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621. Industrial Location and Spatial Inequality: Theory and Evidence from India

Author:
Somik V. Lall and Sanjoy Chakravorty
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We argue that spatial inequality of industry location is a primary cause of spatial income inequality in developing nations. We focus on understanding the process of spatial industrial variation—identifying the spatial factors that have cost implications for firms, and the factors that influence the location decisions of new industrial units. The analysis has two parts. First we examine the contribution of economic geography factors to the cost structure of firms in eight industry sectors and show that local industrial diversity is the one factor with significant and substantial cost reducing effects. We then show that new private sector industrial investments in India are biased toward existing industrial and coastal districts, whereas state industrial investments (in deep decline after structural reforms) are far less biased toward such districts. We conclude that structural reforms lead to increased spatial inequality in industrialization, and therefore, income.
Topic:
Development, Economics, Industrial Policy, and Political Economy
Political Geography:
South Asia and India

622. The Transition from Official Aid to Private Capital Flows: Implications for a Developing Country

Author:
Renu Kohli
Publication Date:
07-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
India's capital account displays a sharp swing in external financing from official assistance to private capital transfers in the 1990s. This paper examines the implications of this transition for the country. An analysis of the private resource transfer reveals that unlike official flows, private capital flows are associated with real exchange rate appreciation, expansion in domestic money supply and stock market growth, liquidity and volatility. The paper concludes with a discussion on the implications of the transition for economic policy.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
South Asia and India

623. Prospects Brighten for Long-term Peace in South Asia

Author:
Rafiq Dossani
Publication Date:
11-2004
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Ever since 1998, the year of India and Pakistan's nuclear tests, many commentators have argued that, in the absence of U.S. intervention, the two nations are headed for armed conflict that will likely end in nuclear war. The logic underlying this view is twofold. First, that religious radicalism—defined as the participation in political and/or military activities by groups in the name of religion—has become sufficiently powerful in Pakistan to make ongoing support for the Kashmir insurgency inevitable. Second is that India's concurrent growth of nationalism and religious radicalism, as well as a rise in economic power, will make the state less willing to tolerate Pakistan's support for insurgency in Kashmir. Against this seemingly inevitable clash, Pakistani President Musharraf is viewed as a lonely holdout against the forces of religious radicalism in Pakistan. U.S. support is therefore argued to be critical for sustaining Musharraf, whether through political support for Pakistan's policies in Kashmir, or economic support. This paper reaches a different conclusion: that peace is about to “break out” between India and Pakistan. Our conclusion is based on the following analysis. First, Islamic radicalism in Pakistan relies (and has always relied) on the army to survive, as it lacks sufficient popularity to influence state policy through political parties or popular agitation. Second, the army has previously supported Islamic radicalism tactically, but not ideologically, providing such support only when it has perceived the state to be in crisis. Contrary to a common view, the elections of 2002 were no different in this respect. Third, Hindu radicalism in India, though gaining in both popular and political support, is insufficiently popular to support irrational aggression against Pakistan. At the same time, India's improved economic prospects have influenced its rulers to favor accommodation with Pakistan. Third, the outcomes of recent elections in India and Pakistan have shifted the Pakistani army's strategic priorities toward negotiating a civilian-military balance, and away from destabilizing civilian politics through “crisis-mode” tactics that have included support for Islamic radicalism.
Topic:
Nationalism, Nuclear Weapons, and Religion
Political Geography:
Pakistan, United States, South Asia, India, Asia, and Kashmir

624. Power Sector Reforms in India: Issues Relating to Agriculture

Author:
Rafiq Dossani
Publication Date:
03-2004
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Firstly, the cost-to-serve for each category of consumer varies depending on several factors. There are technical reasons such as power factor, voltage of supply and so on which are set out in the Electricity Supply Act, 1948. There are also commercial reasons. In some situations, the total quantity of power available could not be sold, unless some categories of consumers we are charged a lower tariff. There are also considerations of equity or the need to meet the merit wants of the poorer population, which prompted differential pricing.
Topic:
Agriculture, Economics, and Energy Policy
Political Geography:
South Asia and India

625. India: the Next Economic Giant

Author:
Mark P Thirlwell
Publication Date:
08-2004
Content Type:
Working Paper
Institution:
Lowy Institute for International Policy
Abstract:
The Indian economy is showing clear signs of realising its dormant potential. The impact of more than a decade of economic reforms, instigated by a 1991 balance of payments crisis, has now removed or at least mitigated some of the major economic distortions that have handicapped past economic performance. One important result has been a significant boost to the economy's overall potential growth rate. Another has been India's re-engagement with the global economy, which in turn has transformed the prospects of key sectors of the Indian economy. This transformation has been most visible in the case of information technology-related services exports, where India has already become an important global player. But there are also positive signs in the areas of merchandise trade and international capital flows. These trends will have important consequences for the international economy as a whole and for Australia in particular.
Topic:
Economics, Emerging Markets, and Globalization
Political Geography:
India, East Asia, Asia, and Australia

626. Doubling the Global Work Force: The Challenge of Integrating China, India, and the Former Soviet Bloc into the World Economy

Author:
Richard B. Freeman
Publication Date:
11-2004
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
In 1985, the global economic world (N. America, S. America, Western Europe, Japan, Asian Tigers, Africa) consisted of 2.5 billion people. In 2000 as a result of the collapse of communism, India's turn from autarky, China's shift to market capitalism, global economy encompassed 6 billion people. Had China, India, and the former Soviet empire stayed outside, global economy would have had 3.3 billion.
Topic:
International Relations, Economics, and Government
Political Geography:
Africa, Japan, China, America, India, Asia, and Western Europe

627. The Next Wave of Globalization? Exploring the Relocation of Service Provision to India

Author:
Rafiq Dossani and Martin Kenney
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
Berkeley Roundtable on the International Economy
Abstract:
The rapid increase in the ability and desire of multinational corporations to offshore services or, what are commonly termed “business processes” to developing nations is becoming a significant international development issue. This paper utilizes a case study of India, the largest recipient of offshored services, to explain the dynamics of offshoring from the perspective of the firm and the recipient nation. The explosion of offshoring is placed within a historical context. The technologies enabling offshoring and the corporate environment are discussed. Finally, the organizational forms involved in offshoring are discussed. The conclusion considers the implications of the offshoring of services for developed and developing nations and possible policy initiatives for developing nations interested in the possibility of entering the ITES sector.
Topic:
Development, Globalization, International Trade and Finance, and Science and Technology
Political Geography:
South Asia and India

628. The Language of Democracy: Vernacular Or Esperanto? A Comparison between the Multiculturalist and Cosmopolitan Perspectives

Author:
Daniele Archibugi
Publication Date:
12-2004
Content Type:
Working Paper
Institution:
Minda de Gunzburg Center for European Studies, Harvard University
Abstract:
Will Kymlicka has argued “democratic politics is politics in the vernacular.” Does it imply that democratic politics is impossible in a multilingual community, whether at the local, national, regional or global level? This paper discusses this assumption and maintains that democratic politics should imply the willingness of all players to make an effort to understand each other. Democratic politics imply the willingness to overcome the barriers to mutual understanding, including the linguistic ones. Any time that there is a community of fate, a democrat should search for methods that allow deliberation according to the two key conditions of political equality and participation. If linguistic diversity is an obstacle to equality and participation, some methods should be found to overcome it, as exemplified by the Esperanto metaphor. The paper illustrates the argument with four cases of multi-linguistic political communities: a) a school in California with English-speaking and Spanish-speaking students; b) the city of Byelostok in the second half of the nineteenth century, where four different linguistic communities (Polish, Russian, German and Yiddish) coexisted. This led Markus Zamenhof to invent Esperanto; c) the linguistic problems of the Indian state, and the role played by English – a language unspoken by the majority of the Indian population in 1947 – in developing Indian democracy; and d) the case of the European Parliament, with twenty languages and a wealth of interpreters and translators.
Topic:
Democratization, Economics, and Politics
Political Geography:
Russia, Europe, India, California, and Germany

629. Indian Higher Education Reform: From Half-Baked Socialism to Half-Baked Capitalism

Author:
Devesh Kapur and Pratap Bhanu Mehta
Publication Date:
09-2004
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This paper examines the political economy of Indian higher (tertiary) education. We first provide an empirical mapping of Indian higher education and demonstrate that higher education in India is being de facto privatized on a massive scale. But this privatization is not a result of changing ideological commitments of the key actors—the state, the judiciary or India’s propertied classes. Rather, this privatization has resulted from a breakdown of the state system and an exit of Indian elites from public institutions, to both private sector institutions within the country as well as abroad. Private philanthropy in higher education, which was supportive of public institutions in the past, is also increasingly withdrawing its support. Consequently the ideological and institutional underpinnings of this form of privatization remain exceedingly weak. The paper questions the extent to which the political economy of Indian higher education can be explained by the hypothesis of “middle class capture” and suggests that education policy, far from serving the interests of the middle class, is actually driven by a combination of ideology and vested interests. We also examine the role of the judiciary in shaping the regulatory landscape of Indian higher education and argue that it an important actor shaping the regulatory landscape of higher education, but in a manner that has done as much to confuse as clarify. Instead of being part of a comprehensive program of education reform, private initiatives remain hostage to the discretionary actions of the state. As a result, the education system remains suspended between over-regulation by the state on the one hand, and a discretionary privatization that is unable to mobilize private capital in productive ways. The result is a sub-optimal structuring of higher education. The most potent consequence of this is a secession of the middle class—ironically the very class whose interests these institutions were supposed to serve—from a stake in public institutions.
Topic:
Political Economy, Privatization, Capitalism, Higher Education, and Middle Class
Political Geography:
South Asia and India

630. Finding a Kashmir Settlement: The Burden of Leadership

Author:
Teresita C. Schaffer
Publication Date:
06-2003
Content Type:
Working Paper
Abstract:
The combined talents of the people of India and Pakistan, with the fitful help of a long list of others, have been trying for over 50 years to resolve the Kashmir issue. This essay offers no ready-made answers but rather suggestions on where to begin to look for them. Experience with other recent peace processes teaches valuable lessons about how would-be peacemakers need to approach their task and the ways in which third parties can help.
Topic:
Security and Terrorism
Political Geography:
Pakistan, South Asia, and India

631. The Dignity of Difference: A Salute to Jonathan Sacks

Author:
Fred Dallmayr
Publication Date:
12-2003
Content Type:
Working Paper
Institution:
Kroc Institute for International Peace Studies, University of Notre Dame
Abstract:
In the teeth of its modern despisers, religion has made a comeback in our time — for good or ill. Too often, the negative side is in the limelight. What Gilles Kepel has called the “revenge of God” on inspection usually turns out to be the ill will and vengefulness of religious communities and their leaders. The litany of contemporary religious clashes — or conflicts in good part spawned by religious motives — is long and depressing: Christians pitted against Muslims in Africa and the Balkans; Jews against Palestinians in the Near East; Hindus against Muslims in India and Kashmir; Hindus against Buddhists in Sri Lank, not to forget the old feud between Catholics and Protestants in Northern Ireland.
Topic:
Conflict Prevention, Globalization, Peace Studies, and Religion
Political Geography:
Africa, India, Kashmir, Sri Lanka, Palestine, Balkans, and North Ireland

632. Convergence Club Empirics: Some Dynamics and Explanations of Unequal Growth of Unequal Growth across Indian States

Author:
Sanghamitra Bandyopadhyay
Publication Date:
11-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper documents the convergence of incomes across Indian states over the period 1965 to 1998. It departs from traditional analyses of convergence by tracking the evolution of the entire income distribution, instead of standard regression and time series analyses. The findings reveal twin-peaks dynamics-the existence of two income convergence clubs, one at 50 per cent, another at 125 per cent of the national average income. Income disparities across states seem to have declined over the 1960s, only to increase over the subsequent three decades. The observed polarization is strongly explained by the disparate distribution of infrastructure, and that of education, and to an extent by a number of macroeconomic indicators; that of capital expenditure and fiscal deficits.
Topic:
Economics and Emerging Markets
Political Geography:
South Asia and India

633. Impact of Trade Liberalization on Returns from Land: A Regional Study of Indian Agriculture

Author:
Ghosh Nilabja
Publication Date:
06-2003
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Trade liberalization, by aligning domestic prices with world prices, is envisaged to bring welfare gains to a country. In the case of Indian agriculture, owing to the vastness and diversity of the sector, the impact is likely to be profoundly unequal across regions especially when liberalization is double-edged, acting on both output and input sides. This paper views returns from land resource as a primary determinant of farmers' economic well-being and production incentive and considers paddy both as the dominant support for the rural population and as a product with comparative advantage, as most studies have demonstrated. Working with state and sub-state level data and taking account of the differences in technologies, productivities and transport costs, the paper finds that the gains vary regionally and may not be positive in all cases when both output and input prices are globally aligned.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
South Asia and India

634. Went for Cost, Stayed for Quality?: Moving the Back Office to India

Author:
Rafiq Dossani and Martin Kenney
Publication Date:
11-2003
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Will the next great wave of globalization come in services? Increasingly, components of back-office services, such as payroll and order fulfillment, and some front-office services, such as customer care, are being relocated from the United States and other developed countries to English-speaking, developing nations—especially India, but also other nations, such as the Philippines. Though moving service activities offshore is not entirely new, the pace has quickened of late. The acceleration of this business process offshoring (BPO) is intertwined, though not synonymous, with another phenomenon, namely an increasing willingness by firms to outsource what formerly were considered core activities. It is significant that a substantial number of service activities might move offshore, because it was once thought that service jobs were the future growth area for developed country economies. Manufacturing, by contrast, would relocate to lower labor cost regions offshore. Notably, the services commonly known as “business processes” (BPs) are among the fastest growing job categories in the United States (Goodman and Steadman 2002). Should these jobs begin to move offshore, a new tendency may be under way in the global economy that will be as or more important than the relocation of manufacturing offshore, and might necessitate a rethinking of government policies across a wide spectrum.
Topic:
International Relations and Globalization
Political Geography:
United States, India, Asia, and Philippines

635. Farmer's Willingness to Pay for Power in India

Author:
Rafiq Dossani and V. Ranganathan
Publication Date:
07-2003
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
Electric power for rural pumpset usage is subsidized by all the states in India, the subsidy being estimated at 1.1 percent of GDP. Users are charged a highly subsidized, flat, annual fee that varies with pumpset size. This fixed charge has encouraged waste and raised subsidies over time. Unwilling to bear these costs any longer, states have proposed a range of strategies, including independent regulation, metering of agricultural pumpsets, and raising prices.
Topic:
Economics and Government
Political Geography:
South Asia and India

636. New Priorities in South Asia

Author:
Frank G. II Wisner, Nicholas Platt, and Marshall M. Bouton
Publication Date:
10-2003
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
South Asia may be halfway around the globe from the United States, but in the age of the Internet and globalization, what happens there—as the September 11, 2001, terrorist attacks by al-Qaeda tragically underscored—can affect all Americans. The challenge to U.S. policy over the medium term (through 2010) is to design and implement a stable and sustained approach that will solidify bilateral ties with three of the key countries of the region—India, Pakistan, and Afghanistan—and give the United States an opportunity to influence major regional developments. This report assesses the strengths and weaknesses of India, Pakistan, and Afghanistan and recommends how U.S. policy can best take advantage of the opportunities while addressing the dangers that they present. Success in dealing with South Asia will require sustained and highlevel attention, sensitive diplomacy, a realistic view of what is possible, and, especially with Pakistan and Afghanistan, investment of substantial resources.
Topic:
Security, Nuclear Weapons, and Weapons of Mass Destruction
Political Geography:
Pakistan, Afghanistan, United States, South Asia, and India

637. Kashmir: The View From Islamabad

Publication Date:
12-2003
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
More than five decades after independence, Pakistan is no closer to a resolution with India of the dispute over Kashmir. Pakistan and India have fought three wars, two of them over the status of Kashmir. They have been on the brink of war on several other occasions, including in Siachen in 1987 and in Kargil in 1999. From December 2001 to October 2002, the nuclear-armed protagonists came close to war once again when India mobilised along its international border with Pakistan following the terrorist attack on the parliament in New Delhi. Intense diplomatic and political pressure by the U.S., in coordination with other G-8 countries, averted what could have been a catastrophic clash.
Topic:
Security, Government, Regional Cooperation, and War
Political Geography:
Pakistan, United States, South Asia, India, Kashmir, New Delhi, and Islamabad

638. Kashmir: Learning from the Past

Publication Date:
12-2003
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
While its roots predate Indian and Pakistani independence, the Kashmir conflict's current directions can best be understood in the light of the nationalism and state building that followed the end of British colonial rule. Domestic factors, including the imperatives of regime legitimacy and consolidation, remain important influences in both countries.
Topic:
Security, Government, and Regional Cooperation
Political Geography:
Pakistan, South Asia, India, and Kashmir

639. Went for Cost, Stayed for Quality?: Moving the Back Office to India

Author:
Rafiq Dossani and Martin Kenney
Publication Date:
07-2003
Content Type:
Working Paper
Institution:
Berkeley Roundtable on the International Economy
Abstract:
Will the next great wave of globalization come in services? Increasingly, components of back-office services, such as payroll and order fulfillment, and some front-office services, such as customer care are being relocated from the U.S. and other developed countries to English-speaking, developing nations especially India, but also other nations such as the Phillipines. Though moving service activities offshore is not entirely new, the pace has of late quickened. The acceleration of this offshoring is intertwined, though not synonymous, with another phenomenon, namely an increasing willingness by firms to outsource what formerly were considered core activities. The importance of the fact that a substantial number of service activities might move offshore is that it was service jobs that were thought to be the future growth area for developed country economies as manufacturing relocated to lower labor cost regions offshore. This is especially important, because these services commonly known as "business processes" (BPs) are among the fastest growing job categories in the US (Goodman and Steadman 2002). Should these jobs begin to move offshore, a new tendency may be underway in the global economy that will be as important or more important than the relocation of manufacturing offshore, and might necessitate a rethinking of government policies across a wide spectrum.
Topic:
Economics, Globalization, and Industrial Policy
Political Geography:
United States, South Asia, and India

640. Coercion and Risk-Taking in Nuclear South Asia

Author:
Verghese Koithara
Publication Date:
03-2003
Content Type:
Working Paper
Institution:
Center for International Security and Cooperation (CISAC), Stanford University
Abstract:
The partition-bred conflict between India and Pakistan that began in 1947 went into remission in 1971 following India's emphatic victory in war that year. It reemerged in 1989 when serious disaffection in the Kashmir Valley gave Pakistan an opening to promote militancy. This created a dangerous situation because it was about the same time that both Pakistan and India also acquired nuclear weapons. There was a major confrontation between the two countries during March-May 1990. Since then there has been continuous tension with each attempting to coerce the other. In May 1998 both countries carried out several nuclear tests each. A year later, during May-July 1999, the two fought a two-month "limited war" in the Kargil region of Kashmir that caused over 1,200 fatalities. Kargil was a clear effort on Pakistan's part to test the deterrence value of its nuclear weapons. In December 2001 India resorted to an unprecedented military mobilization (Operation Parakram), holding out the clear threat of attacking Pakistan unless the latter stopped its sub-conventional operations.
Topic:
International Relations, Security, and Nuclear Weapons
Political Geography:
Pakistan, South Asia, and India