South Africa’s KwaZulu-Natal (KZN) is a garden province. Its extravagant waterfront homes are lit in Abeer pink sunsets and washed by the doleful Chowtal chants of the Indian Ocean. Its interior is carpeted with lush green sugarcane plantations and neat roadways. The Great Kei River snakes along the border separating it from Transkei which was once a Bantustan- an area set aside for members of a specific ethnicity namely the Xhosa. On crossing the river from KZN into Transkei, you are derailed into a bygone era or perhaps a different country. The earth is brown and deforested. People live mostly in ‘villas miseria’ cooking on open fires without running water, unlike the sumptuousness of the Palace of the Lost City across the river.
The contradiction is a living laboratory of Arthur Lewis’s theory of the dual economy where the differences across the two sides of the river are intimately linked to major differences in economic institutions. According to Lewis’s paradigm, less developed and underdeveloped economies have a dual structure divided into a modern sector and a traditional sector. KwaZulu-Natal is characterized by features which correspond to Lewis’s modern sector. It is rich with bustling urban life, up-to-date industry and flourishing use of technologies. Transkei on the other side of the river is associated with rural life, inefficient use of labour and communal ownership of land, agriculture, parochial institutions and outmoded knowledges.
Arthur Lewis and Eric Williams understood that the ‘problem of development’ was how to reallocate labour to the modern sector by educating West Indian peoples to become entrepreneurs, businessmen, manufactures, engineers, scientists, and skilled workers to drive competitiveness without reducing the quality and the quantity of goods produced by the rural sector. Farmers, for instance, cultivating the Trinitario and other cocoa hybrid types from the Imperial College Selections could supply local manufactures with beans to produce chocolates and truffles flavoured with local peppers, ginger, sea salt, Angostura aromas, cane sugar and tonka beans. Both the single estate farmer and the entrepreneur with their in-house chefs inside local factories could control the global supply chain of exotic Trinitario fruity and floral confectionery exports.
Oversimplifications of Lewis’s model have led to distortions around the separation between the different sectors and may lead to the belief that manufacturing has a profit incentive lacking in agriculture. But the agricultural sector can also benefit from similar investment and productivity growth. The stark contradiction of KZN and Transkei sheds a spotlight on how economic development itself can feed on and even create the darkness of underdevelopment in some parts of the domestic and world economy. Formal versus informal employment is a very imperfect proxy for India’s dual economic structure.
India’s dual economy is stark- with about 10 percent of the workforce employed in the formal sector. The India that the British East India Company (EIC) conquered was a multifaceted jewel. The British government assisted the Company’s rise with military and naval resources, enabling legislation, loans from the Bank of England, and supportive foreign policy to counter competition from European countries. Goa, Chittagong and the seven islands that make up Bombay were all once under Portuguese rule. Likewise Pondicherry, Yanam, Chandernagore and Karaikal were all part of French India.
India was the largest producer and exporter of textiles in the world. The establishment of the British EIC marked the contraction of India’s textile industry and the first great deindustrialization of the modern world. It was the beginning of reversed development in India. Indians grew cotton but primarily to sell to England. As India no longer wove or spun much of it- master weavers became beggars. Soon India was buying textiles from Britain and growing opium for the EIC to sell in China. Apologists argue that Indian textiles were wiped out by Britain’s Industrial Revolution which was driven by the transatlantic slave trade. But the love for empire did not translate into a transfer of technology to India. Rather India became the victim of technological obsolescence. Between 1801 and 1839, 327 British ships were built in Bengal. Soon caulkers, sawyers, joiners and shipwrights were unemployed in London. In 1813, British legislation removed 40 percent of Bengal-built ships out of the India-England trade. Trade with China was allowed but since there was no market for Chinese goods in India and the ships were denied access to London, the Calcutta-China passage proved unprofitable. The continuation of colonial asymmetries occasionally makes this type of diagnosis relevant. Some even see the merit in past imperial arrangements.
Our horizons remain limited only within a colonized mind. To lead a life in resentment against an imposed inferiority deflects attention away from setting bold new objectives and priorities which we have reason to pursue and value in a modern world.
