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Press Release Issued by the Confederation of Indian
Industry
Summary of
Unger’s Address
to the Confederation of Indian Industry
India, China, Brazil, Russia, Indonesia should ally to
challenge the present organisation of the world economy. Prof. Unger defines "
second way" to sustainable globalisation and economic development.
New Delhi, August 8, 2001 - In order to develop a market
friendly, socially inclusive "alternative strategy" for sustained
globalisation and economic development, large marginalised economies like India,
China, Brazil, Russia, Indonesia should join hands to challenge the present
organisation of the world economy, stated Prof. Roberto
Mangabeira Unger, Professor of Law at the Harvard University and Member of the
Opposition in Brazil. However, they could do so only if they succeed in
democratisation of their own societies, he added. Prof. Unger was addressing a
session on "Globalisation and Economic Development: What is the market
friendly socially inclusive alternative?" organised by Confederation of
Indian Industry (CII) here today.
Prof. Unger believes that major marginalised economies must challenge the
organisation of world economy and propose an alternative global trading regime.
He said that an alternative to the present trade regime must not prohibit
government activism in the form of subsidies. The world trade regime should be
forced to accept the parameters defined under Intellectual property rights. The
objective should not be to maximise free trade but to maximise development
possibilities. Free trade should be just an instrument and not the end, he
emphasised.
Elaborating in this context, Prof. Unger expressed his view, that China’s
decision to join the WTO has put the country on a dangerous and critical
juncture, which could either become the basis of a regression or advancement. In
his opinion, India, instead of treating China as a model to emulate, should
rather treat it as a partner in developing a socially inclusive alternative
model for sustainable globalisation.
He emphasised that this project alternative could advance only through
reconstruction of a world economic order and democratisation of markets.
Inspiration or the central focus of organising this effort lies in alliance
between state and informal or private sector, he added.
Prof. Unger characterises this "second way" or the "alternative
strategy’ for a sustained growth as an alternative that shows a nation means
to reshape the distribution of comparative advantages in the world. He believes
that developing economies must pass through a gateway of common innovations and
share institutions of innovation to energise the democracy to create a real
basis for difference.
The way forward for the developing economies lies in higher domestic savings and
higher tax yields. According to him, channeling these high domestic savings to
productive investment rather than dissipating the same into uncertain ventures
are imperatives for energising democracy. Therefore, it becomes essential for
economies like India and Brazil to organise national savings so as to optimally
employ the productive potential of savings through deepening credit and creation
of new forms of venture capital within and outside the capital markets, he
added. He further stressed that the high tax yield for the government should be
in a form that unburdens production and minimises the trauma to the real
economy.
Organisation of a civil society outside the state is perceived as yet another
important ingredient of the ‘second way" or the alternative strategy as
defined by the Professor. A democratic society, in his opinion, requires a
highly organised society. Civil society, therefore has to reshape itself and
also create a legal structure that facilitates the structure of the civil
society parallel to the local government.
Economic and educational endowment of every individual, thus emerges as the
prime mover of a democratised society and paves way for sustainable
globalisation. The Professor stressed the need to combine educational
empowerment with development
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