Manufacturing Imperialism: the political economy of SEZ by G.N. Saibaba
The
country that is more developed industrially only shows, to the less developed,
the image of its own future --Marx, Capital, Vol I
An
epitome of beauty, serenity and colonial charm… --An
advertisement for The Carlton, a luxury hotel created by the Rahejas in Kodaikanal,
Tamil Nadu
Introduction
Land, development and
displacement has once again become the central point of debate in India.
Curiously the debate is on industrial development ostensibly, under capitalism.
Suddenly it has dawned upon the learned Prime Minister Manmohan Singh and his
policy experts that land and agriculture cannot be the main basis for the
economy of a country like India that is marching ahead in the 21st century. The
often erudite, soft spoken PM has even gone to the extent of calling all those,
who oppose the present road map of prosperity and growth laid out by his
government, anti-development and hence anti-national. The Prime Minister has
equated the present policy prescription for growth tempered by the diktats of
the World Bank and IMF with the ‘national interest’. Dr. Manmohan Singh is not
alone in his concern about the future of the so-called ‘second generation
reforms’, otherwise known as Liberalisation, Privatisation and Globalisation
(LPG).
He is joined by the likes of Dr.
Amartya Sen who is always ready to ‘grade’ the ‘performance’ of the Indian
economy. In one of his interviews to The Telegraph while trying hard to pull
the CPM-led West Bengal government out of the ignominy of Nandigram and Singur
the Nobel Laureate has made it loud and clear that whatever is happening in the
form of Special Economic Zones throughout the sub-continent is development
through industrialisation that India badly needs. And make no mistake. This
development package will inevitably have to exploit land that was / is fertile
or otherwise. Gone are the days when agriculture alone could provide to the
developmental needs of the Indian economy which as per Sen the economist is
poised for a growth of more than 9 percent, mainly propelled through foreign
direct investments. At best, it is nothing but Sen and the art of consensus
building. Incidentally, when the people of Singur was protesting against land
being taken from them against their will, Telegraph had carried photographs of
CPM cadre moving in hordes on motorcycles in Singur with red flag and the life
size portrait of Ratan Tata trying to ‘educate’ the people about the virtues of
the TATAs as the harbinger of industrialization in post-47 India. Perhaps both,
the Nobel laureate and the lumpen brigade of the CPM, were conveying the same,
albeit, in different ways.
It’s official now. Agriculture
cannot be the main provider of employment for the vast sections of the masses
abounding rural India. In fact, the first official warning came in the form of
an innocuous survey of the NSSO—about which the government had made a song and
dance, not to mention the media that had gone overboard—proclaiming that about
40 percent or more of the peasantry in India would want to rid their lives of
agriculture.
Yet in the maze of this publicity
blitzkrieg by the proponents of LPG, what is carefully ignored is the question
of development itself. The question as usual is deliberately posed in a manner
where the pertinent aspects on the ramifications of a development model—that is
totally reliant on foreign capital / dependent on imperialism—for the vast
sections of the masses of this country hardly gets any mention.
What is argued is that
displacement is inevitable in development. The rest of the arguments are just a
logical corollary of this initial refrain. Since the peasantry cannot provide
labour opportunities through agriculture anymore for the bulk of the masses as
required by the circumstances coupled with the diminishing returns for the
farmers with a high input cost and low market price / support price for the
output, there is no more incentive for them to continue in the same productive
activity.
Amidst all this effort of
consensus building are the shocking and gripping accounts of violence and
repression from the killing fields of Kashipur, Kalinganagar, Nandigram,
Raigada, Jagatsinghpur and Singur. When this is being written the CPI (M) has
resorted to the worst carnage in Nandigram which even the die hard supporters
of CPI (M) itself have shockingly compared it to the worst genocide that
followed the post-Godhra riots in the state of Gujarat in 2002. The scope of
this article does not permit to deal with the entire happenings in Nandigram.
It may be dealt in a separate piece.
Is displacement due to
development or the development of displacement an inevitable thing like ones
own shadow, a necessary evil that has to be lived with when one thinks about
development? Or is there a possibility of a development which is free of any
form of displacement; any form of violence on the people? Is this phenomenon of
displacement due to development a new feature in the trajectory that India
followed post-47? These are vital questions we cannot shy away from if we are
serious in fighting the four dreaded Ds—Displacement, Destruction, Destitution
and Death, especially in a social reality like South Asia and that too at a
time when private capital—foreign and domestic—is considered as the main
vehicle of implementation of the policies of LPG.
Towards
an understanding of the politics of development
A concrete understanding of the
present phase of LPG of the Indian economy and its implications in the South
Asian sub-continent, calls for the need of an approach toward development from
the point of view of the vast sections of the masses. It then becomes pertinent
to disentangle the maze that has deliberately been created on the question of
development through a dialectical approach the politico-economic rationale of
the path of development which India has been / is embarking. Any attempt to
talk about the future of the path of development that India should embrace
should flow from a perspective informed by the past and an understanding of the
present rooted in the past enlightened by a theory that is in the interest of
the vast sections of the masses. It is the effort of this paper to look at the
present phase of policy initiatives—termed as the second generation reforms of
LPG—in a continuum since post-47 India. It is argued here that any attempt to
theorise the history and nature of development in post-47 India cannot escape
the larger structural and causal elements within and without the Indian
sub-continent which contributed and sustained the Indian state. In essence it
is the mapping of the trajectory of interests that have contributed towards the
forging and implementation of a model of development that is essentially an
expression of the interest of the dominant class of that state.
Poverty
of critique or Poverty of the critique of poverty
In their critique of displacement
due to development, many of the activists, academics and social commentators
consider the present phase of development (initiated through the second
generation reforms of LPG) as the main cause of ruin of gains of the Nehruvian
era. The main lacuna of this approach among other things is the obfuscation of
the real nature of the politics of development that was unveiled soon after the
transfer of power in India from the British. In this perception of development
it becomes natural that despite the best efforts of the planned economy in the
Nehruvian period certain people, certain communities, still remain out of the
loop of the ‘fruits’ of development. Neither development could reach these
people nor do people embrace development. Development thus becomes a neutral category.
No matter which class or state is promoting it, development needs to take
place. It also flows from the same argument that development, it does not
matter who is getting benefited from it, should be promoted as it will
ultimately make the country prosper, stable and secure for everyone. At the end
of the day, commonsense has it that the ‘fruits’ of development will
reach—trickle down to—everyone, irrespective of caste, class, nationality,
religion and region. In this context, what Amartya Sen has to say, celebrates
the commonsense that is shared in the above mentioned paragraph:
When people move out of
agriculture, total production does not go down. So per capita income increases.
For the prosperity of industry, agriculture and the economy, you do need
industrialisation. Those in effect preventing that, either by politically
making it impossible for an industrialist to feel comfortable in Bengal or
making it difficult to buy land for industry, do not serve the interest of the
poor well. … The market economy has many imperfections… But it also creates job
and income and if the income goes up, government revenues go up, so there is
money available for education and healthcare and other things.
Amartya Sen’s sophistry with the
language of the market fails to locate the dynamic of the process of
development in the interests of the classes that is promoting it. For Amartya
Sen, logically those who lose out their jobs in the agrarian economy should get
their labour in the industrial economy. And they are not getting jobs as there
are no industries. And the way out is to bring in private capital—foreign /
domestic—to start industries which will generate jobs. In other words
industrial development cannot happen without capital generation. And hence
private capital becomes inevitable. As to what kind of industry and what kind
of jobs and the quantum of job creation—all these are immaterial. Any protest
of the peasantry and the landless agricultural labourers against the loss of
their livelihood becomes politically motivated opposition for him. He takes it
for granted that there is forward and backward correspondence between the rural
and the urban, between the agrarian and the industrial production in post-47
India. In other words, for Amartya Sen the shift of priorities from the
agrarian to the industrial is a smooth exercise. Those who have lost their
livelihoods will gain through jobs in the industrial scenario. The dynamic of
development moves as a neutral category for him through time and space. The
circularity of the logic is quite revealing when one looks at what the
professor is saying: To start with, why was Five Year Plans important for
capital formation during the planned economy period? For development. Why was
Green Revolution important for capital formation in agriculture? For
development. Why was land reform in agriculture important for capital
formation? For development. Why was disinvestment in Public Sector Undertakings
important for capital formation? For development. Why is privatisation of the social
sectors important for capital formation? For development. Why is
corporatisation of agriculture important for capital formation? For
development. Why is concentration of land important for capital formation? For
development. And why is mass use of agricultural land for industrialisation
displacing the livelihoods of lakhs and lakhs of people important for capital
formation? Again, for development. Reading between the lines will have Sen the
economist telling us that development brings crisis, devastation, destitution,
death, destruction, because of development and the only way out of this crisis
is through development!
Close on the heels of the above
notion of development is the contention made by many that all was well till the
mid-80s of the last century and things started deteriorating ever since then.
Central to this argument is the nostalgia of the good old days of Nehruvian
planned economy with Public Sector Undertakings (PSUs), Five Year Plans and
Nationalisation being the hallmark of development planning during this period.
This perception, which is shared by the socialists, Gandhians, the CPI, CPM and
their ilk in the parliament again exalts development to the status of a neutral
category, shorn off the real interest it represents in space, time and
structure.
Development is thus possible in
the urban centres because there is availability of capital, market, and also
income so as to consume the products that are available in the market.
Conversely there is no or little development in the rural, tribal areas as in
these social realities there is little income generation to match the parity of
the products available, besides low income / low capital formation has resulted
in a skewed or total absence of the market in these social formations. Thus development
gets reduced to presence or absence of capital, market, income . People become
less important in this model. Thus it becomes natural in this model of
development to come up with programmes like poverty alleviation / amelioration,
Food for work, Rozgar Yojana, National Rural Employment Guarantee Schemes, etc.
as externally induced initiatives to reach those sections who are out of the
loop of the above mentioned model as if these schemes or concepts are in itself
external to the notion of development.
Not only those people who become
targets of these schemes are reduced to lifeless things, to be worked upon so
as to be uplifted, even the onus of responsibility of not being part of the
model of development promoted by the state falls on their shoulders. Thus
moribund capital leaves the imprint of its own parasitic nature on those people
who are easy targets of its logic of surplus maximisation. Thus it becomes easy
for the cabinet minister to dismiss the shocking instance of tribals consuming
poisonous roots or grass to keep them alive as a ‘natural’ ‘cultural’ attribute
of these people not in the habit of eating rice which is being provided to them
by the government. The fact that they are left out of the loop of the model of
development imposed on them by the State and hence they are starving to death
due to lack of opportunities to survive as a people becomes politically
motivated interventions of those who are anti-development and primitive in
their vision.
A deeper investigation into the
period of Nehruvian planned economy would prove beyond doubt that what is being
implemented today by the likes of Manmohan Singh in the form of LPG is yet
another unfolding dimension of the politics of development in the present phase
of imperialist exploitation of the world economy. It becomes pertinent then to
look into the articulation of the planned economy of the Nehruvian era, how it
was befitting the post-47 arrangement, the re-division of the world market
after the World War II that emerged as a consensus among the erstwhile colonial
powers and the emerging ruling classes in the erstwhile colonies, most of whom
emerged in the anti-colonial resistance.
The Legacy of 1947
The transfer of power in the
Indian sub-continent also was when the Second World War had come to an end. The
Indian big bourgeoisie, who had developed under the protection of British
colonialism, emerged as one of the key forces that had to ensure the
reproduction of a new division of market and resources as part of the
imperialist division of the world. The comprador Indian big bourgeoisie in
alliance with the big feudal landlords had emerged as the ruling classes of
post-47 India . These classes lacked the political will to usher India through
a self-induced development that would generate growth through the mutual
correspondence between the rural and the urban, through the promotion of local
innovation which can easily be absorbed by the vast section of the masses thus
creating the way for large scale employment opportunities. A cursory glance
into the state of the newly formed Indian economy would give the indications
towards what were the major factors that had defined the logic of state
building in post-47 India.
In 1948-49, agriculture accounted
for 49.1 percent of the total national income. This comprised of stock breeding
and auxiliary activities, forestry and fisheries. The total work force in the
agrarian economy rose from 69.4 in 1901 to 73.7 in 1951 . In 1950-51 less than
two percent of the total working population was employed in the factory and its
share in the national income was a mere 5.8 percent. Thus the main concerns of
the emerging state were to manage the unfolding contradictions within the
economy and society in the form of the demands of the people buoyant with the
spirit of anti-colonial resistance and also the needs of a middle class that
had a role to play as opinion makers in the formulation of the policies.
The disparities between the rich
and the poor were so wide.
The overall stratification in the
agricultural sector was also not encouraging. Less than 3 percent of the total
agricultural population were non-cultivating landlords, around 63 percent
cultivators (owners or tenants) and around 32 percent were agricultural
labourers . The land was concentrated in the hands of the less than 3 percent
agricultural population.
The scenario is succinctly summed
up by Charles Bettelheim: …the absence of the labour market in a large part of
the rural sector; the personal subservience of the immediate producer to the
landowner; the excessive importance of land rent; the underdeveloped marketing
system resulting in little social division of labour, a low rate of
accumulation, and the use of produce mainly to satisfy immediate needs .
He further characterised the
economy as “semi-feudal”. The comprador ruling classes in Indiaعد had to
address two vital problems that were confronting the economy as bottle necks in
domestic planning and development: (1) A low industrial base which will force
the domestic economy to spend large sums of money (foreign exchange) to import
all manufactured goods. (2) The much needed foreign exchange could be earned
only through primary commodity exports to the developed capitalist countries. These
exports were always subjected to wild fluctuations in demand and reduced
purchasing power.
Displacement
is inevitable in the present model of development
Given the subservient class
nature of the Indian big bourgeoisie-feudal landlord alliance, an independent,
self expanding capitalist development that could successfully address the above
mentioned impediments was totally ruled out as that would threaten the very
class basis of the emerging post -47 India. But at the same time they had to
negotiate with the growing internal pressures from the domestic economy failing
which would have been a grave danger to their expansionist dreams.
This low industrial base and a
relatively low rate of accumulation forced the comprador bourgeoisie-landlord
alliance to agree for an economy with the Public Sector Undertakings (PSUs) as
one of the principle sources of capital mobilization. The technology for the
core industries such as steel, heavy engineering, mining etc. was obtained
through foreign collaboration. Whatever efforts that were made to reduce
dependence on foreign exchange (as the continual lack of foreign exchange was
perceived as the main source of dependence) to the minimum proved
counterproductive.
Despite all the nationalist
pretensions of the likes of Nehru—thus the coinage of the term Nehruvian
socialism—the logic of imperialism prevailed over in a strategy conceived as
Import-substitution Industrialisation. All the effort to reduce the import of
manufactured goods to minimise the burden on foreign exchange by replacing the
same through enhanced domestic production had faded into oblivion overwhelmed
by the real image of imperialist development’s future in the sub-continent as
it started reproducing itself in the multiple local specificities (multiple modes
of production) of the less developed Indian economy. As the mass of the Indian
population remained poor tied to the land for survival, incapable of providing
a market for goods, the efforts to produce domestic manufactured goods did not
translate into production of mass consumption goods. Thus there was hardly any
correspondence—neither forward nor backward—between the agrarian and the
industrial realities that unfolded in post-47 India.
The development that was promoted
by the Indian State created islands of prosperity amidst a sea of humanity
languishing in poverty and destitution unable to find them worthy of anything
in a model that was subservient to the imperialist interests of maximisation of
the surplus. This model could only benefit a few in the Indian economy, those
who form the dominant class/caste in this society whose interest was congruent
to the needs of imperialist capital and it was only possible by holding back
the productive capabilities of the Indian economy by not letting the majority
partake in their role as active producers of use values. At best what these
people would be of use is as cheap labour to perform the least skilled of
labour that would further dehumanise them. This model could only degrade the
labour by pushing them further down the pyramid of hierarchy that was
maintained to produce and reproduce the status-quo. It was not necessary that
the landless agricultural labourer who had lost his/her opportunity in the
agrarian economy would end up as labour in the factories at the urban centres.
What this model has perpetuated is the violent displacement of the
opportunities of toiling sections in the countryside to convert them into
pavement dwellers or squatters who are struggling to eke out an existence as
these people have become misfits in the urban scenario.
It would certainly be not at the
risk of exaggeration, if one says that imperialism, which has become the way of
life of capitalism, has lend its image of the future in the form of
‘development’, in less developed countries like India. Thus the realisation of
the image of the future of imperialism in less developed countries like India
as a model of development is a replication of the status-quo where the money
lender-trader-landlord nexus hold the political power, while sharing the
benefits of surplus generated in the economy with imperialism. The persistence
of this model in a semi-feudal, semi-colonial reality cannot be ensured without
total reliance on imperialism. Needless to say, displacement is inevitable in
this model without which it cannot replicate itself. Greater unevenness,
widening regional disparities, increasing impoverishment of the people etc. are
necessary evils in this model. This is diametrically opposite to an alternative
model which would move towards a structural change in the economy with
redistribution of land and a thoroughgoing shift in political power in favour
of the toiling masses. This model envisages mass participation, with the needs
of the masses forming the propellant factor giving a sense of direction to the
industries resulting in the production of items that are useful for the
everyday life of the people, for leading a dignified meaningful existence. This
would necessitate the orientation or the choice of capital that is sensitive to
the resource base of the economy and indigenous technology. And such a
model of development where people are an asset and not a burden to the economy
and their physical, mental well-being is what development is all about will be
detrimental to the interests of the landlord-money lender-trader alliance which
is holding power in the economy. Let us now look into how imperialist logic or
the reproduction of the future of imperialism gets articulated in a
semi-feudal, semi-colonial reality like India.
Five Year Plans—the Emperor’s New Clothes
The eve of transfer of power in
1947 also overlapped with the crisis of food shortage in India almost akin to
famine conditions. In the post World War II scenario it was US imperialism that
was better placed to invest in the new markets of the erstwhile colonies. At
the same time it was not an attractive proposition for the US private capital
to invest heavily in the Indian economy. Indian economy did not have the necessary
infrastructure at that time to attract private capital from foreign countries.
Another factor that was looming like a spectre was the success of the Chinese
Revolution which the ruling classes and imperialism feared would incite the
imagination of the toiling masses. The Telangana armed struggle which was
raging the fields, forests and villages of the Telangana region had fully
developed into a movement of the peasantry and the landless agricultural
labour. The remarks of Chester Bowles the then US Ambassador to India, is quite
reflective of the emerging picture:
We have a critical choice: we can
help and guide the economic and social upheaval now sweeping Asia, Africa and
Latin America into constructive, peaceful channels. Or we can sit back
nervously and ineffectually, while the revolution of rising expectations in
Asia, Africa and Latin America slips into the hands of reckless extremists who
despite everything we stand for—and a succession of Red Chinas and Red Cubas
comes into being.
Amidst the rhetoric of the
American tradition and moral bound duty of defending the free world to lead its
own existence was to push India into a development path which would, in the
first place consolidate the power of those classes who were vying for their
position in the new republic. True to the parasitic, moribund nature of the
capital that was being pledged to India in the form of US aid, what US—and
other imperialist powers who had swooped down on the South Asian market
including the erstwhile Soviet Union—was looking for was the same parasitic
classes in the Indian economy that would carry forward the dynamic of surplus
extraction in alliance with imperialist interests while retaining the Indian
economy in the same old backward conditions of low technical know how and
capital formation.
It was in this context that India
inaugurated the Community Development Programme which had later become an
integral part of India’s Five Year Plans. Two agreements were signed between
the government of India and the US on 31 May 1952 setting out detail the road
map of the implementation of the programme. The programme was totally
conceived and developed under the initiative of US ‘experts’ and agencies.
Funds were provided by the Ford and Rockefeller foundations, the US Aid for International
Development (USAID) and the US Department of Agriculture who all worked in
tandem with ‘experts’ brought from the US to ensure the implementation of the
project. These included Wolf Ladejinsky and Professor Kenneth Parsons, both US
experts in land policy . In effect the Community Development Programme further
consolidated the rural power structure without unleashing the productive
potential of the vast sections of the rural masses. It facilitated the
extraction of the surplus in the agrarian economy under the garb of community
development through the labour of the landless and the poor peasant while the
middle and rich landowners and the moneylender remained as they are. The aid
and the programme as well as various policies promoted by the Indian State
resulted in benefiting and consolidating the richer sections of the rural
community. It further inculcated an unproductive outlook or reinforced the
parasitic nature of the landlord-moneylender-trader combine in the agrarian
economy of rural India.
The Draft Outline of First Five
Year Plan also envisaged the above mentioned consolidation of the rural
class/caste configuration conducive for introducing the so-called ‘cooperative
farming’. It had its necessary sanction of the Nagpur session of the Congress
in January 1959. In the sophistry of the language of Planning Commission, “the
entire land of the village” will be regarded as “a single farm” while
maintaining the ownership rights and compensating “through ownership dividends
to be paid at each harvest”. For the utilisation of the labour of the landless
and the poor peasantry, it was mentioned that the “management of the land and
resources of the village should be organised so as to provide maximum
employment…” Community Development Programme, Cooperative farming and the
attendant state policies had further deepened the bond between the comprador
ruling classes and US imperialism.
Quite evidently, the dynamic of
development that was set in motion was externally induced propelled
fundamentally by the needs of imperialist capital rather than an internally
induced self expanding dynamic which would have primarily responded to the
needs of vast sections of the masses and that being the main source of its
strength. The self induced / internally induced development is an inclusive
model which cannot be implemented without unleashing the productive potential
of the masses. Without land reforms, without distributing the land to the
tillers this was not possible. Land reforms were a pre-requisite for this model.
Besides, this model also gave an impetus for local innovations. The direct
implication of going for an internally induced development was to undermine the
existing class / caste hierarchy which was holding back the economy. Such a
development which would have successfully addressed the question of possible
ways of avoiding displacement or lack of participation or lack of opportunities
for the vast sections of the masses was not in the interest of the ruling
classes of this country. Displacement was inevitable in their pro-imperialist
model of development where moribund, parasitic capital only looked for the
maximisation of surplus while retaining the local regressive structures of the
domestic economy which would facilitate this process.
The Myth
of Nehruvian Socialism
The Indian state under Nehru’s
leadership solicited the assistance of US land-grant universities and the
Rockefeller Foundation in setting up Indian agricultural universities and
agricultural research institutions. The then Planning Commission Secretary even
urged the Ford Foundation to establish centres of applied economic research
throughout the country to provide adequate data inputs and expertise towards
policy making by the Planning Commission. At hindsight, one can say that the
grounds for the policy package of the so-called ‘Green Revolution’ (implemented
in the third five year plan) was already set when the close partnership among
the Indian Statistical Institute, the National Council of Applied Economic
Research, the Delhi School of Economics and the Gokhale Institute in Pune with
the Massachusetts Institute of Technology was facilitated with full blessings
from both sides as the Ford Foundation provided funds for cementing the
collaboration.
Amidst this smokescreen of
‘socialist planning’ was the calculated foreign aid from the US and other
imperialist countries. From 1952-59 (1952 being the year of signing of the
first Indo-US agreement which has already been mentioned), India received a
variety of assistance from the US in the form of grant and loans—the loan being
payable at 4 percent interest or 3 if paid in dollars. The single largest grant
of assistance for India was under Public Law 480 which was to the tune of $ 915
million.
From 1958-62, India topped the
list receiving 12.3 percent of the total US aid disbursed. She was placed only
second to South Vietnam with 8.4 percent of the total aid dispersed in the
period 1963-68 while India was placed in the fourth position with 2.9 percent
of the total aid dispersed during 1969-74. India topped in the above mentioned
two phases receiving 14.8 and 13.9 percent of the total US economic aid while
being placed second in the last phase with 4.9 percent of the share.
It becomes evident that there was
a close correspondence between the development path charted by the Indian
ruling classes and the interests of US imperialism which was the prime force
after the WW II. It is significant to note what the US had to say about this
development assistance pledged to countries like India to “help them help
themselves” (to quote Chester Bowles). The then US Secretary of State Dean
Acheson while submitting the case for the need for an Act for International
Development to the Senate Foreign Relations Committee had this to say:
In a very real sense it is a
security measure… Economic development will bring us certain practical material
benefits. It will open up new sources of materials and goods we need, and new
markets for the products of our farms and factories.
Regarding the improvement of the
lives of the people in the least developed countries,
Its purpose is to encourage the
exchange of technical skills and promote the flow of private investment
capital.
One of the principal architects
of PL 480, the Agricultural Trade Development and Assistance Act of 1954,
Harold Cooley recalled after several years that the prime motive behind
conceiving such an act was to enable way to “a surplus disposal program—a
program through which we thought we would be able to expand our foreign
markets.”
Thus it was inevitable for
foreign capital to cross its national boundaries in search of huge markets like
India. The post WWII boom that was visible in the US economy and the aggressive
aid packages for post war reconstruction in Western Europe and Asia along with
the assistance offered to newly ‘independent’ countries like India had a
dynamic that was set in motion from the domestic US economy itself. The essence
of expansion under imperialism—propelled by the relentless search for surplus
value—and its nuanced articulation in the specific local material conditions of
countries like India, to realise the extraction of surplus, as a necessary
condition to maintain the pace of accumulation for imperialism to perpetuate
itself. To paraphrase none other than Lenin: “The necessity for exporting
capital arises from the fact that in a few countries capitalism has become
‘over-ripe’ and …capital cannot find ‘profitable’ investment.” Moreover, “The
more capitalism is developed, the more the need for raw materials is felt, the
more bitter competition becomes, and the more feverishly the hunt for raw
materials proceeds throughout the whole world…”
Catching
up with the West
It becomes pertinent here to
grasp the central aspect: the primary drive behind the export of capital is to
utilize the possibilities where profitable opportunities exist. Hence it
becomes necessary for imperialism to get behind tariff walls; the need to
control supplies of necessary (present and future) raw materials, (which
explains extractive investment and loan capital to assist the construction of
infrastructure); the development of large-scale institutions for mobilizing
capital; and the growth of monopoly and competition among monopolies (or
oligopolies) for raw materials, markets, and profits in general, facilitated by
a world-wide division of labour.
As have been mentioned in the
beginning, the initial efforts towards an import substitution industrialisation
saw India resorting to an ambitious project of big hydel power projects in the
form of Bhakra dam I Punjab, Hirakud in Orissa, Sharavathi project in Karnataka
all with foreign assistance in the form of aid and expertise. The International
Bank for Reconstruction and Development had granted loans amounting to $ 62.5
million primarily for agricultural and power projects and for purchase of
locomotives. The Sharavathi project had the assistance of the US. A total of
Rs. 233 crores was envisaged in the First Plan for expanding the private sector
which was double the money set aside for the public sector. This period also
witnessed the initiation of the “system of joint enterprises” under which a lot
of foreign concerns had established industries in the country in collaboration
with Indian businessmen. The second five year plan saw the setting up of
steel plants with foreign collaboration. The first steel plant was set up at
Bhilai with the technological assistance of the USSR . It should be noted that
Soviet Union under Stalin had approached the People’s Republic of China with
technological assistance for setting up steel plants. But the Chinese under
Mao’s leadership had rejected the proposal and had embarked on a drive of
initiating and promoting small scale enterprises with stress to local know how
as the cornerstone of the Chinese policy of self-reliance and massive
production of steel. Thus Mao had decisively rejected the slogan of “catching
up with the West” which was also being promoted by the then Soviet Bloc.
Moreover, it was this policy of catching up which later got translated under
the leadership of Khruschev of Soviet Union as the slogans of “peaceful
co-existence” and “peaceful competition” with US imperialism—the culmination of
revisionism and the full blown expression of Soviet Social imperialism.
The other steel plants soon
followed at Rourkela (West Germany), Durgapur (British). Despite the public
sector producing the locomotives for the Indian Railways it was deliberately
discouraged in favour of the Tata owned TELCO which sold the product at higher
prices and never met the deadlines. Despite giving the private sector tax
concessions, interest free loans, state guarantee for all loans taken from
abroad, rebate on imports and development rebate it miserably failed to improve
the position of machine tools—pointed out by the Government Expert Committee in
1954—as it was found that over two lakh light machine tools had become out of
date. Indian private enterprises had also mooted an agency called the
Industrial Credit and Investment Corporation of India (ICICI) to channel foreign
investment into India. The participating countries in this agency were India,
Britain and the USA.
Parasitism
of the Private Sector: the exploitative vehicle of the Comprador bourgeoisie
Even the Indian parliament could
not shy away from the severe parasitic nature of the Indian industry promoted
by the comprador bourgeois is so evident from the following extract from the
Lok Sabha annexure. It is important to quote this as it is a telling example of
the nature of industrialisation that was ushered in by the comprador bourgeois:
…take the case of Jamshedpur
Engineering and Machine Manufacturing Company Ltd. Replies to questions in the
Lok Sabha in 1958 …certain broad facts emerge. The Government encouraged this
firm to secure foreign technical collaboration, since the manufacture of
chilled iron rolls was a specialised line. The main electric furnace was
imported by the company at the end of 1955 and four long years later was it
erected. By then it was found that ancillary and auxiliary equipment required for
operating the furnace had not been installed! The government made inquiries
more than once about the delay and even a “show cause” notice was issued. It
was reported by the firm that important cables were missing and by the time the
new cables were received the foreign erectors had left India. It was later said
that the electrical furnace would go into production, but it would not satisfy
more than 5 percent of the demand. Meanwhile, the government decided to put up
in the public sector the Central Foundry Forge Project at Ranchi (with
Czechoslavak collaboration)…
Moreover, in the Lok Sabha
debates, MPs noted with anguish the sudden conversion of more than 350 public
limited companies into private concerns in a span of two years up to April
1958. There was even the tall talk of considering amendments to the Companies
Act . Further a large number of industries in the private sector got a surfeit
of concessions, relief and financial aid from the government. Also the
government guaranteed all kinds of loans taken from abroad by the private
sector companies. Still there were other kinds of benefits and incentives such
as rebate on import and development rebate which as per TN Singh, the then
Chair of the Lok Sabha Public Accounts Committee was unique in the world. He
himself agrees to the fact that many of these companies owed much of their
success of expansion programmes to this development rebate scheme. And this
meant huge loss to the government exchequer .
In 1948 the book value of
outstanding foreign business investments in the private sector in India was Rs.
2646 million. It had increased to Rs. 12306 million by the end of March 1967.
According to another source, of the 2200 foreign collaboration agreements
approved between 1948 and 1964, 1900 of it were effected between 1956 and 1964.
In a Table that maps the
performance over a span of period starting from 1950 to 1967, along with
countries such as Australia, Canada, Japan, UK and USA, India came at the
bottom as a country wherein the share of the Public Sector in the total
national expenditure was the lowest. It should be noted that all the other
countries cited along with India in the Table are all capitalist without any
inkling towards any declared principles of Socialism. While the share of the
public sector in National Expenditure was an abysmal 8.3 percent in 1950, it
slightly climbed up to 12.7 percent in the year 1967. In the gross fixed
capital formation the near insignificant role of the public sector exploded all
myths of state control on capital formation for the greater common good.
Perhaps in the table only US was an exception with even lesser control. In 1950
if was only 2.9 percent, by 1967 it slithered up to 7. This shows beyond doubt
the near total lack of government control over the means of production in the
Indian economy.
Green
Revolution: Pockets of uneven growth
A much more technology driven
response was the package of the fertiliser-pesticide-high yield variety
combination celebrated under the magic slogan of ‘Green Revolution’. This
package which was termed as “primarily a fertiliser scheme” by John D. Mellor,
the then chief economist for the USAID made possible the newly irrigated areas
under canal irrigation as captive markets. The rich peasant who owned the land
in these areas was totally dependent for the fertiliser, pesticide and the HYV
seed on the agribusiness and fertiliser corporations of the US. That the
more prosperous farmers have got the lion share of the benefits of ‘Green
Revolution’ was accepted by one of the key architects of the same policy, Wolf
Ladenjinsky, who significantly, is a close confidant of Nehru and also a ‘rural
expert’ from the US specially called in by Chester Bowles, US ambassador to
India in the late forties and early fifties. Not only did ‘Green
revolution’ failed to address the target of self sufficiency in food grains but
also it aggravated regional income disparities by virtue of raising incomes in
the technologically affected areas. Further there has hardly any change in the
status of food grain imports to India despite all the euphoria about ‘Green
Revolution’.
Another concrete aspect that
reveals the hold of the landlord-moneylender-trader nexus on the Indian economy
and how their interests are served by a pro-imperialist development model is
evident from the fact that the proportion of land revenue and agricultural
income tax collected by the States to national income from agriculture had
steadily declined from 1.63 percent in 1960-61 to .85 percent in 1970-71. Thus
planning was nothing but to give a free hand for the rich and the big landed
while cutting the pockets of the poor and the toiling through indirect taxation
as the proportion of national income through indirect taxation had increased
three fold from 4.2 percent to 11.0 percent during the period 1950-51 to
1970-71.
Increasing
inequalities, increasing disparities: the most violent form of displacement
The study undertaken by PD Ojha
and VV Bhatt for the Reserve bank of India on the pattern of income distribution
brings out a key dimension of the nature of surplus accrual and mobilization in
the Indian economy. This study shows that the degree of inequality in income
distribution had increased in India with the initiation and implementation of
the planned economic development. During the period covered for the
study—1953-54 to 1956-57—they found that the top ten percent of households
obtained up to 28 percent of total personal income. On the other hand they have
also shown that the urban low income group as a whole has suffered a decline in
it’s per household income. They also point out that direct taxes have not
affected the pattern of changes in personal income. As a pointer to the
direction in which the Indian economy is moving towards in the sixties, the
degree of inequality of distribution in income, they indicate, has been more or
less due to a substantial increase in the per house-hold income of the
high-income non-salary earner (capitalist and landlord classes) group.
The pretensions of ‘Nehruvian
Socialism’ or ‘Mixed economy’ or ‘Socialist patterned society’ all fall flat
when the concrete facts speak, unequivocally, what was actually becoming of the
Indian economy under the smokescreen of the above slogans or empty rhetoric
that was part of the electoral speeches or tall talk in the parliamentary
debates of leaders of the various political parties. Today the situation that
is prevalent in the Indian economy is no less different from what has been
mentioned above—a situation that was way back in the early 70s of the last
century. We will come to that later.
The resulting imbalances—or the
lack of forward and backward linkages—between industry and agriculture had put
the economy under severe strain. As has been discussed before what industry
produced could not meet the needs of mass consumption let alone erect the
necessary support structure towards enhancing production in agriculture and
manufacture in general. Public Law 480, the massive food import from the US was
the first manifestation of the tremors set in motion by the imbalance between
industry and agriculture. It was followed by the IADP (Intensive Agricultural
Development Programme) again sponsored by the American institutions which
concentrated more on the rich peasants supplying them with subsidized inputs,
generous credits, price incentives, technical advice and marketing facilities.
But none of these measures could
address the real problems facing the people of India. Rather all measures were
meant to consolidate the domination of the exploiting classes over the
exploited—the nexus of the moneylender-landlord-trader grip on the Indian
economy. Since 1950-51 the Indian economy went through several ups and downs,
mainly due to the good and bad harvests that the agricultural sector recorded.
This also shows the centrality of the agrarian sector as the mainstay for
capital and foreign exchange required for the so-called industrialisation that
was heavily dependent on foreign technology and equipment. There was continuous
drain of the surplus from the agrarian sector towards feeding the industries in
terms of ensuring a steady supply of machinery which were highly capital
intensive. It was in the interest of imperialism that agriculture the mainstay
of the economy received the least share in all the first three plans. As
has been mentioned before it is in the same period that the US interest in
investment in rural sector has come in the form of PL 480 and several other
programmes targeted to bolster the surplus maximization capacity of the parasitic
landed and comprador classes.
By 1966-67, the big picture of
Indian economy was bleak as it pulled along a stagnant industry unable to
provide employment or produce goods of mass consumption. The overall stagnation
in the economy was due to the decline in purchasing power of the masses and the
shortage of foreign exchange with the spiralling demand for abnormally high
imports of food grains and raw materials. After twenty years of planning, by
1971, the unemployment figures had more than trebled. During the Third Plan
foreign aid represented 23 percent of the total investment. Although since the
First Five Year plan the domestic saving rate which was 5.5 percent had gone up
to 9 percent by 1969-70, this had always been less than the investment rate.
The investment-saving gap was bridged with the help of foreign aid. With the
growth in population, after twenty years of planning the plight of the average
Indian had worsened as his/her access to agricultural land, housing, water,
medical facilities and transport had in many cases deteriorated.
This is nothing but displacement
inherent in an economic system that is subservient to the needs of imperialism
in process breeding more and more inequalities. In other words, we have to
locate the prime motivating factor of displacement in the matrix of the
production relations and productive forces that is the fulcrum of any economy.
India is primarily an agrarian economy with vast sections of her people
dependent on agriculture. It is the surplus generated in the agrarian sector
that is being extracted to run the economy including the so-called industrial
sector. This has created an economy with huge disparities; wealth getting
concentrated at the urban centres and massive impoverisation of the rural
sector. This in itself is displacement with a whole lot of people unable to
utilize their productive capabilities held as captives under the confines of a
skewed market in the rural sector. This development model creates disparities
between the urban and rural, between agriculture and industries, big industries
and small industries, big capital and small capital, big labour and small
labour and finally mental and manual labour. As have been mentioned before
there will pockets of 'growth centres' while the rest of the regions suffer
from lack of opportunities and impoverishment. Men, women, young and old, none
are left out of the ambit of this development menace.
The
central role of foreign aid: planning for the rich
As regards the role played by aid
in boosting the Indian economy the hand out of one of the key policy advocacy
bodies of the State itself eloquent:
Out of the total non-food aid
received and utilised about 86 percent was devoted either to strengthening the
infrastructure or to augmenting the output of producers’ goods. Of the
remaining 7.6 percent went as investment into consumer goods industry, 3.6
percent as capital goods into education and research, and 2.8 percent into
unspecified uses… It would appear, therefore that the present use structure of
foreign aid in India provides only marginal possibilities, if at all, for
reducing the amount received without direct damage to development.
On the one hand in all the policy
documents of the government and public pronouncements of the Prime Minister and
various other leaders there are always repeated pleas with a visible impatience
to rid of the dependence on foreign aid as one of the main sustenance for
development planning in India. But on the other the government documents and
advocacy bodies of the State indulge in their artful dodge to finally stand
firm behind the need for foreign aid to meet the demands of the industry as
well as to stave off the balance of payment crisis. India, like many of the
Third World countries that had embarked on the path of ‘catching up with the
West’ had a serious balance of payment crisis as it was not able meet its
requirements of maintenance imports through its export earnings. And it was
also widely shared in the officialdom that this situation is going to stay for
a while.
Thus what these agencies of the
state do is to turn upside down the logic of self-reliance itself. By now what
has been elucidated in this write up is the systematic erosion of self-reliance
of the people of this country by making them more and more indebted and
impoverished. On the contrary what these experts argue is that for attaining
self-reliance we have to give fillip to industrial production for which the
kind of technical know how that is needed cannot be brought in without foreign
aid as most of the industries in India are capital intensive and dependent on
foreign technology. Hence foreign aid will boost industrial production bringing
with it effective employment and boom in the market finally making us less
dependent on foreign aid. In this twist of logic, they conveniently shy away
from the fact that the present crisis was triggered off due to dependence on
foreign aid. Thus what they were effectively doing is using the same thing that
was the reason behind the crisis to stave off the crisis itself! It is also
carefully hidden that what was the necessity to go all out for getting foreign
aid. We stress once again that without foreign assistance it would have been
impossible for the ruling classes to maintain their dominance and hold over the
Indian economy.
And it is also very clear as to
how crucial was the concern of US imperialism to ensure the perpetuation of
this state as there were many factors of convergence than of divergence which
is manifested in the extensive aid packages that it provided throughout the
various Five Year Plans. From Rs. 380.3 crores in the First Plan foreign aid to
India had steadily increased to Rs. 2731.3 crores in the Second and Rs. 3937.8
crores in the Third plan. The share of grants in overall external
assistance fell off sharply after the first plan period and by 1970-71, had
diminished to 5.5 percent Most of the foreign aid was country tied. This
implied that loans from a particular country have to be utilized for imports
from that alone. So, for a country like India, to buy from the cheapest markets
possible was not a choice that she could exercise as she was bound by the loan
contract. This was a severe disadvantage when it came to repayments which had
to be effected in fully convertible foreign exchange. Further loan financed
imports had to be procured in the donor countries regardless of price and other
servicing considerations. Thus loan aid was nothing but giving money to a
recipient country—which should be paid back over a definite period with
principle and interest—to purchase imports from the donor country so as to
promote its own market in the recipient country! The external debt situation of
India was showing alarming trends in the same period. In 1970-71, the debt
service burden of the Indian economy was as much as 28 percent of the country’s
exports and more than 55 percent of the new commitments of foreign aid.
Ironically it was under the
guidance of the World Bank, and as a result of its ‘tied’ aid that India chose
to go for foreign collaborations for giant fertiliser plants in the late 1970s.
This is despite the fact that the public sector in India had acquired the basic
expertise of fertiliser technology. The result was the total dismantling of the
public sector enterprises dealing with fertiliser production and the initiation
of projects with highly inflated capital costs. Thus the capital costs of
fertiliser plants had risen to some multiples of the actual costs that would have
been incurred if the government chose to rely on the locally available
technology notwithstanding its shortcomings. This had pulled up the costs of
the fertiliser thus hitting the farmer badly.
The acute crisis that had gripped
the economy had its political fall out with increasing discontent from the
masses. It was at the same time that the clarion call of the Naxalite movement
that emerged in the late 1960s reverberated throughout the length and breadth
of the subcontinent. The rising spectre of unemployment, the acute shortage of
food due to severe drought and the crisis that had rocked the ruling classes
and their pro-imperialist politics all had its reflection in the call to
revolution exhorted by the Naxalites. In fact this was the first movement since
the transfer of power in 1947 that exposed the façade of the Nehruvian planned
economic development. And it was also the first time that the debate on land
was brought back violently into the political lexicon of India. This movement
also declared that there can not be a development free from all forms of
exploitation without fundamentally doing away with all the structures that was
holding back the economy of this country in the service of imperialism. It was
also the time when the country was forced to debate on the path of development
it had been embarking on.
Need for a new strategy
The challenge that was facing the
Indian big bourgeoisie was enormous. Firstly, in most of the Third World
Countries like India, the bourgeoisie had to grapple with the crisis which was
of their own making. They had to find a way out of the strategy of Import
Substitution Industrialisation which contrary to their claims had driven the
economy into further dependence to the external market and capital. Given the
precarious condition of debt bondage with a major share of the earnings from
exports resulting in only debt servicing and not the principle amount of the
loan the ruling classes had to push for more exports. This also meant further
dependence on the external market.
At the same time there were also
a situation emerging in the international scenario with the capitalist world
led by US imperialism also giving an impetus to the Third World countries to
resort to a new strategy of export led industrialisation. Imperialism had a
valid reason to press for such a strategy which meant a new trend of
international subcontracting by the multinational corporations. One of
the major reasons for international subcontracting was the growing internal
class pressures and struggles. In the US by the mid 60s capitalists were no
longer able to maintain high profit margins with the rising demands of the
working class for better wages and political gains. The international economic
pressures like large balance of payments deficits and domestic economic
pressures such as inflation, full employment and profit squeeze led the US
capitalists to a dead end where profit margins could not be successfully
restored through continued price hikes. One way of restoring the profit margin
through reducing the costs of production and combating full employment
pressures at home was by getting into the cheap labour markets of the Third
World. Thus international subcontracting for more direct production for the US
market unleashed a new international division of labour.
It was also possible for the
capitalists in the industrialised imperialist countries to think in terms of
subcontracting with the development of new labour intensive manufacturing
industries like electronics and light manufacturing joining older labour
intensive industries like clothing and shoe manufacture. As many of the
products in the industrialised West have become standardised being sold in mass
markets it is easy to subcontract such products. The advancement in these
product lines by new technological innovations in transportation and
communication has also made possible the international subcontracting of such
products easier due to their quicker, cheaper and safer dispatch its products
and components. Yet another factor that contributed to this dynamic of the
international division of labour was the inter-imperialist rivalry. Post
WW II US was the dominant capitalist power investing in the Third World. Only
US multinationals were investing in the Third World markets with the sole
purpose of securing those markets. Most of such investment was in the Latin
American countries with sizable domestic markets. By the mid-60s the emergence
of Germany and Japan from the ashes of the WW II gave the US stiff challenge to
its control over the international market. To meet the export led economies of
these countries with the advantage of relatively cheap labour, more government
assistance and more modern plants and equipment, US trans-national capital met
this challenge partly by means of international subcontracting. Through this
strategy, US protected her markets while also forcing Japan and Germany into a
similar strategy.
The
Impact on India
The pressures from within and
without the Indian economy was visible in the mid-60s itself as can read
between the lines from the policy pronouncements of the various government
national advocacy bodies.
To quote:
For the rest [industries] they
should undertake to earn the requisite foreign exchange through exports. It is
possible that diversion of a part of the output to exports may involve some
decline in the profit rate for the industry… The second measure, which is not
entirely independent of the first, is to earmark certain plants/industry to be
specifically devoted to exports. These plants could be treated for the purpose
of taxation and other matters, even freight charges, on a different footing
from other plants in the same industry. The special treatment would, of course,
ensure that the unit does not suffer any loss as a result of exporting instead
of selling in the domestic market.
Besides there were also efforts
to increase the target of iron ore production in lieu of the expected increase
in demand in the European market in the mid 1970s. Among other possibilities of
exports in the mineral field was that of coal, magnesite and other
refractories, ilmenite and steatite; glass sand and dimension stone. The NCAER
study also pointed out the loss due to transportation costs of exporting the
Kiriburu iron ore from Orissa through Vishakapatnam in Andhra Pradesh Instead
it pointed out the need to develop the Paradeep port which would foot a cheaper
bill for transportation. Further, the possibilities of exploring the vast
hydro-electric potential of the Indravathi river basin in Chhattisgarh region
for profit maximisation through cheaper smelting of the iron ore produced in
the Korba region was also being stressed in the document. No wonder, the
profit hungry multinationals are up for grabs for all these areas, which are
abundant in natural resources, in the present policy initiative of Special
Economic Zones, mega hydel projects and mining operations.
Export
Processing Zones—Precursors of SEZs
In tune with the above parameters
set by the policy makers taking into consideration the new international
dynamic as well as the domestic imbalances Export Processing Zones took off as
way of more foreign exchange to beef up the needs of the industrial sector and
to stave of the balance of payment crisis.
Thus, the precursor to the SEZs
were the Export Processing Zones (EPZs) that were set up in Gujarat, Kerala,
West Bengal and Andhra Pradesh. In Gujarat, the first Export Processing Zone
was set up in the late sixties. It was followed by the EPZ in Santa Cruz in Mumbai
in 1973. In the early 80s another four EPZs were established at Kochi in
Kerala, Falta in West Bengal, Chennai and Vishakapatnam in Andhra Pradesh. In
the overview to Special Economic Zones the reasons for setting up EPZs were
justified as necessary in order to “overcome the often repeated shortcomings on
account of the multiplicity of controls and clearances; absence of world-class
infrastructure, and an unstable fiscal regime and with a view to attract larger
foreign investments in India.” But there is hardly any review of how much
the policy of establishing Export Processing Zones have helped correct the
“unstable fiscal regime”.
India set the first special EPZ
in Kandla, Gujarat, as early as in 1965. Santa Cruz Electronics Export
Processing Zone (SEEPZ) followed becoming functional in 1973. Four more zones
were set up by the Central Government in 1984 at Kochi (Kerala), Chennai (Tamil
Nadu), Falta (West Bengal), and NOIDA (Uttar Pradesh). And also another one in
Vishakhapatnam (Andhra Pradesh).
SEEPZ in Mumbai had eaten up the
labour intensive small scale industries—most of them of the cottage industry
status—by displacing it with a highly mechanized jewellery industry which
accounted for more than 55 percent of the total jewellery exports in 2002-03.
The collaboration of the Tatas with Burroughs an American company, 1977 in
SEEPZ saw the beginning of India’s exports in software and peripherals.
Citibank established a 100
percent foreign owned export oriented, offshore software company in SEEPZ in
1985. The first private EPZ started operations in 1998 in Surat, Gujarat. All
these eight EPZs, including the one at Surat, have since been converted to the
new SEZ scheme.
Foreign Direct Investment (FDI)
to the total investment in EPZ was a low at 16.7 percent. Despite all the hype
and expectations the share of EPZ in the country's export was a mere 5 percent
in 2004-05 accounting for 1 percent of employment in the factory sector and
0.32 percent of factory investment. This also indicates that India is yet to
come out of its traditional resource based exports. This is also a reflection
on the incapability of the big bourgeoisie who is not able to carve out in the
international race of subcontracting and also near incapability of the former
in developing a market based on manufactured industrial goods on his own as his
interests are fundamentally tied with the ups and downs of the imperialist
market and capital.
Thus in the 70s, Mexico, Brazil,
Argentina and India accounted for over 55 percent of all the Third World
industrial production though this was mainly exports based on traditional
resource base as these countries had a large natural resource endowment. Many
of these exports comprised of products made from foodstuffs, tobacco, wood,
textiles and leather. India specialized in textiles, leather and footwear and
clothing.
Special
Economic Zones: The image of the future of imperialism in the third world
The present analysis of Special
Economic Zones (SEZs) will be confined to the geographical location of India
from Punjab to down south as in the state of Kerala. The analysis of the entire
region of various nationalities known as the North East and the region of Jammu
and Kashmir need specific detailed analysis. That is beyond the scope of this
present article. It would confine at the moment with a broad overview of the
political economy of Special Economic Zones in the former category. Here again
it is stressed that the present analysis is limited in its scope. If the
contours etched out in the present article can be extended into specific area
wise or state wise analysis followed by in-depth case studies can provide much
more insights—empirical as well as conceptual—into the serious ramifications
that this policy initiative will have on the future of the lives and
livelihoods of the various peoples of the sub-continent.
The Special Economic Zones (SEZs)
Policy was announced in April 2000 offering more lucrative incentives/benefits
for private investment. During the period 1 November 2000 to 9 February 2006
SEZs functioned under the provisions of the Foreign Trade Policy with all
existing zones being converted into SEZs. Statutes to formalize the fiscal
incentives became operational subsequently.
The Special Economic Zones (SEZ)
Act, 2005, was passed by Indian Parliament without much debate—which should not
be a matter of surprise—in May, 2005 receiving the Presidential assent on the
23 June, 2005. The SEZ act, supported by SEZ Rules, came into effect on 10
February, 2006. The new SEZ law covers activities limited not only to
manufacturing, but also services and trade, and has the much simpler objective
of generating exports and earning foreign exchange, with no predetermined value
addition component or minimum export requirements.
SEZs will be notified as
‘industrial townships’ under Article 243Q of the Constitution which exempts
them from the provisions of Part IX of the Constitution that provides for
elected local governments. An Industrial Township Authority is constituted with
the same powers and duties as a municipal body. The Development Commissioner
along with the Developer effectively replaces local democratic institutions
centralizing powers with every arm of the state such as public services,
police, judiciary and local governance coming under the control of the
Development Commissioner, the Developer and the Central Government.
The judicial and policing
functions are altered with 'No investigation, search or seizure shall be
carried out in a Special Economic Zone by any agency or officer' without the
permission of the Development Commissioner under Section 22 of the Act with the
exception being only in the case of 'notified offences', notified by the
Central government under section 21 of the Act, which are also to be intimated
to the Development Commissioner. Special courts are provided under the Act in
SEZ's for both civil and criminal matters who alone can try and adjudicate any
civil dispute within an SEZ or any trial of a 'notified offence'. Ordinary
criminal trials of non-notified offences can take place in ordinary courts, but
investigation of such crimes is not possible without the authorization of the
Development Commissioner. Appeals from the special courts will lie directly
with the High Court of the State. These provisions produce a system of a
separate judiciary for the SEZ with the Development Commissioner playing a key
role. The net effect is the transfer of power over resources, governance and
people within the Zone to big business and investment capital, and the creation
of a new economic, geographical and political reality.
Workers are told that they could
not organise trade unions because of the 'zone' status which are declared
public utility services, a designation under the Industrial Disputes Act, 1947.
Labour inspectors are reportedly issued orders by the Commerce Ministry not to
visit the zones without prior permission from the Ministry. There is also the
unemployment caused due to land acquisition or change in land use in and
outside SEZ. The long term impact such as impact of pollution and change in
land use in the surrounding areas could be colossal if one is to go by past
experience.
With favoured position and
pampering along with relaxation of regulatory mechanism, SEZs could become the
hub of economic offences. For instance, the 33rd Report of the Parliamentary
Standing Committee on Finance found that show cause notices had been issued for
more than Rs. 3,400 crores between 2002-2003 and 2004-2005 for fraud in Export
Oriented Units (EOU's) and some other export schemes.
A whole range of incentives and
facilities are offered under the Act including duty free import/domestic
procurement of goods; 100% Income Tax exemption on export income; exemption
from minimum alternate tax, Central Sales Tax, Service Tax and State sales tax
and other levies, customs/excise duties, and dividend distribution tax;
external commercial borrowing up to US$500 million in a year is permitted
without any maturity restriction; provision of standard factories/plots at low
rents with extended lease period, and infrastructure and utilities. Most taxes
and cesses are not applicable to goods procured from the Domestic Tariff Area.
The fifteen year income tax holiday consists of total exemption for the first
five years, 50% for the next five years, and 50% on reinvested export profits
for the following five years, while Developers get a 10 year 100% tax
exemption. Electricity taxes and duties are to be removed for electricity that
is to be used within the processing area.
The incentives dished out to SEZs
will create a tilted playing field between SEZ and non-SEZ investors. Given the
incentives, SEZs, rather than start new initiatives, would simply attract
existing enterprises to relocate themselves from the domestic economy to SEZs
to avail of the incentives in order to maximize profits. This would amount to a
mere shift in existing investment from the outside to the SEZs rather than new
investments. Of the SEZs notified, IT/ITES constituted the bulk of them with
single sector IT SEZ forming the majority. This is followed by
Textiles/Apparel/Wool and Pharma/chemicals. It looks that the relocation
process is in effective swing as can be noticed by the exceptional number in
the IT sector. The government in November 2006 itself decided to stop further
in-principle approval of IT SEZs. The Software Technology Parks Initiative, the
main scheme is also scheduled to end by 2009. The majority of SEZ investment is
from the private sector. Real estate sector applicants form the majority in the
private sector followed by IT companies forming nearly three quarters of
non-public sector approvals. IT and multi product SEZ's, form the bulk of all
applications by real estate companies. Real estate development rather than
export generation is a factor to reckon with.
As indicated earlier, relocation
of industries from outside to the SEZs to take advantage of the relative
advantage would simply mean mostly the translocation or migration of existing
labour than generation of new employment. In addition, the likely negative
impact of SEZs on manufacturing outside the SEZs could spell a decline in
employment outside. Between 1998 and 2003, while investments grew by 73%,
employment growth showed only a 13.7% rise in EPZs. Net increase in employment,
considering the growth in employment in SEZs, would therefore be actually far
low.
Objections
to the SEZ raised by the government
The objections to the SEZ are
multifarious. Each wing of the government has a different reason to be
circumspect of the feasibility of the project. The finance ministry and the
Reserve Bank of India are unhappy with the SEZ policy on grounds that the
policy offers excessive exemptions which will lead to revenue loss and spur
real estate speculation. The loss to the government on account of SEZ is
incredible. In 2004 - 2005, the government already incurred a loss of Rs.
41,000 crores - a staggering 72% of customs revenues and 23% of total indirect
tax revenue of any kind. The Finance Ministry estimates that Rs. 1.75 lakh
crores will be lost over the next five years.
The IMF and the Asian Development
Bank have criticized the tax exemptions being provided making SEZ ‘business
friendly’ rather than ‘market friendly’, inherently violating market principles
and market reform which they ardently promote.
The Rural Development Ministry
objected to the large-scale acquisition of agricultural land threatening
spinning off further food insecurity. The establishment of SEZs, and a large
number of them, requires substantial land to be acquired or purchased by
developers. About 2 lakh hectares are required for establishing the approved
and in-principle approved SEZs. The notorious Land Acquisition Act 1894 has
been used to acquire lands in many cases whether the developer is a public
sector or private sector, at a price well below market prices not taking the
dependants of the land as an affected party in the acquisition normally. Land
can be acquired under this Act only for 'public purpose' which are defined in
Section 3(f) of the Land Acquisition Act and does not include companies.
However, the judiciary has deftly reinterpreted the law to say that once the
government has acquired a land, the government can sell, dispose or transfer
rights of its land at will to whomsoever it wants to, irrespective of the
original intent of acquisition. In effect, land acquisition by the State has
made a decisive shift from 'public purpose' to also 'private profit'. But with
militant resistance, the developer purchasing land directly from the owner
without the mediation of the state is a proposed remedy.
Acquisition of prime agricultural
land became a major issue with all its serious implication which is now
attempted to be restricted with restriction of acquisition on single crop
agricultural land alone beside waste and barren land. Double cropped
agricultural land, if necessary, is to be limited to 10 percent of the total
land. More over such areas have powerful farming interests and is at the heart
of agricultural economies. That the category of waste and barren land most
often constitute survival resource base for the most marginalized in vast
numbers is ignored. Land acquisitions, or alternatively land purchases, are
therefore to increasingly focus on the marginal and tribal areas. Official
rehabilitation schemes rarely work satisfactorily, be it by the state or the
private sector. However, holding the state responsible is easier than the
private purchaser in a democracy. The proposition to take the land on lease is
also floated to ostensibly ensure permanent income to the oustees.
Already in Kakinada in Andhra
Pradesh, the government's oil refinery and SEZ that is to be built along with
the Oil and Natural Gas Corporation on 10,000 acres has run into problems, with
farmers in the area refusing to give up their fertile land.
The lands are invariably located
in close proximity to raw materials, urban centres and transportation
facilities. At least 35 percent of the acquired land is to be used as
processing area while the rest could be for residential and recreational facilities.
The acquisition bypasses and belittles local self-governance institutions of
the panchayats. The SEZs moreover become the nodal points for speculation
fuelling large scale real estate activities around the Zones with the emergence
of powerful land mafias in connivance with authorities to dispossess people of
their lands in the surrounding areas driving land prices up within SEZs and
around it. The attraction to SEZs is likely to vanish in due course defeating
the main attraction of low cost SEZ. Almost as though recognizing this reality,
the Reserve Bank of India has asked the banks to treat SEZ lending as real
estate business and not infrastructure.
Now the SEZs will be required to
at least use 50 percent of the land for processing unit as compared to the
earlier 35 percent so that the real estate component would be lower. Finally,
the export requirement has been made more stringent compared to earlier.
Among the many concessions being
offered to the developers of the SEZs, one is cheap land close to cities and
new highways. Land is being allotted much in excess of the requirement of
industries. The implication is clear that land is being seen as urban real
estate where huge profits can be made. While Singur is not an SEZ, the Tata
group is being given about a 1,000 acre of land when they only need perhaps 70
acre for the car factory. Since the land in Singur is at the intersection of
two important highways, it is prime land. This kind of consideration is clearly
important for many of the planned SEZs.
There is another reason for the
rush to set up these huge estates. In the last three years, the corporate
sector profits have been growing at an average of 30% so that they have a lot
of cash to invest. Real estate is a good proposition to park their funds in.
Thus, we are witnessing the creation of a large number of new landlords.
Given this past experience, what
is the guarantee that land acquired by industries for the SEZs would only be
used for specified purposes and not for speculative purposes as real estate.
The example of DLF and others in Gurgaon and other places comes to mind. They
acquired advance information as to which areas are likely to be urbanised
around the new NH 8 and acquired that land from farmers at literally throwaway
prices (market prices for that time). They have then released the land slowly
over the last 20 years keeping prices artificially high all along and
benefiting enormously. Land prices in this period have risen almost 500 times.
Far higher than any other index of prices.
A Planning Commission study has
shown that 73 per cent of the cultivable land in the country is owned by 23.6
per cent of the population. With more and more farmers being displaced through
land acquisitions, either for SEZ or for food processing and technology parks
or for real estate purposes, land is further getting accumulated in the hands
of the elite and resourceful. With chief ministers acting as property dealers,
farmers are being lured to divest control over cultivable land. Food security
and food self-sufficiency is no longer the country's political priority.
Ashok Kumar Bhattacharya, an
independent analyst, managing editor of the 'Business Standard' newspaper, says
that the new provision-- cutting to 50 percent the land area in a SEZ that
could be used for non-commercial purposes -- was a reaction to "a group of
smart, rent-seeking industrialists seeking to acquire large tracts of land for
real estate development in the name of establishing industrial or commercial
ventures."
Baviskar, a sociologist who works
on issues relating to the impact of land acquisition on the environment and
development, said the Indian government's policy so far had been akin to
"land reforms in reverse" whereby rights to land had been transferred
from underprivileged sections to affluent business elites.
SEZs will aggravate regional
disparities. Over three-quarters of all approved SEZs are located in six States
- Andhra Pradesh, Gujarat, Haryana, Karnataka, Maharashtra and Tamil Nadu.
Maharashtra and Andhra Pradesh alone account for more than a third of all
approvals. These states are all relatively well developed States with high
industrial capacity. These are also highly urbanized with the partial exception
of Maharashtra. Obviously investment is channelised to areas of high levels of
industry and investment which further propels these states to showcase their
'success' further.
Further, given the concessions,
much of the investment in SEZs is likely to be at the expense of the investment
in the rest of the economy. Finally, some may even close their units in the
rest of the economy to shift to the SEZs. Due to these three factors, the net
investment will turn out to be much less than what would be the gross flow of
investment to the SEZs. In fact, because the price of output from SEZ is likely
to be lower than that in the rest of the country, a lot of smuggling will take
place and the output in the rest of the economy will be adversely affected.
This will further affect employment.
Further, due to smuggling of
cheap goods from SEZs to the rest of the country, there will be further loss of
tax collection. When smuggling takes place easily from outside the guarded
borders, it is not difficult to imagine that this would be easy from the
unguarded SEZs. The resultant revenue losses will aggravate the deficit in the
budgets and will result in cut back in expenditures to fulfil the FRBM Act
requirements. Most of the time these cuts tend to be in the social sectors
which will worsen the situation for the poor.
There would be enclave
development and disparities would rise. Migration to urban areas will rise and
they will face further collapse. The excess land being allotted to the SEZs
will result in the creation of new landlords. Government is creating new
landlords 60 years after independence and long after it was thought prudent to
end landlordism in the country. Reports suggest that some large SEZs being set
up by the corporates will be known as "…desh", like, Bangladesh,
where the well off will live in style.
If the overall gains from SEZs
are so unclear and the government is going ahead with the scheme, then it can
only be because it wants to give concessions to certain sections (who are
pushing for it). The central government is playing the same role as the World
Bank and IMF do in making nation states to compete for capital and give
concessions to it. The SEZ policy is making the states compete with each other
to get capital. Those states that do not go for SEZs will suffer because others
will go ahead and attract investment.
The long journey of the republic
from Nehru’s “cooperative farming” in the early 50s of the last century to
Manmohan’s “corporate farming” after 60 years of the transfer of power has the
same theme: increasing parasitism of the comprador bourgeois-landlord-money
lender-trader on the Indian economy with the vast sections of the toiling
masses struggling to eke out an existence. Without doubt development planning
and its implementation in India have taken place till date under the watchful
eyes of Imperialism. Today this development model has reached a flash point
from where the only way out for it is through a violent restructure of the
existing economy in favour of a much more brutal exploitation of the people and
the resources.
Integrated
Struggle against Displacement of all Kinds is the Need of the Hour
The need of the hour at this
juncture is to focus our attention on building a people’s resistance movement
against SEZs, against the entire agenda of imperialist globalisation and its
ideology. The resistance should be planned in such a way that we challenge the
present model of development and in the process simultaneously initiate a model
of development with the human being at the centre.
A formidable resistance is possible
across the country if all the genuine resistance movements against displacement
can be brought together without any narrow-minded short term benefits for any
individuals or organizations involved in this process. The broadest and lofty
goal of this process should be to build boundless resistance and solidarity
among the fighting forces as it is clear for all of us that the Indian rulers
and their imperialist masters are determined to use the worst brutal repressive
mechanism to suppress the movements against land acquisition for the
implementation of their projects.
A united resistance struggle at
the sub-continent level should be initiated by bringing together all struggles
against all kinds of displacement, though we can gather the largest support possible
by focusing on SEZs at the beginning.
The integrated movement against
displacement of people from their natural habitats due to the large scale
intrusion of the Industrial monopolies of the imperialist countries should have
certain clear demands before the people of the country. Some of the points of
immediate interest are:
1. The Special Economic Zones
regime should be done away with by repealing the SEZs Act, 2005. Wherever land
is acquired should be returned back to the farmers with adequate compensation
for the period of time the land is held away from the farmers.
2. The Land Acquisition Act, 1894
should be repealed. The concept of ‘eminent domain’, which gives unlimited
power to the rulers to exercise control over people and their resources should
end.
3. No big dams should be built.
The river-interlinking project should not be taken up. Only small scale
irrigation projects which do not displace the people and impact the environment
adversely should be built after proper consultation with the people.
4. No mining projects should be
opened without proper evaluation of the use of minerals underneath for the use
of people in the country. Mining of minerals should not be given to any
monopoly company--foreign or domestic. Large scale mining which displaces local
people and degrades environment should not be taken up.
5. The displacement of people in
the urban areas in the name of beautification and restructuring the cities and
towns should be immediately stopped.
Displacement and Rehabilitation
Policies
The uncompromising principle of
our fight should have at its centre the slogan of ‘a big NO to displacement’.
Similarly, a big NO to rehabilitation packages, however progressive it may
sound. No compensation whatever the magnitude it maybe should be acceptable for
all of us. The total rejection of displacement-and-rehabilitation frame should
be the central motto of such resistance movement.
However, we should demand for the
just and proper rehabilitation of all those millions of families and people who
have been displaced since 1947 as a result of mining, mega-projects, dams,
industries, etc. Displacement as a concept should be removed from the notion of
development. Displacement is an exclusivist principle which is central to the
present model of development. Any policy of rehabilitation is used only to
divide the people who oppose the imposition of sacrifice on them for the
benefit of others who benefit from the projects. For example, after 1947, there
has been no project or dam where at least a sizeable population is
rehabilitated. Rehabilitation is an impossible scheme, no matter whatever the
progressive nature of the rehabilitation package/policy is, in this model of
development. We must understand that rehabilitation means throwing some crumbs
of leftovers. We should also realise that no just rehabilitation can ever be
made possible.
The only way that Development can
be
“Cheshire Puss [asked Alice]
Would you tell me please, which
way I ought to go from here?”
“That depends a good deal on
where you want to get to”, said the Cat
“I don’t much care where,” said
Alice.
“Then it doesn’t matter which way
you go,” said the Cat
—Lewis Carroll, Alice Adventures
in Wonderland
A pro-people model of development
can be built only by smashing the present model of development which is
subservient to imperialism and in turn serves it. This model of development is
a people-centred model based on a self-reliant economy which is free from all
kinds of imperialist control and subjugation. This model of development allows
the natural resources of the country to be used in a way best suited for the
needs of the masses of people, not for surplus generation for the capitalists
and imperialists or for the extravagance of a decadent, parasitic class, feudal
in existence and colonial in taste. This would move towards a structural change
in the economy with redistribution of land and a thoroughgoing shift in
political power in favour of the toiling masses. The direct implication of
going for an internally induced development was to undermine the existing
class/caste hierarchy which was holding back the economy. Such a development
which would have successfully addressed the question of possible ways of
avoiding displacement or lack of participation or lack of opportunities for the
vast sections of the masses was not in the interest of the ruling classes of
this country.
Pro-people development could only
be built as part of the large-scale resistance of the people to the present
exploitative model of imperialist development. The resistance struggle of the
people against the present model of development cannot be successful without
destroying all the pillars of this semi-feudal, semi-colonial State that
perpetuates exploitation, oppression, mistreatment and violent denial of the
right of the human being to lead a dignified existence. To put it differently
the present pro-imperialist model of development displaces reduces the human
being to the subhuman where every possible dimension of his existence becomes
meaningless. Any alternative against this murderous, beastly existence cannot
escape the movement to move the centre of development from capital generation
to the innumerous productive potential of the human being to make and remake
the world in his/her own image—where the mental and manual labour have broken
the shackles imposed on it by the exploitative society and have merged to
create a new world free from all forms of exploitation.
In the place of the present
exploitative development, indigenous industry that generates employment and
displaces none from their natural habitats should be developed. Not only
protecting labour rights should be the policy while building the indigenous
industry be pursued, but the industry should be run and managed by the workers
themselves. This kind of an alternative model of development is possible only
when we start from below by depending and developing agriculture sector through
distributing land to the landless peasants. The agri-based industry which
serves the purpose of absorbing the agrarian produce and surplus labour from
the rural sector should be developed. This model should develop with an aim to
drive towards ‘community ownership and individual right to use land and industry’.
Land should not be allowed to concentrate in the hands of a few nor should it
be allocated to build large and mega industrial complexes. The infrastructure
projects should in fact concentrate on building people’s health care and
education systems instead of building super high ways or mega malls. Protection
of environment, developing regeneration methods of natural resources should be
integral part of this alternative developmental model. Industry and business
that aims at super profits could never address this question. It’s only by
smashing the concept of surplus generation in the hands of a few people that
one can build towards environmental regeneration. People take the
decision-making power into their hands in this developmental model. Reproduction
of everlasting methods of equitable distribution of resources and produces
should be ensured.
This model envisages mass
participation, with the needs of the masses forming the propellant factor
giving a sense of direction to the industries resulting in the production of
items that are useful for the everyday life of the people, for leading a
dignified meaningful existence. This would necessitate the orientation of an
economy sensitive to its resource base and indigenous technology; an impetus
for local innovations that would destabilise the present hierarchy of
production relations with the ‘expert’ at the top. The self induced /
internally induced development is an inclusive model which cannot be
implemented without unleashing the productive potential of the masses. Without
land reforms, without distributing the land to the tiller this becomes
impossible. Land reforms are a pre-requisite for this model.
The initiative of the masses of
Dandakaranya is a definite step in this direction. The Indian state is quick to
dub them as terrorists, anti-national. Organised under the CPI (Maoist) they
have fought the efforts of the state to implement the pro-imperialist model of
development in their immediate social formation which is primarily a tribal
economy.
In this mode of production,
pro-imperialist model of development had its imprint in the form of the local
contractor who had come to collect kendu leaves, the forest officials denying
the tribals the right to their natural habitat, the mining corporations who
have come to extract minerals and also big hydel power projects. The resistance
that started against the forest officials and the contractors for better price
for the kendu leaves soon had to face the repression from the forest
official-contractor nexus who had brought goons from outside. The resistance
also had to deal with opposition from within in the form of tribal chiefs or
youth who enjoyed special favours from the contractor/forest officials. It was
thus a resistance that constantly interrogated the social reality from within
and without. The fight against the exploitation by the contractor/officials
also had thrown open the need to fight similar tendencies of oppression and
exploitation within the tribal social formation. Thus women fought against
forced marriages, sexual exploitation and an equal role in the everyday affairs
of their society. The need to resist exploitation of forest wealth and tribal
labour for the profit maximisation of capital also provoked them to organise
themselves into a settled community that would not only take care of themselves
but their future generations as well. Thus evolved the practice of shared
agriculture that would share seeds; bio-fertilisers that will renew the soil.
Cooperatives were also created. Since the soil and the seed were not uniform
the crops and cropping patterns also used to differ. Also the tribal peasant
who had more land than the one at the lowest bracket or the clan that was
better placed than other due to historical reasons could perform better because
of their social location in the economy. This could have created imbalances and
inequalities within the economy. But this also had inspired the people there to
device ways and means through which surplus could be redistributed.
All this could not have been
possible without the mobilisatioan of the tribal masses into an organised force
ready to defend the gains that they have made in the process of transforming
into a new being.
It is this potent threat of a
resistance in the form of a peoples’ model of development—the only way that
development can be conceived—that has forced the Indian state backed by
imperialism to clamp down on this people through a Salwa Judum. But then any
form of practice that defies the logic of imperialism, of moribund capital is
bound to face a violent response which is essentially the characteristic of
predatory capital. Any resistance that would want to build a new world with the
human being at the centre cannot shy away from the fact of defending it. It is
that what the call of Naxalbari had given. It is that the heroic struggles of
the people of Nandigram, Kalinganagar, Kashipur, Jagatsinghpur, Lohandigudi,
Koel Karo etc.
Towards a
United Struggle
What do we mean by displacement?
Does it only comprise of the people displaced due to the construction of dams?
Of Super highways? Of mining? Of big industries? We have to move beyond the
conventional way of looking at displacement. Then only can we find the root
cause of the reasons of an economy that promotes displacement as the
fundamental principle of its reproduction; its perpetuation; its survival
strategy i.e. to benefit a few at the cost of many. In that sense the
fundamental necessity of a development that engenders displacement is the
common running thread when one talks about Special Economic Zones, dams,
mining, super highways, urban beautification, retail marketing by monopolies
and so on. Here we have to grasp the point that all these forms of displacement
are intertwined so as to reinforce each other in realizing the fundamental
axiom of imperialist globalization—that of value and profit maximization. The
strategy is to retain all regressive structures within the sub-continent
economy that would facilitate and perpetuate this process while weeding out all
possibilities within the economy that can generate a dynamic of resistance
primarily in the form of development while not ruling out other forms of
resistance.
The enormity of the crisis that
is gripping the ruling classes is getting manifested in various forms. The
initial inference is the readiness of the state and its various arms to break
the law of the land. The manner in which the repressive machinery of the state
is being mobilised to brow beat the people into submission by violating
constitutional guarantees and other norms and procedures of a democratic polity
speak volumes about the need of the ruling class to some how go ahead with
these policies. At the same time the state is also enacting new laws to clamp
down all forms of dissent. The state is tying to divide the people fighting
against various forms of displacement. The struggles against various kinds of
displacement should be integrated taking into consideration the underlying
commonality of the issue that is confronting the various sections fighting
against displacement. This can only ensure a mighty stream of struggle that can
ensure an alternative not only as empty slogan but also as a reality. The
people in their local areas have been building valiant struggles all over India
against various projects displacing millions of people from their local
habitats. These projects have been either under way or are in pipeline through
MoUs signed by the Union Government or state governments. The variety of
projects that have been planned to massively uproot the people include Special
Economic Zones, mega projects, super highways and other infrastructure schemes,
big dams, urban renewal and beautification, corporate agriculture, national
parks and sanctuaries, etc.
These struggles waged at the
local areas of displacement which erupt at different spells of time are being
crushed by the governments using the police and paramilitary forces along with
local goons, ruling party henchmen, and the good old divide and rule tactics of
the private company involved in the project. A network of people’s struggles at
all India level or let us say the sub-continent level is the need of the hour
so that these diverse grass-root movements are expanded by collectively facing
the onslaught of state repression.
Friends, we have broadly yet with
a perspective discussed the contours of the direction in which the Indian
subcontinent is moving towards. There are definite indicators without doubt
that show a clear direction. While this is being concluded the news from India is
that more than 10000 people are rendered homeless in planned carnage of the
people of Nandigram by the West Bengal government with its fascist cadres
notoriously called the harmads. Hundreds of women have been raped by the goons
of the CPM while the state police force stood by as mute witnesses. All the
houses of the defiant masses have been burnt down for refusing to give away
their lives and livelihoods for the setting up of a Chemical Hub and for
fighting tooth and nail the repressive fascistic tactics of the CPM cadres.
Not far away from West Bengal,
the people of the Jharkhand state have united against all kinds of policies
that would bring large scale displacement for them. There have violent protests
in the state against such policies. The state has not been successful so far in
putting up a vigilante force like salwa judum in Jharkhand under the banner of
Nagarik Suraksha Dal (Citizens Protection Force) due to the stiff resistance of
the masses. In Orissa the people are up against the massive displacement in
Jagatsinghpur, Kalinganagar, Kashipur etc. In the Neighbouring state of
Chhattisgarh the state is fighting a bloody battle with the Maoists under the
shade of the vigilant gang called salwa judum. In Andhra Pradesh the people are
up against bauxite mining in Vishakapatnam and the mega dam at Polavaram which
will displace more than 200000 tribal people. This shows a clear pattern that
is emerging in the days to come. With people on one side and the brutal state
repressive machinery in service of imperialism on the other. And this is going
to be turbulent days. And as I have pointed out this struggle cannot be
successful without having a comprehensive vision which would decisively move
away from all the pillars that are propping up the imperialist beast in our
country, the sub-continent. And I believe none other than Rockefeller would
agree with me as to what the truth really is when we dig deeper. Let me quote
from the letter that he had written to President Eisenhower of the US :
“To put the problem in a
nutshell—our policy must be both “global” i.e. embrace every part of the world
and also “total” i.e. include political, psychological, economic, military and
special methods integrated into one whole. In other word the task is to hitch
all our horses in a single team…”
Para 9
We should not ignore the vital
fact that virtually all of our natural rubber, manganese, chromium and tin, as
well as substantial proportions of our zinc, copper and oil and a third or more
of the lead and aluminium we need comes from abroad, and, furthermore, that it
is chiefly drawn from the underdeveloped areas of Africa and Asia, which are in
the orbit of one or other of the military alliances built by the US. This is
also true of a major part of our “super strategic material” (uranium ore, in
particular).”
Para 19
“The government should make use
of and encourage private investors, seeing that many political objectives can
be secured with their help. In the long run such private investments should
allow us to eliminate or neutralise any disloyal opposition or resistance to
our policy, and to put increased economic pressure on any local business
interests which show uncertainty or hesitate to support us. At the same time
economic support for those strata of the local business community which are
ready to cooperate with the US should be increased, and the necessary
conditions should be created for businessmen of this type to be put in key
economic positions and accordingly for their political influence to be
increased.”
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