India's Pandora’s Box is now being opened

Foreign Direct Investment will help some of India, but won't correct growing inequalities.

Last Friday, the Indian government announced big bang reforms signalling that the Indian economy is now wide open for business. The landmark decision includes allowing 49 per cent foreign direct investment (FDI) in aviation, raising the FDI cap in the media industry to 74 per cent and most pertinently allowing 51 per cent FDI in the sector of multi-brand retail. This means the Tescos and Walmarts of the world can now set up shop in India.

In the lead up to the high octane announcements the ruling party at the centre - the Congress - that leads a coalition government which rather tellingly goes by the moniker of UPA 2 (United Progressive Alliance; "2" to indicate its second term) was reeling under the vertiginous impact of "Coalgate" – a scam unearthed by the national auditor, the CAG (the Comptroller and Auditor General). Suggestive of crony capitalism, the government "gifted" coal mining permits to private players fleecing the national ex-chequer to the tune of £33bn. The new wave of economic liberalisation policies is a laudable attempt to take the spotlight off the scam. The policies are also a damage limitation attempt by a floundering government to counter allegations of inertia in national and foreign publications. The unflattering foreign reviews unsurprisingly hurt most.

The new measures were explained by India’s Commerce and Industry Minister, Anand Sharma, in an "exclusive" on India’s premier news channel, NDTV. He said the reforms, in particular, those in multi brand retailing were what India needed. Let’s set the record straight here. Which India was the minister referring to? If we look at India’s 1.2 billion population as a pyramid, at the apex sit 1.2 million affluent households. They tend to live in India’s top eight cities. Approximately 300 million people are middle class. It is the base of the pyramid that comprises the biggest section in terms of the number of people – at least 700 million people consisting of 114 million families. This is nearly 60 per cent of the country’s population. They include "struggling India" and "destitute India"; those for whom making needs meet is a daily battle and those who are below the poverty line. Surely, the minister was not referring to this chunk of the Indian "market"? They simply do not have the purchasing power for a Carrefour or a Walmart. Their everyday grind absorbs them, survival overwhelms them. Conspicuous consumption does not feature on their agenda of preoccupations. Neither will the big retailers be counting them in. It is a mutual disaffection.

A strong argument in favour of FDI in mammoth retail is that it will generate employment. Surely, it will. But we can’t let the question lie there. We must ask, for whom? Will it source employees from the unskilled, illiterate vegetable vendors who, akin to a capillary network, are spread across the length and breadth of the country? Operating at the point of delivery to the grocery shopper, they are the lifeblood of India’s unorganised grocery sector. Succinctly asked – will the giant retailers employ from the displaced workforce? If the big chains simply usurp their livelihoods what will become of their families entirely dependent on their incomes? Or are they simply not part of this narrative? In which case let’s be clear – in the way FDI is being sold it isn’t for the appeal of the Indian imagination but of a sliver of the Indian imagination.

Since the first wave of economic deregulation reforms in 1991 (ironically passed by the incumbent Indian Prime Minister Manmohan Singh when he was finance minister) select segments of India have unequivocally prospered. Even a cursory look at the 2G spectrum scam and "Coalgate" make clear the benefits accrued to the political brass and to the corporate sector. The famous Indian middle class has also expanded. And on a recent visit to South Kolkata, in the vicinity of an upmarket supermarket, the prosperity of urban sprawl was also plain to see. An open garbage dump heaved and street urchins ran around it. A friend plaintively remarked "garbage dumps are flourishing too". The brush of 1991 painted some of India gold, the other parts left to fester into elision.

Will the brush of the 2012 reforms paint India differently? In the "spillover" effect of the big foreign companies operating in India, there will be benefits to be had. The promises of improved supply chain infrastructure and the elimination of middlemen (how the middlemen will be redeployed is another matter) have been reiterated over and over. The headlines of the "in-favour" rhetoric relay thus - more FDI will drive consumption, manufacturing, economic growth and GDP. But for the holistic temperature of the development of a nation the Gini Coefficient and the Human Development Index are more apposite thermometers – and on both counts, unlike the growth index, India’s score is not reassuring. Also, if we put to the test the theory of how gigantic foreign retailers will encourage Indian manufacturing by citing the example of the "Walmart effect" on American manufacturing – then the prognosis is slim. The bottomline is this: it will certainly help "some" of India, but it is definitely not the panacea to India’s most pressing woes.

 

Members of The Indian National Association of Street Vendors shout anti-government slogans during a protest against Foreign Direct Investment. Photograph: Getty Images
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Why Nigel Farage is hoovering up all the women I know

Beware young fogeys.

I can’t remember where I was when I first worked out that I was older than Nigel Farage. You’d think after that bombshell went off, you’d still be able to locate the crater. Anyway, there it is: the cut-price little Oswald Mosley is about a year younger than me.

I mention this not because I want to dwell on the nasty piece of shit, but because I’ve been having to face, at one remove, so to speak, the problem of young fogeyism. It seems to be all around. And not only that, it’s hoovering up women I know.

The first time it happened was with B——. She was going to come round last weekend, but then emailed to cancel the day before, because she was going to watch rugby – apparently there’s some kind of tournament on, but it never seems to end – with her boyfriend. How ghastly, I said, or words to that effect; I’d rather die.

She then made the Category One mistake of saying, “Rugby, cricket, all the same to me,” with a cheeky little “x” at the end of it.

I replied thus: Rugby is a violent and brutal game (the coy term is “contact sport”, which means you get to – indeed, are encouraged to – injure the opposing team as often as you can, in the absence of any other tactic) loved by fascists, or, at best, those with suspicious ideas about the order of society with which I doubt you, B——, would wish to be aligned. Also, only people of immense bulk and limited intelligence can play it. Cricket is a game of deep and subtle strategy, capable of extraordinary variation, which is appreciated across the class spectrum, and is also so democratically designed that even the less athletic – such as I – can play it. [I delete here, for your comfort, a rant of 800 or so words in which I develop my theory that cricket is a bulwark against racism, and rugby, er, isn’t.] Both are dismayingly over-represented at the national level by ex-public-school boys; cricket as a matter of historical accident (the selling-off of school playing fields under Thatcher and Major), rugby as a matter of policy. Have a lovely day watching it.

Two things to note. 1) This woman is not, by either birth or ancestry, from a part of the world where rugby is played. 2) You wouldn’t have thought she was one of nature’s rugby fans, as she considers that Jeremy Corbyn is a good person to be leading the Labour Party. (True, thousands of Tories think the same thing, but for completely different reasons.)

That’s Exhibit A. Exhibit B is my old friend C——, whom I haven’t seen for about five years or so but suddenly pops up from the past to say hello, how about a drink? I always liked C—— very much, largely because she’s very funny and, let’s be frank about this, something of a sexpot. She seems keen to bring someone over with her who, reading between the lines like a modern-day Sherlock Holmes, I deduce to be her latest partner. The thing is, she says, she’s not sure he can come, because he might be going beagling.

Beagling?

Well, she does come round (alone, thank goodness) and she’s looking even better than I remember, and is even funnier, too, and she shows me some of the pictures she has put up on her profile page on some dating site, and they’re not the kind of photographs this magazine will ever publish, let’s leave it at that. (One of them even moves.) And, as it turns out – and it doesn’t really surprise me that much – the young beagler she is seeing is a good thirty years-plus younger than she, and his photograph shows him to be all ears and curls, like a transporter mix-up between Prince Charles and the young David Gower. Like B——’s young man, he is not called Gervaise or Peregrine but may as well be.

What on Earth is going on here? Can we blame Farage? I can understand the pull of the void, but this is getting ridiculous. Do they not quite understand what they’re doing? Actually, C—— does, because she’s had her eyes open all her life, and B——, her youth and political idealism notwithstanding, didn’t exactly come down in the last shower, either.

So what is it with these young wannabe toffs – one of whom isn’t even rich? “You’d like him,” C—— says, but I’m not so sure. People who go beagling sure as hell don’t like me, and I see no reason not to return the favour.

Well, I can’t thrash this out here. C—— leaves, but not before giving me the kind of kiss that makes me wish Binkie Beagley, or whatever his name is, would just wink out of existence.

Nicholas Lezard is a literary critic for the Guardian and also writes for the Independent. He writes the Down and Out in London column for the New Statesman.

This article first appeared in the 16 February 2017 issue of the New Statesman, The New Times