By Ashok Malik*
Following the recent Brexit vote and continued convulsions in Britain and Europe and, separately, in the United States it has become fashionable to talk about de-globalisation. In the US, as in Europe, unresolved economic concerns following the financial crisis of 2008 have been complemented by fears about Islamist terrorism and migration from Syria, Afghanistan, Pakistan and other conflict zones. These have combined to create a backlash against easier movement of goods, services and peoples.
While all this is true, it is important to place the urges in the West in a wider historical context and not see them merely as a reflection of contemporary headlines. In India, for instance, Brexit has led to very misleading interpretations. The British vote to leave Europe has been welcomed by CPM, with the Communists probably believing, as they periodically do to their peril, that the “final crisis of global capitalism“ is upon us.
Brexit has also won support from some on the right, who have read it exaggeratedly in terms of concerns about radical Islam. Likewise, to get excited about the Donald Trump phenomenon purely in terms of the Muslim bashing he resorts to would be a limited reading of a complex issue.
The rage against globalisation, against outsourcing and, earlier, against the migration of mining and steel industry jobs to China, South Korea and other parts of Asia is an old one. It well precedes 2008 or even 911. In 1999, the World Trade Organization conference in Seattle was marked by street protests by, among others, American labour unions. The protests forced President Bill Clinton into acknowledging them in his official speech. Remember this was at a time of unprecedented American prosperity , following a decade-long tech boom.
The following year, the angry and unemployed blue-collar worker in the US heartland became a focus of left-leaning presidential candidate Al Gore. Four years later, this very segment was moved not by economic concerns but by patriotism, in the aftermath of 9/11, and voted decisively for George W. Bush.
What Trump has done is to hijack the economic trauma of globalisation’s have-nots from the left, and conflate these with identity politics. European nationalist parties are beginning to act similarly, and some of those instincts found resonance in the Brexit campaign.
Yet, anti-outsider sentiment in Britain is complicated. It has only a limited association with Syrian Muslim refugees, most of whom are on the European mainland anyway , and with terrorism (though that is a global worry now). The Brexit urge has a longer history of nostalgia for “manufacturing in northern England“ and disaffection with free worker movement under European Union (EU) protocols, causing eastern Europeans to take away jobs that native Britons didn’t want in the first place. Indeed some older-generation South Asians in Britain (including Hindus and Muslims of Indian and Pakistani origin) voted like their white peers and against the EU competition.
Whether by Brexit and others in Europe or in Trump’s (and Bernie Sanders’) America, globalisation is being challenged. However, to announce its burial would be premature. This is not the first wave of globalisation. The previous incarnation, aby-product of the same 19th century trade currents that produced imperialism, too retreated after a few decades.Nevertheless each successive surge of globalisation has left the world economy and system that much more integrated. As such, while the liberal trading order will be under interrogation in the coming years, particularly the so-called “hyperglobalisation” that has welded financial markets, the fact is the global economy will remain that much more integrated than it was say 25 years ago.
It is worth noting that during the recent Brexit referendum, one million citizens of Commonwealth countries who are residents of Britain voted. This group, which included many Indians and is not to be confused with British citizens of Commonwealth origin, has the right to vote in British elections under anachronistic rules that are, really, an imperial hangover. In contrast, the three million citizens of other EU countries who are also resident in Britain were not allowed to vote.
In sum, more than de-globalisation, this was a contest between older and newer templates of globalisation, and an attempt to tackle questions of whose globalisation and globalisation on which terms.
Indian enthusiasts of the de-globalisation club are motivated more by ideology (on the left) or identity (on the right). They are ignoring the fact that India is among the biggest beneficiaries of globalisation and has a much greater stake in the international economy than is realised. Some numbers would be educative.
In 1990-91, at the cusp of liberalisation, India’s external trade amounted to 15.2% of a GDP valued at $275 billion. Today , trade amounts to just under 50% of a GDP valued at $2 trillion. In absolute terms, that means India’s external trade made up about $40 billion in 1991 and totals some $1 trillion now. In essence, it drives Indian jobs, prosperity and aspirations.
Indians need to keep these figures in mind before foraying mindlessly into the West’s globalisation debates, motivated by ideological or identity reasoning. India may not be able to influence those debates, but let it at least be pragmatic enough to understand how it is implicated by them.
About the author:
*Ashok Malik is a Distinguished Fellow, and Head of ORF’s Neighbourhood Regional Studies Initiative. His work focuses on Indian domestic politics and foreign/trade policy, and their increasing interplay, as well as on the broader process of globalisation and how it is influencing policy choices in not just the economy but in social sector spheres such as health, education and urbanisation. A journalist for 20 years, Ashok is a columnist for several leading Indian and international publications (such as Times of India, Hindustan Times, YaleGlobal Online).
This article originally appeared in The Times of India and is reprinted with permission.
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