> What is "neo-liberal" about Indian economic policy?
Chris wrote:
> Auto demand is very up in Russia.
Well, neoliberalism doesn't revolve around whether auto demand is up or down. A higher auto demand is perfectly compatible with neoliberalism. Auto demand can go very up in a country, for instance, if the country's economic changes take back much from the working class and farmers (see, for instance, "Share of Wages, Managerial Pay, and Profits in the Private Corporate Sector, Before and After ‘Reform’," <http://www.rupe-india.org/39/otis.html>), fatten profits of investors, create a significant number of new professional jobs with salaries good enough for upscale consumption, while cheapening formerly luxury goods and subsidizing the new professionals' consumption (e.g., more investments in highways while failing to make sufficient investments in public transport).
<blockquote>December 5, 2005 <http://www.nytimes.com/2005/12/05/international/asia/05highway.html? pagewanted=print> India Accelerating | The Car Boom In Today's India, Status Comes With Four Wheels
By AMY WALDMAN VISHAKHAPATNAM, India - On the dark highway, the car showroom glowed in the night like an American drive-in. Inside, it looked more like a game-show set: bright lights, white floors, huge windows, high ceilings and ad posters of beaming consumers far paler than most Indians. For 36-year-old Ram Reddy, the price was right enough to make a down payment on his fifth family car.
He and his brother already had one car "for the children," two "for the ladies," and so on. Now they were buying the Toyota Innova, a big- as-a-boat luxury van that retails for a minimum of $23,000, 46 times India's per capita income of about $500.
The Innova is a new plaything of the moneyed here, one being peddled, like so many products in India today, by a Bollywood star. It is yet another symbol of the kid-in-a-candy-store psyche that has seized India's growing consuming class, once denied capitalism's choices and now flooded with them.
Fifteen years after India began its transition from a state-run to a free-market economy, a new culture of money - making it, and even more, spending it - is afoot.
This domestic hunger for goods has become an important engine for an economy that still lags in exports. So intense is the advertising onslaught, so giddy the media coverage of the new affluence, that it is almost easy to forget that India remains home to the world's largest number of poor people, according to the World Bank.
Still, India's middle class has grown to an estimated 250 million in the past decade, and the number of super-rich has grown sharply as well.
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The growing lust for cars also reflects India finally having roads decent enough to drive them on. It is making a historic effort to upgrade its dismal, mostly two-lane national highway system into four- or six-lane interstates, its largest infrastructure project since independence in 1947.
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The revamped highways mean that, for the first time in India, cars can go fast; thus the new appetite for fast cars. The middle and upper classes, already being lured by one of the world's fastest- growing domestic airline industries, are discovering driving for pleasure as much as need.
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Named for Visakha, the god of valor, Vishakhapatnam faces the Bay of Bengal, in the state of Andhra Pradesh. The city is home to one of India's largest ports and the country's oldest shipyard. It is also squarely in India's booming south.
Some residents have prospered by going to work in the United States in information technology, others by opening "business process outsourcing" centers. Many work in pharmaceutical production, or export carpets or shellfish.
Pricy hotels line the beachfront, and driving schools the side streets, although Indian driving habits raise questions about the quality of their instruction. Almost every beauty salon also has a "body weight reduction" center, reflecting the upper-middle-class's new obsession, and plumpness: people are still starving in India, but people are overeating, too.
In a historical blink, capitalism, which postcolonial analysis once labeled poverty's cause, is now seen as its solution. Debt, once anathema for the middle class, is now an acceptable means to an end.
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India's state-run rail network may have been built by the British, but it came to represent a certain egalitarianism. Powerful and voiceless, rich and poor - all navigated the same chaotic, crowded stations and rode the same jam-packed trains, if not in the same class.
Cars, in contrast, reflect the atomization prosperity brings.
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"Please do not drive in the wrong direction," a flashing sign implores over the redone highway.
The feeble exhortation underscores one of the many downsides of India's auto boom. The country already has one of the world's highest accident rates, with more than 80,000 traffic-related deaths a year. Few police officers patrol its roads, which ensures that pretty much anything goes, even at times on the fancy new highway.
With India reveling in its rising global profile, there has been little planning for the traffic, environmental or economic consequences of millions more Indians acquiring new cars. India's economic boom has outpaced any planning for the resources, like oil for auto fuel, it will demand. Urban planning is so poor that in Bangalore and other cities traffic congestion is threatening investment and business expansion.
At the same time, the focus on cars threatens to obscure the needs of the many more without them. There are still only about eight million passenger vehicles on Indian roads, in a country of more than one billion people. By the late 1920's, in comparison, the United States had 23 million registered car owners.
Poor Indians rely, in addition to their feet, on an extraordinary array of contraptions for transport. They pile on top of buses in the Indian version of the double-decker. They ride tractors and bullock carts and pack 13 strong into Tempo taxis made for 6.
What they cannot regularly rely on is public transport. While New Delhi and Calcutta have built subways, most cities have not, and they face severe bus shortages as well. Cars speed by waiting bus riders, who stand like spectators.
The rise of the auto, and the investment in highways, dovetails with a larger trend of privatization in Indian life, in which the "haves" are those who can afford to pay for services the government does not provide: efficient transport, clean water, good schools, decent health care.
Most Indians cannot afford the tolls along the Golden Quadrilateral, let alone the cars to drive on it. Gandhi, whose foot marches for social justice defined an era of Indian history, now has an expressway named for him. Its toll of $1.33 is more than about 300 million Indians earn in a day.
India's growing material hunger has another downside: it is largely being sated by credit and debt.
With borrowing comes the danger of overstretching, and pricy cars purchased in Vishakhapatnam's Toyota showroom can always be taken back.
That is where the repo man comes in. He waits at a tollbooth in Rajasthan, cater-corner from Vishakhapatnam on the Quadrilateral, armed with a long list of deadbeats' license plate numbers.
In a beat-up Maruti van, with a stick inside, Anil Kumar Vyas, 34, was chasing down Toyota owners behind in their payments. Befitting his upper-caste Brahmin status, he was also a local village head, but that brought more prestige than profit.
His may be one of the few lines of work that has benefited from traffic jams and potholes. Bad roads made for easy captures, since no one could drive over 22 miles an hour. On the new, smooth four-lane highway, he has already given chase at more than 60 miles an hour.
"It is harder for us to catch them," he said. "We're still working it out."</blockquote>
Yoshie Furuhashi <http://montages.blogspot.com> <http://monthlyreview.org> <http://mrzine.org>