CONSIDERING the impact of NEP in the past four years we make the following propositions:

A Massive Reverse Trend of Compradorisation

Though the Indian monopoly bourgeoisie remained compradors all along they were compradors with a difference. Unlike the Chinese compradors, the Indian capitalists, despite being dependent on foreign capital and technology, had an industrial base, exercised some degree of control over the domestic market and some even enjoyed a certain measure of technological self-reliance. They put the Indian state to good use to acquire some relative independence vis-a-vis the finance capital. But all that is changing under the new economic regime and NEP.

The big monopoly industrial houses of India are vying with each other to enter into ‘strategic alliances’ with foreign monopolies. They are again reducing themselves to managing agencies, trading houses, commission agents and junior partners of MNCs. Even the number one monopoly house, the house of Tatas, was no exception to this; in their competition with Lever they embraced Proctor & Gamble. The Chauhan of Pure Drinks who waged a so-called ‘nationalistic’ cola war against Pepsi for several years succumbed to Coca Cola for $60 million. United Breweries, the market leader in India, has offered 20% of its returns to Carlsberg just to use the latter's brand name. The TVS group, which prides itself for being one of the top 20 monopoly houses in India, considers its bagging of a job order for components from Ford Motors the biggest achievement in its entire corporate life. The entire auto industry is already enmeshed in ‘strategic alliances’. The Indian tyre giant MKF was asked to reduce its stakes to 49% when it sought a collaboration with the world leader, Firestone. Almost all the corporate reports these days read like sell-out reports.

Even public sector enterprises are being offered to the MNCs. The telecom giant ITI was offered to AT&T Bell and the latter was ready to take it over provided they were allowed to retain only 15% of the existing labour force. Foreign banks are also considering outright purchase of some Indian public sector banks and the only hitch seems to be the absence of an hire-and-fire policy. With the entire institutional framework designed to offer protection to the Indian bourgeoisie from the foreign monopolies torn apart, things are back to square one and the bourgeoisie is back to its naked position as compradors.

Meanwhile, let us see what is happening to the Indian economy in the short term.

The Lingering Crisis

By now it is clear that the Indian bourgeoisie has not been able to carry out the structural adjustment programme dictated by IMF as they originally visualised. Fiscal stabilisation has gone haywire, the fiscal deficit is back to 7-plus mark, a huge liquidity is again building up and the inflation has already crossed into double digits. At this rate of inflation the advantages of devaluation will soon be eroded and the export growth will fall behind. It may be 1990 all over again.

The first phase of fiscal squeeze sent the economy into a deep recession from which it is yet to recover and the industrial growth is yet to reach even half of the pre-1989 levels. Now with another dose of fiscal consolidation urgently on the agenda, even without IMF breathing down their necks, there are no prospects for the economy to go on to the terrain of higher growth in the short term. In place of vibrant growth that Manmohan Singh promised in three years we only have a perennial recession, a lingering stagflation rather. Even a cautious Manmohan Singh had to admit that it might take at least ten years for the reform measures to bear fruit.

The crisis at the turn of the ’90s was partly structural and partly cyclical. That is, even if one were to grant some merit to the argument that certain structural reforms would create some room for growth and that way accept the crisis to be partly structural, the crisis was primarily cyclical. Or rather one of periodical stagnation because in underdeveloped economies like India the cycle does not operate in a pure form where the recovery is somewhat automatic. The assumption behind the IMF-Manmohan school is that a package of structural reforms, not internally dictated by the prerequisites of deepening the capitalist growth but externally directed by the interests of finance capital, would pull the economy from the doldrums, stimulate the economy and sustain a long, new phase of growth. On the contrary, the structural reforms have only worsened things, added to the crisis of stagnation and postponed any possible recovery. It is now clear that the Indian bourgeoisie is no longer capable of sustaining long periods of growth through heavy internal and external borrowings as they did in the ’80s. Rather the crisis of stagnation which they were facing from mid-60s onwards and which they were trying to overcome in one form or another including controlled development of capitalism in agriculture to some extent, increasing public sector investment, generating a middle class market for consumer durables and increasing investments through enormous borrowings etc., is now finding a most concentrated expression. The bourgeoisie seems to have run out of all other options. The present option, before it can yield any results — no positive result is in sight even in the medium term — will cause tremendous devastation in the economy, erode whatever autonomy and internal viability that capitalism in India had and make the bourgeoisie ever more dependent on the imperialists. This much is evident even in the short run.

The Risky Inflow of Capital

True, the payments crisis has been overcome. Exports have been growing fast. But in view of the rising inflation it is extremely doubtful whether the present export growth can be sustained without sending the whole of the economy back again into a tailspin of recession. Sustaining only the export sector at cost of all other sectors of the economy would cause dangerous distortions in the long run.

Despite export growth the trade gap still remains and easing of the situation on the payments front has mainly come about through capital inflows — FDI, Euro issues, remittances and investments by foreign institutional investors in Indian stock markets. The last two categories are extremely risky propositions and at the first sign of trouble they will take to flight as happened in 1990. Earlier the core industrial sector was considered the bedrock of self-reliance, was confined to the public sector and was considered out of bounds for private or foreign capital. But now foreign capital is much sought after in the core sector, with the government guaranteeing fabulous terms as in the power and oil sectors and grumblings are heard only about opening up consumer goods sector to foreign investment where it hurls the private capitalists. Allowing FII investment is an invitation to foreign investors to take over Indian companies and it has already thrown up an opposition pressure group, the 'Bombay Club'. Because of the badly needed hard currency, the state is forced to compromise the interests of the bourgeoisie itself. Here is a concrete instance of how the compulsions of the structural adjustment leads to further compradorisation.

Convulsions in Indian Industry

Starting from the early ’80s, the Indian industry has been going through a great flux. Certain traditional industrial sectors like textiles and jute have been partly or wholly destroyed. The past four years have only accentuated this process. Since 1990 many of the new projects have been put on hold and much of the new investments is not going into the new projects but to modernise the existing plants. Liberalisation of imports has dealt a mortal blow at the capital goods industry and there is no recovery as yet in this sector. Especially many units of the machine tools industry have been wiped out. Even though robots have not entered Indian industry in a big way, semi-automation — introduction of CMC machines is now more or less generalised. This has displaced not only thousands of workers in the engineering industry but has also made all the earlier generations of machines redundant which have ended up in sweat-shops manufacturing components for the bigger industries. Everywhere in industry, there is rationalisation, reorganisation of the production process and intensification of the exploitation of the labour power. With massive new changes in the labour process to suit the new technologies and the needs of internationalisation of production there is an uneasy coexistence of pre-Taylorean, Taylorean and post-Taylorean labour processes.

Ancillarisation is now more or less generalised in the entire industry. The German multinational Mico-Bosch in Bangalore puts out its jobs to a certain SSI unit there which too has a German collaboration for 25% of the wage costs. Opening up the electronic industry in stages has caused at least two massive waves of closures. The phenomenon of industrial sickness has increased and the number of SSIs closed has reached around a staggering 2,35,000. Even in the large-scale sector there is a high degree of technological unevenness and many companies in the fertiliser, cement, sugar, heavy engineering and electrical sectors are facing closure. The public sector units, with their financial strait-jackets and callous managements are the least prepared for the new situation and there is a decision to close down as many as 65 PSUs. All these things are happening despite some 60% additional effective protection to the Indian manufacturers through devaluation. In the Indian version of ‘shock therapy’ too, there is too much shock and too little therapy.

Disruptions in Agriculture

Except for the general crisis of green revolution India never witnessed an acute agrarian crisis throughout ’80s. But integration into the world market and free trade under GATT regime threatens to cause serious disruptions in Indian agriculture. Here too all the regulatory mechanisms are abolished in one stroke. In the short run some regions and certain crop lines will be badly affected. For instance, as per GATT agreement, there should be a single common market for food grains in India. If there is going to be free movement of rice from Andhra to Kerala, the paddy cultivation in Kerala, which is already unremunerative and which was being sustained through legislative measures preventing conversion of paddy lands into some other crop lands, will become totally unsustainable because the price difference is Rs.3 per Kg. between Kerala and Andhra. And more than a million people, cultivators and labourers, depend on paddy cultivation in Kerala, a state which already has a very high level of unemployment. And it will have a depressing effect on the wage levels in Kerala, achieved through decades of struggle and organisation. Presently an agricultural labourer on the paddy fields in Kerala gets Rs.55-60 a day whereas his counterpart in Andhra gets not more than Rs.30. Similarly, free movement of wheat from Punjab-Haryana region will have a negative impact on the spread of green revolution in other parts, say the eastern region.

Likewise free imports and exports might cause tremors on the price front. When the Ministry of Commerce decided to import edible oils the coconut prices crashed from Rs.6 to Rs.2 per coconut and that had a devastating effect on the coconut growers in Kerala, Tamil Nadu and Karnataka. Though certain commodities from India are competitive in the world market India doesn't have a huge exportable surplus in any of these commodities. Last year when cotton export was allowed cotton prices and yarn prices went up by 30 to 40% and the handloom weavers, who we're already facing starvation deaths in some parts of the country, were not getting the yarn. Only after massive protests by the weavers, the commerce ministry, as a belated move, imposed the condition on exporters of yarn that they should import commensurate amount of cotton. The present steep rise in sugar prices has also something to do with the decision to allow export of sugar last year. First sugar export was allowed, and then when sugar prices shot up in the domestic market sugar was imported, and in the process the bureaucrats of STC, FCI and Congressmen made Rs.300 crore commission and that is free-market GATT regime for you!

Whatever may be the comparative advantages of Indian agriculture it is doubtful whether the real advantages will accrue to the Indian farmers. How the Pepsi manipulated the prices and cheated the farmers of Punjab and how Cadbury did the same to Cocoa growers in Kerala and ITC to tobacco growers in Andhra are well known facts. Those who argue for GATT on the pretext of increased exports overlook how the export-based agriculture of Latin America was totally ravaged by the MNCs. According to The Ecologist magazine 80% of the Third World land on which export crops grow is controlled by MNCs, from Unilever to Nestle and Lonhro. Between 1982 and 1992, the EC depressed world sugar prices by 75% that led to the loss of millions of jobs in the Third World. In Africa, which enjoyed food self-sufficiency till 1960, cheaper wheat imports from the West forced out of market the local food products like corn, millet and rice, and millions of small and middle farmers were ruined. The African agriculture was devastated. Later when the wheat imports became dearer there were famines and, of course, 'humanitarian' military interventions. But the most far-reaching impact of the GATT-regime will be on the class structure in rural areas. More than 70% of the cultivating households in India own between one to four hectares of land. Most of them are small and middle farmers who are highly indebted and are on the margins of independent farming. Large-scale entry of capital into agriculture, sharp fluctuations in prices and full play of market forces will throw millions of farmers out of independent farming. The historically unfinished process of differentiation of Indian peasantry which has been remarkably slow will proceed in a rapid but extremely painful way.

Grim Employment Scenario

The corporate sector in India “has not added a single net job in the past four years/Rather there has been a negative growth in employment in this sector. A ban on recruitment is in force in government services and public sector. Service sector employment which rapidly grew in ’70s and early ’80s has come to a halt adding to the middle class frustrations. Employment in agriculture is virtually stagnant for the past four years. In many parts of the country, especially in arid and semi-arid regions, the agricultural labourers were getting not more than 90-110 days of work a year. In many parts of rural India there is a huge surplus labour and rural labour migration has reached phenomenal proportions. The only sector where employment has grown in the past four years is the small-scale industrial sector or the so-called informal sector where employment has grown by 6%. This is mainly because of the ancillarisation undertaken in a generalised way by the large enterprises. Anyway, workers in this sector get subsistence wages and hence employment growth in this sector is not of much economic significance.

Slipping Sovereignty

The distinction between domestic capital and foreign capital in Indian economy is only a technical distinction now and they are no longer two different categories. Correspondingly, the Indian state is also losing step by step whatever economic sovereignty it had. The broad parameters of the macro-economic policy are set by the IMF and even when the government is not negotiating for a loan it has little latitude. The sectoral policies are often dictated by the World Bank, for instance, in areas like health, education etc. Even a chamber of industry from Germany gives a memorandum calling for policy changes and the government readily submits to that on the eve of the budget behind the back of the parliament. If there is a short reprieve from the hard IMF conditionalities, then ‘soft’ pressure is applied on the Indian government by various means. At Davos it is declared the ‘Year of India’, various foreign statesmen shower praise on India’s open: door policy and even the visiting Prime Minister of that little Singapore calls for allowing foreigners to own lands in India and to invest in real estate development. Some radical intellectuals are calling this phenomenon the retreat of the state. Whatever regulatory role the state can have m future will be within the SAP of IMF. True, the state still has nominal powers to take decisions in the national interests against finance capital but in real terms it cannot do so without causing a violent break in its external economic and political relations.

This, in brief, is the scenario after the change in the economic regime in India. In the light of this, let us now consider the basic issues involved.

A Forced Option?

From whatever has been said above, it is clear that there is an organic link between the NEP and the new world situation. The neo-colonialist pressures on the Indian government to adapt to the New World Order is also well known. But to dispel any impression that NEP is purely a product of external pressure, of a forced situation, let us make it clear that it is primarily due to internal compulsions that the Indian ruling classes have adopted the core orientation of the new policy. This policy is due to the prolonged crisis of the Nehruvian socialism and its collapse as well as the logical continuation of it. The framework of Nehruvian Socialism had run into a crisis by mid-60s itself. Despite some drastic measures like bank nationalisation and MKTP, FERA etc, taken by Indira Gandhi to reinforce the same, that framework had clearly reached its economic limits by the turn of the '80s and a process of gradual dismantling began in early '80s itself. Absence of radical land reforms to facilitate broad-based capitalist development in agriculture, the narrow base and shallowness of Green Revolution and very skewed income distribution are ultimately at the bottom of the crisis and the transition to a new economic regime. In this sense it is only an internally forced situation.

What is new about the NEP is that the Indian ruling classes have lost much of their bargaining capacity. One may recall that in the earlier decades, the Indian ruling classes were trying to bargain for a better deal within the framework of dependence, largely under the slogan of New International Economic Order, even while retaining monopoly over foreign trade and some control over foreign capital. Now these controls have gone and instead of the New international Economic Order the Indian bourgeoisie has been forced to come to terms with the New World Order. Secondly, the new qualitative element is the irreversibility of these reforms.

While earlier the state retained formal powers to curb market forces and protect domestic capital, now, under GATT regime and IMF conditionalities the state is powerless to do so unless it opts for thoroughly breaking with all these institutions which is inconceivable.


Is there a Middle Way?

Narasimha Rao philosophises too much on the Madhyamika these days. All the attempts by the Indian bourgeoisie in the past decades to follow a middle path between an independent and autonomous development and total and outright dependence, articulated mainly through NIEO, have ended in a total fiasco. Now again they are harping on a middle way between a free market regime and the Nehruvian model. Can they pursue it? Whatever may be the compulsions, can the present course be put to good use by the bourgeoisie and will it enable them to overcome their dependence? First of all, there can be no middle way between accepting the GATT and rejecting it just as there can be no middle way between accepting IMF conditions and rejecting IMF option altogether.

Secondly, just as Ranjit Sau's critique of the theoretical model on which IMF bases its structural adjustment programme amply shows, the SAP is not going to relieve the Third World countries of their crisis, rather it will only reproduce the crisis on a higher plane with greater severity after a time lag. The nation would be leap-frogging from one crisis to another and would be losing its economic sovereignty step by step in the bargain. And this suicidal course would appear fully justified from the point of view of economic rationality.

The centrepiece of the present neo-colonial onslaught is the ideological offensive of neo-liberalism based on a perverse interpretation of the neo-classical economic theory and the logic of the economic rationality of the market. The perverse side of the whole thing will become clear if you take a close look at the IMF functions. Since structural adjustment always becomes a borrower's burden, the institutions like IMF and World Bank never suggest structural adjustment to the OECD countries despite the fact that the lifting of a few protectionist measures in the West would go a long way in easing the payments crisis of many of the borrowing Third World countries. The logic of economic rationality always operates like the one-way traffic. This logic of the market has been internalised and uncritically accepted by the Indian establishment. Economic rationality Vs social priorities — this is the central contradiction not only in the present new course but in the entire path of development of capitalism in India.

If the experience of the Latin American countries is any indication what is in store for India is not difficult to guess: despite some initial growth and greater mobility of the capital there will be debt crisis, capital flight and debt-trap and conversion of debts into capital assets by the international finance capital for which public assets will be offered for a song; selling a way the PSUs for crumbs; sharp slump in growth; higher and even hyperinflation; massive devaluations; violations of GATT regime and reprisals; wage freeze, exit policies, anti-strike laws and anti-trade union legislations; and, finally, food crisis and famines. And also political authoritarianism is always the Siamese twin of economic neo-liberalism. In a country of continental dimensions with a stronger indigenous base like India it may take time for this to happen but this is the sure road ahead.

Alternatively, there may be temporary withdrawals from GATT or IMF, a new round of nationalisation of banks and some key industries and new restrictions on foreign capital etc., — in short, selective delinking — if the crisis comes to a head and a new popular or radical political force takes over power. The neo-liberal package will have to run its full course and it is bound to create the objective conditions for a radical rupture. Just as there is no calling it a halt in the midway, there is no 'middle way' between the two alternatives either.


Our Approach

Many of the ‘leftist’ academic offsprings of the Nehruvian era have gone over to the camp of neo-liberals in the ’90s. Some vulgar Marxists also echo the views of neo-liberals. Even some well-meaning people, frustrated with the earlier control-permit raj and searching for alternatives within the realm of economic theory, have resigned themselves to endorsing the present course. Opposition to globalisation would be futile since it is a historical trend and the only alternative to the market is command economy — so goes their argument. True, globalisation is a historical trend and nobody is opposed to global economic interaction per se. But the point is globalisation in whose terms and in whose interests. The imperialists also launch their neo-colonial offensive under the slogan of ‘globalisation’. The real issue is globalisation with or without self-reliance. Likewise, nobody is opposed to market forces in abstraction. True, the dismantling of the Nehruvian socialism has made capital more mobile and has removed many unnecessary fetters. And our party never held any brief for the public sector as the opportunist left did. But our point of departure is not that of some forward-looking businessman out to make best advantage out of the new situation. Rather our starting point is the consistent defense of the people's interests. It is not for us to choose between this or that bourgeois alternative, between the Nehruvian socialism and the present market regime. Whatever be the option of the bourgeoisie at a given stage, suggesting alternatives to it is not the task of the communists but to defend the people from the onslaughts. Our point of departure is the whole of political economy, the fight against the increasing dependence, the erosion of sovereignty and the betrayal of the nation by the comprador bourgeoisie for its own self-interests.

No Autarky

In opposing the NEP we never advocate autarky. In fact, Marxism has nothing to do with autarky. We have seen how certain socialist countries totally delinked their way to doom. Autarky, when taken to its extremes invariably leads to its opposite — total dependence. That is why we welcome the general direction of reforms in the socialist countries. Even under Com. Mao, China's relative isolation was more due to political reasons and not because of economic isolationism. In this respect we sharply differ from the anarchists. Taking into account the new world situation and recognising the need for some adjustment, we even incorporated some changes in our New Democratic Programme: while we reiterated expropriation of the bureaucrat capital we modified our approach towards foreign capital in India to that of regulation. Likewise we have not fully endorsed some extreme forms in the struggle against foreign capital, favoured by some grassrdotist forces, like calling for complete boycott of all foreign goods and physical attacks on the establishments of foreign capital etc. In opposing the NEP we are not harking back to that decrepit Nehruvian socialism either, as the CPI(M) is doing.

Back to Nehruvian Socialism?

CPI(M)’s harking back to the historically outdated Nehruvian model is not just a matter of nostalgia. This party fails to see the logical continuity of the old policies of the bourgeoisie in NEP. They have always denied the comprador character of the Indian big bourgeoisie and recognised dependence only in a general way and never as-a structural dependence on imperialism. That is why they see the NEP as an aberration. That is also the reason why they interpret the Bombay Club as the opposition by monopoly bourgeoisie to the NEP and are so much enamoured of it. They oppose the new policies from the premise of the conservative sections of the bourgeoisie and not from the standpoint of the people. They utterly fail to grasp the qualitatively new phase of neo-colonialism. Instead of making use of any predicament of the big bourgeoisie in its attempt at renegotiating its relations with imperialism they rush forward to seek allies within the ranks of the ruling class. In their characteristic opportunist manner they search in vain to look for opposition to NEP within Congress (I) itself. But no section of the ruling class or the Congress party seem lobe sharing with CPI(M) any illusion about going back to the Nehruvian model.

In its limited opposition to the NEP, the CPI(M) glorifies the public sector and makes the defense of public sector the central theme of this opposition. True, we will always oppose leaving the workers in the lurch by handing over the PSUs to private capitalists and the corruption of small coteries of politicians and bureaucrats enriching themselves at the cost of national assets. But CPI(M) elevates what is essentially a trade union issue to the level of an issue of economic policy. On the other hand, even when the national sovereignty itself is at stake due to the economic policies of the Congress(I), the CPI(M) would not elevate its opposition to these policies to the political level of calling for the overthrow of the Congress government under the pretext that this would strengthen the BJP but instead would only call for an economic course correction from the Rao government and would confine all its opposition to NEP to the level of mass organisations and trade unions!

India is no Banana Republic

We also disagree with those enthusiasts who reduce the whole of NEP as some kind of imperialist conspiracy and who in their eagerness to oppose imperialism make it the exclusive and principal target. Of course, there is a need for greater thrust against imperialism but not to the exclusion or obfuscation of all other contradictions in the country. One can see shades of this approach in some sections of the farmers movement as well as in the single-issue campaigns on seeds and patent rights led by petty bourgeois democrats. Exaggerating the neo-colonial dimension of the problem invariably leads to the belittling of its internal roots.

Moreover India’s position compared to some other Third World countries is unique. It has a stronger internal basis for capitalism. Despite all sorts of neo-colonialist pressures it has not yet become a full-fledged classical-type neo-colony. It has a home market which is bigger than that of some developed capitalist countries. When it opened up it did not collapse like some former Eastern bloc economies. Here the attempts by the imperialists to reduce the country to the level of a banana republic cannot but be very protracted and complicated. The main line of attack should be directed against the Indian bourgeoisie without whose support the imperialists cannot achieve this. The struggle should continue to be waged on a broad front and it is too premature to narrow down the targets.


In our approach towards the imperialism Vs Third World relations we differ from the theories of underdevelopment emanating mostly from Latin America. At least some theorists of this school emphasised the law of unequal exchange one-sidedly to the point of denying any possibility of development in the Third World which has been disproved by the reality itself. Of late, some leading spokesman of this school have come up with a programme of delinking for the autonomous development of the Third World countries. In stressing the so-called inexorable economic logic of world capitalism they reduce what is primarily a class relation and political question – seizure of power by the proletariat and the popular masses — to the level of some economic strategy. True, a victorious revolution in a Third World country basing on radical internal restructuring and self-reliance will effect some restructuring of the external economic relations as well and there may be temporary dislocations due to political reasons also. This is what Comrade Mao's New Democracy is all about. However, delinking and external integration are not absolute and mutually exclusive categories, and ultimately they are also politically determined.


To consolidate a new coalition of social and political forces against NEP, a concrete alternative programme is, of course, necessary. But suggesting concrete alternative proposals to tide over the crisis within the existing overall broad framework, as is being done by some NCOs and CPI(M), is fraught with liberal and social-democratic overtones. One must be clear about the class line too. The CPI(M), for instance, believes that the monopoly bourgeoisie stands in opposition to the NEP and has pinned much hopes on the Bombay Club.

It may be pertinent here to go into the details of the Bombay Club phenomenon. This pressure group of 17 leading industrialists, representing some sections of the monopoly bourgeoisie, in real terms, had concrete opposition to only one aspect of the NEP : that of allowing foreign institutional investors to invest directly in the stock market. These monopolists who controlled their empires with often less than 10% holdings became panicky when massive FII funds — around Rs. 6000 crore — poured in within weeks and when they started bullish buying into some blue chip scrips. It was Swaraj Paul phenomenon all over again and the fear of takeovers haunted the big bourgeoisie. The Bombay Club met and had the gall to come up with some stupid and unrealistic demands like permission to issue non-voting shares, to borrow from the banks against their existing holdings to further augment their holdings and for consolidating their holdings through fresh issues — absurd proposals some of which go against the very grain of capitalism. Later when the government allowed some of the monopoly houses to raise cheap Euro-loans and to come up with new issues to enhance the promoters holdings nothing more was heard of the Bombay Club. Earlier too the big bourgeoisie had lots of grumblings against the license permit raj. Just as those grumblings cannot be taken as their opposition to the Nehruvian model itself the present protests over this or that specific aspect of the policy cannot betaken as their challenge to the NEP itself.

This, however, doesn't rule out the possibility of sections of bourgeoisie turning around to oppose the NEP in future. Large sections of small and medium capitalists, though they do not exactly resemble the old national bourgeoisie of the colonial countries which was a historically rising independent class, are facing more and more severe problems under NEP and their protests too can be channelised into the overall opposition.

Coming back to the question of an alternative framework, such a meaningful framework can emerge, not as an intellectual exercise but out of the objective struggles of the people themselves. And instead of confining ourselves to alternatives at the level of concrete policies we will have to raise a package of issues that have a direct bearing upon national sovereignty to elevate the struggle against NEP to a qualitatively higher level : right to renegotiate foreign debt and to declare moratorium on that; right to regulate foreign capital including the right to nationalise foreign property; right to arrest capital flight and freeze foreign assets; reform of the international monetary system and the liberalisation of the IMF conditionalities; right to protectionism and to annul GATT conditionalities under conditions of BoP crisis; and the right to cancel patent rights in the national interests etc. Only this way we can make preparations for the decisive turning point and concretely pose the question of alternative political power.