Panel Title : THE EFFECT OF GLOBALIZATION ON THE ASIAN ECONOMY (PANEL I)
Chair : Vladimir Yakovlevich Portyakov
Paper Title : Globalization in India: Some Myths and Realities
India's globalization is a conscious and deliberate effort to permit the factors of production, the produce and the socio-economic forces to permeate across the national boundaries and remove any obstacle to such permeance. Although economic in the core, globalization has pervasive effects on the society. It has its impact on the socio-economic structure, values, social institutions and attitudes. The Indian social structure is basically pluralistic, replete with a multitude of enclaves of several types and strata. There are enclaves making rural-urban, men-women, caste-dalits, organized-unorganized, formal-informal, and so on. A great majority of the workers are still connected with agriculture, out of which a large chunk makes landless labourers. In the urban areas, they work mainly in the unorganized sector. The increasing gulf between the urban and the rural sectors, the terms of trade being in favour of the urban sector, affect them most harshly. The process of globalisation not only opened up the economy and accelerated cross-border mobility of persons, goods, capital, data and ideas but also opened up the society to various effects. The present paper in this connection is an attempt to reveal some of the myths and realities of globalisation in India.
Paper Title : Globalization vis-à-vis Welfarism in Tamil Nadu, 1991-2003
Article 39 in Chapter IV of the Indian Constitution laid down the duty of the state as one of ensuring that ‘the ownership and control of material resources of the community are so distributed as best to subserve the common good...(and) that the operation of the economic system does not result in the concentration of wealth and the means of production to the common detriment.' Despite this vision articulated in the Constitution the policies designed by the state to reduce the fiscal deficit often came in the way of creating a true welfare state in India. Yet it became incumbent on the government to design social security programmes in tune with domestic realities. Anticipating adverse consequences of globalization, the Ministry of Finance after two years of economic reforms stated the government's commitment to create a social safety net for the purpose of minimizing the hardship likely to be imposed on any section of labouring class. Whether the commitments stated in the document of the Finance Ministry have been honoured by the governments both at the Centre and the state in Tamil Nadu, and what are the policy measures adopted by the Tamil Nadu government during the period from 1991-1996 and later in the years since 2001, when the AIDMK government that was wedded to neo-liberal economic policy was in power, are the issues that are analyzed in the first part of the paper. It was claimed that the new economic policy involving structural adjustment programme was poised to take the country to a rapid development process. To what extent the outcome of path charted by World Bank has been true in the case of India, is highlighted in the second part. Because of liberalization, privatization and globalization, most of the governments were compelled to withdraw certain welfare measures. Tamil Nadu was no exception to that. The third part deals with the policies pursued by governments both at the Centre and in the State with special focus on their impact in a village of south Tamil Nadu.
Vladimir Yakovlevich Portyakov
Paper Title : Russia, China and India in the World Economy
nteraction among Russia, China and India on the international scene largely depends on what place the three countries occupy in the world economy. According to the International Monetary Fund, China's GDP totaled US$ 2,225 billion in 2005. With the share of 5 percent China is now ranked 4th in the global economy. China has achieved world leadership in the production of steel, coal, cement, chemical fertilizers, cotton fabrics, TV sets, grain, meat, raw cotton, and peanut. Russia's GDP was estimated by the IMF at $766 billion in 2005, which accounted for 1.72 percent of the global index. Russia is the world leader in the production of natural gas and rough diamonds and occupies the second position in the production of crude oil and potatoes. India's GDP totaled $775 billion in 2005, or 1.74 percent of the world's total. India has a global reputation as a producer of jewelry, tea, medicines, fabrics, and prêt-a-porter clothes. In recent years, it has moved to the forefront of software production and outsourcing of services based on information technologies. On the basis of the Purchasing Power Parity (PPP), in 2003 these three countries had together a 20.85 percent share in the global GDP. China outstrips both Russia and India by a large margin in the volume of foreign trade and in terms of its share of global trade. In 2005 China's share in global commodity exports went up to 7.33 percent and in imports, to 6.14 percent. Russia's share in global exports showed 2.36 percent and in global imports 1.16 percent. Indian commodity exports totaled 0.86 percent of the world's total, while imports made up 1.22 percent. Bilateral trade relations between Russia and India, and Russia and China are growing rather steadily. In 2005, Chinese-Russian trade reached $29.1 billion, while Chinese-Indian trade stood at $18.7 billion. Trade relations between Russia and India are much weaker, with Russian statistics putting the volume at $3.1 billion in 2005. The above-mentioned statistics leads us to the following conclusions. First, China is playing nowadays the role of the engine in the Asian economy, and of "active growth factor" in the global economy on the whole. However, China may experience problems in the future due to a scanty resource base and a lack of affiliation with any integration-minded regional groups. Thus, one may expect to see a marked increase in China's efforts to eliminate or minimize those problems. Second, the respectable positions Russia has gained in the global economy largely proceed from its ability to maintain and develop strong elements of its Soviet heritage in the international division of labor - first of all, in natural gas and crude oil extraction, defense technologies and atomic energy. Russia retains a high potential in international transit transportation and also could rejuvenate the still existing intellectual resources to develop innovation-based production and export. Third, the rapid upgrading of services in software and outsourcing of IT-based business services alters India's role in the international division of labor, yet the latter's relative advantages in traditional industries will play a dominant role over the long-term. Fourth, the zone of the three countries' overlapping interests and mutual compatibility in terms of the global economy is broader than the zone of their potential conflicting interests. This lays a solid foundation for increasing the scale of trilateral cooperation and ramifying its forms, as well as for working together in the format of Asian integration.
Paper Title : Indo-Nepal Economic Relations : A Pragmatic Approach towards Globalisation
Regional and inter-regional co-operation in the present global scenario of economic advancement have been envisaged as essentioal tools for the achievement of economic security of a region as well as for the poverty alleviation programmes. The twin objectives lie in the core of the global free trade because the less developed nations find themselves quite open and insecure thrown before the giant economieswhose impact they can absorb only with the regional and inter-regional groupings. This economic groupingamong countries of a developing sector rests upon the building up of a definite socio-cultural infrastructure that determines a healthy growth in several social pockets including health, sanitation, education, employment generation, social empowerment, environment etc. leading to the co-operation in establishing security/safety zones in the region. South Asia provides an ample opportunity of such experiments, some of which are already visible in the Indo-Nepal relations, through the process of mutual economic co-operations that has been in progress since long.India has also established close relations with her other less developed neighbours. However, the Indo-Nepal relation is much significance due to the rising international interest shown in this Himalayan country which has time and again built up pressure on the Indian mind to evolve a practical Indian Nepal-policy. Apart from this India's free trade agreements with Nepal, Bhutan and Sri lanka have been quite fruitful for all concerned nations. In this region Indo-centricity is a hard socio-economic and political reality and these nations are very much economically tied to India. Many are lndlocked and dependent upon India for access to the outside world.Their progress to a great extent depends on India's stand. India on her own part is taking the right step for the betterment of the region which of course will serve her own political and economic interests. Nevertheless a lot has to be done to help her neighbours in their efforts to upgrade their economies and to alleviate poverty in the region.
Paper Title : Asia's Missing Success Story: Aircraft Industy
The aircraft industry has been considered as one of the capstones of successful industrial development in the world. There was a significant power shift from Europe to the United States when the US became a dominant power in aircraft industry. The impact was so huge that four European countries overcame a collective action problem to challenge the US hegemony by setting up Airbus, which regained the pride of Europe. Unlike other high-tech industries such as IT industry, the aircraft industry symbolizes more than the country's high-tech prowess. The industry represents the pride of nation as the industry is tightly connected to the national security due to the closeness to the defense industry. Many Asian countries have been known for its high-tech industrial development. Yet, none of the Asian countries even including Japan has successfully developed this industry. Why not in Asia? Post World War II Asia has had a lot of security concerns, which should benefit the development of aircraft industry due to its closeness to national defense. Geographically, Asia is characterized so many islands and mountainous vast lands, all of which should encourage aircraft development. After carefully studying various Asian cases (Japan, Indonesia, South Korea, and Taiwan) as well as recent none-Asian successful cases (Canada and Brazil), the author argues an assortment of reasons including international relations, slow start of the industry, strategic business mistakes, and macro-economic factors, has contributed to the failure of Asia in this industry. The most recent attempt of China's ARJ-21 project is also facing a significant up-hill battle to succeed due to the significant change of international environment and the structure of the industry in China.