GLOBALISATION AND INDIAN SOCIETY LIBERALISATION - Liberalisation befalls when something which was forbidden is no longer forbidden or when government laws are loosened. Examples of Liberalization : - The economic reforms commenced under Deng Xiaoping in China, which brought hundreds of millions of people out of poverty. - “Miracle of Chile” in the 1980s LICENSE RAJ - Liberalization is the result of ‘New Industrial Policy’ which abolished the “License Raj’.Concept of Liberalization : - Liberalisation refers to freedom to business enterprise from excessive government control. - There are less licensing and other formalities to be followed by business firms due to the reforms introduced by the Industrial Policy, 1991. - Prime Minister P. V. Narasimha Rao. 1) Delicensing of Industries : - The Industrial Policy, 1991, abolished licensing for most industries. - The Sixindustries that required licensing include : + Alcohol + Cigarettes + Industrial Explosives + Defence Products + Drugs and Pharmaceuticals, and + Hazardous Chemicals 2) Liberalisation of Foreign Investment: - _ Increase in inflow of foreign capital for expansion and modernisation. - Development of skills of Indian personnel due to training provided by foreign MNCs (who have entered into joint ventures with Indian firms.) - _ Transfer of technology by foreign partners to Indian firms. - ‘Makein India’ 3) Liberalisation of Foreign Technology Imports : - Automatic permission was given for foreign technology imports in priority industries upto 2 million US dollars - No permission was required from Govt. authorities for hiring foreign technicians and foreign testing of indigenously developed technologies - ‘Make in India’ + Saving foreign exchange + Building technological capacity for manufacturing + Developing new skills 4) Liberalisation of Industrial Location : 5) Liberal Taxation: 6) Autonomy to Public Sector Units : - ONGC, SAIL, NTPC.PRIVATISATION - Privatization occurs when a government - owned business, operation, or a property becomes owned by a private, non-goverment party. This can be achieved in two ways (|)by direct sale of the public sector enterprise (ii) by the withdrawal of the government from the ownership and management of the public sector firm. - _ Privatisation can also be termed as Denationalisation or Disinvestment. Definition of Privatisation : - “It is defined as the process whereby the public operations are transferred to the private sector”. - Steve H. Hanke - “The transfer of ownership, property or business from the Government to the private sector is termed as Privatisation. The Government ceases to be the owner of the entity of business”. The Economic Times. Concept of Privatisation: - Reduction in the role of public sector and increase in the role of private sector in business and non business activities. 1) Dereservation of Public Sector: - Railway - Atomic Energy - Specified Minerals 2) Disinvestment of Public Sector: - The disinvestmentis undertaken to achieve the following objectives :- (a) To provide good customer service (b) To overcome political interference in managing the units. (c) To overcome corruption in PSUs (d) To make effective use of proceeds from disinvestment. (e) Toimprove efficiency of PSUs, etc.- The disinvestment of PSUs has achieved the above objectives, and now the Govt. can concentrate more on social development activities rather than economic activities. Examples of Privatisation : 1) DelhiAirport, India 2) BharatAluminium Company, India 3) British Airways, UK GLOBALISATION GLOBALISATION = LIBERALISATION + PRIVATISATION Definition of Globalisation : “Globalisation is the process in which people, ideas and goods spread throughout the world, thus resulting into more interaction and integration between the world’s culture, governments and economies”. “Globalisation is the process whereby social relations acquire relatively distance-less and borderless qualities.” -Baylis and Smith Concept of Globalisation : - It implies free flow of goods and services, capital, technology and labour across national borders - The main purpose of globalisation is to exploit the global opportunities for local growth Elements of globaliation : 1) Introduction of Foreign Exchange ManagementAct, 1999 2) Reduction in Custom Duty 3) Liberalisation of Foreign Investment 4) Signing of WTO AgreementsImpact of Globalisation: 1) Positive Impact - Benefits of Reduction in Custom Duties - Benefits of FEMA 1999 - Benefits of Foreign Direct Investment 2) Negative Impact - Problem for Domestic Companies - Problem of Foreign Investment - Problem of Foreign Technology Examples of Globalisation : - Subway - Google - Fedex - HP - Apple - Pepsi PROBLEMS OF MIGRATION AND URBAN ENVIRONMENT Types of Migration: Migration is the movement of people from one place to another place, which could be across a political or administrative boundary. - International (movement between different countries) - __Infra-national (movement Within a country - Migration can be temporal in nature (For a short period) or permanent, or it may be voluntary or forced. - Migration is nota new phenomena. - History stands evidence to the fact the people have migrated across the globe resulting in spread of migration and migrants have increased manifold. - Rural to urban migration : It involves movement of people from rural areas to cities. Such migration is migration is more common in developing countries due to industrialisation. = Urban Rural migration : It involves movement of people from urban areas to rural areas. Such migration is more common in developed countries due to higher cost of urban living.Reasons of Migration : - Economic motivation : In search for work, better pay or to pursue a particular career path. to Support their families - Social motivation : Moving somewhere for a better quality of life or to be closer to family or friends. Girls after marriage have a change of region or countries - Political motivation : Moving to escape political, religious or ethnic persecution, orconflict - Environmental motivation : In order to escape natural disasters such as flooding or drought The major Push and Pull Factors of Migration can be diagrammatically presented as : PUSH FACTORS PULL FACTORS t+ Unemployment Potential for Employment |—»| Lack of Safety }» A Safer Atmosphere + Poverty Greater Wealth | War. Civil Unrest |—{ Political Security tf Hazards t—| Less Risk of Natural Hazards | Isolation | Friends and FamilyProblems of Migration : = Overcrowding - Housing Effects of Migration Effects of Migration A. On the Country of Origin B. On The Host Country Onthe Country of Origin Positive Foreign exchange reserves - The area benefits from remittances sent home. - Upon return, migrants bring new skills to the country such as the ability to speak foreign languages. These new skills can help to improve the economy in the country of origin. Fusion of cultures. - There is less pressure on resources such as food and social services such as health care. - Brain Drain Loss of young workforce; those with skills and those with entrepreneurialtalents. - Returning migrants increase social expectations for communities, for example, increasing demand for better leisure facilities. - Lots of young people migrating out of the country can increase the dependency ratio. On the Host Country - Migrants take up less desirable, menial jobs which natives would not take but need filling - The hostcountry can gain skilled labor for cheap.- Thereis a labor surplus; those with skills and education fuel the economy. - The “skill gap” in many host countries can be filled by migrants. - Gain Drain - There has been migration of Indian professionals, academicians, scientists, engineers, etc. to foreign countries such as America, Canada, England, etc. The talent, knowledge, skills of such migrants contributes to the economic development of the host country. - Costs of retirement can be transferred to the country of origin - Much of the money earned by the migrants isn’t spentin the host country and is instead sent back to the country of origin - More people increase the pressure on resources and services such as health care systems. - The creation of a multiethnic society increases understanding and tolerance of other cultures. - People from other countries can encourage the learning of new languages, helping people develop skills for working internationally. - Aspects of cultural identity are lost, especially in second generation children. - Segregated ethnic areas are created e.g. China Town, Schools become dominated by migrant children. - Discrimination against ethnic groups & minorities which can lead to civil unrest and extremism. GLOBALISATION AND CHANGES IN AGRARIAN SECTOR 1 Changes in Food Basket 2 Changes in Agricultural Marketing Systems 3 Changes in Agricultural Exports 4 Changes in the Share of Agricultural Employment 5 Changes inthe Share of Agriculture in GDP 6 Changes inArea of Cultivation 7 Contract farming and corporate farmingINCREASE IN FARMERS’ SUICIDES IN INDIA Reasons for Farmers’ Suicides : - The State of Maharashtra, with 3,786 farmers suicides - Farmer suicides rates in Bihar and Uttar Pradesh - two large states of India by size and popullation - have been about 10 times lower than Maharashtra. - Indebtedness - Higher Input Costs - Lower Prices for Output - Crop Failures - Lack of Relief Package for Farmers - Group Program do not reach small farmers The Contract farming results in positive impacts like producer link. up with profitable markets, better farm incomes, skill upgradation due to transfer of technology, and sharing of market risk. It does not at least make small farmers landless unlike corporate farming. Further, there is sharing of benefits in contracting as against corporate farming. 7. Contract Farming and Corporate Farming : The concept of contract farming and corporate farming has gained importance since the post-reform period. Contract farming is working with farmers by corporate firms (such as Pepsico) and sharing the rewards. Corporate farming is undertaken by large corporate firms either by buying the land or taking land on lease basis.veyeses- on: Arguments in Favour of Corporate Farming: It is argued that large-scale corporate agriculture is more o¢, i i t in the country. It leads to res than peasant farming preva i investment in agri 7 allocative efficiency, induces higher private inve: agricul, and results in higher output, income and exports. (1) In India majority of the farmers are having small landholdin, which are uneconomical for cultivation. Also the landhotgin. are fragmented and scattered as small holdings in different ate This leads to high cost of cultivation. Through corporate farming it becomes possible for the corporate firms to take these smal portions of land lying nearby from the small farmers and then do cultivation of this large portion of land. - + le (2) Corporate farming is expected to increase the land productivity , & te (3) Corporate firms tend to introduce new methodologies inig cultivation since finance is not an issue for them. There js scope for Research and Development in agriculture ang implementation of the same. (4) Through corporate farming there would be more flow of capital into farming. (5) Consumers will be benefited in the long run because of increased availability of farm produce. (6) Corporate -farming will induce competition amongst the cultivators. This will lead to more quality conscious farming. (7) Corporate farming is mainly done by corporate firms to venture into the international market for selling the farm produce. There is a huge demand in the foreign market for Indian fruits, vegetables, nuts, oil seeds, spices, etc.— ¢ eee (8) Corporate firms are in a better position to market the agricultut produce. They have the necessary infrastructure facilities |ik? warehousing, transportation, etc. needed for marketing thejcultural products. This | i 14 leads to greater effici reducing wastage and increasing the income of ree hood yments Against Corporate Farming: coor are 'S Promoted on the grounds that large-scale corporate eee or 'S More efficient than peasant farming Seen jn the country oy that it leads to better allocative efficiency, induces pgher private Investment in agriculture, and results in higher output, income an exports. Various studies on the national and intemational experience challenges claims of corporate farming: Following are the arguments against corporate farming () Indian economy is an agrarian economy, Family farming has been pret lominant in India. Corporate firms are good in finance. Small and marginal farmers will find it difficult to compete with corporate firms in farming due to lack of finance. (2) Many corporate firms lack experience in the field of farming. So often due to mismanagement and not focussing on improving the field, the output is not as per the expectation. This has been the reason of failure of big corporate farms in US, UK, Iran, Ghana; etc. ai, Su : (3) There is also the problem of exploitation of the agricultural labourers. Labourers are not paid adequate wages by these farms. Female labourers are paid low wages. Even children are employed on these farms at low wage rate. Corporate farming makes large number of small farmers landless. These landless farmers find it difficult to get an alternative employment, since farming had been their occupation and only source of livelihood. ¢ 5 rise to an increase in casual labourers wherein the labourers are hired on contract. Once the contract gets over, the labourers are asked to leave. Hence no job security is provided to such labourers. - Seeronol employment: An analysis of the above points suggest that there is a need to have system wherein the farmers are not displaced and they get the in terms of skill upgradation, benefits from the corporate firms technology transfer and profit and risk sharing. This is possible (4) 6) Corporate farming give!v e central government ang f i id other instityy, ncial and of institutig, | farmers to carry on we the new age generaji,, ture and come out With through contract farming system. Th government need to provide financl uidance and aid to the small and marginal their occupation. Also this will motivate farmers to remain in the field of agricul innovative farming techniques. 9. Need for national weather risk management system/disease alert system Facilitating national weather risk management system that alerts farmers when there is a danger of extreme weather, would go a long way in reducing losses in agriculture. Foundation Course - II (BMS, BAT, ™ Value added services like pest and disease alert applications, jn combination with the weather forecast would equip the farmers to handle and manage their crops better. For example, Water Watch Cooperative, @ Netherlands base Organisation, has developed a disease alert system that sends an alarm to farmers, if probability of a pest/disease would be detected. Similarly, system that detect the amount of water to be provided to a field based on the field water content, biomass and rainfall probability, would aid in optimisation of water provision to the crop and ensure efficient crop management. There is often mismanagement due to lack of relevant farming, experience. There was also neglect of field improvement, no contingency planning, and poor labour relations. A major adverse fall out of corporate farming was displacement of large number of small farmers. On the other hand, there have been many cases of success when the corporate firms worked with local farmers under the contract farming system. Therefore, there is a need to look at contract farming alternative as it meets the needs of both corporate firms as well as small farmers.