name of a channel for capitalism. The economic might also served to buy off entire nations so that capitalism could thrive in them. And sure they did succeed. Well, for those who matters, it did.
To ask the obvious, where do we figure in this field? We have come a long way from those times; when the US gave us food grains in grant, when we had to sell bullion in the international market to sustain our imports, when our forex reserves came down all the way to $1 billion; to one of the largest producers of food grains, more than $300 billion of forex reserves and the fourth largest holder of dollar and ready to buy back gold from the IMF. But does these make us a so called economic superpower? We ourselves assign that term to us taking pride in the new found purchasing power of the great India middle class. It’s true we have huge remittances from our NRIs; we have a large export industry (although the import-export deficits are still on the darker side) and the purchasing power of the average Indian is said to be higher than say 20 years back. But what can we do with this economic might?
Power matters only as long as it is used; the muscle to flex and make other nations act to your will without resorting to arms. As a matter of fact the economic powerhouse status that other national leaders bestow on us is the power of the worlds biggest market for selling goods and services. Sure that's a power; that's the only power we have. But are we going to utilize that? When are we going to ask things to move our way when we have the power to do so? The pathetic state we are in is clearly depicted by our affairs in this realm. We are not able to influence even our neighbors to buy from us, we are ready to open up our markets, banking and insurance system and whatever we can without even the slightest compulsion or need. We allow foreign banks to work freely in India when our own State Bank has been denied permission to operate in areas with vast migrant Indian population. We have to push over selves to a corner and limit the liability of American companies in case of a nuclear accident (and with Bhopal like tragedies and the kind of treatment the victims have been receiving, i doubt whether there is any liability for a foreign company operating in India). We want to open our markets just for the sake of opening it up. We should seriously think where the priorities of our policy makers and the bureaucrats is. It’s as if we are selling ourselves to the bidders, rather than be the bidder in other world economies. Our hold on the SAARC countries itself is loosening.
China is flexing its economic power by influencing even India’s neighbors and surrounding us and choking us. We are still too complacent to do anything proactive. We take pride in our economics by stating that if we wanted we can reduce America to nothing by recalling our engineers and scientists (I laugh myself out of my senses) and all the [crappy meager] software that we produce [for foreign companies]. We fail to realize that our software power is only an illusion. It’s the foreign corporates that are still running the business and we are just tools. If they want they can make Mexicans or Chinese or Africans to do the same thing. As long as we don’t flex the economic muscle its useless. After all brains is all that matters and only if it is used. For our politicians the philosophy seems to be that of the cancer cell - growth for the sake of growth.
(to be continued)
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