Challenges of Liberalization, Privatization, Globalization

Introduction
There is a famous quote by Aristotle, Man is by nature a social animal. Interactions among people are prerequisite for a society. Phenomenon when these interactions are liberated from the dictates of state and spread across the boundaries all over the world is also known as Liberalization, Privatization and Globalization. Although these terns were initially associated with economy, they have impact in other areas as well. Liberalization is to make the liberal policies and rules to allow market forces to prevail. Privatization is to open different market segments which were initially restricted for only public sector only to private sectors also. Globalization is to allow flow of goods and services between two nations with minimal restraint.

Genesis of Liberalization, Privatization and Globalization


1. World Bank Aid Conditionality
In the last decades of twentieth century most of the African and Asian colonies were freed. For achieving the fast socio-economic development these countries approached World Bank to get the aid for their development. Condition of opening the market to private companies and other nations was attached to the aid provided by World Bank. Although after 90s, World Bank have done some modifications in their policies and conditions to provide the financial aid. But still there is tacit conditionality associated with the aid given. Hence aid conditionality is considered one of the reason for prevalence of Liberalization, Privatization and globalization. In India after the economic reforms of 1991, these changes are introduced and they are termed as LPG.


2. Emergence of Welfare State
With the emergence of welfare state concepts like transparency, accountability, equity and efficiency started to embolden. Traditional Governments were inefficient, incompetent and unable to deliver to the demand of peoples. Red-tape, nepotism, corruption, favoritism and other irregularities crept in the public sector and financial crisis looms in many countries. So countries are compelled to open the market for different players and lose their monopolies in some areas. This is one of the reasons that countries like Russia and others have to follow the liberalization, Privatization and Globalization (LPG).

Impact of LPG on Economy
Economy is related to the production and distribution of goods and services among different individuals, groups, organization or nations. Economic activities are as old as the human existence in the earth is. It works on the ideology of mutual exchange with consent. As the civilization advanced people created their kingdoms and controlled various economic activities in their territory. These kingdoms were the predecessor of current states and nations.
Positive impacts of LPG on the economy of current states are as follows:


1. Higher Growth in Financial Terms:
With more private firms and flow of capital from developed countries to developing countries, higher growth in terms of Gross Domestic Product and Per Capita Income is observed in most of the countries.

2. More employment opportunities:
More people were employed in various multinational firms and private companies. With availability of cheap labor various firms from developed countries shifted their working location to developing countries. This created more opportunities of employment.

3. Better Infrastructure
Private sector also started funding the infrastructure projects. National highways, Airports and other such projects are contracted out to private firms. Better infrastructure also invited more investment from other countries.

4. More welfare Schemes:
With higher growth rate, states get more opportunity to invest in welfare schemes for betterment of poor and ignored section of the society and work for alleviation of poverty and inequality in the society.

Negative impact of LPG on economy:


1. Hegemony of developed nations over developing nations:
Developed nations have been criticized for being enforcing policies on developing nations. Ideologies of developed nations are imposed on developing countries without giving consideration of the existing conditions of developing countries.

2. Exploitation of Natural Resources:
Private companies work with the motive of profit earning. In the absence of any proper policies, private companies exploited the natural resources very badly. This has done some of the irreparable damages to the developing countries and their ecology.

3. Increased Inequality:
With concentration of wealth in few private hands who have the motive of more profit earning rather than society welfare, inequality has increased many folds in both developing as well as developed nations. Private firms are also alleged of influencing politicians for making favorable policies for them.

4. Destructive Competition:
Competition is considered good and constructive for any economy till it increases the efficiency in a controlled circumstance. But when it goes beyond certain limit, it has many unintentional side effects. Examples of destructive competition include cutting cost by polluting the environment, competing by reducing the workers safety and protection measures and competing at socially irresponsible, damaging financial speculation.


Impact of LPG on culture
According to Anthropologist Edward B. Taylor, Culture is that complex whole which includes knowledge, belief, art, law, morals, custom, and any other capabilities and habits acquired by man as a member of society. With economic exchange, exchange of culture also takes place, knowingly or unknowingly. This has taken place in earlier times also as claimed by many historians.
Positive impacts of LPG on Culture

1. Exchange of ideas
Globalization cause cultures to cross the boundaries. Good practices are accepted from the cultures of other countries. One such example is the women empowerment in different countries after being influenced from western countries. Similarly message of Shrimad Bhagwad Geeta is being spread from India to different countries including western countries.

2. Exchange of good practices
Good practices are accepted by one nation from culture of other nations. One of such example is the practice of Yoga being spread in developing countries by Yog Guru Baba Ramdev.

3. More availability of Opportunities
With liberalization, privatization and globalization, more entertainment companies come up in the society to bring out the talent from different ends of the country. This gives the opportunity and platform to the artists to showcase their talents. Increased numbers of reality shows are an example of this.


Negative Impacts of LPG on Culture

1. Exchange of Bad practices:
Along with good practices, bad practices are also assimilated by people. Alcoholism, drug addiction and smoking among other things are some of the examples of bad practices accepted. Similarly prevalence of junk food in India can also be contributed towards LPG.

2. Dissolution of Culture
With the acceptance of other culture people often forget their own culture. This is true mostly in case of developing countries where young generation doesnt found any merit in accepting their age old culture and get attracted towards the culture of developing countries.






Impact of LPG in Education and Technology:

Education is a continuous process. It does not end with graduation day. Similarly the education system also keeps on changing as the nation grows reducing redundant things and adding recent advancement. Technology has become one of the important parts of education in recent times.

Positive Impacts of LPG on Education and Technology:

1. Advanced technology to developing countries:
Developed countries have availability of advanced technology as they spend good amount of money in Research and Development activities. New technologies are necessity for fast development because old technologies become redundant and inefficient with the rising population and decreasing resources.

2. Better Education System:
With more number of Schools and Colleges in the country level of education also improves. Constructive competition and innovative ideas brings in better methods to impart good education. Availability of various online portals and education videos explaining various concepts of different subjects succinctly is one such example of improvement in education.

3. Knowledge sharing across the borders:
One nation may have expertise in some subject and other nation may have in some other subject. Exchange of knowledge between two nations may benefit both the countries.

Negative Impacts of LPG on Education and Technology:

1. Developed countries imposing new technologies:
Developed countries impose new technologies on developing countries through various international organizations. For eg. Chloro Fluoro Carbons were used earlier as refrigerant which produce high amount of Ozone depleting gases. Hydro Chloro Fluoro Carbon (HCFC-22) using refrigerants are introduced and developing countries are forced to switch to cleaner refrigerant. Now America is pushing India for cleaner refrigerants, made of Hydro Fluro Carbon (HFC). Such type of behavior benefits the corporates of developed countries affecting the poor persons of developing countries.

2. Conversion of Education into Business
Private firms start using the opportunity of high number of young people and convert education into a business. Hefty amount of fees is collected by them and low quality of education is imparted. Presence of high number of Engineering colleeges in India without good teachers and any future perspective for students is one such example.





Impact of LPG on Public Administration:

Public administration is the government in execution. Traditionally public administration has been transformed into a black box working in a secret manner with least priority to public welfare and social improvement. Such behaviour has made public administration passive and inefficient. Recently due to pressure from media, civil society and international financing bodies, public administration is changing itself. With the beginning of paradigm of New Public Management in public administration more stress is now given on the management side of administration which includes efficiency, effectiveness, transparency and output. Concept of less government and more governance is more prevalent all across the globe. LPG can be credited as one of the reasons of genesis of New Public Management.


Positive impacts of LPG on Public Administration:

1. Changing role of Administration
Role of Administration has been changed from provider of services to the one regulating services and empowering Citizens. It has also become Customer oriented and result oriented branch of state from previous traditional, rigid and complex bureaucracy.

2. Trend of contracting out:
Administrations across the world have started contracting out as much Work to private or public agencies as possible. One of the reasons of contracting out is that authority and accountability are easy to delegate and monitor. In India responsibility of PAN card printing is given to UTI and NSDL.

3. Learning good practices from private entities
Public administration has learned to use better methods of private companies. Strict rules, management by objective and use of detailed project reports are some such techniques now used in public administration as well. Scientific and statistical methods are used with recent technologies to increase the efficiency and effectiveness. Remuneration has also increased for public administration personnel.

Negative impacts of LPG on Public Administration:

1. Increasing complexities
LPG has caused advancement in technology and increase in awareness of citizens. This has resulted in more scrutiny of Administrative work. These improvements have brought transparency and accountability in the administrative work. But they have also increased the complexity of work and put lot of restrictions on daily working of administrators. Public opinion is always desired as a feedback in Administration. But it should not hinder the administrators in taking any decision. Also as more players are coming out in the market task of regulating and maintaining equal playing field for everyone becomes more difficult.




2. Emergence of international and regional multinational platforms
Many groups and organizations have emerged with the LPG. As a result of this, decisions are now taken considering various circumstances globally instead of just local problems. India's decision to implement food security bill recently is objected by developed countries at WTO meet in Bali and India has to convince all the nations to reach an intermediate Solution. Similarly groups at the regional levels are also emerging which effect the decision by Administration.

Conclusion:
Liberalisation, Globalisation and Privatisation have affected all the countries economically, politically, culturally, and in all other aspects. They have brought many improvements and changes in the Society and citizens across the globe. However it is very important to look down into the advancement of LPG both from positive point as well as negative point. We need to critically scrutinize any shortcoming in the approach of LPG, so that we can correct it in future. Problems like rise of inequality, environment degradation, and hegemony of developed countries over developed countries have to be considered and solved with commitment from all the countries and sections of Society.

by Rajesh Garkoti
References:


1. http://ozone.unep.org/Events/ozone_day_2011/HCFC%20Leaflet.pdf

2. The Competition Paradigm: America's Romance with Conflict, Contest, and Commerce - By Pauline Vaillancourt Rosenau

3. http://anthro.palomar.edu/culture/culture_1.htm

Development Industry in India and its stakeholders- paper 2

* What is development?
It is the creation of long term conditions for mankinds multidimensional and sustainable well being. The dimensions may be educational, health, economic, etc.

* What is the development industry?
It is the various agencies that form an interconnected network to ensure development that is sustainable, equitable and balanced. Basically, it collects together various resources (manpower, money) to produce the product i.e. development.

* Who are its stakeholders?
All organizations and individuals who create ,manage, or benefit from development.
This includes the Govt, NGOs, donors, charities, groups, associations ,etc. ,and above all the common man.

* NGOs-Non Governmental Organizations
Formally registered not for profit association groups of individuals founded on principles of equality, altruism and voluntary work spirit to promote human development (including environment and biodiversity) and nation building.
They may be (1) advocacy based i.e. talking about a specific issue or rights of a section of society, like CRY or Helpage India (2) development based i.e. engaged in the development of various sectors, like Dhan Foundation.
2009 - 3.3 million NGOs in India. 19 million workers and volunteers. Foreign funding alone was close to 10,800 crores.

* Why are NGOs needed for development?
1. Backlog of social deprivation
2. Indian budget is the size of Norway budget. Not enough resources.
3. Lack of infrastructure, personnel and expertise in Govt. Organizations
4. Lack of trust-the ultimate beneficiaries of development cannot articulate their demands to Govt. Officials
5. Bad service delivery
6. Lack of values required for development
7. Inefficiency and corruption
NGOs are guardians of our values and watchdogs of society. They are advocates of social action. They are knowledge and manpower repository. They improve citizen-govt interface.

* Issues with NGOs- foreign funding under FCRA act 2010, corruption , being used as fronts for corporate organizations , lack of regulation , actual performance and impact, etc.
From 6th plan onwards , which identified them as new actors for development, the govt has been trying to harness NGOs effectively for development. The national policy on voluntary sector 2007 mentions creating an accreditation methodology, a central law, independent self regulation agency, simplifying rules, joint consultative groups, etc in order to address the above issues.
2nd ARC also recommended that NGOs with substantial funding and providing public uility services should be brought under the Prevention of Corruption Act.


* Donors and Aid
Individuals and organizations that give away funds and expertise for development.
They can be (1) International i.e. like the British DFID and Indian aid in Africa
(2) Agencies-like ADB and World Bank (3) Individual donors philanthropists like Bill and Melinda Gates through their foundation. (4) Corporate like the Times Foundation.
Donation is untied contribution towards development. The donor expects no benefits in return. In actual practice, it is often used for political and commercial self interests. The Gates Foundation has been accused of furthering the agenda of pushing Microsoft in developing nations. It may even be used as a front for money laundering. So scrutiny of donations, particularly foreign, is necessary.
India- past ten years- gave away 3.5 billion dollars in aid. 90% was to south Asian countries. It received 2000 million dollars of international aid in 2008. Acc. To the Hurun philanthropy list 2013, Aziz Premji is at the top, contributing 8000cr. Education is the area with max funding.


* Charities
An organization, institution, fund established to help the needy.
A charity operates for education, poor relief, medical relief and any other object of general public utility. Ex- the Missionaries of Charity, SOS Villages, etc
Charities often operate old age homes, orphanages, hospitals and so on. In the developmental context, charities have an important role to play in supplementing the govts efforts towards a welfare state. They look after sections of society that are often neglected. Baba Amte is an example of such work.

* Trust, endowments and Wakf.-usually floated under India Trusts Act 1882,a trust is an organization floated to devote a corpus of funds, real estate, etc for public purpose.

* Society-organization for promotion of literature, fine arts, science, diffusion of useful knowledge, museums, collections of art, instruments, inventions, charity, etc. under Societies Registration Act, 1860.



* Self Help Groups

They are informal associations of people who choose to come together to find ways to improve their living conditions. They are usually groups of 10-15 women who come together to generate addition income and learn financial and occupational skills. Both the rural and urban livelihood missions NRLM and NULM have SHGs as a central feature. Till 2006,there were 2.2 million SHGs in India.



* Why are SHGs important in development?
1.They aid in financial inclusion
2.Financial education
3.Socio economic empowerment
4.Address and articulate shortfalls of development
5.Increase domestic output
6.Equitable and balanced growth




* Institutional- they may include finance institutions like NABARD,SIDBI, economic development institutions like cooperatives, socio-economic development institutions like National Scheduled Castes Finance and Development Corporation.



Ultimately,the most important stakeholders in development are the officer who is in charge of development at the ground level-the civil servant ,and the recipient of all these intitatives for his benefit the common man.

By: Dr Sukhmani Sangha

Ref.

1. Yojana Nov 2011

2. 2nd ARC reports on Social capital and Ethics

3. World Bank studies on aid

4. Indiakanoon.org

FIGHTING CORRUPTION

MORAL VALUES MUST PREVAIL

A World Bank defines corruption as use of public office for private profit. When the world was divided between the two superpowers and the Cold War was on, the World Bank did not focus on the issue of corruption as a significant issue. The reason is obvious. So long as the Cold War prevailed, what mattered was the ideological orientation of the country receiving the aid. It used to be said by the superpowers, "We know that so and so is a son of a bitch, but he is our son of a bitch". This approach underwent a massive change when the Cold War ended. The taxpayers in the aid-giving countries started questioning whether the aid given was reaching the beneficiaries in the recipient countries. That the issue of checking corruption and thereby ensuring good governance was an important pre-requisite for development and removal of poverty in developing countries is now widely recognized. Corruption, therefore, has become an issue of global concern. It is not only in the area of public governance that fighting corruption became a central issue. Even in the area of global business, thanks to the scams in the year 2000, when Fortune 500 companies like Enron and universally reputed companies like Arthur Anderson were exposed as having indulged in financial engineering and window-dressing of accounts misleading the market and the investors, the issue of corporate governance assumed equal importance. Honesty is the best policy, is a discovery the world made once again in the 1990s. Stringent legal steps, like the Sorbonne Oxley Act in the United States, were taken.


Matter of concern

As we look ahead, the question before us is will corruption continue to plague the country? Corruption is anti-poor. In a country, where 26 per cent of the population is below the poverty line, corruption hits the poor very badly. Many of the development schemes meant for the weaker sections do not benefit them at all. Rajiv Gandhi remarked that only 15 paisa out of every rupee meant for the anti-poverty programme reaches the beneficiaries. In fact, the major point of criticism about the Government of India's Employment Guarantee Act, which visualizes a Rs 1,50,000-crore scheme - to ensure that all citizens in the rural areas are assured of a minimum 100 days of work with a daily wage of Rs 60 - is seen as a tremendous opportunity for corrupt elements among the bureaucracy and politicians to siphon off huge funds. Even the Maharashtra Employment Guarantee Scheme, on which the Central Government's scheme has been modeled, also offers no hope. Even in that scheme, there are false muster rolls. Aruna Roy through her Mazdoor Kisan Sangharsh Samiti brought home in Rajasthan the extent of leakage in development funds. As we look ahead to the next 10 to 15 years, what is it that we can hope for on the corruption front? It is very easy to be pessimistic. The pessimist can always argue that corruption has always been with us like the poor and it is a global phenomenon. Nevertheless, the fact is that while corruption is a global phenomenon, we have seen countries which were corrupt, reforming themselves and getting the benefits of corruption-free, good governance in our own lifetime. Singapore is a classic example. Botswana has also been quoted by the World Bank as a good African country, which has done well on the issue of fighting corruption. If we look at history, thanks to the highly ethical William Gladstone, four times Prime Minister of Britain, the UK which was a corrupt country in the 19th century became a well-governed country by the be-ginning of the 20th century.

Begin with schools

In India, this whole concept of good behaviour got crystallised in dharma, or the set of duties every person has to perform. In the Bhagvadagita, Lord Krishna says in Chapter 3 "swadharme nidhanamshreya paradharmo bhayapaha". Doing one's own duty is the most desirable and if one cannot perform duty, death is a better option. This inculcation of values in the educational system is possible. This, in turn, would mean referring to the sources of tradition which will involve a reference to some religion. Today, for example, these values of good conduct, based on Hindu traditions, are taught in the DAV and the Ramakrishna Mission schools. In Christian missionary schools, the moral lessons are drawn on the basis of Christian teachings. But our government having been secular, it has been remarkably successful in totally eliminating any induction of values in our educational system. We have, there-fore, a whole lot of students coming through the schools where they do not learn any values. This big defect has to be rectified. I am happy that this seems to have been realized especially after the scams of 1997 and 2000 in global business. In the institutions like Anna University, engineering ethics has been introduced as a separate subject. But what about other streams of education? If we want India to become less corrupt, if not corruption-free, we must start with the educational system and ensure that moral values are inducted.


Role models

The second factor which decides the level of corruption is a set of social values. Here, opinion makers in society have to become role models. Unfortunately, our politics has become criminalized. Law-breakers are lawmakers today. The only people the youth probably look upon as role models are politicians and media stars who collectively represent what is called the Page Three culture. So far as professions are concerned, every professional association can uphold ethics and codes of conduct, and thereby build role models and benchmarks for guiding society. The third important factor is the system. In any society, from the ethics point of view, 10 per cent may, by nature, be ethical and 10 per cent will, by nature, be corrupt, and 80 per cent will modify their behavior depending on the system. One simple example of this is how, while an Indian may throw rubbish on the streets without batting an eyelid, the same Indian, when he reaches Singapore, is on guard and may not commit nuisance or throw rubbish on the streets. We must redesign our system of governance to check corruption. Corruption today is a game in which five major players are involved. They are the corrupt neta, the babu, lala, jhola and dada-the corrupt politicians, the corrupt bureaucrats, the corrupt businessmen, the corrupt NGOs and criminals. For tackling each of them, I would suggest the following: Political corruption is at the root of all corruption in our country. Our politics is corrupt because it is based on black money. Every political party collects cash, which is black money. Black money is oxygen for corruption and corruption is oxygen for black money. Therefore, we must focus on electoral reform and reducing black money. Simultaneously, we must also bring greater transparency in the raising of funds by the political parties. Some steps have been taken for removing restrictions on political contributions. We should try to create a situation similar to that of the United States or Britain in so far as fund-raising is concerned. This would provide an opportunity to reduce corruption. Dr Jayaprakash Narayan, a very committed IAS officer who resigned and set up an NGO, Lok Satta, in Andhra Pradesh, has highlighted the need for changing our electoral system itself. Instead of the British system of first past the post, which only nine out of 47 countries have adopted, we should opt for a system of proportional representation. He also suggests direct elections for the post of chief minister, who can then appoint a cabinet of talent. It is an interesting idea and worth trying. To begin with, it is necessary to build a consensus in the country on this idea.

Winning formula

So far as bureaucratic corruption is concerned, the following three-point formula must be adopted. Simplification of rules and procedures to reduce the scope of corruption; Transparency and empowering of public, and Effective punishment. There is an urgent need to bring a sense of accountability in bureaucracy. Article 311 provides so much protection to the public servant that it is very difficult to take action effectively and in time against corrupt officials. Fighting corruption is a hard task. There cannot be a single-point approach to the task. We have to adopt a multi-point approach, some of which I have indicated above. We then come to the basic question. The powers that be, whether in politics or bureaucracy or business, are benefiting from the corrupt system. Can there be a situation where these beneficiaries of corruption will initiate action to check corruption? That may amount to causing hara-kiri. My perception is that as far as our politicians are concerned, they act only under two circumstances: One, where the TINA (There is no alternative) factor prevails; and two, where there is a vote bank advantage. The TINA factor can be created in our country by broadly two methods. One is by using the route of the public interest litigation and activating the Supreme Court so that the persons concerned have no alternative but to implement it. The enactment of the CVC Act and the practice of the candidates declaring their criminal record while filing nominations are examples of this type.
However, there are also limits to judicial intervention. The second instrument that can create the TINA factor is technology, particularly information technology. We have seen how in the railway reservation system, the use of IT has brought down corruption. I understand that even in the issue of passport, computerization has helped in bringing down corruption. So greater use of IT and reforming and simplifying the procedures can be the second broad strategy to help create the TINA factor. Finally, we have to practice the advice given in the Taitreya Upanishad to arrive at constructive solutions to our problem:

Sahana vavatu Sahanau bhunaktu
Saha Viryam kara va vahai
Tejas vina maditha vastu
Ma vidh visha vahai
Om Shanti! Shanti! Shanti

(Let us come together. Let us enjoy together. Let our strengths come together. Let us move from darkness to light. Let us avoid the poison of misunderstanding and hatred. That way lies progress.)

Adopting this strategy, we can definitely see India becoming a less corrupt, progressive and developed country in the next 10 to 15 year

PRAVIN KAUSHAL

Ref: The Hindu, ET, HT, CNN-IBN, Lok Sabha Channel
Choice: aptitude>polity>disaster