India As A Side Dish

IT'S hard not to be reminded of a tawdry Bollywood melodrama while trying to make sense of the inflamed rhetoric being spouted in New Delhi and Islamabad ever since Pokhran-II. After L.K. Advani's reckless provocations and A.B. Vajpayee's pledge that the whole country was ready to bear the cost of economic sanctions, Nawaz Sharif could not resist rising to the bait. Commenting on the inevitable fallout of sanctions on Pakistan's already teetering economy, Sharif lapsed into a decidedly filmi dialogue: "If the nation will only take one meal a day, then my children will take only one meal a day."

South Asia must be the only place in the world where politicians faithfully promise to redistribute poverty. In other countries, even populists pledge a larger share of the national wealth. The rising jingoism encouraged first by the BJP and now joined in full fury by Pakistan reveals yet again how badly out of step the subcontinent is from the rest of Asia. Just about everywhere else, leaders are focused on their economies, obsessed with the task of putting the financial crisis behind them. In India, meanwhile, the government thumbs its nose at the grave implications of sanctions on our slowing economy.

We were promised a big bang budget, but this one amounts to a blast from our protectionist past. The hike in import duties, when our tariffs are already the highest in Asia, pushes up our manufacturing costs and is bound to dissuade foreign and domestic businessmen alike from using India as an export base. After US sanctions were announced, Pramod Mahajan gloated that European businessmen would readily take the place of American corporations—never mind that the US accounted for the largest share of our rather puny $3 billion in foreign direct investment last year. (China, by comparison, pulled in more than $40 billion in 1997). The BJP may be more brazenly transparent about it, but they are only the latest in a long tradition of Indian politicians for whom economic development is a sideshow. Politics is the main event. For decades, our brand of pseudo-socialism has been pursued without much conviction; unlike genuinely socialist states in Eastern Europe or even Cuba and Vietnam, we cannot boast of high literacy or low infant mortality rates.

When it comes to development, we are dilettantes. A bit of this, a bit of that and when it doesn't work, there are always the more engaging diversions—and divisions—of politics to fall back on. In the '60s, governments across Asia began to abandon the import-substitution regimes and profitably put their faith in free trade instead. India was the conspicuous exception. A Japanese PM rallied his country around the challenge of doubling the per capita income in 10 years—Japan did it in eight. Korea, Taiwan, Hong Kong and Singapore saw their share of developing economy exports quadruple between 1965 and 1990. "Of all the isms," one Asian technocrat said of Asia's economic success, "we had pragmatism." That is the one "ism" we lack. By contrast, Mrs Gandhi brought the '60s to a close by tightening the regulatory noose on the economy, nationalising banks in a bid to clip Morarji Desai's wings. Mrs Gandhi was a genius of realpolitik; real economics was another matter.

Decades of loud talk and very little action has left us only an occasional cameo role on the world stage, a predicament we resent. Economist Jagdish Bhagwati aptly characterised this unhappy national condition: "The worst psychological state to be in is to have a superiority complex and an inferior status." It's economic clout that counts today as China demonstrates, much to our annoyance. The Chinese have reportedly had the gall to insist that President Clinton stop nowhere else on his way to Beijing this summer; the craven administration has complied, even at the risk of offending Japan.

No party understands India's manifest insecurities better than the BJP. Their economic agenda is full of talk about self-reliance, but the subtext is that Indian industry can't compete. As Sandipan Deb argued eloquently in this magazine a few months ago, it is inconsistent to be both proud and protectionist. The BJP's rallying cry to Hindus overflows with the same bombastic self-assertiveness, but the undertone is that they are somehow losing out to Muslims and other minorities. The nuclear blasts are a variation on this theme, another virtuoso display of the BJP's gift for playing to India's superiority/inferiority complex. As Anand Patwardhan argued in Fat -her Son and Holy War, his documentary on the rhetoric of religious fundamentalism, the rabble are aroused with language aimed at their wrongheaded notions of virility. Almost on cue, Bal Thackeray proclaimed that our N-tests have proved we "are not eunuchs". It is not just our rightful place in the world that we are reclaiming, but our masculinity. Our leaders appear to suffer from a bizarre existential dilemma. The infinitely more cosmopolitan Advani crowed to Asiaweek: "Before no one noticed us. We just didn't exist. Now even the criticism is laced with a new-found respect." And he says he's receiving elated calls from Los Angeles to say India has never stood taller and prouder in media coverage abroad. Really? To use a less than scientific sample: India's Big Bang didn't even make the cover of Time in the US; the death of crooner Frank Sinatra did.

I wish I could confirm that our star turn on CNN and BBC has restored a much-needed lustre to our international reputation, but evidence points the other way. Our aspirations to a permanent seat on the Security Council are history. In economic terms, we are as much of a nonentity as ever if my experience at two recent conferences in Hong Kong is any indication—India was scarcely mentioned at the discussions on the prospects for Asia's economies.

It's painful to recall that at the outset of the Asian financial crisis, FIIs referred to India as "a haven of stability". Then the Congress selfishly brought down the UF. Now the BJP has upped the ante against Pakistan. So much for the safe haven. Put it down as just another economic opportunity missed, yet another wrong turn by our leaders. I was wrong to say India was ignored at these conferences. An economist from China criticised the intemperate rhetoric from the Indian government, adding, "India seems to have childish leaders." I should have delivered a sharp rejoinder, but found myself unable to. When we tally the huge costs of the sanctions and of the arms race this bravado has set off, leave alone risks of a calamitous confrontation, he will have won the argument anyway.