Wednesday, 26 September 2012
Fine Design for India aka FDI
This mad outrage against introduction of FDI that is going on through the country is nothing but that; a madness. Those who are screaming their guts out in anger against the FDI, namely political groups fall in two broad categories: those who have a vested interest in the system of the middleman continuing, and the other group which is opposing because they don't understand what is going on but likes to stay with those who are shouting the most.
I see in this so-called outrage a similar one that erupted years ago when the government was thinking of introducing computers in the country. I remember quite vivdly the extent of furore that the government's decision had caused. There wasn't a square inch of wall space that hadn't been graffitied on with strong bellegerent words against computerisation. Those were the days of writings of political slogans on every available wall space, be they private buildings or government offices. Political pundits and social scientists all joined in the chorus against all forms of computerisation. They all felt that thousands upon thousands would be rendered jobless. Industry would come to a halt. And in any case our country was not "ready" for computers, which were viewed as exotic inventions of a much more developed economy.
We all know what happened after that. The government pushed through computerisation. Jobs weren't lost. In fact more jobs got created. Efficiency in banks and all public sectors improved a thousandfold and there was just no looking back. Can we even imagine a world without computers today?
Cut to the present day fracas over the issue of the FDI. In simple terms what is happening is that the farmer, who is actually growing food with his own hands is having to sell the product to this middleman or 'phorey' (in the local dialect). The middleman pays the farmer, let's say Rs 2 for an item. That, the middleman sells to the wholesale trader (mahajan- again in the local dialet), let's say for Rs 15. The wholesaler sells that in turn to the retailer for Rs 20. The actual consumer of the item, you and I, have to buy that product from the retailer for Rs 25. And the poor farmer who actually produced it is left holding his miserable Rs2.
Can there be greater injustice?
Now if the FDI comes in, the foreign investor, let's say Wal Mart goes to the farmer directly, lifts that very item from him for Rs 10. And then Wal Mart, which has its own retail outlet sells it for Rs 15. The result is a win-win situation for the farmer and the actual consumer, both of who are happy. The FDI in one fell swoop has thus obliterated the phorey and the mahajan. The transaction is simplified, products reach farm fresh to the ultimate consumer, you and me, and the entire business becomes vigorous and healthy. No more blood sucking phoreys who have been exploiting the poor farmers all this time with political patronage. The political patronage has been there for the obvious reason that the phoreys have to share their loot with the political group that is in power.
Is it any wonder then why certain political groups are so hell bent against the introduction of the FDI, which in fact is one hell of a Fine Design for India?
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