The swadeshi serpent bites its tail; and a response

The swadeshi serpent bites its tail; and a response by Sauvik Chakraverti

21 December 1996 Indian Express

History does not reveal the lurid picture of colonial exploitation that Indian economic historiographers have painted in our minds. Well into this century, when laissez-faire ruled British thinking, it was quite clear that foreign capital was a good thing, and that foreign capitalists were profit-seeking individuals with interests quite distinct from that of the imperial state. Further, that the laissezfaire imperial state providing high quality administration should perhaps be the 'model' to be emulated today, given the dismal record of socialist interventionism.

India had its trains and telecom decades before Japan (Perry presented the Shogun with a miniature railway), and Indian cities had modern, efficient and economical electric mass transportation system - so it is quite clear that infrastructural development was proceeding rapidly with the inflow of foreign funds, much of it private.

When we examine the mind of the foreign capitalist, there does not seem to be any indication that he is an agent of the imperialist state: he is a private man, interested in private gain. The mistake made by exponents of swadeshi (or those who see a sinister neo-imperialism at work in the global market) is that they do not see individuals: they see states. Where liberals look upon the state with unconcealed scepticism, they see states in business, and they want their state to protect their businesses - at our expense of course.

The real problem with swadeshi - as with any other false ideology - begins when you place yourself at the receiving end: when the serpent bites its tail. If it was true that the best way to ensure national prosperity and general well-being is to consume only locally-produced goods, India wouldn't have had a caste of trader, or entire communities of them. Trade would be uneconomical, unintelligent, and not worth the trouble. If you look at our traders carefully, you do not see them as political agents they are economic actors.

They work in a self-regulating civic society, buying and selling for a margin. You see them everywhere: from the North-East to the deep South, you will find shopkeepers who all hail from some part of western India. They contribute to the local economy. What do they do when swadeshi strikes deep, and sub-national political movements espouse ideologies that look towards Indians from other parts of the country as foreigners? Keeping Indian markets for Indians may be fine for some big industrialists, but what happens when people want Maharashtra for Maharashtrians, Assam for the Assamese and so on.

Not having thought out its economic ideology clearly, the Government of India is making a fool of itself 'protecting national interests'- as at the WTO meet in Singapore. Where children study the swadeshi movement in government-approved textbooks as a logically correct way of securing national prosperity, how can our bureaucrats think differently? The ideology filters through and is adopted at sub-national level by sub-nationalists. Fast-food outlets owned by Americans are demolished by those who do not bother to notice that ITC was free to set up Indian food restaurants in the US: the Government of India's exchange regulations were the only hindrance!

Swadeshi is not truth. Chandni Chowk, where the world came to do business in a prosperous India, is. Swadeshi is merely the ideology of Congress nationalism. It should not be the ideology of the Government of India. It should also not be taught to children in the manner in which it is done today. They will soon be young voters, and so should be politically aware. Economic historiography should not be nationalist propaganda that borders on hysteria. Congress Raj - socialist and nationalist - must be compared with British Raj - imperial and liberal.

It will be seen that we had a far greater share of world trade then than we do now. That money was coming into the infrastructure. The government was standing by, running things, and not getting in the way. That money was convertible, and we were freer, economically. Big cities were built. Municipalities worked. Is Seshan calling for a second freedom movement?