The key problem of Narendra Modi’s notion of self-reliance in the face of US-China trade war aims to substitute the global supply chains away from China to assist MNC-backed American global capital. After two hundred years of colonial rule, Brittan completely crushed the Indian industry and exhausted the resources at the dawn of the independence. Jute, cotton and railways were only the established industries worthy to name.

India’s industrial sector was in very poor condition. It only contributed about 11.8 per cent to the national GDP. The output and productivity were very low. We were also technologically backward. It was realised that mere political freedom would not be of much use without achieving economic independence. Nehruvian model of self-reliance was more or less followed during the course of seven Five-Year Plans after Independence. So, the Mahalanobis model came into effect in the second Five-Year Plan. The focus here was on heavy industries, especially those that produce capital goods (equipment or goods used in the production of other goods). Major steel, oil, energy, pharmaceutical, hydel power and irrigation projects and fertilizer plants were built in public sector seeking assistance from erstwhile USSR.

Several national research institutions and IITs have been established across the country to give science and technology support for self-reliant heavy industry. At the dawn of Independence, most private entrepreneurs had neither vision nor the capability to undertake heavy investments in core sector industries having long gestation periods. In line with Bombay plan of 1945, eight major industrialists of that time sought huge government investments in establishing a heavy industry in public sector and also actively supported Nehruvian model of self-reliance. The industrial policy was formulated to help Indian capitalists to create a potential national bourgeoisie robust enough in later times to get into heavy and capital goods industry.

Decades following independence, established self-reliant heavy industry in strategic sectors of economy in public sector had put India ahead of most developing countries. By ’70s and ’80s, however we failed to modernise these industries technologically. With no clear agenda to conduct research to meet the technological needs of domestic heavy industry and address local health and other pressing societal issues, most of our famed national institutes and IITs ended up conducting research catering to research requirements of major western MNCs. Universities became centres for manufacturing thousands of highly qualified engineers and scientists whose final destination was immigration to USA.

During 1970s and ’80s, however, we failed to modernise and technologically upgrade our industries to match with world standards. Private sector too paid little attention to domestic research, development and technology. Due to low productivity and monopoly control in production even in consumer goods’ production, we lagged behind the world in productivity. Despite existence of large steel producing Bhilai or Bokaro or Coal India there were serious shortages for steel, energy, fertilizer, electrical, electronic and other goods and were rated globally uncompetitive.

As a result in late ’70s and early ’80s we missed the bus to arrive at third technological revolution comprising electronics, microprocessors, personal computers. Thus, we got completely detached from global supply chains. The public sector industry became known for low productivity, too much of bureaucracy, financial mismanagement and corruption.

Indian private sector standing on the clutches of public sector heavy industry and bled it all through in sectors like steel and energy. By mid ’80s, it grew in strength and became emboldened. It started collaborating with major MNCs for the latest technology to manufacture goods by paying huge royalties. In mid ’70s western MNCs started investing heavily on R&D in basic sciences and succeeded in developing state-of-the-art modern technologies in manufacturing.

In early ’90s India joined the neo-liberal band wagon under intensive pressure from IMF and World bank actively embarking liberalisation, privatisation and globalisation. Following the dictates of those global financial institutions, the very concept of self-reliance was rubbished, in the belief that it was unprofitable to reinventing the wheel indigenously, when advanced technologies could simply be bought from anywhere at lower costs. By early ’80s major MNCs were possessing dominant modern technologies and started controlling of production of goods worldwide.

In 1991, the chosen path of disinvestments and privatisation as part of neo-liberal economic agenda resulted in a paradigm shift in the policy of the government of India towards the PSEs. They lost the monopoly assured so far by the government. The regime of commanding heights for the public sector gave way to the environment of market economy. Beginning twenty first century with dwindling state protection and budget support, the PSEs now had to face competition and domination of market forces.

Based on profit-making capabilities (an average annual turnover of more than Rs 25,000 crore and Rs5,000 crore of profit during the last three years) thr government identified nine central PSEs (BHEL, BPCL, GAIL, HPCL, IOC, MTNL, NTPC, ONGC, and SAIL) as ‘Navratnas’ and 45 ‘Miniratnas’ gave them autonomy allowing them to enter in to joint ventures and raise capital from the international and domestic markets. The Board for Industrial and Financial Reconstruction (BIFR) was created to identify sick industries as part of the neo-liberal economic agenda gradually to disinvest, sell or close them finally.

Privatisation or disinvestment process was on a fast-track, under the National Democratic Alliance (NDA) government of A B Vajpayee. It even set up a separate ministry of disinvestment headed by Arun Shourie. The disinvestment ministry between 1994 and 2005 privatised Videsh Sanchar Nigam Ltd, Hindustan Zinc, Balco, IPCL, several ITDC hotels and initiated sale of Maruti automobiles. The strategic sales during that period merely fetched government Rs 6,344 crore.

Western MNCs guard their technology and extract huge amounts from developing nations in the form of royalties and patents. For example, mobile network MNCs Vodafone Idea and Airtel had to pay about Rs 51,400 crore and Rs 25,980 crore worth of balance annual growth revenues respectively for using satellite 3G services to department of telecommunications. Despite Supreme Court’s ruling, the firms backed by present government refuse to pay this hefty sum thus making both Hindustan telecommunications and BSNL bankrupt.

In the last 14-15 years under present and successive regimes, we got FDI of around 345 billion dollars (about Rs 23 lakh crore). And the amount of foreign exchange that went out from the country to MNC mother companies during the same period was around 287 billion dollars (about Rs 19 lakh crore). This information was revealed by none other than Dr Ashwani Mahajan, convener of Swadeshi Jagaran Manch, an affiliate of RSS.

In the recent Rafale fighter jet acquisition deal, France’s Dassault and Reliance Aerospace Ltd (DRAL, subsidiary of Anil Ambani’ group) formed a joint venture to manufacture jet components at the Nagpur facility of the latter. Hindustan Aeronautics Ltd, a proven and experienced PSE was overlooked in granting this production contract. It was alleged in many quarters that despite no experience in aircraft production (incidentally Ambani’s DRAL in Nagpur was created only 15 days after signing the contract) the award was given to Anil Ambani’s DRAL simply to rescue his sinking business fortunes. It was also alleged that the contract was negotiated to Anil Ambani due to his closeness to government officials in Delhi by ignoring public sector H

As per the available data the ratio for Maharatna companies operating performance and productivity of assets was respectable and indicates their higher efficiency with 4.5 for Coal India shows the highest value (0.51), followed by ONGC (0.23), GAIL (0.13), BHEL (0.12) and NTPC (0.11).

Despite high financial performance of PSUs, the present NDA government is actively pursuing its neo-liberal reforms by privatising even profit-making PSUs as can be seen from the above data. It appears the present government (as the previous regimes) is hell bent on privitising all public assets and hand over them to private corporate houses.

At a time when the country is seriously struck with Covid pandemic, instead of addressing the problem, the ruling NDA government chose to best use of this epidemicto disinvest all public assets at break-neck speed. While uttering Atmanirbharata, in reality Narendra Modi is breaking the back of indigenous policy of self-reliance and actively serving the interests of Indian capitalists and global imperialism. Current neo-liberal reform march does not stop with disinvestment of PSUs like, coal, oil industries but extends to railways, health, education and other sectors of economy. The temples which were built by India’s first Prime Minister in 1950s and later, are being dismantled one by one by the present government. (IPA Service)