Globalisation and liberalisation

Since the late 1980s, and especially since 1991, India has moved from state-led development towards liberalisation and globalisation.

Globalisation: the growing movement of goods, money, information and people across the world, creating more integrated markets. India's software and call centre (BPO) industries are linked directly to the global market: a worker in Bengaluru may serve a customer in the US.

Even culture becomes a commodity in global markets: yoga, ayurveda, Indian music and spiritual retreats are sold worldwide. The Pushkar fair in Rajasthan, once a camel and cattle fair, is now marketed internationally as a tourist attraction.

Liberalisation (also called marketisation) means giving markets a bigger role and the state a smaller one:

• privatisation: selling government companies to private firms;
• deregulation: removing government controls;
• lowering tariffs (taxes on imports);
• letting foreign companies invest and operate in India.

The effects are mixed:

• Gains: faster economic growth, new goods and services, new jobs in some sectors, and a growing middle class.
• Losses: farmers face competition from imports and less state support (such as lower government buying at minimum support prices); small manufacturers cannot compete with big firms; workers in the organised sector lose secure jobs as more work becomes contract or casual.

So liberalisation has winners and losers. Sociologists ask who gains and who loses, not just how fast the economy grows.