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DINA
DAWN - the Internet Edition


April 6, 2006 Thursday Rabi-ul-Awwal 7, 1427
Features


Growing poverty makes India’s economic growth look hollow



Growing poverty makes India’s economic growth look hollow


By Randeep Ramesh

KOLKATA: A blue-suited Boris Becker strokes his chin, shakes his head and speaks into the lens. “No, no. I’m sorry, I can’t think of any place I like to live in as much as this place.” Flanked by wooden, Swiss-style chalets and manicured, verdant lawns the former Wimbledon champion then saunters off, presumably to find his place. The advertisement, which has been shown repeatedly on Indian television screens for the past month, promotes the impression that Becker wants to live the rest of his life in the shadow of the Sahyadri Hills, an oasis of greenery in the dust of the Indian state of Maharashtra.

What is being advertised is a first in the country — a private enclave that will eventually separate 35,000 wealthy residents from the teeming poverty in India. In the process, 11,000 acres of prime forest are slowly being converted into a city, called Aamby Valley, which is sealed off by eight-foot-high brick walls topped by an electric fence. Inside, every home has a panic button and streets are lined with closed-circuit television cameras. Gated and guarded by a gun-toting police force, the township is out of bounds to non-residents — intentionally cut off from the rest of India.

In many ways, Aamby Valley resembles a luxury holiday resort rather than an exclusive utopia. It boasts some of the best weather in the country, with the temperature rarely rising above 32C, and it is cooled by year-round breezes. There are water parks, hiking trails, rock-climbing walls, an 18-hole golf course, a tribal village, five-star restaurants, a 1,500-bed hospital and an airport for private jets. With just 250 of the 7,000 homes built, Aamby Valley has the creepy feel of an abandoned Hollywood set.

But the township is more than just a flash housing development. Its construction marks a step change in India’s evolution from dirt-poor country into a middle-income one, unembarrassed by the fact that the rich are getting richer — some of them very rich indeed.

Previously, the wealthy have had to deal with the choking poverty of the country, edging their Mercedes past lolling cows and avoiding pavement pools of urine in their Manolo Blahniks. There was no way to shut out the crime, traffic and noise that pervade the country’s city streets. Until India globalised in the 1990s, Indians tended to identify with the poor — a societal trait that drew inspiration from the example of the ascetic Mohandas Gandhi.

Gandhi’s India, or at least his influence on economics, has all but disappeared in the past decade. From 1947 until 1991, the economy grew at 3.5% a year, the so-called Hindu rate of growth which championed equality and social stability over wealth. After 1991, that all changed. Notions of speed and efficiency were stamped on to a civilisation that traditionally took a slower, more relaxed view of life. Economic growth rose to 6% a year. In the past three years, it has zoomed to 8% a year — meaning that the economy will double in size in a decade. The message now is similar to that of China during the 90s, in the phrase attributed to Deng Xiaoping: “To get rich is glorious.”

Two Nations

Not that the wealth has reached all of the country. India is one land, but the rich and poor exist on apparently different planets. Virtually unreported are some awful daily realities: the rate of malnutrition in children under five is a shamefully high 45%. Less than a third of India’s homes have a toilet and most women have to wait until the dark of evening to venture out to answer the call of nature. The talk of making poverty history sounds hollow in India, a land which is home to a third of the world’s poor and where some 300 million people live on less than $1 a day.

Yet another world is growing up, fuelled by the immense wealth that is being amassed by India’s new monied classes, who shop for brand-name luxury goods, ski in the Alps and send their kids to Harvard. Very soon the country will have 3.8m households with an annual income of 10m rupees (£130,000). Below them in any rich list is the middle class, estimated to number about 150 million. Their hunger for goods has seen a new money culture — how to make it and how to spend it. India’s masses were, under the more equal state-run economy, denied shopping choices. The country is today undergoing a consumer boom. For some, this is proof enough that, in opening up, India has gained from globalisation — allowing Dior, Bulgari and Rolls-Royce into the country.

Consumption in this India is nothing if not conspicuous.

Aamby Valley offers Indians a way to buy their way out of the state: a couple of acres costs 70m rupees (£900,000). In British terms it may not sound like a fortune, but the price of the cheapest wooden two-bedroom chalet is 15m rupees (£190,000) — 90 times the average Indian family’s annual income. This alone will ensure that flourishing India is kept well apart from the unwashed masses.

It often takes celebrity to lift the poor in India out of anonymity. On a sultry spring evening in Delhi last month, the novelist Arundhati Roy could be found in the middle of a troupe of chanting, sari-clad women, who were hoping to draw attention to a terrible blight on the rural landscape: farmers’ suicides. Thousands of farmers have taken their own lives, having found themselves with debts.

Roy likens the country’s progress to two convoys of trucks: a small group that is on its way to a “glittering destination near the top of world”, and a more massive pack that “melts into the darkness and disappears”. “A section of India has seceded from the nation,” she says. “This project of corporate globalisation has created a constituency of very rich people who are very thrilled about it. They do not care about the hawkers being cleared from the streets or the slums that are disappeared overnight.” As she sees it, India is not coming together but coming apart because liberalisation has convulsed the country at an unprecedented, unacceptable velocity. In the cities, the hammer and bulldozer are, often, noisily demolishing slum block after slum block, making way for shiny new apartments. Nowhere is this shift more profoundly felt than in the country’s villages where, Roy says, “India does not live. It dies”.

India is largely a mosaic of 500,000 villages, each with a population of about 1,000 people. This basic demographic unit has, for centuries, acquiesced to an unseen order, governed by caste rules, harvests and religious festivals. Yet the blooming of capitalism that, in India’s cities, translates into rampant consumerism, extravagant architecture and looser sexual mores has had a more wrenching effect in the nation’s villages. Just a few hundred kilometres from Aamby Valley, in Vidarbha, the farming belt in eastern Maharashtra, are fields of black soil that once reaped a rich harvest of “white gold”, as cotton was known. But the crop has lost its lustre in recent years. The arrival of new pesticides, genetically modified seeds and swanky tractors that soak up increasingly expensive petrol has pushed up the cost of the production. At the same time, India dismantled the wall of duties that kept out foreign cotton as part of its liberalisation drive.

Vidarbha’s farmers, unprotected by market controls and tariffs, have to compete with growers from the European Union and US who are subsidised to the tune of billions of dollars a year. The last vestiges of Indian government support were withdrawn a few months ago. The result is that Indian cotton farmers have become impoverished in a few short years. Many have borrowed to stay alive - first from banks and then from usurious moneylenders. Chained in poverty by debts they cannot pay, farmers began to sell first their carts, then their cattle, followed by land and homes. Some offer their kidneys for 100,000 rupees (£1,300). Others have put up entire villages for sale. The 800 acres of Dorli village in Wardha district, complete with accommodation for 46 families, can be yours for 200m rupees (£2.5m), about the same as three plots in Aamby Valley.

It is such inequalities, particularly in a culture that has come to promote assiduously the accumulation of wealth, that fuels predictions by the CIA and investment banks such as Goldman Sachs that India, along with China, will come to dominate the world economy in the next few decades. China is already the globe’s second-largest economy; India is on the verge of overtaking Japan to become the third biggest. A future of even greater wealth seems assured. But so does today’s reality that India remains a terrifying place to be poor.—Dawn/The Guardian News Service

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