With an eye on the Lok Sabha polls, the government is working overtime to appease the American bosses hoping to impress the angry Indian electorate with an American certificate of ‘good conduct and excellent performance’. With the exchange value of the Indian rupee nose-diving to 60 per dollar, India’s import bill is becoming increasingly unmanageable. Short-term compulsions of debt repayment are also exerting great pressure on India’s forex reserves. It was a similar scenario in early 1990s that led the Indian policy establishment to opt for the neoliberal package of liberalization, privatization and globalization. And after twenty-two years as the Indian economy finds itself in a deeper mess, Indian policymakers can think of no other course but to extend still greater concessions to global capital.
As elections draw nearer and the shadow of economic crisis grows darker and longer, frantic parleys are on between key architects of the Indian policy establishment and their American counterparts. Just as Chidambaram, Anand Sharma and Montek Singh Ahluwalia returned from their appeasement mission to the US, there came the announcement of an across-the-board hike in FDI limits in a dozen sectors of strategic importance including telecommunications, insurance and defence. This has of course made the US establishment hungry for more, as became glaringly evident from the wish list presented by US Vice-President Joe Biden during his recent visit to India. Biden’s visit was preceded by the visit of US Secretary of State John Kerry and will be followed by another Manmohan-Obama meet in Washington later this year.
The Congress had signed the Indo-US strategic partnership and the subsequent nuclear deal during its first tenure. Before the forthcoming Lok Sabha elections, it now seeks to push the country deeper into the policy trap laid by the US. Biden’s wish list gives us an idea of the kind of concessions the Americans are demanding and the Congress may well end up extending. The US wants not only greater FDI concessions in every sector but a lenient tax regime and still greater Indian reliance on American imports. In particular, the US wants India to completely open up the insurance sector, accept the intellectual property right claims of US pharmaceutical companies and weaken, if not altogether waive, the liability clause in civilian nuclear trade. The US-India Business Council has also written to President Barack Obama complaining about India’s ‘archaic laws in land acquisition’.
Economic interests apart, the US wants assured Indian assistance in implementing its AfPak policy. As the US and its NATO allies contemplate ‘withdrawal’ of their combat forces from Afghanistan by 2014, the US wants India to step in and fill the void. Indian involvement in Afghanistan in compliance with the US game-plan is fraught with dangerous consequences. It will make India an automatic target of Taliban resistance and terrorist attacks. And it will invariably open up another front of tension and possible conflict with Pakistan. It is one thing for India to extend assistance to Afghanistan within a framework of bilateral as well as South Asian cooperation, but India footing the economic, political and military bill of US design in Afghanistan is a completely different proposition.
The pro-corporate pro-US policies pursued by successive governments over the last two decades have already landed India into a deep economic and foreign policy crisis. The frantic election-eve measures now being taken by the UPA government can only aggravate the crisis. The country must resist these disastrous moves tooth and nail and get ready to vote out the discredited UPA government along with its entire policy baggage.
