The Hindu : A blackened economy

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Saturday, Mar 16, 2002

Opinion

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A blackened economy

By C. Rammanohar Reddy

A society that periodically indulges in events of barbarism, whose intensity seems to increase with time, cannot possibly hope to build an economy on organised lines.

IT IS self-evident that any form of mass violence throws sand into the wheels of the economy. One does not, therefore, need much sagacity to predict that the carnage in Gujarat — there is no gentler way of describing what has happened — is going to have a strong negative impact on one of India's most industrialised States. It will take months before production activity revives, while potential new investors would be foolish if they did not reconsider their plans for the State. The spectre that awaits Gujarat could well be what has befallen Maharashtra, where the industrial climate has never fully recovered after the Mumbai communal riots of 1993.

The economic effect of the poison that struck Gujarat is also not going to be localised. As a weak Centre struggles to deal with the countrywide consequences of the Vishwa Hindu Parishad's 2002 display of communalism, the management of the national economy is going to be the first casualty. The mixed up budget of Yashwant Sinha has already been forgotten. Further, an economy which was beginning to show the occasional sign of revival will retreat into a sluggish state. But what is worrying, even frightening, is that Gujarat 2002 may mark a new kind of violence which threatens India and its economy.

Gujarat 2002, Mumbai 1992-93 and Delhi 1984. All three have many things in common. They saw political groups mobilise their cadre to carry out the killings, they saw mass murders by "ordinary" people who so easily turned into frenzied mobs, they witnessed a breakdown of civil society and, most significantly, the state played the fiddle as citizens were burnt to death. But as the stories trickle out about the kind of events that took place in Gujarat between February 27, when the barbaric Godhra massacre took place, and March 3, when the Statewide fires eventually began to ebb, it is becoming apparent that Gujarat 2002 was unique in its horrors. News reports point out that this was the first time that citizens, the agencies whose basic duty is to prevent violence (the police) and those who are supposed to administer the law (the political executive) joined together to participate in murder on a mass scale. This `participation' was active involvement or deliberate dereliction of duty. For the victims there is no difference between the two. This is also the first time since 1947 that communal violence has been perpetrated outside its natural habitat — cities and towns — and has simultaneously taken place all over, from villages to the State capital. Narendra Modi's Newton Law of "every action produces a reaction" may have been in the same tradition as Rajiv Gandhi's rendering of wisdom, "when a big tree falls, the ground shakes". But the difference between now and then is that this time the agents of the State appear to have connived in the killings. Institutions collapsed, governance broke down and the mobs ruled the streets because the administration seemed to want it so. Such events have taken place at a local level, but never before have they happened on such a widespread scale. Gujarat has blown completely apart the BJP's claim of a Government being able to hold the communal peace; what has been revealed behind the mask is an ugly cancer. Indians elsewhere in the country must now live in fear that what happened in Gujarat could well happen in their town or village.When citizens have to fear for their lives, it marks the beginning of a breakdown of the organisation of economic production. Economic growth requires at the very minimum social peace, stability and the rule of law. The fallout of what was perpetrated in Gujarat or the effects of the mass mobilisation by the VHP is exactly the opposite. When the disruption to the public peace is as violent as it has been in recent weeks, the effects cannot be contained within a region. In the immediate future, it is inevitable that the impact will be felt nationally on private and Government decisions on the economy. These will be at best postponed, some will be even cancelled. A society that periodically indulges in events of barbarism, whose intensity seems to increase with time, cannot possibly hope to build an economy on organised lines.

There is also the very specific impact on the Muslim community. First, the process of ghettoisation that began all over India after the Rath Yatra in 1990 and the Babri Masjid demolition in 1992 will now take on a new urgency. Second, the targeting and destruction of minority businesses — a 1990s phenomenon in communal riots — is going to further isolate the community. As if they had not suffered enough, a vicious campaign has now begun to boycott minority businesses in Gujarat. If all this can happen in a State where the Muslim community — the Bohras and the Khwajas — is perhaps the most assimilated in all of India, what can possibly await the minorities elsewhere in the country? Altogether, the Muslim Indian is faced with the prospect of further economic marginalisation. Contrary to what the "nationalist secularists" will have us believe, the Muslim Indian is on the whole already poorer and suffers from greater social deprivation than the average Indian. Again, it is impossible to construct a universal economy when newer and more numerous forms of social discrimination are added to the many that already exist. What is possible is a further fortification of the enclave economy which we already have — a small, modern and technologically advanced economy which is connected more to the outside world than to the rest of India. But such an enclave economy is not sustainable. In time, either the ramparts of this enclave will be scaled by those on the outside or its foundations will be hollowed out by social conflict.

There is the traditional view that poor economic prospects and high unemployment underlie much of social conflict. All that is required then is rapid economic growth. This will supposedly give all citizens a greater stake in a peaceful civil society and simultaneously dissolve communal tensions. This is too simple an understanding of what drives communalism and other social tensions in India.

There is no doubt that among the mobs which rampaged through Ahmedabad there were as many educated unemployed youth as there were lumpen youth. But more jobs in a wealthier society alone will not make much difference because the poison of communalism now runs too deep in the body politic. It is quite common — now more than ever before — for Indians of the best economic standing to spout communal opinion of the vilest kind, demonstrating that individual economic advancement does not remove religious bigotry from the mind. Such individuals may not carry cans of petrol to burn people of another religion, but they certainly do subscribe to the same opinions that incite others to murder.

Our Prime Minister called the Gujarat mayhem a `black mark' on India. That was too mild a description. As far as the economy is concerned, what we have now in literal and figurative terms is a blackened economy.

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