Speaking on 'India and Globalisation' at the Foreign Policy Centre, a European think tank with a global outlook, in London on Thursday, Finance Minister P Chidambaram said, "We abide by every obligation under the WTO. Yet we are denied of market access (by developed countries). A lot must change as there is a lot of talk but very little action".
He said "India accepts and willingly embraces the imperative of globalisation. We do so in our self-interest. The real question is the terms of engagement in globalisation.
"As of today, the terms are heavily weighted in favour of the developed countries. Millions of people in the developing countries, and in the least developed countries, watch in silence, and with a growing sense of bitterness, that the age
of prosperity is passing them by. This does not augur well for either globalisation or stability."
Asking the developed countries to review the process of globalisation, Chidambaram said, "I urge you to renew the process by making it more inclusive, more just and more equitable."
Chidambaram, who will represent India as an invitee at the two-day meeting of the G-7 rich nations beginning on Friday in London, said the Foreign Policy Centre was well placed to take a leadership role in this behalf and India would be very happy to work with it in areas of mutual interest.
Along with India, the G-7 has invited China, Brazil, Russia and South Africa for the meeting.
The Indian finance minister indicated that his efforts would be to broad-base the tax collection in the country. Last time he had succeeded in increasing the number of persons covered under taxation from 1.2 million to 25 to 30 million and "we have to raise it to 50 million."
In a lighter vein, he told the audience that he would welcome any suggestion for broadening the tax net.
To a query, Chidambaram said the previous NDA government believed in privatisation being an end in itself. "Our coalition does not believe in the privatisation for the sake of privatisation. Our policy is that public sector will occupy an important place in Indian economy and profit-making public sector units will not be privatized. They can go to market and raise funds. Only loss making units will be sold off."
Asking the developed countries to open up their markets to products from developing countries, Chidambaram said, "My farmer must be able to export his products to the world market... That is not happening. We want market access. We want developed countries to comply with WTO obligations."
Observing that globalisation meant different things to different countries and different things to different people, within a country, he said, "The international architecture, comprising the UN, the World Bank and the IMF, has served the
globe reasonably well in the last 50 years. As we face new kinds of complex challenges in the future, we need to find new ways of organising the international architecture in response to the emerging new poles of economic strength on the plane."
Reeling out statistics, the Finance Minister said India's GDP, at market prices, is nearly $800 billion per year. "Exports of goods and services amount to $133 billion a year. The net capital inflows average about $19 billion annually."
He said a new aspect of India's globalisation is outward FDI by Indian companies, who are now enormously confident, and are in the process of becoming multinational corporations.
Chidambaram said, "In 2003-04, outward FDI from India amounted to a sum of $1.4 billion - a small step by world standards, but a giant leap for India.
"In my view this is only the beginning. Indian companies are hungry to go abroad, acquire manufacturing firms as well as brands, and position themselves at the doors of new markets. For the first time, Indian companies are seen as potentially major players in the world market."
The finance minister said the traditional face of Indian business has changed dramatically in the last few years.
"Indian firms are no longer only seekers of foreign technology or producers of staple goods or providers of low-end services. Their engagement with the world has acquired new dimensions."
Even in the traditional engagement in goods and services, India has become the leading nation in software services - TCS, Infosys and Wipro are acknowledged world brands.
India is also a major hub for manufacturing and export of manufactured products, especially in sectors such as automobiles, auto parts and accessories, leather goods, textiles, pharmaceuticals, petroleum products and machine tools, he said.
If you add handicrafts and hand made products, flowers and herbs, the traditional engagement with the world would be quite impressive."