Monday, May 16, 2011

When will India's stupid, English-speaking pro-market middle class intellectuals learn that market is in trouble?

The global recession has partly ended but the Western economies have not yet recovered from the enervating effects of the financial market meltdown. Meanwhile, India's stupid, English-speaking, pro-market middle classes are celebrating the defeat of the 34-year-long Marxist government in West Bengal last on May 13 as a snub to the anti-capitalist ideology of the party. There was nothing more myopic than this. It should not come as a surprise if prime minister Manmohan Singh and some of his pro-market allies in the government must be thinking in the same way as the stupid chattering classes outside in their private moments.
The one man who seems to realise that all is not well on the political and economic fronts is Union finance minister Pranab Mukherjee. He knows that there are problems to be solved.
A senior analyst has pointed out that India's capitalist class is investing more outside the country -- especially in Europe, the US and elsewhere than in India. He also said that Indian investments in the US are growing at a faster rate than the US investments in India. The fact is that the West is not only looking for Indian markets but also for Indian investments in their own countries. The emergence of the Indian multinational company should indeed be a matter of celebration, but this is happening at the cost of investments in India.
The analyst goes on to say that the reason Indian investors are looking out is due to the fact the corruption constraints of doing business in India is frightening. Therefore, corruption has to be eliminated at the different levels, especially at the lower and middle levels, for Indian corporations to set up shop and generate jobs if and when they want.
Of course, corruption is one the problems. Indian corporations are happy to invest abroad, which could turn out to be false, that the assurance of returns on investments are more promising. The lure of foreign destinations is not any more confined to education, jobs, and holidays, but now includes doing business and investing abroad.
But the markets in Europe and America are not going to bounce back any time soon because of the inherent social and economic structures there. They do not have the qualified work force, their government have social security obligations towards their ageing populations which they cannot give up, and their market demand is not any too robust. The real market engines are in Asia and in the East. But then who is tell all this to the stupid, English-speaking, pro-market Indian middle classes who cannot think by definition, and who want to introduce market reforms in Kolkata to proclaim the end of the Marxist era!

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