It is important to create demand for goods and services before the products are made in India and services sector is established. How do we create demand? By putting money into the hands of as many people as possible. If we take various sectors of the economy, agriculture sector is the one where more than 50% (nearly 65%) of the people are engaged. If those in the agricultural sector are to have surplus money to purchase additionally produced goods and services, the prices for the agricultural products should be increased for farmers and the wages of agricultural labourers should be increased. This will mean:
- When prices of onions, tomatoes, rice, wheat etc go up, there should be no agitations against the price rise
- There should be no ban on exports of these items
- There should be no permission for imports of these items
- There should appropriate storage facilities to store surplus production and there is no distress selling
- Farmers should be employed full time i.e. at least for 8 hours a day. This will require farmers to take up allied work like dairy farming, poultry farming, goat and sheep rearing, honey making, rope making etc. or intensive farming like multiple crops, good irrigation, etc.
People not engaged in agricultural sector will suffer with increased prices. To remove their sufferings their wages should also be increased. Their wages otherwise also will go up with large scale demand from farmers and farm workers for the manufactured goods leading to higher profits for factories which in turn will lead to higher wages.
Gold is the main item of export for Guyana contributing over 40% to total exports. India is a very large importer of gold. India should explore possibilities of import of gold directly from Guyana , if necessary by undertaking of refining etc.
The second major item of export of Guyana is Rice. Guyana has large uncultivated but cultivable land. Indian companies can lease land for cultivation of Paddy, set up rice mills and increase exports of rice from Guyana. Guyana’s trade deficit can be wiped out.Indian companies can earn good profits as Guyana has fertile land and abundant rainfall.
Sugar is the fourth largest item of Guyana’s exports. Here also Indian companies can set up sugar mills and also lease land for cultivating sugarcane for feeding the mills. With increased sugar production, there will be increase in the production of molasses which can feed Rum factories. Guyana’s Rum is famous and Indian companies can produce and export Rum from Guyana.
Guyana also produces and exports rough diamonds and India is a large importer of this item. India can directly import diamond from Guyana .India can also explore possibilities of diamond exploration.
Some of the items which Guyana can import from India are: motor vehicles , including cars, sugar machinery, agricultural machinery like tractors, harvesters etc.Guyana consumes wheat but does not produce the same. Guyana can import wheat/wheat flour from India. The quantity will not be huge as the total population of Guyana is less than one million.
There are also possibilities for cooperation between the two countries in laying railway lines in Guyana and construction of bridges across rivers
Food Security is wrongly understood by planners. Food security means keeping adequate stock of food grains in the market. While countries where climatic and other conditions are not favourable for agriculture, the governments should ensure adequate stock in the market by facilitating or directly importing food grains. In countries like India food security means facilitating production of adequate food grains by making farming a profitable profession i.e. by ensuring fair prices for agricultural produce. At the same time government should ensure work with fair wages for all adult people. Even the disabled should do jobs according to their ability. The only fields where government should provide services free of cost or at subsidized rates are health and education. This is because, these services at times can become unaffordable for people.Food grains need not be supplied at subsidised rates.
Economy can grow only when the production of goods and services grow. This can happen only when all adults work.
Excerpts from “Simple Alternate Development Strategy”1997
“Import of technology can be avoided,if in addition to the correction of the universiy admission system. the Indian companies allot about 15-25% of their work force, for research and development. Manpower is much cheaper in India than in advanced countries. If an advanced country like Japan or Germany or USA can deploy 100 people for research and development in a particular area, India can afford to earmark 500 people or 1000 people or more for the same purpose. Then India can improve technology much faser than developed countries and also develop much higher and sophisticated technology and within 4-5 years the country will be in a position to export technology to foreign coutries. While developed countries like Sweden, denmark, Finland etc. with populations of less than 10 million can concentrate and specialise only in a few fields, India with a population of over 900 million, can specialise in almost all fields. India has the third largest reservoir of scientific and technological manpower. But unfortunately all are not employed. Even of the employed, not all are doing scientific and tehnical work. Most of the scientists, doctors and technocrats occupying very high positions in their respective fields do very little of their work but more of administrative work, (their aptitude, more for administrative work than to technical and scientific work, can be traced to the faulty admission system in professional courses…) which can be done by non-technical persons….It is really regrettable that with the third largest reservoir of scientific and technical personnel, India has not been able to produce even a single Nobel prize winner in science….. while many small countries in Europe can boast of several Nobel prize winners.
Small countires like Singapore and even medium sized countries like Malaysia, South Korea and Taiwan cannot afford to employ large enough number of people in research and developmt and, therefore have to import technology …..Again while in many countries,the colonial powers did not leave much of infrastructure for scientific and technical development, in India,the British have left large and well equipped establishments. At the time of independence, India had several univesities, scientific institutes like Geological
Survey of India,Meteorology Department, Council of Scientific and Industrial Research etc.The British established railways and telecommunication system in India within a few years of esablishment of the same in Europe. But this is not the case with several other countries. They did not leave such establishments in Singapore, Malaysia,Sri Lanka etc. In fact, some of the counries under the foreign rule, did not even have universities when they became independent. The British had even established several modern factories in India. All that India needed to do, after independence, was to improve upon and expand the existing institutes. Even now the task is only to improve and expand the existing establishments and not to start from the scratch. If done, India could become major exporter of sophisticated technology in almost every field.”
Two-three years ago there was bumper crop of onion. Onion prices crashed and in spite of very good crop, the farmers could not make more money than in the previous years. The consumers had very good time. The government did not take any action to give incentives to producers to export onions to ensure that the local prices did not crash. Government kept quiet.
This year, due to heavy rains and other reasons the production has done down steeply. The prices in the local market increased and the farmers who had very poor crop had some satisfaction that the prices are high. But the government would not allow them to be happy. On the basis of consumers’ complaints against high prices, the government disallowed export of onion and allowed import of onions free of any restrictions and without duty. The prices will come down and the farmers would suffer as usual.
While the consumers have good time through out their life, the producers of onions as also other agricultural produce will have bad or not so good time through out their life.
There is no rationale in the government’s action. The argument that due to high prices only merchants profit and not the farmers is not convincing.
The same is the case with cotton and cotton yarn. If producers of fabrics and ready made garments had good time- high profits- when cotton production was high and the prices were low, why not they have low profits or even small loss when cotton prices are high?