All ages come to an end. The Ice Age was succeeded by the Bronze Age, the Renaissance was followed by the Reformation, great powers have succeeded one another, Rome, Great Britain, the US(Senge et al. 2008, 7). Nothing's here to stay. With the present financial crisis, another age is drawing to a close – but not, as many globalization critics may think with glee, the age of globalization. What we now see going down is an international order in which the Western societies are the center and the measure of all things (the G7 is a reflection of this eroding constellation of power), the age of industrialization (based as it was on the delusion of an infinite supply of natural resources and infinite capacities of the atmosphere, the oceans and the global forests to absorb greenhouse gas emissions and other collateral wastes of our consumption patterns), and the illusion that the nation-state could, despite accelerating globalization, somehow just muddle on as it has in the course of the past 200 years. The concern now is to create a truly viable, sustainable globalization that accepts the global challenges of the twenty-first century.

Abstract

It is increasingly asserted that recent financial crises have been driven by changes in market sentiment, the latter stemming from alterations in so-called fundamentals. There are, however, few studies aimed at identifying empirically whether this is true. Applying a Markov switching autoregressive model and using the broad money-to-international reserves ratio as the variable that captures market confidence, this chapter times the start and the end of Mexico's 1994–95 financial crisis. The estimated probabilities indicate that financial panic started since November 1993 and that it ended in May 1995. It is established that the beginning and end of the crisis is associated with a change in private agents' confidence and not to ex post events, such as the abandonment of the exchange rate or the recovery of the economy led by export growth. The results also indicate that in order to recover agents' confidence, the government had to reinforce its strategy of financial liberalisation. This placed strong limitations on the authorities' room for manoeuvre in setting macroeconomic policy.

Keywords: Markov switching autoregressive model; market confidence; financial crises; Mexico.

JEL Classification: E44, C22.

Introduction

One of the most well-worn arguments within the vast and divergent literature concerning recent financial crises is that they stem from changes in market confidence. Such confidence is held to rest on so-called economic fundamentals and domestic political conditions. As soon as the fundamentals diverge from what may be considered sound, so it is argued, the confidence of investors ebbs away causing progressive withdrawals of capital overseas.

Introduction

The Russian Federation is one of the largest countries in the world, covering an area of 17.1 million km2 (1/3 of Eurasia), with the world's largest reserves of natural resources (45 per cent of the world's total natural gas, 13 per cent of oil, 23 per cent of coal, 22 per cent of forests, 37 per cent of lake water, etc.). However, Russia's climate and soil are mostly not favourable for agriculture and industrial activities, with only 13 per cent of the surface suitable for farming, while the population is concentrated in several regions leaving large areas almost unpopulated.

Russian history has also been rather turbulent. After the October Revolution in 1917, the centuries-old tsarist regime was brought to an end. The Union of Soviet Socialist Republics (USSR), comprising 15 such republics, lasted up to 1991. The Russian Soviet Federative Socialist Republic dominated the USSR for its entire 74-year history, the USSR often being referred to as ‘Russia’ and its people as ‘Russians’. Russia was the largest republic of the USSR and contributed over half of its population. After the breakup of the USSR in 1991, social and economic reforms were launched. The Soviet ideology, economy and administration underwent a transition towards democratic principles and a free market system.

Russia as the successor of the USSR is also known for its contribution to the world's science and technology (S&T).

This chapter proposes to raise some fundamental questions relating to education. What is meant by a ‘national’ education? How does it relate to the state? Is the idea of nation relevant in the twenty-first century? And, finally, what kind of education should we plan for India in the light of these questions?

For those who have been following the order as well as the drift of these questions, their interconnections should be obvious. Nevertheless, it may help to spell out some of them. There is, to my mind, a great deal of confusion regarding what we mean by nation. A lot of people use it interchangeably with the idea of the state. Hence, when we speak of a topic such as national education, we sometimes equate it with the state's educational policy. But isn't there a way of conceiving the nation so as not to confine it to the state? Often, a certain lack of clarity dogs such inquiries.

Similarly, the links between culture and nation, on the one hand, and between the nation itself and its education system are seldom examined rigorously. To worsen our confusion, some of these terms have become so ideologically charged that it becomes practically impossible to discuss them dispassionately in intellectual circles. A certain kind of well- or ill-intentioned wishy-washiness coupled with the passionate decrying of our perceived opponents’ positions becomes the substitute for clear thinking.

The Idea of ‘Tolerance’

I want briefly to reflect on the connotations of the word ‘tolerance’. This is but natural, not just from a philosophical standpoint but from that of language and literature, of which I am a student. No doubt, there is an affirmative side to tolerance. It implies acceptance, forbearance, open-mindedness, patience, even charity. But the connotations of the word, at least to me, are not entirely positive. Tolerance suggests a reluctant, even forced, acceptance of the Other. It stops short of respect or appreciation. In fact, it might even imply an uneasy coexistence. Etymologically, the word suggests a burden, coming from the Latin tollere, which means to lift up. Tolerance is not the best possible attitude to Others, but rather the minimum prerequisite for social harmony. It is also used to indicate the interdiction of something undesirable as in the phrase ‘zero tolerance’. Overall, I don't think it to be a happy word. We may, perhaps, need to begin with tolerance, but must not end with it. We will have to go much farther than tolerance, work much harder on ourselves if we really want this world to be peaceful. The principle of tolerance will have to be converted to that of love, love that is proactive, powerful, and healing. The politics of conflict must be replaced by the politics of embrace if perpetual peace is to be institutionalized on earth.

Preamble

The crisis that has hit the world economy since 2008 has lent support to suggestions put forward previously that a significant share of the growth potential of the world economy resides in a few large less developed countries. Brazil, Russia, India, China and South Africa (BRICS) have such potential. More than just that, the BRICS countries are thought to have the capacity to ‘change the world’ on account of both the threats and the opportunities they represent from the economic, social and political points of view.

International agencies and analysts suggest that investors should pay careful attention to the opportunities offered by these countries. In such analyses, the focus has been restricted to identifying investment possibilities in the BRICS production structures and examining the prospects offered by their consumer markets. This book is part of a study—the BRICS project—where the interest in analysing the BRICS goes much further. These countries present significant development opportunities, as well as several common characteristics and challenges. Identifying and analysing them may help to uncover possible paths for fulfilling their socio-political and economic development potential. More importantly, it can also reveal development alternatives that might help both developed and underdeveloped countries to overcome the problems brought by an exhausted production and consumption system and a malignant regulatory and financial regime.

One of the biggest challenges before the Indian republic is how to manage relations between Hindus and Muslims. This dispute preceded the formation of India; indeed, was instrumental in the bloody partition of the country into India and Pakistan, and, perhaps, has an even older prehistory, going back to the Muslim conquest of North India at the end of the twelfth century. Is it fair to call it Muslim conquest, which has religious overtones, rather than an Arab, Turkish, Afghan, Persian, Central Asian or Moghul conquest, as the case may have been? The answer to this question depends partly on how the conquerors saw themselves, how the conquered saw them and what historians have to say in the matter.

The first mosque in Delhi was called the Quwaat-ul-Islam, or ‘the might of Islam’ mosque. It was built on the ruins of dozens of Hindu and Jain shrines, destroyed by the conquerors. The tallest minaret in the world, the Qutub Minar, was started by Qutub-ud-Din Aibak, the man who defeated the Hindu king, Prithviraj Chauhan, to found the Delhi Sultanate, the first of many Muslim kingdoms in India. India was by no means the first foreign land conquered by Islamic armies. So what happened here followed an older pattern. In Andalusia, for example, a similar destruction of existing churches took place to build the great Mesquita in Cordoba. Victorious Islamic armies, in this case, Arab–Berber hordes, also built victory towers.

Nationalism and the Present Intellectual Crisis

In a previous chapter, I looked back at the ninety years before Independence to map the trajectory of protonationalism as it manifested in the Great Revolt of 1857. I then examined some examples of national(ist) thought in the twentieth century. In this chapter, I wish to look sixty years after Independence to trace the progress of post-nationalism during a period that I see India passing through an intellectual crisis. One of the components of this crisis is the confusion over Indian nationalism. Very simply, the question before thinking Indians is whether to forget the history and traditions of our national struggle, to deny the sacrifices and efforts of all those who strove that we might be free and self-reliant today, nay, to denounce nationalism itself as a false ideology—and to look for some other way, some other principle of organizing our civic life? Or, whether to go back to these very traditions, to rejuvenate them to deal with some of our present problems?

Some might consider this is an exaggeration, if not caricature of the issue, yet it is not very far from the truth. The success of the Bollywood movie Rang De Basanti (RDB) is a vocal testimony to the crisis in Indian nationalism. The film touched a sensitive chord in the millions who saw it, especially the youth, who were also the protagonists of the story.

To trace the growth of the national sentiment, a convenient point of departure is the Great Revolt of 1857. Not only does it give us clues to what India was before the consolidation of colonial power, it also helps us understand the dynamics between the colonizers and the colonized. Without an examination of colonialism, it would be impossible to have a sense of how modern India came to be the way it is. There are, of course, several different ways of trying to understand the relationship between the colonizers and the colonized, especially as it unfolded in India. The overthrow of colonial power in India was one of the great events of the twentieth century, with widespread ramifications for many nations all over the globe.

While there was something spectacular about the end of the Raj in 1947, resistance to British power had a much older and continuous history in the subcontinent. The fabled stability of the empire was more or less just that—a fable, a myth, a colonial fabrication bolstered by endless propaganda. The actual history of British power in India is marked by periodic unrest and decadal famines. Almost every group that was subdued and forced to join the complex configuration of alliances that characterized British paramountcy in India, actively resisted such cooptation. A certain dissatisfaction and resentment simmered all over the land. From small tribal and peasant revolts to large-scale uprisings in different parts of India, colonial rule was marked by widespread discontent.

This book is partly an attempt to negotiate the very difficult and challenging terrain of Indian modernity, more specifically, of the role of Indian nationalism in its construction. I believe that it is nationalism that became the primary engine of modernity in India. What I propose to do in this chapter is to offer a model and three snapshots that might help in understanding this phenomenon better. My model identifies three positions in India's response to modernity, while the snapshots are close examinations of three moments in the history of Indian nationalism through the reading of three sets of texts. The model is meant to explain India's intellectual face-off with the West, while the three snapshots are oblique illustrations of both the model and the face-off. Together, they are a part of a larger project of Indian self-understanding, which is so essential to the attainment of svaraj, or responsible self-governmentality, a goal that at both the individual and collective level, continues to fascinate and inspire.

Svaraj is, of course, the cornerstone not only of Gandhian thought, but of much of India's intellectual exertions in the last two centuries. We might even assert that what distinguishes political thought in India from Indian political thought—to use the distinction made by Professor Anthony Parel (2006) in ‘From “Political Thought in India” to “Indian Political Thought”’—is that the latter is centred on svaraj, while the former is not.

Introduction

South Africa is one of the strongest economies in Africa and key to the economic and political development of Sub-Saharan Africa (World Bank 2007). In relation to the global arena, South Africa has been variously categorized, but the central thrust is one of considerable economic potential, with significant constraints imposed by the legacy of the past. It has generally been grouped alongside middle-income countries like Brazil and India in terms of its strong but highly uneven capacity to participate in global technological innovation in the era of a ‘knowledge economy’ (Albuquerque 2001, UNDP 2001). The general thrust of these analyses is to emphasize the potential of the South African national system of innovation to compete in the global knowledge economy, but that socioeconomic developmental demands require critical efforts for long-term sustainability, and may become a binding constraint.

After the end of Apartheid, and with the transition to a democratic government in South Africa since 1994, there have been changes in governance, in the economy and in science, technology and innovation policy. Unlike many other countries where change has been a more gradual process, the transition was an opportunity for a dramatic break with the fragmented system of the past, towards a systematic attempt to put in place new policy, structures and mechanisms to meet democratic goals.

South Africa is distinctive in that new science and technology policies were systematically redesigned in the mould of a national innovation system (NIS) approach.

Introduction

This chapter is born out of a dialogue between two solitudes—the solitude of the outside and of the solitude inside. The solitude of the outside may be found in the enormous, vacant stretches of the world, the icy wastes of Siberia, the emptiness of the tundra in North America or the deserts of Africa. This kind of solitude is very much out there; it hits you in the middle of the eye.

Vast, empty spaces, totally devoid of people, large swathes of wilderness, whiteness of snow or starkness of sand that hurts the eye. Canada is a country of such solitudes. Most of its population is huddled within a hundred miles of the border with the United States. The rest of the hulking continent in the North is practically devoid of people. It is too cold and too forbidding to attract substantial human habitation as yet. When I first visited Canada in summer 2000, I saw large cities, full of lit-up buildings and a vast network of bright streets, but with hardly any people. We drove into our hotel in Calgary in the evening, passing through empty lots and subdued suburbs, with not a soul in sight.

There is another immense solitude, the solitude of India, the country I live and work in. It is not the emptiness of the outdoor landscapes, but the fullness of chidakash, the limitless firmament of consciousness, the terrain of silence and new creation.

Introduction

It was from my friends in the Sri Aurobindo Ashram, Pondicherry that I first heard that the Mother wanted Sanskrit to be made the national language of India. Indeed, Sanskrit is taught from childhood not only in the ashram schools, but also at Auroville, the community that the Mother founded. On 11 November 1967, the Mother said, ‘Sanskrit! Everyone should learn that. Especially everyone who works here should learn that…’ (Mother 1967).

Because some degree of confusion persisted over the Mother's and Sri Aurobindo's views on the topic, a more direct question was put to the former on 4 October 1971:

When asked by a disciple on what basis she had said that Sanskrit should be the national language of India, the Mother replied, ‘I said Sanskrit because Sri Aurobindo had told me so’.

Introduction

Policies that facilitate innovation in general and innovative performance in domestic industry in particular are an integral part of the development policies pursued by most countries. If the available evidence is any indication, India has been no exception. Both in terms of the institutional arrangements evolved over the years and of policy initiatives, India stands head and shoulders above developing country standards and in some respects is even on a par with some of the developed countries. Indian policymakers, particularly in the early years of independence, highlighted the crucial role of technology in addressing the development problems in the country and underscored the role of domestic generation of technology. The policies on technology imports in general, although initially liberal, were subsequently made restrictive for both embodied and disembodied imports to stimulate enterprises to take up and improve technology. Accordingly, almost all the policies formulated over the first forty years – including the policy statements exclusively for science and technology and others relating to industry, trade, investment and fiscal measures – were intended to influence either domestic generation or imports of technology or both. Apart from establishing its own agencies to promote innovation, the government encouraged the private sector, with the aid of various policy measures, to engage in in-house R&D activities. Also, with a view to promoting dissemination of technology, especially in agriculture, appropriate policy measures and other institutional action were taken from time to time.

Introduction

Debates on innovation policy—its importance, scope, impacts, etc.—have taken place in the ambit of both developed and developing countries. The BRICS group of countries (Brazil, Russia, India, China and South Africa) stand out within this debate for their social and economic potential and also for the impact such development may have on other countries.

With a view to furthering this debate, this article presents the innovation policy adopted by the Brazilian Federal Government. The focus is on the period ranging from 1990 to 2006 even though some general remarks will be made about state intervention before this period that has influenced the Brazilian national system of innovation. The analysis will be tackled by means of an approach that is explicitly based on a combination of the neo-Schumpeterian and Latin American structuralist frameworks, conceiving innovation as the key element of the capitalist dynamics (Cassiolato & Lastres 2008).

Within this framework, the idea of a National System of Innovation1 understands the innovative process as an integrated and systemic (and not linear) process. Although it focuses on the enterprise, institutions and organisations—and how they interact—are also important elements. Furthermore, context and history are crucial components and all policy elements affect the dynamics of the system. Thus, the analysis that follows covers not only innovation policy but science and technology and industrial policy and, more importantly, the overall economic policy of Brazil during the period.

Introduction

Over the past 10 years the world scene has changed and major new actors have taken the stage. It is thus interesting to note that the Lisbon strategy was mainly occupied with lessons to be drawn from the relative success of the US in the ICT-based new economy and that the strategy showed little concern with the five BRICS countries. Today it is obvious that Europe needs to recognise their role both as potential competitors in world trade and as potential partners when it comes to solving major problems of economic instability and environmental sustainability. While in 2000 it seemed adequate to regard the ‘knowledge-based’ economy as reigning solely in the OECD area, this report demonstrates that it is no longer the case.

As we can see from the contributions in this volume Russia and India have impressive knowledge bases in terms of their educational level while China has expanded its investments in both higher education and research at an outstanding rate. In Brazil and South Africa government bodies increasingly apply systemic approaches to policies aimed at promoting innovation. Understanding the specific dynamics linking the knowledge base to innovation and economic performance in each of the five BRICS countries is today a prerequisite for understanding the direction in which the world economy is heading. Here the BRICS project contributes with interesting insights.

Introduction

This chapter is a reflection on how changes in our idea of the nation determine the pragmatics of the academy in contemporary India. More particularly, it examines how the predominantly secularized, ‘Hindu’ academy has responded to the threat posed by the political upsurge of right-wing, Hindu majoritarianism. It argues that the academy has responded by a peculiar politics of its own, which, by virtue of its apparently oppositional and progressive stance, cheats itself into feeling that it is fighting religious fanaticism, but actually blocks it from doing so. This ‘false consciousness’ prevents the academy from discharging its larger social and cultural responsibilities, something that it appears so eager to do. In other words, much of the counter-communalistic academic discourse is, paradoxically, a distorted reflection of the very thing that it seeks to defeat and destroy. This discourse, which has its own paranoias and insecurities, upon closer scrutiny reveals an uncanny resemblance to Hindu extremism. Consequently, the secular academy is not just fearful and aggressive, but also partial and selective in its methods and strategies.

Simply speaking, academic Hinduphobia is born out of the insecurities of the secular Hindu intelligentsia. Alarmed that the very middle classes whose vanguard and champion it supposed itself to be was now deserting it lured by what was so obviously an inferior ideology, it has reacted with predictable anger and bitterness. This secular intelligentsia had almost come to equate Hinduism with its brand of secularism, having been paternalistically tolerant of minority fanaticism, whether Muslim, Sikh, radical, or caste-based.