The Crisis of Indian Economy


-- Prout is The Only Way Out

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    800 million of the estimated1300 million Indian population is rural, dependent on agriculture.The rural economy even today has the features of patriarchal feudalism.

Largely, the implements used have not changed and also the 'feudal arbitration councils' since the time of Akbar, the Mughal. Every day 40 farmers kill themselves as a result of the deep agrarian crisis [psainath.org].The rural area continues to be the traditional source of cheap raw materials and labour for exploitation by the capitalist economy. Subsidies are essentially, attempts at compensation.


            Out of the remaining 500 million urban Indians only 120 million population of the organized sector turned as the all important 'middle-class' for the growth of Indian economy in the last 25 years.

                 After the liberalisation of economy in 1990, debt economy was powered solely by the middle-class appetite for 'consumption' of white goods such as washing machines,TV's, Ac's, cars, and also housing, education, medical care through credit cards/long-term loans, to those with assured pay/periodical pay-revisions. 

                Fast forward to 2019.The 120 million 'middle-class' consumption demand  has saturated.Thus, the market for automobiles/houses/other white goods is shrinking, leading to lay-offs of lakhs of workers in various sectors. This is middle-class-centric, economic recession. All the sectors, including the print/digital media have grown on the back of this privileged middle-class.

                  The national media coverage of informal sector's plight is negligible and of farmer's plight, non-existant, as they don't attract TRP ratings.The local vernacular media may be little better in this regard but is not influential to mould the public opinion.

               The Economists opinion is that the only way to bring into the economy, the excluded sections, farmers and workers in informal sectors, is to give them access to quality healthcare, education and re-skilling. This is a long-term measure, but, is the only solution to the crisis, to be immediately implemented. Later, it will become impossible like it is witnessed in the social turmoil of Brazil and South Africa, ironically well endowed with rich natural resources.
             In contrast, South Korea and Singapore, prevented the 'middle class trap', by investing in quality education and healthcare of its citizens, to power the economy, in spite of abysmal natural resources.

               The Indian political leadership is in denial of the crisis, and is also incapable of engineering the inclusion of these large sections of our society into the economy. Relentless orchestration of divisive emotions on the one hand and electoral politics on the other, affords no incentive to them to take a long term view of the crisis and plan for inclusive growth.
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-- People's Economy of Prout --

    1. Prout's People's economy of Samaj guarantees access to quality healthcare and education to all.


2. The worker-owned corporate coops, will be the answer to the failure and retrenchment /closure by the enterprises.The BSNL/ JetAirways and such other failed enterprises, big and small should be turned over to 'worker-coops' and not privatised as they would cannibalise them for profit*. 

3. Cooperativization of farming, in a phased manner is the only solution to the rural agrarian crisis.

       *The right wing government is aggressively going ahead with transfer of PSU's to domestic and foreign investors.Samaj leaderships should demand their transfer to employee-managed Cooperatives.

The Samaj leaderships have formidable challenges ahead of them to bring the pracar and practice of Proutist school of thinking into the mainstream of Indian economic and political discourse.

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