Pundit Jawaharlal Nehru, the first Prime Minister of the Indian Union declared on 14 August 1947, “Long years ago we made a tryst with destiny, and now is the time to redeem our pledge….  The achievement we celebrate today is but a step, an opening of opportunity, to great triumphs and achievements that await us.” The task he put forth for the Union was, “the ending of poverty and ignorance and disease and inequality of opportunity.44” India embarked on an huge experimentation with planned development.

Within the past 50 years the Indian Union achieved a lot.  India has successfully eliminated the famines that wrecked the Indian Continent until the independence from British.  The last major famine was the Bengal famine in 1943, which killed approximately 3 million people.  This achievement can be attributed to the success of democracy and planned development.

In contrast, China had suffered a major famine in 1959-61 killing approximately 30 million people. In communist USSR, there were famines, killing millions of people in the areas where the lands are very fertile, the facts of which we may never know!  These famines in China and the USSR were due to wrong policies and the communist autocracy.  India’s achievement of controlling famines in itself is a great accomplishment.

There are several areas of creditable achievement, but still the overall success in realizing the Nehru’s task remains negligible. This is because of the failure of socialist and centralized planning which created a corrupt society with bureaucratic red tape.  Since its inception as Jana Sangh in 1951, the BJP has been advocating a liberal economic policy and an open market, both internal and external.  But, only in 1991 the Congress (I) turned around and accepted that philosophy, after the collapse of the USSR.  China woke up to the reality long ago and gave up the socialist economy in favor of an open market, retaining the autocratic communist politics.  The Chinese philosophy is based on two principles, 1)  it doesn’t matter if the cat is black or white and it is good as long as it catches rats, and 2) there is no spirituality in absolute poverty, as you cannot eat ‘philosophy’!

India has several advantages at this time.  If not perfect45, a reasonably good democracy is in place. There was never a military rule in the past 50 years.  Now the policies have changed toward the open market economy.  There is common currency already set for all the 25 states of the Indian Union, while European Union is still working on it.  India has a large elite population which can converse in English and a large scientific community and infrastructure. After signing the GATT agreement, the laws have changed to comply with the international order.  All these and more put together depict a bright future, but there are some drawbacks which should be immediately taken care of, otherwise all the above positive aspects will be nullified effectively.

The major drawbacks are: 1) Though the reforms are irreversible, their implementation has been very unenthusiastic and in fits and stops.  The red-tape, corruption and half-hearted dragging is very dangerous and deters any foreign investment.

2) Though India boasts a large segment of its educated (approximately 400 million, i.e., 40 percent of the total population) as English speaking, the fact remains that more than 60 percent of the population remains illiterate. India’s current literacy is substantially lower than that of South Korea, Thailand and other newly industrializing Asian countries’ achievement in 1960.  The economic growth seems to be directly proportional to the literacy of the population.  But Kerala, a southern nationality in Indian Union, has achieved 90 percent literacy and yet there was no economic growth.  This shows us that the economic liberalization and literacy complement each other in developing the economy.   One without the other seems to be not as effective as both together.

3) Indians have an illusion that India has the third-largest scientific community in the world, forgetting the fact that the Indian Union is a continent of a billion people that accounts for approximately 20% of the world population.  India should have 20% of the total world scientists, engineers and technicians (SET). India has only 3.76 SET per thousand people while Canada, Japan and Germany have 186, 113 and 77 respectively.   A dismal 0.22 SET per thousand people in India is engaged in research and development activities compared to 3.32 in Canada, 6.01 in Japan and 4.68 in Germany.  The per capita expenditure on research and development in India amounts to $2.60 while it is as high as $800.00 for many developed countries and $50.00 for some developing countries.46

4) The above situation is because of lack of facilities for the higher education, which is completely controlled by the government.   Every year millions of eligible students interested in science courses have to choose humanities, history, literature etc., as their major subjects, and thousands of those who got successfully into science are forced to choose a vocation outside science, such as administration or banking due to lack of jobs in the scientific fields.  Thousands of students are denied admissions into schools and thousands of job seekers are denied jobs in their field of expertise because of their birth into a so-called higher caste.  Seventy percent of my MS (chemistry) classmates are currently working as administrators, bankers and managers in Andhra Pradesh. Ninety percent of my Ph.D.classmates including myself had to leave India for good, in search of jobs throughout the world.47

5) Political instability has become another problem recently.  In India low literacy and a diversity of cultures and nationalities compound the difficulties of democracy.  The United States of America is one of the oldest democracies in the world, but certainly, Indian democracy is the grandest experiment of all times.  This results in, at times, chaos and uncertainty.  In the past one year, India changed two Prime Ministers and now (December 1997) is preparing for mid-term elections and the parliament is dissolved.  This situation is the outcome of political immaturity of senile politicians, especially of Congress (I) party, whose main aim seems to be personal glory and vendetta.  The president of Congress (I) party, Mr. Sitaram Kesri has pulled out his support two times on frivolous grounds.  There was no ideological clash, but only personality clash and greed for power.  Trivialities like the former prime minister Deve Gouda did not show enough respect to aging Sitaram Kesri, and the former prime minister Inder K. Gujral did not sack a few ministers neglecting the command of Sitaram Kesri, were the only reasons to pull down the government and plunge the country into an expensive midterm elections. No wonder, the United States didn’t pay any attention either politically or in the news media when the then Prime Minister of India visited here few months back, while rolled a red carpet with a 21 gun salute to the Chinese leader.  This outcome is not only because of the low stature of the Indian politicians in the world politics, but also because of negligible impact and contribution of India in the world market.  The politicians in India desperately need an education not only in political science and economy, but also in moral behavior and etiquette.  It is not just enough to be a very old civilization.  Vemana, a 17th century Telugu poet, questioned, “What is the point in living and dying like termites without contributing something worthwhile to the society?”

The real development through globalization of economy comes only when all the required ingredients are in place.  India needs to pursue such components of successful development as improvement in literacy, real liberation of policies by cutting down the red-tape and corruption, and real compliance with intellectual property laws enacted by the government in compliance with the GATT agreement, which not only encourage the multinationals, but also Indian entrepreneurs and industries who are plagued by the constant piracy threat.  At this hour of development, the Indian government has to pursue vigorously and whole-heartedly the real capitalism and open economy, which ultimately will provide the incentive for real growth in all directions.

India has to permit and encourage the firms, without undue cost, to quickly move down the learning curve, to reap benefits and to appropriate the gains from the technological advances and the government strategy has to consider the structural conditions prevailing in the domestic sector, and make adjustments to induce firms to technological progress.48  The government of India has an uphill task of convincing and helping private firms to develop R&D abilities and technology infrastructure, benefits of which definitely outweigh the costs.

The United States and the European Union have to realize that the Indian Union is not a country like Germany or France, but a continent, bigger than the European Union.  The problems in India are more diverse than in Europe.  Each problem cannot be looked at independently of others in order to find a solution.  The solutions to the problems should be comprehensive.  At the same time, there cannot be a universal solution to any problem, since each state in India is different from the rest.  For example, the problem of family planning and control of population can not have a universal solution in India, since the population growth is not the same in all states.  Every woman on average has 5 or more children in Uttar Pradesh, 2-3 in Andhra Pradesh, and in Kerala less than 2.   Literacy rate in Kerala is 90%, whereas in Bihar 38%.   Female literacy in Kerala is 87%, whereas in Rajasthan 21%.49  In spite of the difficulties in governing such a large diverse continent which accounts for approximately 20% of the population of the whole world, India has complied with the GATT and fulfilled its promises to the world by setting up one of the most stringent intellectual property laws in the world and  the implementation of these IP laws has already resulted in reduction in the piracy to 60% and will be reduced further.

In 1996-97, the total exports of software from India amount to $1billion (0.2%), in the world market of worth $500 billion.  The total estimated piracy in India at present is approximately $600 million,42 i.e.,  approximately 0.12% of the total world software market.

According to a study50 released on May 7 by the Business Software Alliance (BSA) and the Software Publishers Association (SPA), the United States’ loss due to piracy is $3,700 million in Asia-Pacific area, $2,300 million in the United States $1,200 million in Japan, and $ 255 million in India.  The United States had the highest revenue losses due to piracy in the US itself.  One out of every five dollars lost to piracy worldwide occurred in the US in 1996.  Piracy rates are very high in countries like Vietnam (99%), China (96%), Oman (95%) and Russia (91). Low rates were found in US (27%), Germany (36%) etc.  Though the piracy rate is low (27%) in US, it is the highest in dollars ($ 2,300 million).  So, the United States should concentrate more on the piracy at home, Europe, China and Asia-Pacific, where the big bucks are lost.

In May 1997, Mr. Frank Wisner, the outgoing US Ambassador to India admitted that his country easily overlooked the important strides India had made in recent years. The attitudes of India and the US towards each other were hangovers from the era of confrontation.  Mr. Wisner aptly observed that the old era ended and an inter-dependent world had emerged which demanded that countries shed off old attitudes and anxieties that inhibit their ability to seize new opportunities for cooperation.51
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