by Devinder Sharma | Dissident Voice, October 14th, 2008
In India, it didn’t hurt when the farmers were dying. Over 200,000 farmers have committed suicide in the past 15 years, and more than 40 percent of India’s 600 million farmers want to quit agriculture to look for menial jobs in the cities.
The national media kept quiet.
Now that the markets are crashing, the media is up in arms. “Act fast, go big. It is not only about bulls and bears anymore. It’s about India. And it’s hurting,” says a lead story in a national daily. But it didn’t hurt when the farmers were dying.
There is blood on Dalal Street (India’s Wall Street). Yet throughout all these years we refused to acknowledge that farmers were dying, and agriculture was bleeding. Farmers are children of a lesser God, it seemed, who do not belong to India. They only live in Bharat, the countryside.
Just a few months back, when the day Finance Minister P Chidambaram in his budget speech announced a Rs 60,000-crore* loan waiver for the beleaguered farming community, there was an orchestrated outcry: “Where will this money come from?” Television anchors were visibly angry at this supposed ‘windfall’ for the farmers, the print media was outraged at this ‘political and not economic’ decision just before the ensuing elections, and the industry leaders were seen sulking.
Six months later, no one is asking the same question. With the global financial crisis failing to work itself out, the Reserve Bank of India (RBI) is under pressure to intervene. Soon after the Wall Street mayhem, the RBI had pumped in Rs 84,000-crore in the domestic banking system through liquidity facility adjustment. An additional Rs 20,000-crore has been released through a 0.5 percent reduction in a cash reserve ration (CRR), to be further slashed by 100 basis points. It took RBI five years to make the first cut in CRR on Monday, and the next cut comes five days later. That sure is some urgency.
Sounds technical, but let me simplify. Liquidity in layman terms means ‘fund availability’ or, in simple words, making available more cash. All over the industrialized world, governments are stepping in to provide more cash in the hands of the private banks, and India is no exception.
Despite the Finance Minister saying that the fundamentals are strong, the banks are on a massive borrowing spree. In the first week of October alone, they borrowed Rs 90,075-crore every day from RBI through liquid facility adjustment. In the days to come, the RBI is under pressure to release another Rs 30,000-crore through the CRR, and also to cut the repo rate — the rate at which it lends to banks. And thanks to the loan waiver, the banks will receive another Rs 50,000-crore in the coming weeks as part reimbursement for the farm loan waiver and fertilizer loan.
Isn’t it a fact that Rs 60,000-crore loan waiver (later enhanced to Rs 71,000-crore) was actually a relief to the banks? What seemed to be a ‘political’ decision in the name of pulling out the indebted farmers was actually meant to maintain and sustain the health of the banking system. If the government had not provided the loan waiver, banks would have been in a terrible liquidity crisis. With farmers unable to repay, these banks would have been saddled with massive non-performing assets (or a shortfall in liquidity) or non-availability of Rs 71,000-crore in cash.
In other words, the loan waiver was a partial bailout for the banks. Now no one is asking: “Where will this money come from?” On the contrary, most analysts are asking for more ‘speed and sagacity’ to tide over the crisis. The industry has already demanded a bailout package of Rs 100,000-crore.
If only such ‘speed and sagacity’ was shown to tide over the terrible agrarian crisis sweeping throughout the country for over a decade now, thousands of farmers would have been saved from committing suicide. If only the RBI had stepped in to make more cash (or liquidity) available, the nation could have easily provided an assured employment to each and every Indian, not only for 100 days but for all the 365 days in a year. The National Rural Employment Guarantee Programme (NREGA) can be easily extended to bring every unemployed Indian under its gambit.
It is here that I fail to understand the sagacious logic of keeping the poor hungry, and then expecting a higher economic growth trajectory; of paying a multi-million dollar salary (in addition to lucrative perks) to the bosses of the banks and corporate houses, and then to make the man on the street pay for the losses; in other words, the logic behind privatizing the profits and socializing the losses.
Take the case of the bankrupt Lehman Brothers. While the shareholders in the company have been wiped out, Richard Fuld, its chief executive, walked away with US $480 million as his personal remuneration over eight years, which includes a $14 million ocean-front villa in Florida, and a home in an exclusive ski resort. Lawmakers investigating the bailed out insurance company AIG were shocked to learn that days after the government rescued the company, it unashamedly spent US $44,000 on a posh California retreat for its executives, complete with spa, banquets and golf outings.
Why blame the American corporate leaders when US president George Bush himself had given them a free rope: “Government should not decide the compensation for America’s corporate executives.” What he probably meant was that come what may, the US government will continue to provide funds to meet obscene corporate salaries and perks.
Prime Minister Manmohan Singh had also removed the upper ceiling on corporate salaries. According to Merrill-Lynch and Capgemini, driven by impressive economic gains and robust market capitalism growth in 2007, India led the world in high net worth individual (HNWI) population growth at 22.7 per cent. Two year earlier in 2005, there were 83,000 high net worth individuals with a wealth of at least $1 million (without including immovable property). And you guessed right – the number of millionaires has gone up quite considerably in the meantime.
This brings me back to the same question. How long will the world go on encouraging an economic system that makes the rich richer and the poor poorer? While 36 billionaires in India have a collective economic wealth equivalent to one third of the country’s GDP, the country’s 600 million farmers collectively account for only a 17 percent share. With every passing year, the share of agriculture in GDP continues to slide down even further.
The average monthly income of a farm household (which includes five members of a family and two cattle) does not exceed Rs 2,400 (US $60). The value erosion in real farm income over the past few decades has never been discussed, but the erosion in paper wealth of shareholders is being projected as a national disaster.
Bailing out the farmers from a distressing situation is always considered to be bad economics. It is branded as a political compulsion, and the sooner politicians emerge out of it the better it is supposed to be for economic growth and development. This economic prescription, which every economist worth his title is willing to endorse, is invariably given for the farming community, the landless workers and the marginalized communities. They need to learn to be enterprising, is the assumption, and therefore must stop living on government subsidies.
But when it comes to the enterprising millionaires — corporates and leading bankers — government bailouts are not only a must, but should be done speedily. ‘Where will the money come from?’ is not a question to be asked when you are subsidizing the rich and the elite. That, we must understand, is their birthright.
* one crore = 10 million
Devinder Sharma is a New Delhi-based food and trade policy analyst. He is a regular contributor to Share the World’s Resources (STWR), where this article originally appeared, and can be reached at hunger55@gmail.com. Read other articles by Devinder, or visit Devinder’s website.
Peace and Justice Post 
When Will India Quit Kashmir?
October 20, 2008Kashmir Watch, Oct 19, 2008
Dr Abdul Ruff Colachal
After protesters thronged to United Nations Military Observer Group office in Srinagar demanding the resolution of Kashmir dispute, as it is already known, the UN Secretary-General Ban Ki-moon is planning to visit India towards the end of this month or in early November. Another important move in this regard is that United Nations Secretary General has informed the Security Council of his intention to appoint Major General Kim Moon Hwa of the Republic of Korea as Chief Military Observer in the United Nations Military Observer Group in India and Pakistan (UNMOGIP). Major General Kim will replace Major General Dragutin Repinc of Croatia.
The historic opening of Srinagar-Muzaffarabad and Poonch-Rawalakote roads for trade would be supplemented by some more bold initiatives to facilitate Kashmir resolution process, both on bilateral and internal fronts. Kashmir resolution process involves not only various shades of political opinion but all sections of the society. In a historic decision, the Kashmir Chamber of Commerce and Industries (KCCI), Chamber of Commerce and Industry Jammu (CCIJ) and Azad Jammu and Kashmir Chamber of Commerce and Industry (AJKCCI) on Oct 14 formed a 32-member joint chamber of commerce. But the cross-LoC trade cannot be an alternative to Kashmir solution.
The latest developments in the State offer Government of India an opportunity to reinforce its resolve of working through peaceful means and through public participation towards the resolution of the problem.
Freedom Leader Geelani
Calling for a complete shutdown on October 24, the United Nations Raising Day, the Hurriyat Conference (G) chairman, Syed Ali Shah Geelani on Saturday urged masses to send emails, letters, faxes, telegrams and SMS to the UN’s New York headquarters to press for granting Right to self determination (RSD) to people of Kashmir to determine their fate.
Indian Terrorism
Peoples Democratic Party (PDP) Patron Mufti Muhammad Sayeed claimed the State had started witnessing continuous changes of great importance and substance after the 2002 elections transforming its ground scenario positively and this had resulted in consistent increase of public participation in the democratic processes and his party contributed to it. Let that be. But he should enter now the freedom movement by actively involving himself with the freedom leaders fully committed to the cause of full and complete freedom from foreign occupation.
An international organization research on the Kashmir conflict, 7thspace.com, to assess experiences with violence and mental health status among the conflict-affected Kashmiri population, has reported that 85 per cent of Valley population have confrontation with the violence while 66 percent have witnessed torture. The survey reported that the civilian population in Kashmir is exposed to high levels of violence, as demonstrated by the high frequency of deliberate events as detention, hostage, and torture. Respondents reported frequent direct confrontations with violence since the start of conflict, including exposure to crossfire (85.7%), round up raids (82.7%), the witnessing of torture (66.9%), rape (13.3%), and self-experience of forced labor (33.7%), arrests/kidnapping (16.9%), torture (12.9%), and sexual violence (11.6%).The survey found high levels of psychological distress that impacts on daily life and places a burden on the health system. Ongoing feelings of personal vulnerability (not feeling safe) were associated with high levels of psychological distress. Over one-third of respondents were found to have symptoms of psychological distress, women scored significantly higher. A third of respondents had contemplated suicide.
India Destroys Medicinal Fauna of Kashmir
Kashmir is infested with Indian terror forces, agents and pro-India elements sabotaging the cause of freedom. India argues it has every right to heavily militarize Jammu Kashmir and kill the Kashmiri Muslims stock and barrel. Around 60,000 troops are posted in the Gurez which has a habitation of only 30,000 people. The ecology of Gurez is under threat as the army troopers deployed in the border area have been accused of vandalizing the environment by extracting valuable medicinal plants and minerals. Gurez has got vast resources of precious and costly medicinal plants and minerals, which were extracted legally by the locals till 1989 when armed rebellion broke out in Kashmir. After the turmoil, thousands of soldiers were deployed in Gurez and they continue to man each and every ridge.
The locals said that valuable medicinal plants like Kuth (Saussurea cosstus), Diosoriea (Dioscorea deltoidea), Mushki Bala( Veleriana wallichii) Guchies (Morchella esculenta), Black Zeera, Artimesia, Bellodona, Podophyllum (Banwangon) are found in abundance in Gurez. They said that had these natural resources been extracted by the state administration with the help of locals, the economy of the border area would have received a boost. They, however, alleged that the troopers are illegally extracting the natural resources, posing ecological and economic threat to the border area. “There are legal, scientific and technological methods to extract the medicinal plants from the forests. However, troops during illegal extraction are not following these methods and destroy the precious and costly medicinal plants for their monetary benefits,” they said. “We were exporting medicinal plants legally worth crores of rupees to other parts of India and world before start of militancy. After the deployment of army personnel in Gurez, peaks encumbered with medicinal plants and minerals are now on the verge of extinction.
Continued . . .
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Tags:BJP, Indian, Indian forces in Kashmir, Indian-controlled Kashmir, Kashmir dispute, medicinal plants, National Conference, right to self-determination, Syed Ali Shah Geelani, torture and violence in Kashmir, UN Secretary-Genral Ben Ki-moon
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