The Hindu Business Line : Footprints beyond 2003

2003 might seem to have been a fairly humdrum year as far as India is concerned. But has it really been all that uneventful? Has nothing really happened during the year which will leave an imprint on 2004 and beyond?

ANOTHER couple of days, and 2003 will have come to an end. How time flies! It was just the other day when everyone was excited about the coming of the new millennium, a thousand years when, instead of the familiar numeral 1, the year would begin with 2. Nothing much, at one level. But when one recalled that a habit with mankind extending for over a thousand years into the past would come to an end and a new one would begin where the year would be written with a 2 as the first numeral, the shift was indeed a cataclysmic one.

But that was as long as three years ago, and one can say that we have become so familiar with the change that we have stopped thinking about it. And why shouldn't one?

After all, new habits are forming constantly and the old are dying out — even if they happen to be as old as a thousand years.

Indeed, Time cannot stand still and everything else will have to conform to this fact, a change that becomes a part of life in no time, a part of mundane existence itself, waiting for its turn to be altered after perhaps another millennium. Who cares, indeed, because we will all be dead and gone much, much before that new watershed.

But to come back to reality. One is tempted to ask the conventional question: How has India figured in the year that is bowing out? Has it been memorable in any particular aspect, memorable in the sense that it has achieved something in the course of the year which will make it a somewhat different national entity in 2004 when compared to 2003?

On the face of it, nothing much has changed. Thus, the NDA remains in power at the Centre; admittedly, the political colour of some State Governments has changed after the recent elections, but this is not important because it will change again when the next elections are held; the simmering dispute with Pakistan continues as before; Washington continues to play its games in the subcontinent, now blowing the way of New Delhi, and at other times that of Islamabad; the Prime Minister continues to make visits to countries far and near, always trying to push the interests of the nation in the international arena but not always succeeding; the Ayodhya issue continues to crop up with unwavering regularity, its timing always decided by the exigencies of intra-Sangh Parivar politics; and economic policies, some masquerading as reform measures, continue to make waves, with little or no long-term impact on toning up the efficiency of economic activity, generally speaking.

Such has been the humdrum history of 2003 as far as India is concerned, the year going down as just one more in the annals of independent India.

But, come to think of it, has it really been all that uneventful? Has nothing really happened during the year which will leave an imprint on 2004 and beyond?

To this correspondent, at least three events have occurred in 2003 which will make the year stand out as being different from the past, events which are certain to affect developments in the years ahead.

The first is the case of open conflict between the Press and a certain class of politicians, the matter having been taken up by the highest court of the land for deliberation and decision, there being no doubt that the upshot will strongly influence similar cases of confrontation in the years ahead, the only difference being that the country will have a specific roadmap which will make negotiating the troubled terrain a bit easier than has been the case in 2003.

The second development of note has been the crossing of the $100 billion mark as far as the foreign exchange reserves are concerned, an achievement which perforce will make the Indian economy — to the world at least — a different kettle of fish altogether in 2004 and beyond than what it was in 2003 and earlier. In fact, when it is remembered that just 13 years back, the country was scraping the bottom of the reserves bucket to such an extent that it even went ahead with mortgaging its hoard of the yellow metal, the scale of the achievement is simply astounding, full marks being given to the nation's economic managers right from the days of the Narasimha Rao Government to the Vajpayee dispensation.

It will, of course, be argued that there really is nothing much to cheer about in the $100 billion figure because it does not reflect a robust economy where production has gone up concomitantly; that, essentially, it comprises a steep increase in the inflow of funds from foreign institutional investors, which really is money which can leave the economy in a huff as it were.

In fact, had the increase in the reserves been mainly the result of a huge inflow of foreign direct investment, there would have no two views on the fact that the Indian economy had come of age and that the future would only see a further departure from the so-called Hindu and post-Hindu rate of growth of yesteryear.

This argument cannot be countered easily because it is a fact that FDI has not played any major role in the steep increase in the foreign exchange reserves and, to that extent, its performance has not been all that impressive.

But that is only seeing one side of the picture. The point is that, in the international economic league table, any country having a foreign exchange reserves of $100 billion and more — irrespective of the way in which it has been toted up — cannot but be treated differently than the hoi polloi as it were, something which must stand India and Indians in good stead in the international scheme of things.

Indeed, there must be some good reason why FIIs have been seeking to invest funds in India as opposed to other destinations, which itself should be seen as a feather in India's cap, something to be proud of.

What the $100 billion foreign exchange reserve figure has done for India is that it has raised the status of the national economy to being one of the important emerging nations, a move which is bound to have spin-off effects in spheres having nothing to do with economics.

The third important event in 2003 which will leave a distinct imprint on the future is the emergence of India as a leader of the developing world, along with Brazil, in the World Trade Organisation.

In Seattle, too, in 1999, under the stewardship of the late Murasoli Maran, New Delhi played a significant role in halting the juggernaut of the West (for the first time, that is) in steamrolling through its proposals on international trade liberalisation.

At the time, success was achieved in being able to stall the adoption of a declaration at the end of the third Ministerial conference.

At Cancun, that opposition was institutionalised in the formation of the so-called G-20 nations — led principally by Brazil and India — a grouping which still exists three months after the fifth WTO Ministerial, despite seeing a depletion in its numbers following persistent efforts by some developed countries to drive a wedge in its ranks.

The central point is that, from now on, unless New Delhi throws away the advantage gratuitously, India will be seen differently by the developed economies in all matters relating to international trade negotiations, not merely because of its emerging status as an economy of some consequence but also because of its acceptance as an important influence in multilateral trade talks by the developing world.

For this, Mr Arun Jaitley, the Union Minister for Commerce, who led the Indian delegation to Cancun, will have to be thanked because it was mainly his efforts (supported no doubt by an able group of faceless and nameless officials) that enabled India's image to be projected in the way it was.

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