Globalisation and Indias Pluralist Society - Essay Example

INDIA AND GLOBALISATION I. INTRODUCTION Globalisation is a relatively new phenomenon experienced by humanity only within the last fifty years (Soros,2002). It connotes the development of global financial markets, growth of transnational corporations, and their increasing dominions over national governments (Soros, 2002). Globalization also refers to the massive migration of people, changing national identities and cultural belongings (Suarez- Orozco & Qin- Hilliard, 2004) shattering internal and external borders among and between nations. With its multifaceted connotations, globalisation has been broadly understood as a concept, policy and process casually used to describe a variety of phenomena that reflect increased economic interdependence of countries. It includes flows of goods and services across borders, reductions in policy and transport barriers to trade, international capital flows, multinational activity, foreign direct investment, outsourcing, increased exposure to exchange rate volatility, and immigration. These movements of goods, services, capital, firms, and people are believed to contribute to the spread of technology, knowledge, culture and information across borders (Fischer, 2003; Soros, 2002; Balakrishnan, 2003;Geriffi & Sturgeon, 2004). Thus, globalisation permeates the contemporary world. The paper aims to understand the positive impact of globalisation in India. As such, the focus question is how do changes brought about by globalisation have a positive impact in India? The paper will have the following structure: first part is the introduction where globalisation is defined, and the problem is presented. The second part is the presentation of the economic scenario of India. And the third part is about the positive impact of globalisation in India. II. INDIA’S ECONOMY India with a population of 1,139.96 million as of 2008 and a population growth of 1.3% annually is one of the emerging powers of the Third world (Harris, 2005). India’s 2008 GDP is $1,217.49 billion still higher by $40.60 billion than 2007despite the world economic crisis. Both the agricultural and industries sectors share 36% of GDP with 18% each respectively in 2008. The services sector comprises 53% of the GDP while India’s exports of goods and services for 2008 cover 24% of the GDP. There is a remarkable increase in workers’ remittances from $38666 million in 2007 to $51974 million in 2008. Foreign direct investments have tremendously increased from $6,677 million in 2005 to $22,950 million in 2007. Also, an increase in number of mobile phone subscribers from 21 per 100 people in 2007 to 30 per 100 people subscribers in 2008 and an increase in internet users is seen in 2007 -7.2 per 100 people have been attained (World Development Indicator, 2009). In all of these positive movements in the economy, it is undeniable that India’s integration in the world economy has served as the impetus for India’s growth (Qureshi & Wan, 2008; Nayar, 2006). III INDIA AND GLOBALISATION: A POSITIVE GROWTH India is unique among all the other developing countries because of the prevalence of ethnic and linguistic diversity (Nayar,2006) making the country an “instance of a pluralistic society” (Mishra & Nayak, 2006:9). But despite this reality, India has experienced a remarkable growth making it one of the emerging powers in the 21st century among the Third World countries (Harris, 2005). This India has attained only for two decades since her integration in the world economy on 1991(Selko, 2008; Nayar, 2006). As such, the positive effect of globalization in India continues to astound the world. Agriculture. There are two important positive changes that are happening in the agricultural sector of India. First is the development in the sector itself (Mishra & Nayak, 2006) and the second is the increasing awareness of the need for protection of informal labour most of which are farm workers (Hensman,2001). India’s agricultural policies have changed since her entry in the World Trade Organization (Mishra & Nayak, 2006). And the first positive effect that resulted from it is the increase in percentage of areas under cutltivation (Mishra & Nayak, 2006). Second, is the abolition of restriction on what to plant, what to produce, where to sell etc. The freedom in the operations of the agri-business has been given thus, paving the way for a new agricultural structure which is almost totally different from the pre-1991 agricultural sector (Mishra & Nayak, 2006). Third, the sector is starting to be globally competitive as it starts to respond to global demands for finer crops and cash crop(Mishra & Nayak, 2006). The government is beefing up the sector by liberalization of the agricultural market via the “removal of trade restrictions on agricultural commodities, unification of prices so that the dual prices in food grains and other agricultural commodities disappear”(Mishra & Nayak, 2006:4), the development (although slow) of infrastructures necessary for the transport of the produce (Harris, 2005).And as such, the agricultural sector is one of the sectors that have boosted the economic growth of India in the past decade (Li & Zhang, 2008). The other development in this sector is in terms of labour. “A majority of agricultural labourers in India are from the Scheduled Castes and Tribes, that is, communities socially oppressed under the caste system and among the worst exploited economically” (Hensman, 2001). Agricultural labourers who belong to the informal sector do not have any health or hazard pay, are bonded by usury and abuse, exploitation, long hours of work and job insecurity as such they suffer (Hensman, 2001). However, due to globalization, there is already a rising awareness to protect agricultural informal labourers. And the growing support for the protection of agricultural informal labourers come from the alliance between international groups and non-governmental organization (Hensman,2001). Industries. The importance of manufacturing industry cannot be understated. “Manufacturing now employs 25.5 million people and grew at a rate of 12% in 2007. In 2008, it will grow about 8.5% given current economic conditions. Looking ahead to 2014-2015 the sector will have a market capitalization of $520 billion compared with $272 billion in 2007” (Selko,2008: 38). In light of this, the government is investing on infrastructures an amount of $750 billion between 2007-2015 (Selko, 2008). Furthermore, bureaucracy is being reformed in order to address concerns pertinent to red tape (Li & Zhang, 2008; Selko, 2008) since a good international image attracts foreign investors and of course local investors as well. The three major manufacturing industries of India are pharmaceutical, automobile and information technology (Nayar, 2006; Li & Zhang, 2008). In fact, Nayar ( 2006) claims that “…In the case of computer software, India has emerged as major economic power. It is hard to imagine that such a development would have been possible without globalization and liberalization”(37). More than that, India is into innovation and R&D(Li & Zhang, 2008). This is not surprising as India boast of a world class educational system (Selko, 2008; Nayar, 2006; Qureshi & Wan, 2008).In fact, “India’s current level of competitiveness comes from its pool of talent with over 250 universities, 1,500 research institutions and over 10,000 higher education centers turning out over 500 Ph.D.s, 200,000 engineers, 300,000 nonengineering postgraduates and 2.1 million other graduates each year. And it is harnessing this level of talent in terms of productivity and stability” (Selko, 2008:39). Thus, India’s edge over other developing countries lies not only on the potential of India’s huge market (Hensman, 2001), but it is also on the availability of India’s human capital – educated, skilled, English- speaking labour force and at a competitive price (Hensman, 2001). Services. This is another important sector that has kept the Indian economy stable in the midst of the world economic crisis (Nayar, 2006; Hensman, 2001). Normally, the service sector includes transportation, communication, insurance and tourism. But due to the expansion experience because of globalization, services now also include in the field of environment, education and counseling.(Mukhopadhyay, 2002). The service sector has created more jobs, has helped in widening the middle-class base (Hensman, 2001), and that as of 2008, it is 53 percent of India’s GDP (WDI 2009). Foreign Direct Investments. Foreign direct investments (FDI) is one of the surest sign of globalization and liberalization in a particular country. Since, it clearly manifests that a particular country has already opened its doors to other countries for business. Applying FDI to India, India is slow in FDI as compared with China (Nayar, 2006; Li & Zhang, 2008). This is due to the “East India Company Syndrome”. East India Company is what the British has used in order to conquer India from the 17th century to the19th century. Thus, India has been distrustful of foreigners. In fact, there is a continuous opposition against foreign investment fear of foreign political and economic domination (Nayar, 2006). Is this a possible cause of concern? Nayar (2006) claims that if compared with China, indeed, it may be easy to judge that India’s FDI seems to be categorized as an underperformer in global trend. However it should be noted, that there is a long history behind their cautious opening to the global market. It is not a lack of interests from foreign investors but it is a matter of public policy (Nayar, 2006). In this regard, it the ‘low’ FDI of India should be appreciated as a “supplement to the Indian local and national markets and not to supplant it” (Nayar, 2006: 59). In this sense, India has set an example to developing countries – in globalization though plurality is the ethos and borderless economy is the prime mover, the sense of national identity rooted from a common historical experience should drive Third world countries to find their mark in the pluralistic world. Flexible Citizens. Globalisation is movement of people (Suarez-Orozco & Qin – Hilliard, 2004). India, since the 70’s, has already recognized the Indian Diaspora creating flexible citizens (Walton-Roberts, 2004). It is claimed that almost 20 million people of Indian origins live overseas. Their contribution to the economy in terms of remittances is of considerable input. According to WDI (2009), the 2008 workers remittances have amounted to $51, 974 million. The 2007 remittance amounts to $38666 million compared to the foreign direct investments which amounts to $22,950 million. Undeniably, this shows that workers’ remittances form a big part of the government earnings and that it can serve as stimulus and buffer of the government during times of crisis. There is also the sociological influence of Indian diaspora. Indian living overseas are either Non-Resident Indians (NRI) or Person of Indian Origin (PIO). Although there is a distinction between the two, what is noticeable is that whether NRI or PIO, they continue living the Indian culture within their overseas community. Thus, it is claimed that the “bond many NRIs and PIOs maintain with the land of their ancestors contributes significantly to India’s economic and social development, and shapes an increasingly global form of Indianness not ontologically rooted in the country’s sovereign territory. While capital flows are evident at the national scale through remittances and NRI investments, the actual material effect of such transfers needs to be witnessed and measured qualitatively at the regional scale.”(Walton-Roberts, 2004:64 – 65). As such, Indian Diaspora has ushered in a new form of human relations; through the migration of her people India continues to share with the world her wisdom, knowledge and her vision of what takes to be a human person. IV. CONCLUSION Globalisation is a new phenomenon. It is understood as a concept, policy and process casually used to describe a variety of phenomena that reflect increased economic interdependence of countries. It also refers to people’s movement in the global market. And India’s success in these two facets of globalisation is an inspiration. India’s pluralist society offers a unique case for globalization. Her diverse ethnic and linguistic background creates a concrete reality for a pluralistic society. India is an exemplar on how individual countries can establish their own niche in the contemporary pluralist world. Thus, India proves there are many positive aspects that can be gained in globalization. In all of these, globalization is not the panacea for all the ills of the world. India’s success stories as she integrates in globalization have paved the way for a progressive, hopefully, more humane society for all the peoples of India and the world. REFERENCE: Alessandrini, M., Fattouh, B., Ferrarini, B. & Scaramozzinno, P. (2009). Tariff liberalization and trade specialization, ADB Economics Working Paper Series No 177, Retrieved from www.adb.org/Documents/Working-Papers/2009/Economics- WP177.pdf. Accessed on 8 Dec 2009. Balakrishnan,P. (2003). Globalisation, power and justice, Economic and Political Weekly, pp 3166 – 3170. Fischer, S. (2003). Globalisation and its challenges, The American Economic Review, Vol. 93, No 2, pp 1 – 30. Geriffi, G. & Sturgeon, T.J. (2004). 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