No Middle-Class Rage Yet

Maybe this is the summer of middle-class rage, particularly in third world countries. Maybe, this is the symptom of a disease that deserves drastic surgery, not mild medication. Recurring ‘Arab Spring’ even in heavens otherwise immune to mass upsurge! Nobody is safe. No regime, dictatorial or not-so dictatorial looks comfortable. ‘From Istanbul to Rio de Janerio, from Bulgaria to Bosnia, the pent-up frustrations of an engaged citizenry are being triggered by a series of seemingly disparate events. For the disgruntled Egyptians, the situation is back to square one. Throughout the world people are refusing to bury the lessons they have learnt from ‘Arab Spring’, Spain’s ‘‘indignados’’ and the Wall Street Occupy Movement. Much to the dismay of the status quo-ists a new protest struggle, rather a grassroots struggle, against the system and outside the ambit of traditional party politics is emerging. This is a good sign but this difiance that projects itself as a motive force for partyless democracy has its limitations. Issues vary from region to region but the core message is the same : the persons in authority must deliver. Right now Brazil is witnessing its largest mass mobilisation in more than 20 years as more than 200,000 protesters hit the streets of major cities including the capital over a range of social issues. ‘‘There were all kinds of people—the suits, the elderly, young people, families with children’’. The popular upheaval as it is, was unthinkable even a few weeks ago. ‘‘It’s incredible that in a country mad about soccer, that will host the World Cup, people are not talking about matches on social media. They are discussing politics and economics’’.

Nearer home nothing spectacular is happening. The Anna Hazare phenomenon seems to have lost its dynamism. The much publicised crusade against corruption that generated huge expectataions among people is now being channeled into another electoral gambit. And the Anna team itself is a divided house, having no concrete direction of what to do. Once trapped in electoral politics, all this tall talk of fighting corruption in high places will be over.

A kind of helplessness seems to have gripped the youth in this country, they have no future. But they are yet to realise it is worth going into the streets. Then desperation as reflected in spordic maoist actions in the jungles of Chattisgarh and Jharkhand, has very limited appeal to vast masses. Meanwhile, the steady decline of rupee against dollar just reflects the near bankruptcy of Indian economy though the captains of industry and finance continue to sell utopia by projecting high growth rates during this financial year.

The devaluation of rupee seems to have reached a stage of panic. Baffled by the failure to perform in the external sector and plagued by stagnation, inflation and unemployment internally, the Indian monetary authorities in a bid to arrest the free fall of the INR found no other option than opening wider the door for Fll and FDI to enter and operate here vigorously. This policy of allowing Fll and FDI to an unbridled scope to romp in an uninhibited economic space, spawned towards the end of Narasimha Rao's Congress regime and continued through the second period of the NDA regime led by BJP's Atal Behari Vajpayee, more or less stabilised the INR in the second period consequent upon the steady inflow of Fll and FDI money in the form of US$ in the RBI's foreign exchange reserve. The capital markets, the commodity markets, commercial banking and insurance sectors in India were reformed and then connected to the international network and various regulatory bodies never before contemplated were installed in order to ensure transparency which is an alias of conforming to rules of operation set by the MNC think-tank.

India gave to the FII-FDI capital favourable margin of returns and as long as it remains satisfactory, the inflow shall continue and with it the stability of INR. That is to say India at present is caught in a trap. For one thing all the high valued enterprises in the private sector and even the 'Navratnas' in the public sector have significant content of FII-FDI capital and technology input. The FII-FDI combine supplies a significant share of the controlling capital, technical know-how and access to export market and the Indian partners just do the needful managing the affairs so as to fetch for their foreign partners the desired returns and then only can the Indian entrepreneurs amass and enjoy the residuals. With these residuals the Indian partners have climbed from rags to riches in the last 23 years. And even after repatriation of profits and interest amounts according to conditions agreed upon by both the contracting parties, the FII-FDI suppliers still have in their possession a significant accumulation of INR, with which they are now buying US$ from the market. This US$-buying by the FII-FDI combine is a new phenomenon and it has surprised the monetary authorities. It has caused serious turmoil in the capital market and is pulling the price of US$ up and consequently pushing the value of INR down in the money market. The falling prices of gold, oil and gas in the international commodity market may have added fuel to fire. Maoist resistance to wanton loot of mineral resources and degradation of environment could well be another reason. India is really a wonderland! Despite precarious existence of vast masses the middleclass rage shows no signs of bursting into a thunder.

Vol. 46, No. 2, Jul 21- 27, 2013

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