‘India’s Table Has Turned’

Thomas Friedman hailed Nayan Chanda’s book, Bound Together as a ‘unique history of globalisation’. Here Chanda discusses the many faces of globalisation and why it should be made to bend to national interest

July 21, 2007 in Culture
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Photo: Cherian Thomas

Photo: Cherian Thomas

Your book charts the story of globalisation as a historical process that is millennia-old. Where does India stand in that?
If you look at the history of how the world has been connected since the Tigris-Euphrates and Indus valley civilisations, India was at the heart of globalisation in the first 2,000 years of history. It was the first to develop the use of cotton and was the only exporter of cotton textile for centuries. Then Indian artisans developed the skill of turning hard matter into beautiful jewellery, which was exported to Mesopotamia. Even in the 11th century, European and Arab traders collected ivory from East Africa and shipped it to India to be transformed into artefacts before shipping it to Europe — it was being outsourced. Then Indians learned to turn sugarcane juice into granular sugar and India was the world’s only supplier of sugar till it was taken to the Carribean islands. This dominance persisted till the Industrial Revolution knocked India off the pedestal — which was propelled to a large degree by the British desire not to spend silver bullion buying Indian cotton textiles. They tried weaving their own cloth, but couldn’t match India’s cheap labour. This pushed them to invent labour-saving devices and steam power and textile mills, which rang the death-knell of Indian weavers. William Bentinck — Governor General of India in 1835 — wrote a confidential memo to London in which he said, “The Indian plains are bleached white with the bones of weavers.” These were victims of globalisation in the mid-19th century. But they recovered. Indian weavers learnt to dye and print beautiful designs. By the end of the 19th century, India had climbed back to being the number two producer of textile.

Your book reads globalisation as a creative and historic process of interconnectedness. But anxieties around globalisation today are not about interconnectedness so much as about the shape globalisation has taken, aided by many things that didn’t previously exist: technology, media, the growth of extremely large conglomerates. In the past, traders did business on more equal terms.
You are right, the balance of power between partners has shifted. India and China were once disdainful of European traders who wanted to barter trinkets for spices and porcelain and spices. They demanded silver bullion or gold; they set the terms of trade. Then Columbus discovered the New World; Europe’s expansionism gave it a leg up. The tables turned. But a turning of tables, seen on a historical scale, is ephemeral.

Bound Together Nayan Chanda Penguin 391 pp; Rs 525

Bound Together
Nayan Chanda
Penguin
391 pp; Rs 525

But the shifts in power today are not just geographical, they are within countries. The anxieties too are not geographically located — you have the alliances of the poor and the alliances of the benefited. Would you say the basic nature of globalisation has changed?
That’s a very good question. There are many changes, but you can group them in three categories. The first is what we just discussed — a change in the balance of power between the exporting and importing countries. The terms have shifted in favour of industrial countries. The second significant difference is that the spread of trade has resulted in a very unequal distribution of gains. Until the Industrial Revolution, trade was very limited. Then it grew extensively but was limited to the elite of different countries. The consumer revolution in the 20th century changed that drastically. Plastic was the key driver of this. You no longer needed metal and wood and strong sturdy material to hold things, so people began buying more than they needed. Consumerism created a much bigger market than ever existed — big markets brought changes in the structure of corporations and how they do business and the economic gap between countries and within countries began growing.

You argue that anxiety about globalisation is pointless because nobody is driving or directing it. How accurate is that view? And the big myth one is fed is that free markets and globalisation bring trickle-down effects. But your own facts point in the other direction. In Latin America, in the US — benefits accrue only to corporations, not workers.
Yes, but the issue here is not that the free market is not delivering but that the free market needs control, needs government and regulation. The free market does not mean you have the freedom to do anything — it has to be in the national interest. As long as a territorial government is there, that government is responsible for the welfare of the people in that territory. They have to look after their people. One crucial way is through controlling the distribution and deployment of taxes. How the government collects tax and uses it determines how beneficial or non-beneficial a free market is. You have to have clean governments, honest politicians. Redistribution has to be in the interest of the whole population, not just corporations. But there is no option to a free market — without it, you would not have efficiency.

That’s theory. But one is dealing with human nature. Big money has changed the face of politics in India.
It doesn’t have to. Big money doesn’t mean big corruption. Governments in Europe look after the welfare of their citizens much more than in developing countries. There is corruption everywhere — but the degree varies, and the impact on the masses varies. Holland, for example, is awash with money; it is the mecca of multinationals. But it has a clean government. In Latin America, the elite were just too greedy and corrupt. In Africa, the aid was just salted away. Africa lacks human capital, it lacks people with technical or even basic economic competence to budget and run its affairs. There’s also the greed of politicians and the military, so foreign capital on its own doesn’t itself determine anything.

China’s progress has been phenomenal. 300 million people there are living better than they have done before. It opened up its economy and allowed its surplus labour to move from farm to industry.

But that has also led to sweat shops, cheap labour and 80,000 official riots…
You might say they are being exploited – yes, they are. From the point of view of Western corporations and civil rights groups, they are being exploited. But from the point of view of the exploited, worse than being exploited is not being exploited — that is, not having a job. So the question is, when you have a huge population, you have to employ them.

But the US, the biggest proponent of globalisation and the free market, has itself witnessed jobless growth and a fall in standards of living. Can’t the forces of globalisation be set in new directions, or is there inevitability in that too?

It has to take new directions. That’s my hope. That’s how I end the book. Because no one is in charge of globalisation, it cannot be stopped, but because everybody is connected, we have to nudge it in a way that is beneficial to most and least harmful. Greed empowered without restraint is disastrous. This is why I am very supportive of all the pressure groups that are trying to keep people honest, trying to raise issues. Government has become weak around the world — it’s people’s groups that nudge it back on course.

There is much talk of India becoming a superpower in the next few decades. What do you see as its core strength?
Historically, India’s advantage has been its manpower and its quickness to learn skills that others are slow to adopt — Americans, for instance, have been very slow in picking up skills. But India is not going to be able to keep up with its own needs unless it gets more people into the education net. India’s education system is key to its survival. The other key thing is, India has to industrialise. Unfortunately, this drive to industrialise has got mired in controversy around land grabs.

Corporations and governments have tried to take advantage of some situations and taken more land then necessary — but the backlash of this should not derail the process of industrialisation.What triggered this book for you?
In 1997, while I was editor of The Far Eastern Economic Review, we began to think of special issues for the millennium. That’s when the idea struck me: at the beginning of the second millennium, how did Asia look and how has it changed? I began reading and realised that Asia as we know it today is a product of globalisation. It has been transformed by influences across the world. We did four special issues on the subject. At one point, I asked myself, what would have been the tallest man-made building that the first light of January 1, 1000 would have fallen on? I found it would have been the Borobudur temple in Java, a Buddhist temple built in 849 ad. Buddha was born 2,000 miles away but had inspired people to build this massive temple — I saw it as a temple of globalisation. Asking questions around this led me to pinpoint the four broad categories of actors who left home carrying goods and ideas to become catalysts across the globe: traders, preachers, adventurers and warriors.

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