November 16 - 30, December 1-15, 2006

The productive forces in India are attracting world-wide attention today. The monopoly capitalists throughout the world see great potential for maximum profits to be reaped from our country, through maximum exploitation and plunder. They are feasting their greedy eyes on the young and educated labour force, great abundance of fertile land, rivers, minerals, forests and other assets. This is the reason that India is rising to be the number one target destination for investment these days.

From the perspective of the working class and vast majority of the Indian people, the productive forces represent the potential to raise their living conditions and fulfil their needs. However, the Indian bourgeoisie is not interested in developing these productive forces so that the working people of the entire country can benefit. On the contrary, they are out to exploit these forces for immediate private gain, at the expense of the wellbeing of the people and the long-term interests of society. They exploit the productive forces extremely unevenly, overusing some while wasting and periodically destroying others.

In erstwhile textile centres such as Kanpur and parts of Mumbai and Coimbatore, the weaving looms and spinning machines have come to a grinding halt. Thousands of workers have lost their livelihood and been driven to destitution. But the textile capitalists have not suffered. They have fattened themselves enormously through the sale of the lands belonging to the mills, paving the way for luxury apartments or shopping malls.

Even today, when the bourgeoisie is excited by 8% annual economic growth, Gross Domestic Product (GDP) is far below what could be potentially produced if all the available human and physical assets were fully and optimally used to produce all the basic things that the population needs. At the present level of development of productive forces in our country, there exists the potential to produce much more wealth and social surplus than is currently taking place.

The reason for the lopsided, wasteful and destructive use of the productive forces lies in the outmoded production relations in Indian society. The production relations are principally capitalist in nature, with pronounced remnants of old patriarchal feudal relations, and a colonial style imperialistic state structure. Production of material goods and services is highly socialised, while the ownership and control over the means of production is private. As a result, the surplus produced by the toil of the workers and peasants is pocketed by capitalists and landlords for accumulating their private wealth. The surplus is taken out without any guarantee that it will be put back into the economy.

In the existing system, the reinvestment of the social surplus is dictated solely by the drive of big capitalists for maximising their private profits. They put back what they have taken out only when, and where, they are assured of maximum private returns. When the prospective rate of profit in the domestic economy does not look attractive, then investment declines and GDP growth slows down, as happened during 1997-2002. Thus, the fate of the entire economy and hence of the society depends on the private decisions of a small minority of extremely wealthy individuals in the society.

Capitalism inevitably creates, and also makes use of, a huge standing army of unemployed. This is useful to the capitalists to keep wages low and to absorb cyclical movements in market demand. As a result, a huge part of the human productive forces get under-utilised and destroyed
(see Box1), at the same time as the other part gets super-exploited. On the one hand, millions of people have no reliable source of livelihood and their capacity to work remains unused or under-used. On the other hand, those who are employed are overworked and underpaid.

While the destruction of human productive forces is evident, the destruction of material means of production is no less. Capitalist companies exploit nature with no responsibility for future generations. This has led to rapid depletion of forest cover. It has led to erosion in the fertility of soil, over exploitation of ground water in some places and underutilization of surface water in others.

The capitalist relations of production are acting as a barrier to the utilization of available productive forces to their full and optimal extent in harmony with nature, according to a rational plan.

To satisfy the basic needs of the people, more pulses are needed, as well as steel, cement and other products. More electricity is needed to energise every rural and urban home without exception. We need to build more schools, hospitals and houses
(see Box 2). More and better dams and tanks are needed to hold water for irrigation. More roads need to be built so that peasants can bring their products to the market and industrial and consumer goods can reach the villages. To prevent wastage of perishable foods more food processing units and storage infrastructure are needed.

If the economy is reoriented to fulfil the growing needs of the population, a tremendous increase will take place in the production of steel, cement and other building materials, in electric power and other forms of energy, in the production of food and food products, clothing, etc. There will be enough work to absorb everyone in productive labour and eliminate unemployment.

The present orientation of maximising private profit and the rate of plunder is a product of the present system of ownership of the means of production. Reorientation of the economy requires that the relations of production must be transformed. The ownership of the principal means of production must be converted from private to social property. To be precise, the existing private capitalist property, state capitalist property and colonial state property must be converted into state socialist property and collective property of peasant cooperatives, tribal collectives and city residents’ councils. Only then can extended reproduction and the constant improvement in the material and spiritual wellbeing of our people be ensured. Such a transformation requires, as the first necessary step, the workers and peasants to become the rulers of society, dislodging the bourgeoisie from this position.

Instead of a small minority of capitalists taking out the surplus to fill their own pockets, the process of social production must be oriented towards putting the surplus back into the economy, to further develop the productive forces—the human beings, the physical means of production and the natural resource base. The workers’ and peasants’ state would invest in those areas which are required to improve the standard of living of the people and provide secure livelihood for all. The drive to fulfil the increasing material needs of the people will ensure that new entrants into the productive force will be able to participate fully in the production process.