Indian economy - real growth or speculative bubble?

To the Editor,

Sir,

In the last week of November there was much excitement in the Indian stock market as Reliance Industries rapidly dethroned Tata Consultancy Services (TCS) which had a market capitalization or market value of about Rs 8 lakh crores and was the most valuable company in India. Reliance became the first company in India that crossed Rs 10 lakh crores in market capitalization. Analysts as usual are trying to figure out what led to this rapid rise. Was it some changes in the Telecom policy which would benefit Reliance owned Jio or was it due to the recently announced strong alliance Saudi Oil giant ARAMCO etc etc.

Nevertheless what very few people have noticed is the performance of the financial services group HDFC which is into banking, housing finance, insurance and mutual funds. The HDFC group has recently shot past the hitherto largest Indian industrial group the Tatas and also Reliance. What was started as an enterprise by government owned financial institutions, HDFC today is majority foreign owned though the management is still Indian. In Fact HDFC Bank is being listed as one of the outstanding banks globally and has more than double the market value of the largest Indian bank, the government owned SBI.

We see daily in the media that economists are lamenting the plummeting figures of growth in Indian GDP from the heady 8-9 to now below 5 per cent. In fact the latest figures are 4.5 per cent and the next quarter might be even lower. With the government in denial and arrogantly rubbishing any inconvenient economic data, Dr Subramanian Swami an economist and ruling BJP’s MP in the Rajya Sabha suspects that the actual growth rate is perhaps 1.5-2 per cent. That is less than the population growth rate of 2.4 per cent!

But then what explains the stock market indices hitting record highs? It clearly shows that the stock market yo-yo has very little to do with the real economy where farmers are facing great agricultural distress, working class is faced with layoffs and youth are faced with unprecedented unemployment while the cost of education and health care have zoomed up.

This is another glimpse of today’s economy where it is increasingly dominated not by manufacture, services or agriculture in other words the productive sectors of economy but the wholly parasitical and speculative finance capital. The alarming thing is that there is a concerted move to move people’s house hold savings towards this speculative financial sector through mutual funds etc. In fact increasingly workers’ pension and provident fund are being pushed towards stock markets with the false promise of higher return. This is a sure road to disaster.

Yours,

SK, Dharwad

Tag:   

Share Everywhere

Dec 16-31 2019    Letters to Editor    Economy     2019   

PARTY DOCUMENTS

8 Jan General Strike

Call of the Mazdoor Ekta Committee

The all India general strike has been called to resolutely oppose the course of enriching the capitalist minority by impoverishing the toiling majority. It has been called to assert the rights that belong to workers, peasants and other toiling people who create the wealth of India.

Hum Hain Iske Malik! Hindostan Humara!

Election manifesto of a CGPI supported candidate for Lok SabhaParties of the capitalist class claim that there is no alternative to the program of globalisation,liberalisation and privatisation. The truth is that there IS an alternative.The alternative is to reorient the economy to fulfil people’s needs instead of fulfilling capitalist greed. This is the program for the Navnirman of India.

(Click thumbnail to download PDF)

5th Congress DocumentThe Report to the Fifth Congress of the Communist Ghadar Party of India, presented by Comrade Lal Singh, General Secretary of the CGPI, on behalf of its Central Committee, was discussed and adopted by the Fifth Congress of the CGPI, held in November 2016. By decision of the Fifth Congress, this report has been edited for publication.

(Click thumbnail to download PDF)

Click to Download PDFThe first part of this pamphlet is an analysis of facts and phenomena to identify and expose the real aims behind the Note Ban. The second part is devoted to a critical appraisal of the government’s claims that it will reduce inequality, corruption and terrorism. The third part is what Communist Ghadar Party believes is the real solution to these problems and the immediate program of action towards that solution.

(Click thumbnail to download PDF)

These Elections are a FarceInterview with Comrade Lal Singh, General Secretary of Communist Ghadar Party of India by Comrade Chandra Bhan, Editor of Mazdoor Ekta Lehar

(Click thumbnail to download PDF)

Manifesto 2014Unite around the program to reconstitute the Indian Republic and reorient the economy to ensure prosperity and protection for all!

There is growing realisation among workers, peasants and other self-employed people that the program of liberalisation and privatisation only serves to enrich an exploiting minority at their expense. Mass resistance is growing to this anti-worker, anti-peasant and anti-national program.

(Click thumbnail to download PDF)