Increasing Gap between Rich and Poor

There is more and more debate these days about how Capitalism and open markets is increasing the gap between rich and poor. How the big bad greedy capitalists are just nothing more than parasites, sucking the blood of the poor people and becoming richer and richer. Examples quoted are the farmer suicides in Karnataka and Andhra Pradesh, people living in Mumbai slums, pathetic condition of migrants (mostly from Bihar and UP) in Delhi and so and so. And regularly the reason for the unfortunate plight of these people is put on buzz words like globalization, capitalists etc . During the last few days of ourIndependence celebrations, this theme was repeated so many times and on so many programmes. The last straw for my patience came when I saw a persistent Stephen Sackur grilling Sunil Mittal on BBC Hardtalk on how Sunil Mittal made his billions while millions in India continue to live below the poverty line. As if it was all his fault to make money while a whole lot of others couldnt buy their bread. Phew!

Now, before I go on the schizophrenic histeria about India's developments, let me recount the facts. Today, around 25% Indians live on less than a dollar a day, we have huge child labour problems, girls are still unwelcome in our families. Yes, accepted and I also know about the persistent caste system, the all pervading loathing of the minority, the rising naxal problems, the endemic corruption and so on. If in 60 years of independence, we have not been able to do something to such gross problems, there must be something wrong in the way India is progressing right now. There must be something lacking, there must be some lesson on humanitarian development which we must learn from the west. Right. Wrong!

As a nation we may be 60 years independent. However, dont mistake political freedom with economic freedom. What happened in 1947, as far as economics is concerned, is just that the political power was transferred from the Gora Sahebs to the Brown Sahebs. Common Indians still had to fear the government and the bueaucracy. A license was needed for everything, from opening a business to obtaining sugar and kerosene for domestic consumption. Everything was as controlled, if not more, as during the British days. The result of such policies left a nation with around 800 million people totally bankrupt by 1991 and our finance minister was compelled to go begging to IMF for around 2.5 billion USD to avert a balance of payments crisis. And I thank my 330 million Gods for that crisis. Because with that crisis came an opportunity, of a magnitude unparalleled in modern world economic history- an opportunity to start lifting a fifth of the world population out of poverty slowly, steadily and "without saying bye to our cherished democracy" (quote added if you thought of China). Much reviled the IMF may be, it was to their dictats that we had to unshackle our economy and the fact that we had a highly educated finance minister(Manmohan Singh), backed by a highly learned prime minister (Narsimha Rao) helped enormously.

So really our India is just 16 years economically free. And look what has it achieved in the last 16 years. Around 300 million strong middle class population, which aspires to challenge and win over the world. In short, we have a whole USA within our borders demographically and more and more people are coming in the middle class bracket every single day. As the princess Raina of Jordan put it in one of her speeches in India Conclave, the difference between a child born in the west and a child born in sub-saharan africa is the Hope Gap (which basically means whether there is a possibility that a child will have a hope to leave the clutches of poverty during his/her life time). And I think that in the last 16 years, India deserves an A+ to fill the hope gap for so many families. It may take us another 60 years to fill the hope gap for the rest of India but I am certain we will do that nevertheless.

I am always worried that these debates on the increasing gap between rich and poor may lead India astray from the path of filling that hope gap. The socialistic policies we followed till 1991 resulted in a situation where a vast majority of Indians were equally poor and where the only hope of escaping poverty was to join a government job. Today, the situation is at least a lot better with the private sector becoming a leading provider of respectable jobs. What we must do is to unshackle our economy further from the clutches of government. Government's job is to regulate, to collect taxes and provide necessary assistance to the marginalized. Business is best left to the businessmen and economics to economists. And if that means that the gap between a Sunil Mittal and a migrant labour increases, we should not be questioning him as if it is all his fault. Neither should we start thinking about policies which would again make everybody equally poor!