Tackling tough issues in India

Last month I did some travelling around India.   While I was there for a bit of sight-seeing, I was also intrigued as to what social and economic changes might have taken place in the ten years since my last visit.   After all, I’d worked out that the Indian economy would have more or less doubled in size during my absence.   My trip would be a chance to see first-hand how one of the world’s most populous countries was handling sustained economic growth of more than 7%pa.

To my initial disappointment, it was hard to see much evidence of progress on the surface of it.   But if you look a little closer the signs of progress are there’s a new shopping mall here, a brand new highway there.   Landing in Delhi in the north didn’t help, as it became evident when we travelled south that there are larger pockets of wealth in places like Mumbai and Bangalore.   But poverty still exists in India on an enormous scale.

At the time of my travels there was debate in the Indian media about whether India should contribute towards the European bailout fund.  Apparently some key figures, including the head of the Asian Development Bank, Rajat Nag, had called on India and China to "do all they can" to speed the recovery in Europe.   As one of the world’s fastest growing large economies, the Indian government was being urged to be a good global citizen and help Europe in its time in trouble.

I’m sure that those espousing this view are aware of the difference between a fast-growing economy and a wealthy economy.   So why ask Indians to help maintain the living standards of vastly better-off citizens of Greece and other European nations?

There are indeed some very wealthy people living in India, and there is also a growing middle class of people who live a relatively comfortable life; even if they seem to get lost among the hundreds of millions still living in poverty.   But it would seem that these well-off Indians should be helping the poorest Indians, before being asked to help the Europeans.

Another key argument was that India is exposed to the global market place.   A deeper downturn in Europe would affect demand for exports from developing Asia, and therefore it is in India’s interest to put up the money.  This argument may have merit, particularly in the short-term.   But it is difficult to judge how big India’s exposure to any slowdown in global demand would be in the longer-term.

Personally I find the view that India should help bail out Europe distasteful.   It is as if we have developed such a casual attitude towards the world’s poorest that, when we discover we are not going to be quite as rich as we thought we were, we turn to our less-endowed neighbours for money to keep the ride going.

It would be easy to return from a place like India and conclude that there is no such thing as poverty in the western world.   While India’s disabled drag themselves through the mud and their widows beg for food, New Zealand’s generous social welfare system ensures no one will ever really go without – not without options open to them.

Of course we have all heard about third-world poverty before, and many of us have seen it for ourselves.   My aim is not to ram it down people’s throats again, like a World Vision ad.   But whenever I’ve travelled to areas where true poverty is evident I wonder when the "starving children in Africa/India" became such a cliché.

You will have to forgive me though if I don’t have much time for movements like occupy Wall Street, and its many incarnations around the world.   Although the movement has few explicit goals, they seem to be asking the super-rich to give money to the very rich – the very rich being the protestors.   They may not be part of the top 1% as they claim, but are likely to be part of the top 3% to 4% of the world’s richest.

There is nothing wrong with having systems in place to look after our own, to make sure every New Zealander has the opportunity to earn a living or to have a basic income if they can’t work.   But if we get too caught up with the so-called poverty in New Zealand, it sends a sad message to the other half of the world who have a much better idea about what real poverty is.

 

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