US-India Global Review

61 US-INDIA GLOBAL REVIEW JANUARY-MARCH 2018 China, 6.6 for Russia and less than 5.0 for Brazil.11 That hunger index completely ignores data from India’s National Sample Survey Office data showing that very few Indians declare that they are hungry. The Global Hunger Index is actually more a measure of nutri- tional indicators such as under- weight and undersized children, and those characteristics are by no means the same thing as hunger. Small size can have genetic roots, as has been argued by Niti Aayog (the new name for a reformed planning commission) chair Arvind Panagariya.12 Besides, research by Dean Spears in India has proved con- clusively that even when people get enough calories, open defeca- tion and the disease it spreads prevent the body from absorbing the nutrients.13 The problem, then, is not hunger so much as terrible sanitation. Focusing on hunger instead of sanitation amounts to barking up the wrong tree. The hunger ratio in India has fallen so low that National Sample Survey Office surveys no longer bother to measure it. In 1991, it took two years for anyone to get a telephone land- line connection. N. R. Narayana Murthy, head of top software com- pany Infosys, recalls that in the 1980s, it took him three years to get permission to import a com- puter and over one year to get a telephone connection.14 Today, the cell phone revolution means instant access to commu- nication even in remote villages. The number of cell phone connec- tions has just exceeded one bil- lion. India has among the cheap- est cell phone rates in the world, barely two cents per minute, and second-hand cell phones cost just $5, so even the poor can afford to make calls. That advancement has facilitated migration out of and remittances to poor areas. Once unconnected India is now globally connected. In 1991 India’s main exports were textiles and cut-and-polished gems. Today, its main exports are computer software, other business services, pharmaceuticals, auto- mobiles, and auto components. Most developing countries grew fast by harnessing cheap labor. India never did so, because its rigid labor laws inhibited labor flexibility, and they still do so today. Software and business services are estimated at $108 billion in 2015-16, up from virtually nothing in 1991. The range of business services has expanded from call centers and clerical work to high-end financial, medical, and legal work. Credit ratings agencies like Moody’s and Standard and Poor’s, which once gave India very poor ratings, now do a signif- icant amount of their work out of India. In 1991 Indian companies used obsolete technologies based on ancient licensing agreements and did very little research and devel- opment. Today, India has emerged as a global research and develop- ment (R&D) hub. General Electric has located one of its five global R&D centers in Bengaluru. Suzuki and Hyundai have made India a hub for small-car research and production. Microsoft and IBM are among the global companies using India as an R&D base. Imports and exports, of both goods and services, have soared as a proportion of GDP because of India’s opening up and conse- quent globalization. The World Bank estimates that in the period 2011-15, India’s total trade (imports and exports) as a propor- tion of GDP was 49 percent, high- er than the only two other conti- nental-sized economies: China (42 percent) and the United States (30 percent). Many Indian politicians are still instinctively protectionist, yet the data show how much opening up has already happened.15 India has become a global hub for computer software develop- ment. Microsoft, Oracle, SAP, IBM, Accenture, and other top interna- tional companies use India as a base. IBM has more employees in India than in the United States, because Indian skills are often as good as — and much cheaper than — those in the West. That fact has led to many complaints that IBM is shifting jobs to India. Many Indian engineers and scien- tists who used to work for multina- tionals abroad have returned to work in the companies’ Indian Table 4. Fewer Households Report Any Hunger in Preceding 12 Months Source: Angus Deaton and Jean Drèze, “Food and Nutrition in India: Facts and Interpretations,” Economic and Political Weekly (India), February 14, 2009. Years 1983 1993-94 Hunger Ratio 17.3 5.2 2004-5 2.5 3.6 1999-2000

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