A decade after liberalization; Is India growing in the right direction.

A decade after liberalization; Is India growing in the right direction.


Liberalization is one of the most controversial issues that recently we hear. Its pathos and havocs are being popularly discussed. This was accepted by India before thirteen years. The aim was the quick and rapid development in all economic territories. The liberalization paved the way for huge private investment mainly in industrial and service sectors. When we analyze the increase in the private investment due to the liberalization, we have to evaluate its effects and defects also. We can see an increasing trend in the private investment in public sectors and service sectors. When India become a republic the public sectors and the private sectors were being safeguarded giving monopoly for the welfare of the general public. The government control was mainly for the welfare of the people. The prime motive of this sector was not profit maximization but service maximization.

The liberalization movement helped for decreasing the inflationary rate, created more employment opportunities, earned more foreign exchange and overall the financial system of the country became more stable. Due to the rapid industrialization, unemployment is curtailed. As more employment opportunities are created, the income earning capacity of the people increases. Hence, the status of the people also increased. The liberalization will help the allround development of the people of a country and the country become a developed nation. When we measure the development of a country based on the increase in the per capita income, the accurate temperature of the development may not be measured. Always the development should be in compromise with the physical development and the inner development.

Liberalization aims at the maximization of physical development. In the path of this development, more inequalities are created. The gulf between the haves and have not increases, even it will not affect the per capita income. Here a majority class is being depressed and suppressed by the haves. Else, the liberalization leads to capitalism and the result will be old evils of capitalism. The last ten decade, India is also in the way of capitalism, because a large number of private investors have doubled their working capital and the profit earning capacity. Once, the government controlled the share of the public sector undertaking. But now the gigantic private investors control the share market. As the control is in the hands of the private investors, they change the economic system according to their whims and fancies. As the profit maximization is the prime aim of the investors, they do not care the welfare of the public. In the last decade of liberalization, several employees were retrenched. The welfare of labour class is not protected. The investors need only the experts and efficients. But in the society of labourers there are efficient and inefficient based on the surroundings in which man live. So this differentiation has created an ethical problem and has created a society, which is full of fire, covered by ashes. The great result of liberalization (negatively) is the creation of these dissimilarities.

In India several socio-cultural organization has researched and pointed out the harms of liberalization. Moreover as I pointed out earlier, in liberalization the investors do not care in the development of the primary sectors of the economy. Once our country and our great leaders gave more importance to the agriculture sector. The development of India can expect only through the agricultural sector, because more than 70% of the people in our country live in the villages and they directly or indirectly depend on agriculture and traditional works. This is the backbone of our county and economy. But the investors neglected this sector and several farmers and traditional workers of different states had committed suicide, because their existence was dangerously hampered. This dissatisfaction is not the dissatisfaction of a minority class, but the discontent or dissatisfaction of a majority class. Now the government has agreed that there are defects in the liberalization policies. It is a good symptom of economic revitalization and again some control of the government in the private investors.

Hence, we should see that liberalization is a better means of development. But it is like a chariot without a charioteer, it is like a flood without proper water management. In short, I would like to say that always there should be a compromise with the effects and defects of liberalization and should be at the maximum welfare of the people, because the people in a country are its most valuable assets.

Richy. D. Alexander