TWO KINDS OF GLOBALIZATION, The Telegraph
 

At the beginning of this century, my home town, Bangalore, became a showpiece for the advantages to India of an outward-looking economic policy. The city’s Information Technology industry was generating large amounts of foreign exchange by providing high-quality services to global companies. Thousands of new jobs had been created. Besides, as compared to the traditional manufacturing sector, these new industries caused far less damage to the environment.

The appeal of the IT boom was enhanced by the fact that many entrepreneurs came from modest, middle-class backgrounds. They were not born into business families. Having made their money rather than inherited it, they were more willing to share it. Particularly exemplary was Infosys, whose directors chose deliberately to keep their own children out of the company they had created. They also led quiet, unostentatious, lifestyles, that were in striking contrast to the vulgar displays of wealth so common among India ’s business elite. The founders of Infosys brought further credit to themselves by contributing large amounts of money to social causes such education, health, and environmental sustainability.

At the beginning of this decade, my home state, Karnataka, has become a showpiece for the disadvantages to India of opening out its economy to the world. According to the government’s own figures, at least 30 million tonnes of iron ore were illegally exported from the state between 2000 and 2010. This ore was mined without a proper license, without paying the necessary taxes, and often on land that was officially designated as ‘forest’. To feed the hunger for minerals of China in particular, the Government of Karnataka has been prepared to allow, and even encourage, the social and environmental devastation of more-or-less the entire district of Bellary.

Software engineers in Bangalore are paid well, work in a clean, sanitized, controlled environment, and have access to proper health care. On the other hand, mineworkers in Bellary are often paid less than the minimum wage prescribed by law. They work long hours in the hot sun, and are continually exposed to dust and pollution. By comparison with, say, automobile manufacturing, IT is much less profligate in its use of the earth’s resources; compared to mining, it is the greenest of green enterprises. Thus the search for iron in Bellary has led to the forests being stripped and the soils rendered unfit for cultivation. The most severe impact has been on the water regime, with springs drying up and rivers being subject to massive pollution.

With regard to the condition of the workforce and the state of the environment, software in Bangalore and iron ore mining in Bellary are a study in contrast. The contrast is further sharpened when we consider the character of the entrepreneurs in the two sectors. The leading software titans are good citizens, who have, in material terms, given abundantly back to society. On the other hand, the mining lords of Bellary have bent the law to their will, and to their stacks of cash. The police and other authorities in the district are largely subservient to them. Again, while Bellary has the highest number of Mercedes cars per capita of any Indian city, I have not heard anyone speak of mineowners having opened schools and hospitals for the poor. The one gift they are known to have made was of a crown of gold and diamonds (valued at Rs 45 crores) to the deity at the temple of Tirupathi, hoping no doubt that this would encourage the gods to overlook, or perhaps even endorse, their manifold transgressions of the law and of the moral code.

I should immediately correct myself. The Bellary mine-owners have made other and more substantial gifts, which are to political parties. It is widely believed that, in the last state elections in Karnataka, the campaign of the Bharatiya Janata Party was largely underwritten by them. When the BJP and its allies obtained a majority, the Bellary magnates were rewarded with three important posts in the Cabinet. It is said that the Rashtriya Swayamsevak Sangh was less than pleased with these developments; they were worried about the taint of corruption, and suspicious of interlopers who had opportunistically joined the party. However, the RSS was over-ruled by the BJP, which was desperate to come to power in a southern state.

To be fair, while some mining lords are with the BJP, others have funded the Congress and even stood for elections under that party’s banner. In fact, the three Ministers from Bellary in the BJP Government were close to, and possibly sponsored and promoted by, the late Congress Chief Minister of Andhra Pradesh, Y. S. Rajasekhara Reddy. At the same time, they remain close to, and have definitely been sponsored and promoted by, the Leader of the Opposition in the Lok Sabha, Sushma Swaraj.

The less-than-salutary story of the Bellary mine lords is the subject of a documentary film currently being made by Paranjoy Guha Thakurta. Despite having lived for twenty years in that contaminating city, New Delhi, Guha Thakurta has retained his independence and integrity. An experienced and respected journalist, he has the added advantage—for the project at hand—of having made extensive studies of the social, political, and environmental impact of coal mining in Eastern India.

Guha Thakurta was recently in Bangalore, after a spell shooting in Bellary. According to him, the case of mining in Karnataka represents the first time that such close links have been forged between the worlds of crime, business, and politics. In the past, a Mumbai mastan occasionally fought and won an election; other mastans funded the odd politician. But never before have those who made money by illegal and even violent means so brazenly and effectively taken over the politics and administration of an entire Indian state.

What are the larger lessons from the two stories summarized here? That there is a benign side to globalization, but also a brutal side. When the world economy offers opportunities for knowledge workers creating products that do not use much energy and do not damage the environment, these must be grabbed with both hands. When the world economy instead invites us to exploit scarce natural resources quickly, and without a thought for environmental sustainability, then we must be more sceptical.

How to make the best of globalization, given our human and natural endowments, is a matter of public policy. How to make wealth and how then to spend it is a matter of personal choice. In their search for the big buck, the Bellary mine lords have shown a profound lack of concern for the law and for their fellow citizens. On the other hand, the best among Bangalore’s software entrepreneurs have made their money fairly and legally, spent a small fraction on themselves, and a larger fraction on various charitable and philanthrophic causes.

In a single decade, my home town and home state have seen the best of globalization and the worst of globalization, the emergence of the most progressive form of capitalism and its eclipse by the most barbaric form of capitalism.

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