In it, he has raised a very nice point. Globalization is being spread at a rapid rate because of two factors:
- Rapid technological growth
- Gigantic economies of America, the Western Europe and Japan
He says, just imagine what will happen if the economies of US, Europe and Japan suddenly stagnates. One fine day, the engine of globalization is just shut off!
It is a scenario that is quite hard to even imagine. Countries like India have benefited hugely by the fruits of globalization. IT is not the only thing that has come in. Just look at the manufacturing sector. Toyota has outsourced its components to Bharat Forge. Many well-known fashion chains in the West source the clothes from factories in Coimbatore. The result is a rapid increase in the standard of living for Indians.
Just 10 years back, I remember an India where the socialistic stamp was present everywhere:
Want a telephone? Book and wait for three years.
Want a Maruti (Ambassador and Premier Padmini were getting out of fashion)? Wait for two years.
See the difference now:
Want a telephone? Give the address, next day, telephone will be installed. If not, buy a SIM card right now and start talking.
Want a car? Come to the show-room. Take a test ride. If you like it, take it right now. Pay later!
Yes, India as a whole has improved a lot. Yet, most of the change has been driven by the growth in the Americas, Europe and Japanese economies. If suddenly they were to stagnate, what will happen to the growth in India?
It’s a rather gloomy thought. Companies like Infosys, Wipro and TCS would overnight find that they have no new clients. The existing clients too could stop starting new projects. What will happen to the thousands of engineers who are passing out of the assembly line of the Engineering Colleges in India? What will happen the banks who were behind the life selling loans, house loans, car loans? Guess they will go back to the mode of being the stingy Shylock that they generally were.
The second point though was a real eye-opener. Globalization is spreading, not because labour is cheaper elsewhere, but, due to rapid growth in technology.
In the book, the author says, a receptionist was fired in his office. She was fired because a voice-mail system was used as a replacement. But, the poiliticians out there would never raise a slogan, “Throw out the voice mail! Boo to technology”. Instead, they would target Mexican immigrants. Mexicans are responsible for the job losses! Extradite them all. Build higher and higher walls.
Why was this done? Because targeting an intangible high technology is not a good campaign policy. Mexicans are a lot more tangible.
Similar thing is happening now when it comes to the question of Outsourcing. Low labour is being blamed. Indians and Chinese are being projected as leeches sucking out the jobs from the affluent markets and driving them to joblessness and poverty. Is this the only reason why such a mass exodus of the jobs is happening?
Isn’t the fact that these nations have got used to a system of social security and other free lunch programs left them lot lazy to work? Hasn’t the excess indulgence in “good education” made them phobic to technical subjects, letting the Asians take advantage of the better higher education standards in the same counties?
Well, these some of the points that just came to my mind. I know I’ve not put in any solutions to the issues. Still, I just thought I had to put all my thoughts down somewhere – so here it is on my blog!
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