Industrialisation

Extending Lohia to our times, we can infer an important truth about capitalism. Capitalist development cannot take place without colonial or neocolonial exploitation. In the absence of external colonies or neocolonies, capitalism tries to create internal colonies, but they are not enough for full-fledged modern industrial development, which requires both exploitation of labour and the plunder and destruction of natural resources on a global scale. If internal colonial exploitation is fundamental to capitalism and unequal exchange in various forms is one of its important mechanisms, the Third World can be liberated only when it breaks away from the present system of international trade, exchange and finance and looks at ways of building an alternative society in all senses.

During the last two decades West Bengal has led the rest of the country with regard to agricultural performance and implementation of panchayat institutions. But these developments have begun to level out. At the same time the state has fallen behind in other sectors - industry, higher education and state of public finances, particularly - to an extent that is seriously worrying. This paper reviews performance of these different sectors, discusses possible explanatory factors, and makes a number of suggestions for policy reforms. With regard to industrial revival, it stresses public investment in transport and communication, measures to improve higher education, foster industry-university collaborations, and help small-scale industries overcome specific market imperfections (access to credit, technology and distribution channels). In public finance, emphasis is placed on raising tax revenues (especially with regard to the service sector), limiting losses of public sector undertakings, and widening the scope of land taxes and user fees. In the agricultural sector, the need for a greater role of the government with regard to biotechnology, extension services, irrigation and flood control is emphasised, along with suggestions for encouraging and regulating contract farming with MNCs. Finally the article urges greater empowerment of panchayats with regard to social service delivery and agro-business development, and administrative reforms to enhance accountability of state government employees.