PUCL Bulletin, August 2002

Loss of economic and political sovereignty of "We the People of India" by globalisation.
-- By Ravi Kiran Jain

Globalisation is destructive of the sovereignty of the people of this country, which we had solemnly resolved to have in our Constitution.

The Constituent Assembly was already engaged in the task of framing the Constitution of India when we became independent on 15th August 1947. The framing of the Constitution of India was completed on November 26th, 1949 on which date it was adopted and we became Republic on January 26th, 1950

Our Constitution is a socio-economic document. It is a promissory Constitution, a promise made by "WE THE PEOPLE OF INDIA", to ourselves, who had resolved to constitute India into a "Sovereign Socialist Secular Democratic Republic" to secure to all its citizens Justice: Social, Economy and Political and gave "ourselves this Constitution." This promise is contained in the Preamble.

In our constituent assembly this twenty sixth day of November1949, do hereby adopt, enact and give to ourselves this constitution. The Preamble and part IV of the Constitution represent the hopes and aspirations of the people of this Country.

In his famous Tryst with Destiny speech given on August 14-15, 1947 Jawahar Lal Nehru declared that the task ahead was "ending of poverty, and ignorance and disease, and inequality of opportunity." It is this task which we resolved to be achieved keeping in view the true spirit of the Preamble, "We the people of India" have enacted the Constitution. 'We' who were 36 crores in 1950 and who are now 102 crores are the architects and founding fathers and mothers of this Constitution.

The Directive Principles contained in part IV of the Constitution gave us a time bound programme not only to achieve the aforesaid task of which Nehru had reminded the country on the eve of independence, but also to bring prosperity by adopting the economy of self-sufficiency and self-reliance and to become a leading country in the world. Unfortunately, we could not achieve what was envisaged within that time frame.

The history of the struggle for political freedom of the country had played a vital role in the making of our Constitution. Certain fundamental rights are guaranteed for citizens in part III of the Constitution.

Human rights can be classified into the following three categories:
(a) Civil and Political rights
(b) Economic, Social and Cultural rights; and
(c) Collective Rights to Development.

The first category of these rights namely civil and political are enforceable through provisions contained in part III of the Constitution under the heading "Fundamental Rights," the II and III categories of these rights are contained in part IV under the heading "Directive Principles of State Policy", though they are not enforceable through the courts, yet they are "nevertheless fundamental in the governance of the country" and it is the duty of the state to apply these principles in making laws.

The Directive Principles exhort the state to ensure that citizens have an adequate means of livelihood, that the operation of the economic system and the ownership and control of the material resources of the country sub serve the common good, that the health of the workers, including children, is not abused, and that special consideration be given to pregnant women. Workers, both agricultural and industrial, are to have a standard of living that allows them to enjoy leisure and social and cultural opportunities. Among the primary duties of the State is the raising of the level of living that allows them to enjoy leisure, and social and cultural opportunities. Among the primary duties of the State is the raising of the level of nutrition and the general standard of living of the people. The principles express the hope that within ten years of the adoption of the Constitution there will be compulsory primary education for children up to the age of fourteen years. The other provisions of the principles seek equally to secure the renovation of Indian Society by improving the techniques of agriculture, husbandry, cottage industry, etc.

In complete contravention to these fundamental principles the globalisation has reversed the process and is destroying the right to development contained in
Part IV.

The Supreme Court of India in a recent judgment noticed: The Directive Principles in our Constitution are fore-runners of the U.N.O. Convention on Right to Development as inalienable human right and every person and all people are entitled to participate in, contribute to and enjoy economic, social cultural and political development in which all human rights, fundamental freedoms would be fully realised. It is the responsibility of the state as well as the individuals, individually singly and collectively, for the development taking into account the need, fuller responsibility for the human rights, fundamental freedoms as well as the duties to the community, which alone can ensure free and complete fulfillment of human being. They promote and protect an appropriate social and economic order in democracy for development; The state should provide facilities and opportunities to ensure development and to eliminate all obstacles to development by appropriate economic and social reforms so as to eradicate all social injustices. These principles are embedded, as stated earlier, as integral part of our Constitution in the Directive Principles. Therefore, the Directive Principles now stand elevated to inalienable fundamental Human rights. Even they are justiciable by themselves.

Globalisation has made impossible for state to apply these Directive Principles taking them to be fundamental in the governance of the country "in making laws",. After we become the member of W.T.O. it is not the Directive principles but the dictates of the W.T.O. which have became fundamental in the governance of the country. There are clauses in the treaty that our Parliament has to enact laws in tune with some of its provisions. The people's

Commission on GATT headed by Justice V R Krishna Iyer rightly observed that the Final Act deprives the center of its exclusive legislative power qua some of items in three lists of the Seventh schedule by making the following observation in concluding part of it's report.

"In short, the Union Parliament and the State Legislatures have been ousted of their legislative sovereignty over an extraordinary range of matters. Even domestic agriculture, under the purview of the state government, has been transferred wholesale to the W.T.O. The unavoidable conclusion is a loss of legislative and executive sovereignty and the increasing irrelevance of the Union Parliament as an instrument of governance, worse still, all this has been accomplished without even the knowledge or consent of the parliament, under circumstance in which the Prime Minister expressly stated that he would not wait for a parliamentary debate pending negotiations. Negotiations were conducted in a clandestine and covert fashion and the only information ever provided to the people, that too at the end of the day, were statistic furnished by the OECD."

In the seventh Schedule of the Constitution, there are three lists, which provide the power to the Parliament and State Legislatures to make laws regarding various developmental activities. The People's Commission had pointed out that WTO impinges on India's sovereignty by preventing the Centre or the States from legislating in certain matters.

It is accordingly obvious that WTO is destructive of the right to development contained in Part IV of the Constitution of India and takes away our economic and political sovereignty. Right to development can be realised only by people's participation in the process of development. "We, the people of India", should decide what should be the model of development.

"We, the people of India" have been caught in cobweb of globalisation when in 1991 the government led by Chandra Shekhar found that the problem of India's balance of payments had become acute and he had to start negotiations with the I.M.F. Thereafter the Congress Government with Dr. Manmohan Singh as Finance Minister announced new economic policies which departed widely from the theories of Welfare State. The negotiations with the I.M.F. and the World Bank resulted in large immediate credits. These two financial institutions give loan only on their satisfaction that the borrowing country is '"on the right path in its economic, fiscal and industrial reform."

Under the guise of reaching to a satisfaction that the borrowing country is "on the right path," these institutions monitor the economic and industrial development. Now the World Bank gives guidelines which have become "fundamental in the governance of the country," and not the Directive Principles. Various governments since 1991 are committing a breach of faith by violating fundamental norms and principles on which the citizens of this country were to secure for themselves social, economic and political justice. Now the World Bank gives periodical reports.

It examines our "economic performance." Our government provides to World Bank, a free access to all its institutions and official records. The World Bank declares that it conducts studies "as part of the continuing analysis by the Bank of the economic and related conditions of our country." (A World Bank Country Study: India Sustaining Rapid Economic Growth, July 1997)
In its so-called report "India: Reducing Poverty Accelerating Development - A World Bank Country Study" (Oxford University Press, 2000), the World Bank has suggested ways to meet long-term challenges of poverty-reduction and development. It is not merely a suggestion. It is a document of our economic slavery.

One may feel aghast by a careful perusal of this report that is revealing of the fact that all successive governments have absolutely surrendered our country's development agenda in the hands of the World Bank. It is crystal clear by this report that now it is under the World Bank's dictates that the issues of basic education, health, agriculture, industry, infrastructure, etc. are taken up. This report says that is was discussed with government of India on August 10, 1999. It runs into 260 pages and is very elaborate. It is not possible to believe that such a bulky document containing so many aspects could be discussed only in a day. It is not mentioned in the so called report as to who was representing the Government of India in this discussion.

May be that it was only some bureaucrat. It is not merely a report, but a long' term agenda claiming to give guidelines to "We, the people of India", how to reduce our poverty, improve our health, impart education to the poor, how to develop infrastructure and how to have "a good governance" Now the "governance" is being done in accordance with the monitoring of the World Bank, and not on the Directive Principles, contained in Part IV, which according to the Constitution are fundamental in 'governance.' There is hardly any- aspect of human activity, relevant for economic and social development, that has not been dealt within this so called report.

Sovereignty means that the people shall decide how to develop themselves. However, the process of globalisation is creating unemployment, recession, scarcity of raw materials and a haphazard industrial growth and making this country economically bankrupt and it has put us in the cobweb of multinationals with total loss of sovereignty, both political and economic on account of liberalization and globalisation.

The biggest tragedy of the country is that there is no public criticism of the present state of affairs. The reason is that there is no participation of the people. Public action is necessary to restore sovereignty. The enlightened people of this country believe that this loss of sovereignty at the hands of W.T.O., World Bank and I.M.F. is far worse than the slavery which we had before August, 1947. The political leaders of our country have divided the people along caste, communal and regional lines. Issues have become non-issues and non-issues are presented as issues. Jean Dreze and Amartya Sen in a recently published work "India: Economic Development and Social opportunity" rightly conclude that "public action in this broad sense, can play a central role in economic development and in bringing social opportunities within the reach of the people as a whole".

These eminent social scientists further say, "This depends upon a variety of factors including the nature of the political parties and their leadership, the skill and traditions of investigative journalism and also the level of literacy and education in this region." Independence in 1947 meant transfer of power from an alien to the local political class. 'The political leadership till about 1970 maintained Constitutional norms to strengthen the nation by giving it a development agenda to reach to the commanding heights of the economy. But after 1971, a second generation started attaining adulthood. A process of concentration of power in few hands started. Institutions became secondary. Men and women in power became primary. The process of decay of Institution started. The process was hastened and became very fast since 1980. Market started dominating the Institutions, the fall out of which was consumer culture, greed and corruption and nexus of political class with criminals, mafias and multinationals. Since 1991, the political leadership of this country started the process of total surrender of development agenda in the hands of I.M.F. and World Bank.

The state is in retreat everywhere and power is being transferred from the political class of this country to the multinationals. This is happening under the garb of liberalization and globalisation. Power is being transferred to the business class, first to the Indian Business Class and through it to the foreign business led by multinationals.

The loss of sovereignty is a known aspect, but the most important aspect is what should be done. As a first steps the people of this country be made aware of this loss of sovereignty, which is directly violative of their right to development. A debate has to take place on a national scale as to how there can be a people's participation to fight with this situation. It has to be a new struggle for economic independence more arduous than the struggle for political independence that we fought before 1947. Independence in what sense? Independence in deciding our way of life, our model of development, our level of education, our culture, so on and so forth.

The new tools and the new remedies for the enforcement of Human Right To Development can be found in the Institutions of Local Self Governments created by 73rd and 74th Constitutional Amendment Acts for the rural as well as the Urban decentralized planning. The people themselves at the local level can decide what should be the model of development now. The right to development encompasses within its ambit all Human Rights and Fundamental freedoms including right of self- determination. The Right Of Development is of multi-dimensional character incorporating all Civil, Political, Economic, Social and Cultural rights necessary for the holistic development of the individual and the protection of this dignity.

Democracy implies people's participation not only in decision making about preparation of plans for economic development and social justice but also in execution of such plans.

Now under Part IX and IX-A of the Constitution vide Article 243 - B and 243 - Q Panchaayats "shall be constituted in every state" in rural areas and urban areas. Now these Panchaayats are the creation of the Constitution and not the creation of an ordinary Statute. These institutions are Constitutional functionaries, These institutions can be used to realize the rights contained in Directive Principles of State Policy better than higher echelon like Parliament and State legislature which is evident by the perusal of the relevant provisions of the Constitution, Article 243-G give power to the Panchaayat in rural areas and Article 243-W gives power to the Municipalities in urban areas "to function as institutions of Local Self Government" having powers with regards to "the preparations of plans for economic development and social justice as well as the implementations of the schemes for the economic development and social justice as may be entrusted to them including those in relation to the matters listed in the Eleventh Schedule and Twelfth Schedule of the Constitution These schedules are given at the end of this paper. Kindly see the list of items in these schedules which would show that all possible human activity is covered by these items which are necessary for human development.

These are now small republics of the Local Self Government, The institutions, by devolution of powers and responsibilities, shall have the power and authority to prepare plans for economic and social justice, development activity has been brought to the grassroots level. Now we can involve ourselves in our development to have social justice by decentralised planning through these institutions. But we have to create awareness among the people to be active and for defending their civil, political, economic and cultural rights by participating in the decision making process of the implementation of plans and to the execution thereof.

But while adopting the path of involving the people of this country to realise their right to development through the local self- government institutions; we have to be on our guard keeping in view the world Bank's evil eyes on these Institution as well. On page 58 of 'India: Reducing Poverty, Accelerating Development- A World Bank Country Study, it has been observed:
"Local governments, by and large, do not have the autonomy to choose the taxes, these being either laid down by state governments or approved by them.
Except for Municipal Corporation, the local government have no borrowing powers and are wholly dependent on State governments for capital loans. The borrowing powers of municipal governments are governed by the Local Authorities Loans Act 1914, which require them to borrow with the previous sanction of the state government."

This shows that after laying their hands on the Central and various state governments, they want to have an access to these institutions and make even these institutions to loose their decision making power. If that happens, it would be an irreversible process of loss of sovereignty.

Dominance of the global powers like World Bank and IMF have weakened our Parliament and state legislatures and have corrupted our political leaders. They have not yet been able to lay their hands upon the Institutions of' Local Self Government. We have to save these institutions from them.

Kindly Do Peruse These Two Schedules
Eleventh Schedule (Article 243 G)
1. Agriculture, including agricultural extension; 2. Land improvement, implementation of land reforms, land consolidation and soil conservation; 3. Minor irrigation, water management and water-shed development; 4. Animal husbandry, dairying and poultry; 5. Fisheries; 6. Social forestry and farm forestry; 7. Minor forest produce; 8. Small scale industries, including food processing industries; 9. Khadi, village and cottage industries; 10, Rural housing; 11.Drinkingwater,; 12. Fuel and fodder; 13. Roads, culverts, bridged, ferries, waterways and other means of communication; 14. Rural electrification, including distribution of electricity; 15. Non-conventional energy sources; 16. Poverty alleviation programme; 17, Education, including primary and secondary schools; 18. Technical training and vocational education; 19. Adult and non-formal education; 20. Libraries; 21. Cultural activities; 22. Markets and fairs; 23. Health and sanitation, including hospitals, primary health centers and dispensaries,; 24. Family welfare; 25. Women and child development; 26. Social welfare, including welfare of the handicapped and mentally retarded; 27. Welfare of the weaker sections, and in particular, of the Scheduled Castes and the schedule Tribes; 28. Public distribution system; 29. Maintenance of community assets.

Twelfth Schedule (Article 243W)
1. Urban planning including town planning 2. Regulating of land-use and construction of buildings 3. Planning for economic and social development 4. Roads and bridges 5, Water supply for domestic, industrial and commercial purpose 6. Public health, sanitation conservancy and solid waste management 7. Fire services 8. Urban forestry, protection of the environment and (promotion of ecological aspects 9, Safeguarding the interests of weaker sections of society including the handicapped and mentally retarded 10, Slum improvement and up-gradation 11. Provision of urban amenities and facilities such as parks, gardens, playgrounds 12. Promotion of cultural, educational and aesthetic aspects 13, Burials and burial grounds cremation grounds and electric crematoriums 14. Cattle pounds prevention of cruelty to animals 15, Vital statistics including registration of births and deaths 16. Public amenities including street lighting, parking lots, bus stops and public conveniences. 17. Regulation of slaughter houses and tanneries.

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