<p>Neo-liberalism has been with us for the past 31 years. It is now time to take stock and perhaps do a course correction. The creed of the government for the past three decades has been ‘privatisation’. While this has enabled entrepreneurship to surge and the middle-class to expand, the poor haven't been served well. Now is the time for the government to modify its neo-liberal policies to suit the Indian condition.</p>.<p>Privatisation of health and education sectors has hit the poor the most. Sufficient funds should be allocated to these sectors to facilitate state-of-the-art, government-run institutions. India allots a paltry 1.2 per cent of its GDP to health as against China’s 2.7 per cent. The National Achievement Survey 2021 in education points out that there is a progressive decline in the performance of children as they progress from class 3 to class 10, especially in mathematics and science. Also, the performance of schools in rural areas is significantly below that in urban areas. Many government schools are crowded with lack of teachers and two or three classes being taken in a single room. Finally, many are unable to pass the metric exam. In fact, a new category of youth can be found in the countryside who give their educational qualifications as '10th fail'!</p>.<p>About 80 per cent of children in government schools have no access to digital facilities. Surprisingly, in spite of “learning loss” during Covid, as the development educationist Niranjanaradhya V P points out, Karnataka government has in fact cut the share of education in its budget from 12.5 per cent in 2020-21 to 12 per cent in 2021-22. Poorly managed government schools push parents towards private schools, which charge inordinately high fees. There is an urgent need to invigorate the government schools. Allocating RTE seats in private schools. reliance of CSR funds and pushing corporates to adopt schools cannot solve the problem in its entirety either.</p>.<p>In fact, such measures send the message to the poor student that while his parent is unable to, the government is unwilling to shoulder the responsibility of his education. Frequent reports in the press of symptoms of gross neglect like crumbling infrastructure, worms in the midday meals, delay in delivering books, uniforms, socks and shoes, and lack of facilities in children's hostel make for a painful read.</p>.<p>The situation is even more distressing in government hospitals. Expensive medical care and steep hospital bills have distressed even the middle class. Shrinking public healthcare net and expanding private health systems is inimical to a country like India with a large proportion of poor people. In spite of health insurance, Indians have the highest out-of-pocket expenditure in the world. </p>.<p>Secondly, Micro Small and Medium Enterprises (MSMEs) should be encouraged. They make up the network of ancillary industries to larger corporations. Moreover, they are the employment generators, especially for the unskilled labour -- after agriculture, MSMEs are the largest employers in India employing 11 crore, or 45 per cent of all workers. That alone can bring about a bottoms-up approach rather than the current trickle-down one.</p>.<p>At present, MSMEs are yet to recover from the blow dealt by demonetisation since they did much of their business in cash. Banks also have tightened their credit policies and are unwilling to give them loans. GST on their products has multiplied their hardship. Experts opine that government support is essential for MSMEs to survive. They further reiterate that high global inflationary pressures, MSMEs may be unable to gain from the government's Production Linked Incentive Scheme. The government must explore placing a price cap and /or provide subsidies on the energy and fuel consumed by the MSME sector and also certain crucial raw materials, according to experts quoted in various media. MSMEs are a pathway to social mobility. </p>.<p>Neo-liberalism is losing steam in the western advanced countries. The free-market worldview was promoted there in the 1960s and 70s by the Chicago School led by Milton Friedman. In the 1980s, Margaret Thatcher and Ronald Reagan adopted the neo-liberal model in their respective countries. It came to India only a decade later in the 1990s. At the time, the same was brought in without any modifications for Indian conditions. The emphasis was on changing the Indian mind-set from socialism to free-market capitalism and increasing the GDP. Now that three decades have passed, it is time to relook at neo-liberal policies and perhaps modify the same, making it amenable to Indian conditions marked with high rates of poverty. </p>.<p><span class="italic"><em>(The writer is Honorary Senior Research Fellow, Institute of Social Sciences, New Delhi)</em></span></p>
<p>Neo-liberalism has been with us for the past 31 years. It is now time to take stock and perhaps do a course correction. The creed of the government for the past three decades has been ‘privatisation’. While this has enabled entrepreneurship to surge and the middle-class to expand, the poor haven't been served well. Now is the time for the government to modify its neo-liberal policies to suit the Indian condition.</p>.<p>Privatisation of health and education sectors has hit the poor the most. Sufficient funds should be allocated to these sectors to facilitate state-of-the-art, government-run institutions. India allots a paltry 1.2 per cent of its GDP to health as against China’s 2.7 per cent. The National Achievement Survey 2021 in education points out that there is a progressive decline in the performance of children as they progress from class 3 to class 10, especially in mathematics and science. Also, the performance of schools in rural areas is significantly below that in urban areas. Many government schools are crowded with lack of teachers and two or three classes being taken in a single room. Finally, many are unable to pass the metric exam. In fact, a new category of youth can be found in the countryside who give their educational qualifications as '10th fail'!</p>.<p>About 80 per cent of children in government schools have no access to digital facilities. Surprisingly, in spite of “learning loss” during Covid, as the development educationist Niranjanaradhya V P points out, Karnataka government has in fact cut the share of education in its budget from 12.5 per cent in 2020-21 to 12 per cent in 2021-22. Poorly managed government schools push parents towards private schools, which charge inordinately high fees. There is an urgent need to invigorate the government schools. Allocating RTE seats in private schools. reliance of CSR funds and pushing corporates to adopt schools cannot solve the problem in its entirety either.</p>.<p>In fact, such measures send the message to the poor student that while his parent is unable to, the government is unwilling to shoulder the responsibility of his education. Frequent reports in the press of symptoms of gross neglect like crumbling infrastructure, worms in the midday meals, delay in delivering books, uniforms, socks and shoes, and lack of facilities in children's hostel make for a painful read.</p>.<p>The situation is even more distressing in government hospitals. Expensive medical care and steep hospital bills have distressed even the middle class. Shrinking public healthcare net and expanding private health systems is inimical to a country like India with a large proportion of poor people. In spite of health insurance, Indians have the highest out-of-pocket expenditure in the world. </p>.<p>Secondly, Micro Small and Medium Enterprises (MSMEs) should be encouraged. They make up the network of ancillary industries to larger corporations. Moreover, they are the employment generators, especially for the unskilled labour -- after agriculture, MSMEs are the largest employers in India employing 11 crore, or 45 per cent of all workers. That alone can bring about a bottoms-up approach rather than the current trickle-down one.</p>.<p>At present, MSMEs are yet to recover from the blow dealt by demonetisation since they did much of their business in cash. Banks also have tightened their credit policies and are unwilling to give them loans. GST on their products has multiplied their hardship. Experts opine that government support is essential for MSMEs to survive. They further reiterate that high global inflationary pressures, MSMEs may be unable to gain from the government's Production Linked Incentive Scheme. The government must explore placing a price cap and /or provide subsidies on the energy and fuel consumed by the MSME sector and also certain crucial raw materials, according to experts quoted in various media. MSMEs are a pathway to social mobility. </p>.<p>Neo-liberalism is losing steam in the western advanced countries. The free-market worldview was promoted there in the 1960s and 70s by the Chicago School led by Milton Friedman. In the 1980s, Margaret Thatcher and Ronald Reagan adopted the neo-liberal model in their respective countries. It came to India only a decade later in the 1990s. At the time, the same was brought in without any modifications for Indian conditions. The emphasis was on changing the Indian mind-set from socialism to free-market capitalism and increasing the GDP. Now that three decades have passed, it is time to relook at neo-liberal policies and perhaps modify the same, making it amenable to Indian conditions marked with high rates of poverty. </p>.<p><span class="italic"><em>(The writer is Honorary Senior Research Fellow, Institute of Social Sciences, New Delhi)</em></span></p>