Development |

The Effects of Globalization in India and Social Reform

Globalization is a progressing phenomenon marked by increasing interaction among people across the countries and between people and entities such as nation-states and corporations through the information and communication technologies (ICTs), international trade and culture and ideas. Globalization is propelled primarily by economic integration of the world economy. As in globalization in India as has been the case with many other countries, India has felt the effects of globalization through ensuing free market with associated benefits and problems; we must ask ourselves whether the free market and its antecedent effects have made India a truly global civilization.

The fact that the historical trajectory of globalization has been pushed through the spread of trade links between nations and territories situates globalization into a discourse whose antecedent effects have largely to do with the positive and negative aspects of free trade and the world economy. A befitting example is the Silk Route stretching across the old world in ancient times seeking interaction between territories involved in trading.

Although other forms of global integration are possible, much of discourse on contemporary globalization cannot be done without assessing the benefits or problems posed by economic globalization. We shall, therefore, assess the economic attributes of globalization experienced in India and pose the question that even though India is highly influenced by globalization, has India truly become a global civilization?

Economic Globalization in India

India’s share of world Gross Domestic Product (GDP) in terms of purchasing power parity grew from 3.6 per cent in 1990 to about 7.3 per cent by 2016 (Chakravarty, 2016). Despite lagging behind neighbouring China, the statistics thus show that India’s overall economic performance has improved in terms of the world economy. In macro-economic terms, it would seem as if India has benefitted from economic globalization. However, this would be a myopic view when the cumulative process of globalization in India is looked at.

The globalization of a national economy would imply the lifting of certain internal restrictions in allowing open participation with foreign entities. These restrictions can include encouraging foreign direct investment in the country, removing restrictions to the operation of multinational corporations (MNCs), allowing companies in the country to enter into foreign collaborations or into joint ventures with foreign entities and trade liberalization programmes etc. (Raghunath, 2017). India initiated many such reforms in 1991. Liberalization of the Indian economy was composed of a macro-economic stabilization programme particularly focused on India’s trade deficit at the time and structural adjustment programmes.

Battling with a trade deficit at the time preceding liberalization, the Indian economy has come a long way to register one of the highest GDP growth rates in the world. The high growth in GDP is perhaps the most popularly cited benefit of globalization in India. This increase is possible through a favourable balance of trade in contemporary times due to inflows of foreign trade and foreign investment into India. There was also an expansion of economic opportunity, allowing many middle-class and low-income households to significantly increase their household incomes. The goods and services available in India have also improved, contributing to the quality of life, particularly of those consumers who could afford to consume. However, these are mostly economic benefits. A holistic look at the wider socio-economic scenario of globalization in India tells us a different story.

Globalization in India and Social Reform

The general trend in social transformation shows its lag as compared to economic reforms (Pandey, 2011). Although many middle and low-income households have benefitted from globalization in India, most benefits have accrued to areas, which already had significant economic development. Moreover, only a handful of people having the resources to take advantage of the economic benefits were the recipients, leaving others in the periphery. For example, the traditional artisans, small entrepreneurs and petty traders lost their businesses when competing against the bigger players in the fields. One can talk about the digital revolution. However, at the same time one encounters the issue of digital divide, not only in terms of social groups but also amongst men and women! According to one estimate, only 44 per cent of women have a cell phone compared to over 66 per cent men in India. In addition, globalized communication requires access to either considerable finances or access to ICTs and a multitude of India’s population does not have access to either.

Has the Environment Retarded the Development Process

Globalization in India is essentially free market globalization, which largely fulfils the requirements of the expansion of economic activities promoting capitalism. Capitalist processes consist of activities that both integrate and fragment (Pandey, 2011). Apart from the integrative models provided by the free market, fragmentation occurs due to a constant quest for an increase in productive capacity which can lead to much instability in societies. Production can also be unsustainable and the large-scale wastage can prompt capitalist enterprise to search for resources and expand the scope of activity.

Although glocalization or the localization of global entities and information has occurred to a certain extent in many regions in India, the wheel of social transformation due to globalization has also disrupted many aspects on Indian society to a great extent. Economic opportunity itself is not an all-encompassing effect, and growth in investment also needs to be supported by a growth in productivity, which is suffering because of a lack of social reform such as for example radical investments also in the total educational infrastructure. Apart from a lack of expansion in outreach, lack of expansive social and economic reform in education in India will place a cap on both intake and the productivity of prospective employees as the production process progresses. This lack of social reform in education alone can severely limit the economic opportunity provided by globalization in India as time goes on. Although it has been more than 25 years since radical economic reform was initiated, India still lags in terms of social reform in many aspects other than education.

Globalization for example has led to a tremendous development in techniques for agricultural production accompanied by increasing commercialization of agriculture in India. This process however, has not greatly improved the conditions of many farmers in India, and many farmers in India still suffer crippling debts and low income. Some farmed regions have seen greater use of improved techniques while other regions have been pushed towards backwardness.

Regional Disparities in India since Independence

Many poor people, especially in rural India, and forest dwellers have not benefitted much from economic globalization in India at all and remain poor. This poverty is made worse in many cases by the rise in the prices for goods for daily consumption such as fruits and vegetables, which especially also impact the urban poor. Such conditions whereby an income gap persists combined with dispossession of resources such as land and water among poor and marginalized people can provoke social unrest. In rural and forested areas, this can combine with regional identity to form a deadly mixture. With many regulations relaxed, the potential for the ethical responsibility of business can also diminish. This can lead to greater environmental and resource exploitation by commercial entities. These call for better policies in addressing social reform that must keep pace with economic reform, which is changing the face of Indian civilization.

Endnote

Although a certain degree of glocalization has taken place in India that has accentuated global entities and information for Indians, India is not a truly global civilization. As a matter of fact, a multitude of people in India are suffering as a result of market imperfections and economic globalization in India. Samuel P. Huntington has said in his book The Clash of Civilizations and the Remaking of World Order that the process of modernization moves from a universalizing tendency towards more local formations. This process can be misguided in India however, in the absence of effective and sustainable social reform.  Without social reform, India will not be able to utilize the fruits of its economic growth to the fullest in its society. If India is to move towards being a truly global society, it must bring about social reform that can improve the quality of life of most Indians, and allow it to manage its resources more sustainably.

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