India and the World: Understanding new modes of engagement

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This working paper looks at India’s fast growing and emerging economy and its rise in global power by considering how valid this external perception is when, in reality, India’s many States experience widespread conflict, poverty and under-nutrition. This paper reviews some of the future challenges, especially around working in the G20, and in handling issues around Climate Change and conflict over resources, and argues that focused and sustained civil society action is needed to encourage the development of more equitable policies.
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  Oxfam India working   papers series October 2010OIWPS - IX Sukumar Muralidharan India and the World Understanding New Modes of Engagement   From being classed as an “emerging” economy for many years, India has, partly on the back of its robust growth performance since the early-2000s, earned recognition as an global power in the making. This is re fl ected in a new spirit of assertive self-con fi dence within of  fi cial circles and a vigorous “can-do” attitude within India’s business community. Internal political consensus though, seems elusive and India’s many regions of endemic con fl ict show little sign of sharing in the drive towards global power status. Poverty and under-nutrition remain areas of serious concern. Though procedures of statistical estimation have been contentious in recent times, there is now conclusive evidence that the optimism of the early years of the millennium, that a dent had been made in poverty, was misplaced. A host of progressive legislation has been introduced in recent years, backed up with seemingly solid fi scal commitments in areas such as employment and education. But the foundations remain in fi rm and since the global fi nancial meltdown of 2007-08, there have been grounds for worry that the sources of India’s economic growth have themselves become rather narrow. In fl ation remains a worry and a deeper analysis of its causes might indicate that some of the new fi scal commitments may be unsustainable without other tough decisions being made. India remains a major presence in global councils dealing with issues of consequence, such as multilateral trade and climate change. From being a bulwark against efforts to impose inequitable agreements on the developing countries, India has of late been seen as a voice for positive change. The country’s stature in global disarmament councils though, stands diminished and its potential to contribute positively in most other forums still remains to be proved. Focused and sustained civil society action could nudge the policy establishment towards options that mean a positive difference for the world’s poor. Abstract Disclaimer: Oxfam India Working Paper Series disseminates the fi nding of the work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the fi ndings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The fi ndings, interpretations, and conclusion expressed in this paper are entirely those of the authors. They do not necessarily represent the views of Oxfam India. Produced by:   Oxfam India  For more information, please contact:  Avinash Kumar  Theme Lead - Essential ServicesOxfam IndiaPlot No. 1, Community Centre2nd Floor (Above Sujan Mahinder Hospital)New Friends Colony, New Delhi - 110 025Tel: 91 11 4653 8000Website: www.oxfamindia.org  Author:  Sukumar Muralidharan Sukumar Muralidharan  is a freelance journalist based in Delhi. He has had twenty years of experience in the print media, including most recently, as Deputy Editor in Delhi of India’s Frontline magazine. Prior to this, he has worked with the Press Trust of India, Business India in Mumbai, and Deccan Herald in Bangalore. He was for one year, a visiting professor at the Nehru Centre, Jamia Millia Islamia, Delhi. As a  journalist, he has had reporting, writing and editorial responsibilities in areas like science and technology, business and economics, politics, and international affairs. Study supported by Oxfam India in collaboration with Sukumar Muralidharan Copyright @ 2010 Oxfam IndiaReproduction of this publication for educational or other non-commercial purposes is authorized, without prior written permission, provided the source is fully acknowledged.   1 CONTENTS 1. Where pretence ends and reality begins 2. Poverty and global voice 3. Fiscal difficulties and public welfare commitments 4. RTI and the new regime of transparency 5. Dealing with inflation 6. First steps for meaningful and credible global engagement 7. Achieving coherence between multiple forums 8. Second wind for the Indian growth process 9. The G-20 Forum and its Potentialities 10. The challenge of climate change and India’s response 11. Nuclear deal and after: diminished credibility? 12. A problem of image Where pretence ends and reality begins Headline news in much of the country’s media in the month of June, blazoned a 50% increase in the number of millionaires in India. This was among the sharpest rates of increase that any country had witnessed. And yet with all this, the total number of millionaires in India in 2009 stood at just over 120,000, a paltry number for a country of 1.2 billion people. 1  If the importance given to a matter involving this number should seem an index of skewed priorities, the point as emphasised by Merrill Lynch Wealth Management, which carried out the study, was different. Despite the financial turbulence in the world economy, levels of wealth among high-net worth individuals had increased. This pointed to the sound underpinnings of the growth story, said Merrill Lynch, adding for reassurance that India’s wealth is not a bubble, since “Asia has caught up with Europe in terms of its high-net worth population and their wealth”. Just in case it were to be thought that India’s growth story is just about the creation of millionaires, the Union Government has over recent months been showing great seriousness of intent in increasing budgetary commitments towards basic human needs. Early in August, Finance Minister Pranab Mukherjee spoke of a possible outlay of Rs 2.31 billion (Rs 2,31,000 crore) over three years to create the infrastructure that would make the right to education a reality for all Indians. Following this, the next two priorities of the Government he said, would be to make the rights to food and health operative. This level of ambition he said, would have been beyond imagination in the 1980s when the Government, despite best intentions, found itself stymied in all efforts to directly address poverty. What had made the unthinkable a distinct possibility was the turning of a page in the 1990s, which made India’s contemporary and ongoing growth story a reality. 2  
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