Organizer and Chair: Ronald J. Herring, Cornell University
Discussant: Shelley Feldman, Cornell University
A dominant global understanding has emerged around the proposition that government intervention in economic life is counter-productive, however well intentioned. India has been the archetype of stagnation effects of extensive political control of the economy (the "license-permit-quota raj"). Liberalization has been acclaimed as a solution to growth-depressing statism in a discourse supported by the most powerful international actors. Much of the international literature buoyantly assumes that all will be well once the government withdraws its tentacles-after some regrettable "adjustment costs." Political dispute surrounding liberalization within India has however been intense; vigorous opposition has protested real and expected harm. What is missing from that heated debate is empirical attention to specific sectors where negative efforts of liberalization may be located. We focus on three: rural poverty, women, and environment. On rural poverty, the declining trend apparent in NSS data of the 1980s shows some signs of being reversed by the inflationary and unemployment-generating effects of liberalization, as well as by cuts in government programs meant to alleviate poverty. Gendered effects operate through reorganization of the labor market, social spending cuts, and environmental degradation. Environmental effects in general operate mainly through reduction in regulation, intensified resource extraction from export promotion, reduction in government expenditure on environmental activities, and opening the economy to firms with environmentally suspect practices. The panel seeks to give empirical weight to the adjustment costs so lightly passed over in the dominant literature.
Liberalization and the Poor in India: The Empirical Case
N. Chandra Mohan, Business India
The paper focuses on the hypothesis that the major losers of the process of economic reforms since 1991 have been the rural poor. Government officials continue to exude optimism that the percentage of rural people below the poverty line can be brought down to less than 10% by the mid 1990s. Official optimism stems from the trajectory of the 1970s and 1980s: while the absolute number of the poor has grown, their share in India's population has registered a decline from 58.8% in 1970-71 to 50.8 % in 1983 and further to 48.7% in 1987-88. The downtrend in the incidence of rural poverty is expected to continue: faster growth in GDP is expected to trickle down and lift much of the population above the poverty line. The government is also banking on targeted interventions (pro-poor public policies, such as rural public works, etc.) to alleviate residual rural poverty.
However, many economists argue that reforms since 1991 may well have reversed the earlier declines in rural poverty. There is some evidence that the level of underemployment and the incidence of rural poverty have increased since 1991. Food prices shot up by 45% during the early years of reform, 1991-92 and 1992-93, which may have triggered a rise in rural poverty. But explicit data on rural poverty since liberalization do not exist. Collating both the quantitative and qualitative information to assess the impact of reform on poverty is therefore necessary to remedy a major lacuna in the current literature.
Structural Adjustment Programme and Gender Concerns in India
Dolly Arora, University of Delhi
With the adoption of the structural adjustment programme in India, wide-ranging changes in policy orientation have taken place. The New Economic Policies, with their inclination towards liberalization, deregulation, state withdrawal, privatization and globalization, are professedly aimed at introducing correctives in the crisis-ridden economy of India. While policy-makers are already asserting the success of these policies, the effect of policies on different sections of society is not assessed in these evaluations; nor are the specific needs of the most vulnerable sections of society paid any consideration. Accumulating evidence indicates a lack of sensitivity of the new policy regime to the question of gender justice.
This paper will discuss the gender-specific impact of these policies. In particular, it will analyze the implications for women of: (a) changes being effected in production structures and processes, and the consequent reorganization of labor market; (b) the effects of state withdrawal and pattern of social sector allocations, especially in the context of increasing inflation; (c) the effects produced by policy changes with regard to management of natural resources and environment; and (d) the effects of increased consumerism in consequence of liberalization and globalization. These changes will be examined in terms of: (a) the health and nutritional status of women; (b) the nature and extent of domestic and/or market related work burden on women; (c) the access to resources and fair opportunities of healthy conditions of work and leisure; and (d) the extent of liberation or objectification and victimization of women.
Structural Adjustment vs. India's Environment
Ashish Kothari, Indian Institute of Public Administration
India has embarked on an ambitious programme of liberalization and structural adjustment in the 1990s. The major thrust of this programme is to "integrate" India into the global economy. A review of the programme over the last four years shows that:
(i) the drive towards an export-led model of growth is rapidly sacrificing natural resources to earn foreign exchange, as especially seen in the fisheries and mining sectors;
(ii) the move towards liberalization is resulting in an atmosphere of free-for-all, with industries increasingly ignoring environmental standards, and state governments sacrificing natural habitats, to make way for commercial enterprises;
(iii) the directive to reduce government expenditure is resulting in cuts in social and environmental sectors, with a consequent reduction in programmes for the conservation and regeneration of natural resources;
(iv) the opening of the economy is bringing in companies with a notorious track record on environment (including pesticide manufacturers who had almost wound up in their parent countries), and wasteful consumer goods and toxics which are adding to the country's garbage and health problems.
Communities and individuals are responding to these threats, opposing what they consider destructive investments and programmes, and forwarding possible alternatives. The most important component of these efforts is greater community control over development planning and implementation, and greater integration of ecological concerns into developmental planning. A comprehensive alternative economic blueprint has, however, yet to emerge.