Globalisation, broadly defined as the increased interconnectedness and interdependence of economies, societies, and cultures through trade, communication, and technology, has had far-reaching consequences on the political, economic, and social fabric of India. Since the economic liberalisation of 1991, India has embraced globalisation through the opening up of markets, deregulation, and increased integration with the global economy. This process has deeply influenced State politics in India, reshaping governance models, redefining state-citizen relations, altering federal dynamics, and shifting policy priorities.
1. Restructuring of State Functions
Globalisation has led to a transformation in the role of the state from being a provider and regulator to that of a facilitator of economic growth and private enterprise. In the earlier model, the Indian state followed a socialist, planned economy with a significant public sector presence. Post-1991, the liberalisation agenda reduced state control over the economy, promoting privatisation, public-private partnerships, and foreign direct investment (FDI).
- Shift in priorities: State governments have increasingly focused on economic competitiveness, seeking to attract domestic and foreign investment. This has led to inter-state competition, where states offer incentives like tax holidays and land at subsidised rates to corporations, often at the cost of social spending.
- Erosion of welfare functions: In several cases, the emphasis on market efficiency has resulted in reduced investment in welfare schemes. Though schemes like MNREGA or PDS continue, globalisation has pushed states toward a growth-centric model, sometimes ignoring equity concerns.
2. Impact on Federalism and Centre-State Relations
Globalisation has had a mixed impact on Indian federalism. On one hand, it has enhanced the autonomy of states in economic matters; on the other hand, it has led to greater centralisation in decision-making, especially in fiscal matters.
- Rise of competitive federalism: With economic liberalisation, states have begun to play a more active role in attracting investment, creating industrial corridors, and developing infrastructure. The emergence of investment summits like ‘Vibrant Gujarat’ exemplifies this new competitive dynamic among states.
- Centralisation through economic control: The increasing role of institutions like the NITI Aayog, the Finance Commission, and centrally sponsored schemes has given the Union government more leverage over states. The introduction of Goods and Services Tax (GST) has reduced the fiscal autonomy of states, limiting their ability to design independent economic policies.
3. Rise of Identity Politics and Cultural Reassertion
Paradoxically, while globalisation promotes economic integration, it has also led to a reassertion of local identities. In response to the homogenising tendencies of global culture, communities and political groups have sought to preserve and promote their regional, linguistic, and religious identities.
- Cultural resistance: The rise of regional parties, such as the DMK in Tamil Nadu or Shiv Sena in Maharashtra, has been partly fuelled by cultural anxieties over globalisation. These parties often portray themselves as defenders of local culture against the onslaught of Westernisation.
- Rise in populism and nationalism: Globalisation-induced inequalities have also led to the rise of populist politics, where leaders appeal to national pride and cultural heritage to counter the perceived threats of global influence. For example, the emphasis on “Make in India”, “Atmanirbhar Bharat”, and protection of Indian traditions reflects a pushback against the excesses of global integration.
4. Inequality, Unemployment, and Regional Imbalances
Globalisation has exacerbated socio-economic inequalities in India. While some urban centers have become global hubs of IT and services, large sections of rural India remain untouched by the benefits of globalisation.
- Urban bias: Investment has disproportionately flowed into already-developed regions like Bangalore, Hyderabad, and Mumbai, creating an urban-rural divide. States with poor infrastructure and unstable law and order—such as Bihar, Jharkhand, and parts of the Northeast—have struggled to attract investment, leading to uneven development.
- Jobless growth: Despite GDP growth, globalisation has resulted in limited employment generation, especially in manufacturing and agriculture. Many state governments are now faced with the political challenge of managing youth unrest and agrarian distress, as globalised policies have not translated into broad-based economic benefits.
5. Civil Society and Political Mobilisation
Globalisation has led to the emergence of new forms of political mobilisation and civil society activism. Increased access to information, global networks, and digital technologies has empowered citizens to engage in political processes more actively.
- Role of NGOs and activism: Many non-governmental organisations (NGOs) have gained international funding and visibility, enabling them to challenge state policies, particularly in areas like environment, tribal rights, and gender justice.
- Digital politics: The spread of social media and digital platforms has changed how political parties communicate with citizens, conduct campaigns, and shape public opinion. However, it has also raised concerns about misinformation, surveillance, and data privacy.
6. Policy Convergence and Diminishing Ideological Differences
Globalisation has led to a convergence of political ideologies, especially in economic policy. Regardless of the party in power, there has been a general acceptance of market-friendly reforms, FDI, and global trade.
- For instance, both the Congress-led UPA and the BJP-led NDA governments have pursued liberal economic reforms. This convergence has reduced the ideological distance between mainstream parties on economic matters, although they differ on cultural and nationalistic issues.
Conclusion The impact of globalisation on state politics in India is multi-dimensional. It has brought new opportunities for growth, governance innovation, and citizen engagement, but it has also intensified inequalities, regional imbalances, and cultural anxieties. While it has empowered states economically, it has also led to increased centralisation in some aspects. Globalisation has transformed the relationship between the state and the citizen, the economy and politics, and the global and the local. The challenge ahead lies in balancing economic integration with inclusive development and cultural diversity, ensuring that globalisation becomes a tool for empowerment rather than exclusion.
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