WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a SOVEREIGN SOCIALIST SECULAR DEMOCRATIC REPUBLIC…. states the opening sentence of the Indian Constitution. The term ‘Socialist’ commands a lot of importance.
The term ‘Socialist’ in the Preamble was added by 42nd Amendment Act, 1976. It provides that the State has a responsibility towards citizens for their welfare, abolishing discrimination, nationalization of means of production, equal distribution of wealth and securing justice for all.
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With that being aim, since the very first five year plan, lots of emphasis was placed on establishing Public Sector Undertakings (PSUs) companies to generate wealth and its distribution at the ground level that benefit the entire society, control monopoly of the private sector entities, offer products and services at an affordable price to the citizens and for the achievement of overall financial goals and developmental objectives in the country.
The numbers of PSUs grew from five in 1951 to 365 by 2021 for creating a firm base in the Indian economy. But unfortunately, India is witnessing an unwelcome trend of privatisation of PSUs, thus going away from the basic framework of the Constitution, towards privatization/capitalism. It may be a forerunner of direct threat to our socialistic base to allow balanced growth to haves and haves not.
Sadly, the ‘Socialist’ India has now been unofficially replaced by ‘Capitalist’. While India has traditionally followed a ‘mixed economy’ model, with more tilt towards socialism, but as time passed by, circumstances forced India to open up its markets and embrace capitalism. Now, such is the situation that the political leadership directly patronises industrialists. This is known as crony capitalism, a term mostly used with the West, especially the US. Unfortunately, this term is now being used for India as well. The developments of the last couple of weeks actually summarises where the country is heading.
An explosive report by a US-based research firm has accused a top corporate conglomerate of stock manipulation, accounting fraud among others.
The company has had the direct blessings of the country’s premiere for nearly two decades. From 2002 to last March, the group’s revenue rose from $765 million to $8.8 billion while net profits climbed even faster. It has won several government tenders and infrastructure projects in ports, airports, roads, rail, fossil fuels, and green energy across the country.
In 2018, a controversial decision by the Indian government allowed this company to bid—and win—tenders for six airports, despite the fact that the company had no prior experience operating airports. The decision turned his group into one of the country’s biggest private airport operators overnight.
There’s another industry tycoon whose net worth zoomed under the current establishment’s watch. The company’s top executive became doubly richer under this government. Between 2014 and 2019 his wealth more than doubled from about $ 23 billion to $ 55 billion. This all began with the launch of the company’s telecom segment in September of 2016. The person endorsing the brand was no other than the prime minister, who appeared on the advertisements.
From 2014 to 2016, there was hardly any change in the company top executive’s net worth – it remained at about $23 billion. But his net worth skyrocketed and reached $55 billion in 2019.
Even the government auditor, Comptroller and Auditor General of India (CAG) had stated in its report in 2015 that this telecom arm got an undue benefit of about $530 million after the government allowed it to offer voice services over wireless broadband spectrum it had won in 2010.
This is just the tip of the iceberg. Instances like the fight by tribals of Jagatsinghpur’s Dhinkia village in Odisha against a major steel company or the Niyamgiri tribes from the same State struggling against a mining company, shows that the image of the Indian private conglomerates is continuously diminishing.
While India is one of the fastest growing economies in the world, it is also one of the most unequal countries. The rich are getting richer at a much faster pace while the poor are still struggling to earn a minimum wage and access quality education and healthcare services.
According to a 2022 Oxfam report, India’s top 1% owned more than 40.5% of its total wealth in 2021, according to a new report by Oxfam. In 2022, the number of billionaires in the country increased to 166 from 102 in 2020, the report said. It also mentioned that the poor in India are unable to afford even basic necessities to survive.
These are alarming statistics. It is ironic that a country which has such a humongous population under the poverty line crying for basic amenities like safe clean drinking water, is being ruled by the rich, who have the blessings of the political leadership.
Every country needs a strong private sector to support the economy in terms of wealth generation, employment opportunities and efficient service delivery, but that does not allow it to rule over its people. We have to do away with the growing trend of crony capitalism, before it leads to major social unrest.
