India146;s punch

Both papers looked into the reasons why: Public opinion in India was against the Iraq war and there are political concerns in an election year. The NYT also cited the statement issued by 8216;8216;two Left leaning former prime ministers, Indar Kumar Gujral and V.K. Singh8217;8217;. Cue for the Mandal Messiah to say 8216;ouch8217;.

UN umbrella

But the Indian government may have set itself up for a rethink. The caveat in the official statement has not gone unnoticed abroad: That 8216;8216;were there to be an explicit UN mandate for the purpose, the Government of India could consider the deployment of our troops in Iraq.8217;8217; The WASHINGTON POST reported this week on the Powell initiative. The US Secretary of State has begun discussions with UN Secretary General Kofi Annan, it said, on seeking a new Security Council mandate to provide more cover to states considering participation in peacekeeping in Iraq.

Britain8217;s GUARDIAN, for one, must be wondering what8217;s taking the Bush administration so long. It is in the US-British interest, its editorial reiterated impatiently, that a UN security mandate be created, 8216;8216;enabling the likes of France, India and Muslim countries to contribute peacekeepers and thereby possibly reduce the attrition rate against coalition troops.8217;8217; It advised Tony Blair to raise the issue and 8216;8216;tell it like it is8217;8217; when he met George W. on his trip to Washington this week.

Debating diversity

In its Shimla Sankalp, the Congress party talks of 8216;8216;the start of a purposeful dialogue with private industry on how best India8217;s social diversity could be reflected in the private sector in different ways like reservations8230;8217;8217; The Congress document marks a larger shift, perhaps, still underway in the discourse of empowerment in India: From 8216;8216;social justice8217;8217; to 8216;8216;social diversity8217;8217;. The change in emphasis is inspired, it seems, from the American experience.

In June, the US Supreme Court8217;s ruling on affirmative action in the Michigan university case underlined what has become the accepted wisdom in that country: Affirmative action is justified as a programme that brings about racial diversity. But in THE NATION this week, columnist Eric Foner lamented the 8216;8216;single-minded focus8217;8217; on diversity.

When first developed in the 1960s, affirmative action in the US formed part of a broader programme for attacking poverty and racial inequality, 8216;8216;including a domestic Marshall Plan to reverse urban decay and create jobs, and government action to end housing segregation and drastically improve public education8217;8217;. This programme has virtually vanished, complained Foner. Today, the diversity argument presents affirmative action not as a programme that primarily aids minorities but as one that improves the educational environment. It may be a more politically palatable case, conceded Foner. But it suggests that access for non-White students is desirable mainly because it enhances the educational experience of Whites by exposing them to classmates from different backgrounds. 8216;8216;Diversity is undoubtedly a worthy goal. But a singleminded focus on diversity deflects attention from the need to combat the numerous inequalities8230;8217;8217;

No to technocrats

He didn8217;t mention India by name. But in the GUARDIAN this week, Nobel laureate and professor of economics at Columbia University Joseph Stiglitz had some pretty unequivocal advice for developing countries. 8216;8216;Don8217;t trust technocrats8217;8217;, he said.

The professor outlined a familiar scenario: Developing countries are advised or instructed to carry out reforms, often IMF-backed, recommended by 8216;8216;experts8217;8217; or 8216;8216;technocrats8217;8217;, usually US-trained; opposition to these reforms is dismissed as 8216;8216;populist8217;8217;; these countries are criticised for lacking political will abroad. But, argued Stiglitz, many of these 8216;8216;technocratic proposals8217;8217; are in fact based more on ideology than economic science. Because economic policies, he said, are usually not technocratic in a crucial sense: 8216;8216;They involve trade-offs: some may lead to higher inflation but lower unemployment; some help investors, others workers8217;8217;.

Making a policy choice, therefore, does not just involve technical questions about which is 8216;8216;better8217;8217; in some morally uncontroversial sense, argued the professor. It involves choices among values. These are political choices, not to be left to technocrats.

Stiglitz drove his point home with the example of the value added tax VAT. He argued that the Legislature8217;s rejection of the proposal to adopt VAT in Mexico, for instance, wasn8217;t a display of 8216;8216;unbridled populism8217;8217;. There8217;s a fundamental difference, he pointed out, between developed European countries that use such a tax and emerging markets: the size of the informal sector from which VAT is not collected. 8216;8216;This vast 8216;black economy8217; makes the VAT inefficient in most developing countries8230; Developing countries that impose VAT perversely encourage production to remain in the informal sector.8217;8217;

Singing in the rain

Meanwhile, as Finance Minister Jaswant Singh claimed that the Indian economy is looking up, Britain8217;s FINANCIAL TIMES echoed his enthusiasm. India is 8216;8216;singing in the rain8217;8217;, said the paper. Despite the fact that the Indian government 8216;8216;appears to be doing all the wrong things, or at least postponing that which it ought to be doing8217;8217;.

India may achieve at least six per cent growth in gross domestic product this year, predicted the FT, and it is on track to be the 8216;8216;second-fastest-growing in the world after China this year8217;8217;. The reasons: the good monsoon, partly; Indian industry becoming more competitive because of a lower cost of capital and a better understanding of consumers after the first hectic flush of liberalisation; reduction in interest rates over the last year and a half. All in all, as Suman Bery of the National Council for Applied Economic Research told the FT, a business cycle 8216;8216;timed perfectly for the government8217;s electoral calendar8217;8217;.

But the FT couldn8217;t resist the question: Will this year8217;s higher economic growth be sustained?

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