How should India react to the economic decline of Europe?
See the blogpost where Prof. Vaidyanathan presents the dismal state of the European Community and asks India to be prepared for the consequences of future turmoil in Europe.
http://bharatkalyan97.blogspot.com/2013/03/as-europe-goes-down-india-needs-to-be.html As Europe goes down, India needs to be prepared - R. Vaidyanathan
India has an abiding interest in the fate of Europe since India had been led by a colonial regime for over 200 years until Independence in 1947. The colonial regime was a regime of loot of the nation's wealth, resulting in famines and impoverishment. The post-colonial regime has also seen loot of the nation's wealth of unprecedented magnitudes impeding the nation's progress to its true role in the global economy. Vaidyanathan rightly notes that both China and India are retrieving their position of 1820s when they had nearly 50 percent of the global GDP. "In 1990, the share of the G-7 in world GDP (on a purchasing power parity basis) was 51 per cent and that of emerging markets, 36 per cent." This role reversal is the dominant characteristic of the global economy.
Economies of G-7 nations including many members of the European Community which were once imperial powers are now in a dismal state.
What should India do? India giving $10 billion will not be adequate to redeem the ex-colonial states. India and China have to relentlessly pursue the goal of retrieving the status they had in the global economy of 1820s.
India should sets its economic house in order by ridding the state of intolerable levels of corruption leading to flight of wealth into tax havens. Vigorous efforts should be made to ensure restitution of India's wealth stashed from such corruption sanctuaries.
India polity should be restored to its healthy state of a nation led by dharma, eternal, univeresal ethical order devoted to the attainment of abhyudayam, welfare for all the peoples. This necessitates weeding out anti-national elements governed by their own personal interests, now ruling the state. The economic policies of the state should be such as to be in conformity with the civilizational traditions and ethos and restoring family values which are the hall-mark of the civilization promoting family savings and family-based social security systems.
I thought that it was remarkable that states which fought two world wars in Europe finally saw reason and constituted themselves into an European Community to realise their destinies. It appears that the Community is not cohesive enough financially given the mismanagement of public debts of the European states and the failure of the Germans to truly reach out to the other states to make the European monetary union meaningful beyond simply having a common currency, the Euro. The nation-state model of allowing the states to run their own independent fiscal policies has not worked effectively leading to the situation of the PIIGS withhin the European Community. PIIGS is an acronym which refers to Portugal, Italy, Greece, and Spain – as states in a mess created by sovereign debt markets, with people living beyond their productive means.
This holds a lesson for the Indian Ocean Community (IOC) as and when it is formed as a counterpoise to the European Community. IOC can be a powerhouse which can be an effective reaction to the decline of Europe while restoring China and India to their rightful share of the global GDP.
More on the Indian Ocean Community in the links provided at http://bharatkalyan97.blogspot.com/2012/12/indian-ocean-community-book-review-by-v.htmlIndian Ocean Community -- A book review by V. Sundaram IAS & Praveen Shanker Pillai
http://bharatkalyan97.blogspot.com/2012/11/rastram-is-indian-ocean-community.htmlRāṣṭram is Indian Ocean Community -- Kalyanaraman (Nov. 2012)
Kalyanaraman