The Swadeshi Jagran Manch(SJM), an affiliated unit of the Rashtriya Swayamsevak Sangh (RSS), has been a vocal critic of the economic policies of the BJP-led government at the Centre including the Goods and Services Tax (GST) and opening of the retail market for foreign direct investment (FDI).

SJM national co-convener Ashwani Mahajan feels the government has been in a state of ‘confusion’ and is not following Deendayal Upadhyaya’s principles of integral humanism to the extent it should. He also finds fault with the present ‘GDP-centric’ economic growth. In an interview with DIPANKAR CHAKARABORTY, Mahajan says dependence on FDI is no solution to fund the development of infrastructure sector and accelerate growth. Excerpts:

Q: At the Davos World Economic Forum (WEF) summit recently Prime Minister Narendra Modi showcased India as the most attractive destination for foreign direct investment. Knowing your opposition to FDI what do you have to say about the PM’s speech?

A: One day before the Davos summit they came out with an inclusive development report to rank countries. They have taken unemployment as one of the parameters of inequalities. Across the globe it has been found the growth is not reaching the common people. The whole FDI and GDP centric growth model has failed to deliver to the masses in India.

Though we are not against increasing investment in the country, SJM feels we need domestic investment and in small scale industries, more decentralisation, self-employment, and welfare of masses in terms of education, health, etc.

Though we don’t outright reject what the Prime Minister said at Davos, the government must look at the domestic reality as well. Rather than a GDP or FDI-centric growth model we have been advocating an integrated model of development with focus on output, decentralisation and equality. The compartmentalised first growth and then redistribution approach does not work.

Q: India needs huge investments to improve its infrastructure to propel growth. Where will domestic investment come from to meet the huge fund shortfall as suggested by you?

A: Do you have many examples where FDI has created infrastructure of any sort? Perhaps not. Most of the foreign investment is coming in the brownfield sectors. No investment is coming to infrastructure sectors. Foreign investors want to purchase only already well-run companies in cement, pharmaceutical and other sectors.

We understand the government compulsion for FDI which has to do with a 26-year-old developmental model. Globalisation has failed us in terms of foreign exchange earnings. Balance of payment deficit is too huge and for that we need foreign investment. We have been advising governments since our inception in 1991 to refrain from too much globalisation.

Q: But it seems the government is not bothered about your arguments against FDI or globalisation?

A: I won’t say that this government is not bothered. It has acted positively in response to our year-long campaign against import of Chinese goods. Both policy makers and SJM have made people aware of the uncontrolled import of Chinese goods. We find that people have started boycotting Chinese goods.

The government has imposed anti-dumping duties on over 100 goods being imported from China. In areas where China was not allowing us to enter, we too have reciprocated by doing the same. This has given protection to domestic industries vis-a-vis China. So, I don’t agree that the government doesn’t listen to us. We don’t agree with the idea to let other countries be protectionists and we remain open to others.

Q: SJM no longer appears to be its previous aggressive self with street protests and open show of defiance against government policies, etc…

A: This is not true. We find the government falling in line on so many issues raised by us despite the fact that we are not such a powerful entity to get things done. For example land acquisition law, GM, etc.

Q: What has been your communication to government on FDI?

A: We are meeting on 3 and 4 February to discuss among other things the issue of unbridled FDI into the country. We have been telling the government such an approach to FDI is not going to help the country. We are going to discuss and take a decision on the impact of the government move to do away with mandatory 30 per cent procurement from domestic market in single brand retail.

We have told the government that it is not only a bad idea but also against its own ‘Make in India’ policy. The concession being given to foreign investors should be stopped for ensuring a level playing field to domestic companies. More investment will create more GDP but no employment?.

We should change this by focusing more on employment rather than GDP. We have been suggesting to the government that it contribute 25 per cent to wages of newly employed people rather than PF. With that the cost of labour vis-a-vis capital will go down. Instead of compensating the cost of capital the government can compensate the cost of labour.

Q: By the time the SJM meets the government, it will have tabled the Budget proposals. Has the government invited you to discuss and incorporate your various suggestions and sort out points of disagreement?
A: Yes, we have already met. There is no disagreement between the SJM and the government. The government is only afraid of any crisis on foreign exchange reserve front. Therefore, to avoid those problems the government is perhaps inviting more and more foreign investment.

Yet another set of people in the government underlines the need for supplementing development with domestic resources. Therefore, we have not opposed the move to widen the tax net or even GST. But we expect the government to take care of small industries and business organisations in the GST. We are therefore happy with the various reforms undertaken by the government.

Q: The SJM is for reducing dependence on imports and exports to drive economic growth engines. How is it possible when a big chunk of our foreign exchange earnings is spent on importing fossil fuels?
A: We cannot like China heavily subsidise exports and then dump goods across countries. We should focus more on domestic production. We are not against imports and exports. We want the imbalance with too much dependence on imports to go. We are aware about the need for importing fossil fuel.

But like China we have to focus on solar to meet our energy needs. To offset high import bills we should increase exports of domestically produced goods. We can send PSLV, launch multiple satellites into orbit, so can’t we produce a mobile phone? This is ridiculous. We have to excel in production of IT hardware alongside the software.

Q: But how do you generate employment without any means of revenue generation?
A: Our production system is such that it does not create jobs. Nowhere in ancient Sanskrit scriptures is the word unemployment found. Because employment, decentralisation, equality are inherent in our economic heritage which has been well explained in the socio-economic principles of Pandit Deendayal Upadhyaya, ideologue of the Rashtriya Swayamsevak Sangh.

His concept of ‘Integral Humanism’ states that whenever you are making a policy the last man standing in the queue, as Gandhiji also said, should be in your mind. The SJM is opposed to redistribution of wealth by giving away doles to masses such as food security and MNREGA, etc.

We have no doubts about the government’s intentions to generate jobs. We don’t have an integrated approach to development as Deendayal ji wanted.

Q: Are you suggesting the government is deviating from Deendayal Upadhyaya’s path of integral humanism?
A: I am not saying they are deviating. But somehow the continuation of the policy of globalisation has rather confused the government. It is trying to create jobs in other areas. But there has to be a clear-cut fundamental declaration from the policy makers that integral humanism is the philosophy to be followed.

Start Up and Mudra are steps in that direction. However, we need to make a fundamental change in the mindset.