Daily Times

Siamese-twins — Pakistan and India — may not have their fortunes in common, but they have many common woes. This is the impression one gathers after visiting Delhi and Gurgaon for a week.

Let us quickly look at the fortunate side of India, as the list is small. First, the Indian economy has grown over 8 percent for 10 years in a row. However, it is now slipping, but still going to be around 6.5 to 7 percent depending on who you listen to — the government or independent economists. Its middle class has increased rapidly to almost 30 percent of the population, as it does when the growth rates are higher in any economy. In contrast, Pakistan’s economic growth rate ranged between 2.5 to 4 percent at its best for the last three years, and many from among the 60 million middle class have fallen to the lower rung, pushed by high inflation. However, measured on the basis of purchasing power parity over the period 2000-2009, 40 percent of Indians lived below the poverty line, while Pakistan fared better at 22.6 percent (source: HDI report).

Second, democratic institutions in India are strong though the UPA coalition government is weak. But it is not under any danger of a military intervention, and its foreign policy is not decided by the military generals. Unlike India, Pakistan’s democratic institutions are weak and the civilian government is constantly kept under pressure by the khakis. Foreign policy decisions are made in Rawalpindi and all attempts by civilian governments to move away from the dictated line are immediately dubbed as treason. Unfortunately, many politicians and journalists have been abetting this crime against the nation.

Now coming to the common woes, with the most prominent being the rising inequality in Indian and Pakistani societies. Though the middle class has grown in numbers in both the countries, the inequalities have grown sharper. Both countries are blessed with a young population bulge, but that is not being harvested as a demography dividend. The result is rising unemployment and massive migration of the rural poor to the cities. Both countries are facing pressure on urban infrastructure and the cities are bursting at the seams. However, in India the middle classes crib that though the government has money, it is not doing much for infrastructure development. The Indian government’s view is that it is not awash with cash. And it has to control inflation by cutting down the fiscal deficit that hovers at 5 to 5.5 percent.

Indian economists place much of the blame for the slowing down of their economy on the dithering decision making owing to the pulls and pushes of the unwieldy UPA coalition. In Pakistan, the government does not have that kind of money and is under pressure over the fiscal deficit of 6 percent. The blame for Pakistan’s economic woes cannot be placed entirely upon the inefficient government, as it had inherited an economy that was kept under moratorium for two years by the previous government. And extraneous factors like the ongoing terrorist attacks, widespread floods and power shortage also challenge economic growth. But all this cannot condone the present mismanagement.

On the political front, both countries are destined to live with a system where the federal and provincial governments would be formed by different coalitions. The fragmentation of Indian and Pakistani societies has been going on for the last 64 years. Centrifugal forces are getting stronger and both countries’ electorates prefer regional leadership. This is directly in proportion to the rise of the regional bourgeoisie and middle classes. While this development slows down the Centre-led development, it has a positive outcome also. In both countries this situation has forced the central government to devolve more power to the provinces/states. Thus, democracy of regions is in the offing. But a more diluted mandate in both countries in the next elections is more likely.In my discourse with the Indian intelligentsia and middle class professionals, I found both sides were interested in the future course of political and foreign policy of each other’s countries. I was asked about the future of the Zardari-led coalition and whether the opening of the ‘memo’ sluice would deluge Zardari. Of course nobody thought change was going to come through constitutional means, as all know about the omnipresent ‘A’ factor in our politics. My interest was in the growing discord within the UPA coalition on various issues, the latest being allowing foreign retail giants 51 percent holding; Lokpal Bill (anti-corruption bill); rising demands by the coalition partners on the Centre; failure of the regional governments to raise their own resources to please their electorate; whether the Congress party will bag enough votes in the 2014 elections to be the major party once again; and whether Rahul Gandhi will be the next prime minister.

Almost all politicians and journalists were of the view that the opposition to FDI in retail business is just blackmail by leaders like Mamata Banerjee to get more funds for West Bengal and that eventually the government would be able to win her over. They also felt that the states supporting the FDI Bill should be allowed to permit foreign retail giants like Walmart, Carrefour and Metro, etc, to operate in their respective territories. Those opposing it can decide once they see the benefit of big stores to the farmers and consumers. Both in India and Pakistan the urban middle class parties resist tax reform.

The worst commonality is that both countries are burdened with heavy subsidies to public sector corporations. Air India alone has over (Indian) Rs 40 billion losses (Pak Rs 71 billion). While the global economic crisis has hit both countries, the Indian rupee has tumbled by over 15 percent in less than a year as compared to a decline of 2.5 percent in the Pakistani rupee. Business and middle classes in both countries hold poor economic management responsible for the fall in currency value, although much of it is due to the global economic meltdown. Most SPI basket items are more expensive in India than in Pakistan.

Dynastic rule is writ large on the political landscape of both countries. Congress cannot think of any other uniting factor for the party, or prime ministerial candidate, but Rahul Gandhi. All the people I talked to were of the view that he seems to be reluctant at this stage. But if he manages to get more seats in the UP state elections, where he is spearheading the campaign, he will be a candidate for PM. As a matter of fact, much of the Congress’ future, Indian intellectuals believe, hinges on the forthcoming UP elections. But the major obstacle here would be the Dalit leader Mayawati, who has floated the idea of further dividing UP into four provinces to consolidate her power. In spite of her maverick and corrupt politics, people believe it is a positive development because this is the first time the Dalits have been empowered in Indian politics.

Lastly, both countries are suffering from rampant corruption that is now at the top of the urban middle class’s menu. While they are backing Anna Hazare and Imran Khan in India and Pakistan respectively, quietly they are looking for tax loopholes and under-the-table bribes, wheels or baksheesh.

The writer can be reached at ayazbabar@gmail.com