Though many attempts have been made, some
of the ideals outlined by The Mother for Auroville's economy are
as distant as ever.
How do you create an economy if all you have is a set of high
ideals made by none other than The Mother and no economic base
to speak of?
This question has been in the mind of many Aurovilians
since Auroville's inception in 1968. How can one manifest a city
"the land and buildings will belong to the Supreme
a city "which will be the ideal place for those
who want to know the joy and liberation of no longer having any
personal possessions"(2) ,
a city which "will have money
relations only with the outside world"(3) ,
a city "which
will provide for each individual's subsistence and sphere of action"(4)
and which, on top, "will be a self-supporting township"(5)?
These questions have led not only to intense debates but also
to the living research that has characterised Auroville for the
last decades. However, many major issues are yet to be resolved.
In the beginning
Most of the early settlers came with lots
of enthusiasm and little money. Mother had organised 'Prosperity'
for them on the lines of the system in use in the Sri Aurobindo
Ashram. Within a limited range, goods, services and some cash
were made available according to one's request. The Sri Aurobindo
Society collected donations and bought land for the Auroville
project and built the first settlements. If one wished to build
one's own keet hut or a house, it was sufficient to ask permission
from Mother. The principle of 'no private ownership of immoveable
assets' was started in this way. It has continued ever since.
At present all immoveable assets are owned by the Auroville Foundation
which 'holds them in trust for humanity as a whole.'6
After the split between the Sri Aurobindo
Society and Auroville, 'sharing to survive' became the dictum
of the day. Whatever you had, you put in a common pot; whatever
you needed you took out. Food was bought centrally and distributed
in baskets by the group in charge of 'Pour Tous', (meaning 'For
All') a name Mother had given to the central food distribution
system. But acute shortages stimulated individuals to start handicraft
units in an attempt to make ends meet. Still, the pot soon became
empty, and many of these fledgling units lost their money. It
led to a lack of trust in centralised common pots.
By the end of the seventies a new system came
into existence called 'the envelopes'. Money was allocated to
various 'envelopes' for urgent needs such as food, community maintenance,
electricity and water. There was no personal maintenance. Around
this time 'Nandini' was born which received donations 'in kind',
such as clothing, from the young commercial units, for people
to collect on a need basis. But the income remained insufficient
to cover the needs. People who had personal funds started to share
The first upswing came in 1984, when Auroville
got the first maintenance grant from the Government of India for
the Sri Aurobindo International Institute for Educational Research
(SAIIER). But even this boost was insufficient to meet the collective
needs. The commercial units were asked to not only maintain the
Aurovilians who worked there, but also make general contributions
for community maintenance. Aurovilians who worked for projects
had to ensure that their needs were met by their project. Only
Aurovilians who worked directly for community services would be
maintained by the community. In this way Auroville's maintenance
system was born, along with the concept that Aurovilians who work
for commercial units or projects are maintained by those units
November 1988 marked a second upswing. A well-attended
economy seminar led to the beginning of the Central Fund to be
managed by a new group, the Economy Group. Yearly budgets for
all community services and other collective responsibilities were
drawn up and it was agreed that all Aurovilians and Auroville
units would contribute monthly to these budgets. The system prospered.
It brought nutrition, clothing, health and dental care plus a
wide range of goods and services. But the system also highlighted
problems and inequalities.
The central financing of the services led
to inefficiency within some of them - the more so as the central
financing was insufficient. To rectify this, a process evolved
in subsequent years that a number of service units should charge
for their services, and that these charges should include development
costs so that they could finance their own growth. This allowed
unit executives the financial freedom to be creative. This system
was a success in services such as Pour Tous, but could not be
applied to a 'free' service like education.
The other serious concern was that the level
of maintenance that could be provided to those working for community
services was lower - often considerably - than what was taken
by those running commercial units. To counter this, a movement
was started in 1999 called 'The Circle Experiment.' The idea behind
the experiment is to create 'extended-family' groupings where
people with more resources share with those with less. Circle
members pool their maintenances in a common pot, and each member
draws from the pot whatever s/he requires. Those with sufficient
personal resources contribute additionally. Circle deficits are
covered from a buffer provided by one of Auroville's commercial
units. But the circles have not been the success hoped for. About
80% of the participants depend on inadequate community maintenance.
Though the Circle participants receive more income, it remains
insufficient. The experiment failed to convince the larger community
to participate. At present only five of the original nine circles
The commercial units
Contrary to the 'outside' world, Auroville's
commercial units did not develop as privately owned entities -
even though they were all privately financed - but as part of
various Auroville trusts in an attempt to manifest Mother's principle
that "At Auroville nothing belongs to anyone in particular.
All is collective property."7 After the Auroville Foundation
Act was passed, the Foundation became the owner of all units and
delegated the management to individual Aurovilians. At present,
there are more than 100 units that can be termed 'commercial'.
While all of them provide a maintenance to the executives and
employ local labour, the economic base of the majority of them
is weak. Only about 40 commercial units make regular donations
to the community.
The slow growth of the commercial sector is
a cause of concern. In April 2002, Prof. Henk Thomas from The
Netherlands and chartered accountant Manuel Thomas from Chennai,
presented the White Paper on the Auroville Economy. Based on the
key issues of Auroville's economic development from 1968 till
2002, taking into account inflation and population increase, they
concluded that the 'carrying capacity', that is the yearly contribution
to Auroville of all commercial units per capita Aurovilian, had
gone down by more than 20% in the period 1993-1999. An update
of this figure is expected soon, but the indications are that
the situation has not improved, which will make it difficult to
sustain the maintenance levels for those maintained by Auroville.
The Paper warned that, with the changed conditions in the outside
economic world, Auroville's current economic structure cannot
be sustained. It concluded that Auroville's current situation
is loaded with risks and uncertainties which threaten the survival
of Auroville even in the short run, and made a number of recommendations
to improve the commercial sector. Foremost is the need to recognize
businesses as providers of employment and economic value to the
community. Auroville has to promote commerce; provide access to
capital; limit product liability; allow units to enter into joint
ventures with external companies; and stimulate outsiders to participate
in Auroville's development through injecting venture capital.
The Paper stressed that institutions like the Governing Board
of the Auroville Foundation, the Funds and Assets Management Committee
(FAMC) and the Auroville Board of Commerce should take up an active
role, if the goal of expanding to a township of minimally five
thousand people is to be achieved rapidly.
Sadly, hardly any of the White Paper recommendations
have been followed up. The Governing Board has not yet acted;
the FAMC took almost a year before it found the time to discuss
the recommendations; and the Auroville Board of Commerce died
a few years ago due to serious internal disagreements and has
not been revived since. Neither has any other group come into
existence for a strategic planning of business development.
There is another way in which the diminishing 'carrying capacity'
affects Auroville's growth. Most of Auroville's new buildings
are funded from donations. But as a rule, donors do not fund the
subsequent maintenance and repair costs, which have to be borne
by the community. However, a falling income will make this impossible.
Individuality versus fraternity
The economic context of Auroville is largely
determined by two structural features. The first is that individuality
is paramount. Each individual is free to determine his or her
own line of action and development. Anyone wishing to create a
commercial unit, for example, has little more to do than fill
in a form and get permission. The flip side is that from that
point onwards the individual stands alone. There is no guidance
with respect to issues such as accounting, marketing and pricing
policies in order to survive; and no financial support is offered.
Neither is there any form of control. Small wonder then that unit
executives as a rule are closely identified with 'his or her'
unit, even though the legal ownership rests with the Auroville
Foundation. One immediate consequence is that efforts to collectively
market Auroville's products have barely taken off. Another consequence
is that unit executives determine for themselves what maintenance
to take - regardless of the levels of maintenance taken by those
working in the service sector - and freely determine whether or
not to allocate part of their profits to Auroville. The commonly
heard justification is that those Aurovilians who have private
incomes deal with their money in the same way.
The second structural feature of Auroville's economy is that of
fraternity, the underlying basis for the manifestation of Auroville's
ideals. In economic terms fraternity translates into solidarity.
If a diminishing 'carrying capacity' of the commercial units will
make it difficult to sustain even the present inadequate maintenance
levels of those who depend on Auroville, other means must be found.
For if this economic principle of solidarity is not addressed,
only those who have sufficient income will be able to stay in
No exchange of money
The ideal which Auroville has not been able
to manifest is to provide each individual with the basic needs.
Mother stated that the city should take care of the needs of each
individual, 'not according to notions of right and equality, but
on the basis of the most elementary necessities; then, once that
is established, everyone must be free to organize his life, not
according to his monetary means, but according to his inner capacities.'8 In other conversations She indicated that there should be no exchange
of money in Auroville.
If both statements are read together, it appears
that, as a first step, the city should make essential goods available
to each Aurovilian in kind. But where will the money come from?
The city does not levy taxes. It has no income apart from the
voluntary donations from commercial units, from projects, from
guests and from the Rs 1200 scheme (a scheme under which each
unit contributes Rs 1200/month per Aurovilian working in that
unit). This income falls short of the budgetary needs and there
is no easy way in which it can be increased to provide for the
basic needs of each Aurovilian.
It has been argued that if Auroville would
copy the business model of the Sri Aurobindo Ashram, which receives
and re-allocates all profits of all its commercial units centrally,
a no-exchange of money economy providing for the basic needs of
each Aurovilian could easily be established. As Auroville is the
ultimate owner of all the units, this option is technically feasible.
But it does not seem to be a realistic option as it repudiates
the principle of the freedom of the individual. If imposed, it
may even lead to a dampening of business initiative and motivation.
Is the only option then that Auroville continues
to balance its income and expenditure, asking commercial units
to increasingly donate more and service units to spend less? This
is an unenviable task. It has been the job of the Economy Group
ever since its inception 15 years ago. But in March this year
the members of the Economy Group decided to call it a day. They
felt unmotivated to continue the present system, without a promise
that at some time there would be sufficient income to maintain
all Aurovilians in accordance with Mother's vision.
Perhaps a joint effort of individuals and
unit executives is the only way out. A proposal to that effect,
introducing a partial no-exchange of money economy and promising
a substantial improvement of the maintenance of those depending
on Auroville, is presently circulating in the community. The proposal
can only materialise if wealthy Aurovilians and unit executives
cooperate to find the necessary income without feeling that they
are "being taxed under another name". The principle
of fraternity and the ideals of Auroville demand that such a step
be made soon.
1. Early 1965. When published on 8 October
1969, Mother changed 2 answers.
2. 18 September 1969, Collected Works of The Mother Vol. 13 p.
208. The text found in Mother's Agenda is slightly different:
Auroville is the ideal place for those who want to know the joy
and liberation of not having any more personal possession. Mother's
Agenda Vol. 10 p. 336.
3. Mother's Answer in 1965: As long as human habits will be such.
In 1969, Mother changed this answer into the wording used above.
See footnote 1.
4. Bulletin, August 1954, Collected Works of The Mother vol. 12
5. 30-12-1967, Mother's Agenda vol. 8 p 429.
6. Auroville Housing Policy section 1a..
7. 14 May 1970, Collected Works of The Mother vol. 13, p. 213.
8. 30 December 1967, Mothers' Agenda vol. 8 pp 425 - 428 and 429.
Cartoon: economy 2
Cartoon credit: Emanuele