Seasons, festivals and the economy(Diwali Special)

Festivals are not simply the “shopping festival”, and the seasons not just a “holiday season”. Travel, transportation, religious activities which include “daan”, buying of gold, textiles, consumer goods are propellants of economic activity as well as a season of spiritual significance. The tradition is being followed since time immemorial… says Vaijayanthi Chakravarthi.

There used to be two important days in the diary of those who covered the financial markets in the early nineties. For those covering the Bombay Stock Exchange (BSE now) it used to be the day of ceremonial trading day, Muhurat trading and the special trading session on the Union Budget day. For those who covered the Reserve Bank of India it was the two credit policy days, the busy season and lean season credit policy as it used to be called back then. Except for the Union Budget which was purely an accounting and policy event, the other three followed seasons, agriculture and festivals. Muhurat trading as a tradition came into being with the traders on Dalal Street being traditionally Gujarati and Marwaris who followed the Lakshmi Puja, Chopda Puja and the Samvat Year, new accounting year traditions.

On Saturday, the Diwali day this year too the BSE as well NSE hosted Muhurat trading sessions. But the connection to seasons and festivals may slowly fade as players change, and traditions change. RBI credit policy which traditionally followed the agricultural seasons of Rabi and Kharif crops to determine the interest rates slowly changed to quarterly credit policies as the economy expanded and the proportion of agriculture in it slowly came down – now we have RBI credit policy every two months.

But something that hasn’t changed are the seasons, the importance of the southwest monsoon, the festivals that coincide with the seasons and their celebration. Diwali as a four-day long celebration falls exactly in this period, period of transition of seasons, after monsoon, end of harvests in many parts of the country. When I look at the Diwali celebrations in Maharashtra starting with the Govasta Dwadashi to Balipradipada that has so many aspects, religious and spiritual significance, I relate it to a similar four-day festival in Tamil Nadu during Sankranti, a significant post-harvest festival. When agriculture was the predominant activity the harvest seasons and the rejuvenation of other trades coincided with the bounteous harvest and the ability of the farmers to buy. Even in an expanded economy with highly urbanized set up the agricultural seasons are still the most important factors driving our consumption. It is the Vijayadasami, Dhanteras and the Gudi Padwa that have been most watched by the realtors, FMCG companies, jewelers etc. The festive season even now sees the biggest jump in sales. There have been many papers on the multiplier effect of the ten-day long Ganesh festival in Maharashtra by many economists. This year when the economic activity has shrunk due to the pandemic and the lockdown, it is the good monsoon and the crop income that has given some boost to consumption. The festivals are not simply the “shopping festival”, and the seasons not just a “holiday season”. Travel, transportation, religious activities which include “daan”, buying of gold, textiles, consumer goods are propellants of economic activity as well as a season of spiritual significance. Modern day marketers have also targeted Indian consumers trying to sell more gold and silver either on Danteras as has been the tradition or in creating a new wave of gold purchase on Akshaya Tritiyai. The busy and lean season are as true today as it was when RBI had just two policy events in a year. Even now one can see in Tamil Nadu, profusion of 10-day long, month long religious festivals in the hot summer months of April-May when agricultural activities are low. In fact, Tamil merchants for long had a “sale” season in the month of “Adi” which follows the scorching summer months, and in a month when marriages are performed. They used to clear their stocks in the “Adi sale” and stock afresh in time for the Navratri-Diwali busy season. This way for centuries the festivals and the economic cycle have been intertwined. It may not be a mere coincidence when one looks at emphasis on Artha, Varta in our ancient texts, in the Dharma Shastra, Arthashastra etc., Understanding the human mind, and placing enough emphasis on economy and trade many religious activities perhaps were also planned accordingly. As the researchers on Ganesh Festival looked at the multiplier effect of the festival on economy, so have many who have looked at the periodic Kumbh Mela festivals that were religious, spiritual congregations also driving the economy as millions congregate. This also takes us back to our puranas and the Vedic Yagnas. Were they not driving the economy too, showering prosperity on the citizens? Recollect Yudhishtira’s Rajasuya Yajna in the Mahabharata. He wants to spend the riches he had accumulated, and performs the Yajna and the result: the gifts, the honours and the satisfaction of the deities, the citizens, citizens included people of all varnas. Similar are the descriptions of Ashwamedha Yajna in the Ramayana.

Today we may not have kings to perform such large Yajnas, nor have Grihastas who can perform many Yajnas, but we have our festivals. To share the bounty, to celebrate and keep the economic cycle alive. As the pandemic taught us, what else was more important than to produce enough food and share them. Food is still the crux of human life, and perhaps for long the agricultural seasons and festivals will continue to drive our economic cycle.

(As a business journalist Vaijayanthi Chakravarthy has been following Indian markets and their socio-cultural significance for a long time)

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