Jharkhand bleeds

Dipankar Bose
The Statesman, 7 December

Since the creation of Jharkhand, the youngest state of the country, extremism unleashed by Maoist outfits has affected the state’s businesses and economy.

And the loss, which makes everyone pay hard, is when Maoists give calls for statewide bandhs to stress their agendas. Trade, commerce and industry in Jharkhand bleed during every bandh called by the Maoists and the statistics are overwhelming.

Jharkhand was created on 14 November, 2000. Records state that from that day till the third week of November this year, the state has witnessed more than 48 bandhs called by the Maoists. The business loss during these 48 bandh days is close to a whopping Rs 1.30 lakh crore!

The state finance department calculated the figure after considering the details from several industry and business sectors, functioning in Jharkhand. A state finance department official puts it this way ~ a bandh call, if considered to be a total success, means a loss of Rs 2,700 crore a day, in the form of approximate turnover loss from industries and smallscale units, besides manday losses.

The state finance department has based its calculations on the basis of Jharkhand’s gross domestic product. The state’s GDP is Rs 60,000 crore a month. Leaving aside the four Sundays and Saturdays, which are official holidays in the state, the number of working days a month is 22.
If the GDP is divided with the number of working days, the turnover comes to about Rs 2,700 crore for each day. The loss has been calculated by multiplying the number of days on which the Maoists had called bandhs and paralysed the state, with the turnover value for each day. The result ~ Rs 2,700 crore, when multiplied by 48 days, comes close to Rs1.30 lakh crore.

But this is not the end of the long list of losses in terms of economy. The second to come is the Railways, which has been hit by the Maoist bandhs. The East Central Railway (ECR) zone has one of the most profit-making divisions within its ambit ~ the Dhanbad Division. Freight loading and wagon handling done every day by this single division rings sweet bells for ECR coffers. And the section through which most of the freight trains of Dhanbad Division run is the Coal India Chord (CIC) Link. Most of the CIC Link of Dhanbad Division passes through areas of Jharkhand, which are considered by the state police and Union home ministry as the Core Red Corridor.

That means the trains, both passenger and freight, pass everyday under the shadow of assault rifles and explosive devices of the Maoist extremists. As soon as a bandh call is given by the extremists, the first thing that the ECR authorities do is to suspend trains in the CIC section.
That means no loading of wagons along the busy section and no running of goods trains, resulting in unnecessary delays and bunching of rakes in the yards. The situation is more or less the same in the South Eastern Railway network area, in the Ranchi and Kharagpur Divisions and also parts of the East Coast Railway. The routine cancellation of passenger and freight trains only indicate that the Railways has virtually surrendered to the Maoists’ diktat. The Railways suffers losses that run into crores of rupees when trains are suspended along various sections of the ECR, the SER and other zones, where Maoists have a strong presence.

And senior Railway officials only say that they are helpless. “We are helpless during the Maoist bandhs. We have had a series of meetings with the Jharkhand chief secretary, home secretary and the state’s director-general of police. Senior officials of Ranchi and Dhanbad Divisions and also senior officials of the East Coast Railway attended the meeting to review railway security during these bandhs.

“We urged the state police to provide adequate security cover to the Railways so that trains can ply. Every time we got assurances from the state government authorities about security, but on bandh days, all assurances fall apart,” a senior SER official said. Maoists have always targeted the Railways during their bandhs.

During the bandh of 24 September, the extremists blew up the Kajrat-Nawadih station on the Garwah Road-Dehri-on-Sone section. Tracks were blown apart in the Koderma section of the busy Howrah-Delhi Grand Chord route, suspending trains running for long hours. Railway officials estimate that on an average, the ECR Division loses more than Rs 10 crore if train services are suspended on any day along the CIC section. The losses just keep mounting as the Railways practically surrenders to Maoists during bandhs. Passengers and transporters using the Railways are the worst sufferers. These bandhs also hit the operations of the Jharkhand State Mineral Development Corporation-owned coal projects, CCL’s mining projects in the collieries and Hindalco’s Tori bauxite sidings, creating further dents in the state’s coffers.

With little control of the state government over thriving Maoist extremism in Jharkhand, everyone is at their mercy ~ from the masses to the state exchequer.

(The author is The Statesman’s Ranchi-based principal correspondent.)

High & low of oil prices - The Quicksand Of Consumption, Imports And Losses

Bharat Jhunjhunwala
The Statesman, 7 December

Oil prices have shot up by 35 per cent in the last four months and have now touched an all-time high of $95 a barrel. State-owned oil companies, however, continue to sell at lower prices because the government is concerned about the fallout on the coming elections in Gujarat and Himachal. Oil companies are incurring huge losses in the process which is expected to reach an astronomical level of Rs 70,000 crore by the end of the financial year. This is approximately 10 per cent of the total budget of the Government of India.

Oil companies are issuing bonds which are being bought by the government in order to make up for this loss. Technically, the loss is borne by the companies while the government owns assets in the form of bonds. But this burden will ultimately fall on the people of the country. Just as the loss incurred in business cannot be made up by continually borrowing from one’s brother, similarly the loss incurred by public sector oil companies cannot be made up by endlessly borrowing from the government.

The loss suffered by the oil companies is always incurred by the government which owns them. This policy is like that proposed by Charvaka ~ borrow today and drink ghee because no one knows what will happen tomorrow.

Reduce taxes

One suggestion that may help surmount this problem is for the Union and state governments to reduce the taxes on petroleum products. This will immediately provide relief to the oil companies. For example, the taxes may constitute about Rs 20 out of the price of Rs 40 for a litre of petrol. Oil companies are getting only Rs 20 out of the sale. Reduction in the taxes by Rs 10 will increase the receipts of the oil companies by same amount and reduce their loss.

But this too is a fictitious solution. The revenues of the government will be less and it will have to impose higher taxes on other items such as match boxes and bicycle tyres to make up for the loss. The burden of the higher taxes will fall on the people. We must face the hard truth that there is no free lunch. The oil that we are consuming cheap today will have to be paid out of our hard-earned income tomorrow. Instead of tinkering with such non-solutions we must consider the pros and cons of increasing the domestic price of oil.

If the price of oil is lower than the global levels, it can have a negative impact. The low price adversely affects our economic sovereignty. It encourages people to burn more oil which, in turn, forces the oil companies to import yet higher quantities. We sink into the quicksand of ever increasing consumption, imports and losses. Higher consumption of oil makes our economy more energy-intensive. Oil supplies can be curtailed in the event of a war or a natural catastrophe such as tsunami and that will inflict great damage on our economy. The bullock-driven water wheel can continue producing food without these imports but not diesel-driven tubewells.

High consumption of oil also affects our political sovereignty. We have to make friends with dictatorial regimes like those of Saudi Arabia and ignore the violations of human rights of the people in Nigeria by their government in order to secure our supplies. Our income is geared to the consumption of oil and we have less money to develop an ambitious programme to help other developing countries. We also have less money left to buy or manufacture radars, fighter planes and patriot missiles. We have had to make a less-than-equal agreement with the United States to obtain supplies of uranium because we consume a fair amount of energy.

The importance of oil in preserving national sovereignty has been highlighted by the editor of Newsweek, Fareed Zakaria. In an essay written in 2005 he contended that the most important issue for America’s foreign policy is to reduce the domestic consumption of oil. That would lead, he says, to a decline in the global price of oil and have the following consequences: (i) The cash obtained by Saudi Arabia and Iran which gets into the hands of terrorists will be reduced; (ii) Autocratic governments like those of Saudi Arabia will not be able to bribe the Wahabi imams and suppress demands for democratic reforms; (iii) Iran would not be able to fund its nuclear programme; (iv) President Putin of Russia will not be able to destroy competing centres of power or continue the "disastrous" war in Chechnya; and (v) President Hugo Chavez of Venezuela will not be able to rebel against American influence. The success of American foreign policy, says Zakaria, will depend on the reduction in the consumption of oil by America. That holds equally for us. Less consumption of oil and other forms of energy will give us more free play in international politics.

A lower price of oil prevents the development of alternative sources of energy. This writer had an opportunity to study the working of gobar gas plants in Shyampur village near Hardwar some time ago. At least 50 gobar gas plants were in operation successfully for more than 20 years. The LPG gas cylinders became available in the mid-nineties at a low price. Farmers found it easier to cook food with LPG than with gobar gas. They were saved the work of having to mix water with gobar to be fed into the plants, drying the slurry, maintaining the pipelines and water supply, etc. This alternative source of energy was dismantled as soon as cheaper LPG became available. The same applies to wind, solar, micro-hydel, thorium and bio sources of energy. Cheap oil distracts our attention from these sources and traps us into imports.

Other alternatives

The government should consider other alternatives to issuing bonds and reducing taxes. The main reason for not passing on the increase to the consumer is to protect the common man from the price rise. The simple solution is to pass on the same money to the consumer directly. Our population totals approximately 112 crore. Of these about a third are poor. Taking the average size of a family to be four, the number of poor households is about nine crore. The Rs 70,000 crore being spent by the government to insulate oil companies from high prices can be paid to these households directly. Each household will get Rs 6,700 per year.
Alternatively each household will get Rs 2,200 if the amount is given to all families irrespective of the level of income. Such a payout will be politically rewarding. The burden of increase in the price of oil will then fall mainly on those who consume more energy in gas-fired geysers and room heaters, air-conditioned cars and the like. This policy will be a boon for the common man. He will get more money than he spends on the purchase of expensive oil.

The larger benefit to the country will be that high prices will lead to reduced consumption of oil and help preserve our economic and political sovereignty. It will also encourage development of alternative renewable sources of energy which will be beneficial for mankind in the long run.

The author is former Professor of Economics, Indian Institute of Management, Bangalore.

Oris-saga

The Statesman, 4 December

Farmers in quandary over seed issue

BARIPADA, Dec. 3: The farmers of about 25 blocks are worried and have not yet made up their minds as to what they would do after they have been harassed by the State Seed Corporation, which has failed to provide paddy seeds for Ravi cultivation. The farmers alleged that though the officers have been maintaining that seeds are not available, the same are on sale behind their back..

However, hundreds of farmers of undivided Mayurbhanj district, are reportedly returning bags of paddy seeds to the government seed counters, which they had taken earlier, as they are of inferior quality and have failed to germinate.

After a weak monsoon, which delayed cultivation in the district, the framers now find themselves in a quandary, as thousands of quintals of paddy seeds provided by the State Seed Corporation have failed to germinate.

While the district administration did not heed the farmers’ complaints, tests by the State Seed Laboratory have confirmed that the seeds were of inferior quality. Though the plan was to cultivate paddy in 1, 23,435 hectares of land during the Ravi season, it failed due to low quality seeds.

“We have decided to stage a dharna and gherao cooperative offices in the district and will not allow the officers to do their work, until they provide paddy seeds soon,” said one of the farmers.

Farmers misguided on pesticide menace

BHUBANESWAR, Dec. 3: With decreasing number of agricultural extension workers, the farmers are misdirected by pesticide manufacturers, alleged Orissa Coalition for Food Safety & Sovereignty. The mandatory warnings on labels are not adhered to, in direct contravention of international regulatory laws, it added.

Each year approximately three million people are poisoned and 200,000 die from pesticide use. While acute cases of pesticide poisoning are very common, the chronic long-term effects such as cancer, endocrine disrupting effects are of increasing concern, the organisation maintained.

It observed that the pattern of pesticide usage in India is different from that for the world in general. In India 76 per cent of the pesticide used is insecticide, as against 44 per cent globally. The main use of pesticides in India is for cotton crops (45 per cent), followed by paddy and wheat.

The threat to Orissa has risen considerably with the stress on cotton cultivation. This has habituated the farmers to use pesticide and they now use it in increasing quantities in paddy and vegetables.

The introduction of GM crops has resulted in more pesticide use as secondary pests have emerged.

As pesticides kill the natural predators of pests, there has been no appreciable benefit from their use.

It may be mentioned that 3 December is observed the world over as “No Pesticide Use Day” to commemorate the world’s worst chemical disaster- Bhopal pesticide factory explosion in 1984.

People starve in Dhinkia

JAGATSINGHPUR Dec. 3: The Jagatsinghpur district SP Mr RK Sharma tired to underplay the recent spate of violence and the alleged ‘sealing” of Dhinkia village, by insisting that police deployment around Dhinkia was meant to check outsiders and pro-Posco elements from creating a law and order problem. “We have not surrounded or sealed Dhinkia disconnecting it from the rest of the district as has been projected or alleged,” he observed. Villagers, media persons are moving freely, he said before adding that the anti-Posco group has not moved out of the village fearing arrest.

The SP’s statement comes in the wake of Posco Pratirodh Sangram Samiti leader Mr Abhaya Sahoo’s charge that people of Dhinkia have been surrounded by police and are starving since four days. Even the Left party leaders had, yesterday, issued a call for sending relief material and foodstuff to Dhinkia as the village had been sealed by the police.

It is a case of human rights violation, they charged.It may be noted here that Dhinkia is the stronghold of the PPSS and several of its leaders including Sahoo are camping there.

Since 29 November when bombs were hurled at PPSS activists at Balitutha bridge, the entire area is surcharged with apprehensions that the police may forcibly enter Dhinkia and arrest PPSS leaders.

For two years now the police had not been able to enter Dhinkia, Nuagaon, Gadakujang panchyats which come under the proposed POSCO steel plant site.
No government or company authority was allowed to enter as PPSS activists had blocked approach roads and created check gates.

But the recent spate of violence has had the PPSS on the run and taking advantage the police has entered a few areas.

The police has been deployed in large numbers at Balitutha and Trilochanpur villages. Mr Sharma however claims that the deployment is to prevent escalation of violence.

Meanwhile the PPSS has started training local youths in armed struggle and a few tribals have been engaged to impart training in archery and sword fight, PPSS leader Abhaya Sahoo confirmed this and said they were forced to prepare for a violent battle against goons hired by the company who had attacked them at Balitutha recently. For two years it has been a peaceful struggle but from now on it is going to be battle to protect our land at any cost, he said.

The pro-Posco groups have also started holding regular meetings to discuss their strategy.

They assert that police deployment has ushered in peace in the troubled villages.
They alleged that a lot of outsiders including suspected extreme Left elements had infiltrated the area. SP Mr Sharma has appealed to the local people not to take law into their hands and help police to restore peace.

He is keen on forming a peace committee for the purpose but has not yet been able to negotiate with the PPSS leadership.

Plight of a disabled youth....

BHADRAK, Dec. 3: Today is the world disabled day, Speeches are being rendered by VVIPs and meetings and seminars are being held. But the plight of Jagannath Sahu (26), a physically handicapped graduate, remains unchanged.

Without hands, he does everything with the help of his legs. Not only can he write, but he has also completed his studies from Fakir Mohan University in 2004-05. Jagannath, the son of Ramesh Sahu of Jantuali Nuagaon village under Chandabali block is envied by others. “From my childhood, my aim was to complete at least graduation, so that I would able to take up a job to serve my family. Now I think my graduation has no meaning, because a job for a handicapped graduate like me is a dream,” said Jagannath.

“I had gone to the grievance cell of the chief minister, Mr Naveen Patnaik, thrice to meet him, but failed. Then I wrote a letter to the President of India seeking a job. On 3 September, President”s office replied by advising me to meet the chief secretary of Orissa. On 2 November, I went to Bhubaneswar and tried to meet the chief secretary. But he was busy. I was told by his staff to meet the district collector of Bhadrak and that a letter would be sent to the collector," he said.
Jagannath continues to narrate his woes. He said that he returned to Bhadrak only to be told by the collector that no such letter has been received by him.

Police intensify vigil

BARIPADA, Dec. 3: The Mayurbhanj police have intensified vigil, as Naxalites sneak into border districts of the state in order to observe the annual Peoples Liberation of Guerrilla Army (PLGA), which will continue till 8 December.

Security has been beefed up and round-the-clock vigil has been enforced along the border. The reports of massive rallies, meetings and recruitments held by the Naxalite outfit, CPI (Maoists), recently at Belphari in Midnapur district of West Bengal, had prompted the security alert, the police said.

The superintendent of police, Mr Dayal Gangwar, today said that para military personnel of the Central Reserve Police Force (CRPF) and the Orissa Special Armed Police Reserve (OSAP) have been deployed in vulnerable areas of the district.

He, however, declined to divulge details on the size and area of deployment.

However the SP denied having any information, regarding the recruitment drive of the Naxalites.

No such activities have taken place in the district so far, besides the gun battle between the police and the ultras on 28 November, in which there no causality occurred.

The week long annual recruitment drive of the Peoples Liberation of Guerrilla have been held for the past five years since 1999.

Rehabilitation binding on industries: Samal

ANGUL, Dec. 3: The decisions of the Rehabilitation and Peripheral Development Advisory Committee (RPDAC) in matters of rehabilitation of the affected, are binding on all operating and upcoming industries, including private and public sectors, the state revenue minister, Mr Manmohan Samal, said yesterday.

The revenue minister was addressing a gathering, to mark annual function of Jagannath club, one of the premier clubs in industrial Angul district. Claiming that Orissa Rehabilitation policy-2006 is the best in the country, Mr Samal warned that in case of non-compliance, the government may go to make it an act. The government has immediate plans to go for it.

Mr Samal asked the authorities for a regular session of the RPDAC in their respective districts and regions, so that the issues of the rehabilitation can be effectively addressed.

RPDAC is vested with vast powers and authority to deal with these rehabilitation matters as per as the rehabilitation policy are binding on the government and all concerned. He welcomed a recent Supreme Court decision, which has asked all the industries to spare five per cent of their annual profit for peripheral development in their surroundings.

“Certain Central industries are reluctant to spend even one per cent of their profit for community development, Mr Samal said, asking RPDAC members to spend money properly in their areas. The revenue minister disclosed that by 2008, there would be no person without land in the state and till date 80 per cent of people of the state have been covered under the scheme. The rest of the 20 per cent of the landless population will be given land on time.

Mr Samal gave a detailed picture of some of the reforms introduced in his department to simplify the system in order to eradicate corruption in the revenue department. He described that land pass book is a right step in that direction, since the book holder will not be required to run to the tehsil office for income, residential and other certificates, where there is a scope of corruption. Presided over by the club president, Mr Rashi Mishra, the occasion was addressed by the Rajya Sabha MP, Mr Rudra Narayan Pany, the local sub-collector, Mr Nirmal Mishra, among others.

Stir to take place over land loss


BALASORE, Dec. 3: The villagers around the Chandipur defence establishment have expressed their discontentment regarding compensation towards land losers. They have submitted a memorandum today to the district collector and urged him to take immediate action, or else they would resort to agitation.

The villagers who live in close proximity to the defence installation, namely, Jaydevkasabapahi, Bardhanpur, Sahajanagar, Bhimpur and Kusmuli, under the banner of Purvanchala Surakshya Committee(PSC), under the of Mr Biranchi Narayan Panda, met the collector to apprise him of their demands. At the time, the latter was in a meeting with the district level officers, including the superintendent of police and the defence officials, in connection with the ensuing final test of Prithvi’s advance air defence exercise likely to be held on 6 December.

The villagers, besides demanding a notice for evacuation, 72 hours ahead of the test also has demanded Rs 300 and Rs 150 respectively for each adult and minor, against the present compensation of Rs 120 and Rs 60 slated for each day of evacuation.

They too demanded Rs 20 for each cattle head against the prevailing Rs 10 per family for any number of livestock. “ How can the compensation be justified when the defence authorities are adopting a flat means for compensating against any number of cattle heads for one family? Hence, besides demanding a higher rate for adults and minors, we demand compensation against each cattle head" said Mr Panda, the president of PSC.

He further informed that the land losers have not been adequately compensated and alleged that the district authorities are not executing the court order.

The defence has acquired 324.76 acres of land for expansion vide notification in 1998 and payment was made in 2002 varying between Rs 18,000 and Rs 25,000 per acre Mr Panda informed that the amount was given when the state government rate was Rs 2,25, 000 per acre.

He further alleged that despite order by the court against appeals to pay Rs 50,000 per acre with interest, the same has not been executed .

The villagers alleged that they were often prohibited from using the range road, which is owned and maintained by the defence. Under a special agreement it was agreed in 1971 by the defence authorities to allow the villagers to use the road.

Many a times, the defence all of sudden prohibits the road for us. As a result of this, it causes inconvenience. It becomes difficult during emergency. The villagers further alleged that the stretch connecting the Range road to Salt road via Bhimpur and Bardhanpur is not maintained properly. The collector has assured us that he would take steps within 15 days.

Suspected Maoist activities around Satkosia

ANGUL, Dec. 3: Suspected Maoist cadres have reportedly been seen moving around the Satkosia forest area, 40 km from here.

Recently villagers of Laimunda, Kantapara, Baghamunda, Alaberi and Dandabahali reported district police about movement of many suspected uniformed people in the surrounding jungle. Police team led by local circle inspector of police here rushed to the area each time but returned empty handed describing the report to be false. They hardly went up to the suspected hideout locations in the jungle.

The first report came to them on November 20 when villagers of Laimunda said two unknown persons wearing black uniforms interacted with a villager. The second face off took place by some village youths of local village in Tainsi jungle with some strangers. People also saw fire and smoke from the forest located near Gojamundia hill in the night indicating cooking by those people inside the forest.

A couple of days ago a 12-year-old child from village Loiamunda was intercepted by a stranger in uniform near their village jungle who enquired about the movements of police in their village. The father of the child informed Angul police superintendent about the incident.

The ultras are reportedly trying to establish their base in the area as the villagers near the sanctuary are in distress and provide an ideal situation for Naxals to entrench themselves.

Teachers take to roads

BHUBANESWAR, Dec. 3: Teachers of block grant high schools and non-grant schools were back on the streets today laying siege to a stretch of the road leading to the state assembly The agitating teachers community rejected CM Naveen Patnaik’s recent slew of announcements which were basically aimed at an upward revision of the annual block grant.

It is a devious attempt to fool everybody, alleged teachers here while noting that they had never demanded more money or allowances. The one point demand is to abolish the block grant system and provide full fledged grant in aid, they pointed out.

The recent upward revision announced by Mr Patnaik is also dangerous in the sense that from block grant of 40 percent meant for teachers, the present revision makes it a bulk grant in favour of the managing committee of respective educational institutions. This may lead to misappropriation and wide variations in payment to teachers of different institutions depending on their staff strength etc. Again, the announcements are aimed at dividing the teaching community between block grant and non-grant groups, alleged the teachers. The message being given by the government is as though the block grant teachers were interested in their own cause and had ignored the eligible non-grant institution teachers.

Tribals rally for jungle entry

KEONJHAR Dec. 3: The Bhuyan and Juanga, two primitive tribes who are claiming to be the architects of this tribal district, are unwittingly living in an altogether different climate and condition; thanks to the defective jungle rules of the government.

Hundreds of Bhuyans and Juangas of six primal pidhas* (villages) today took out a rally that ended at the collectorate where they staged a demonstration before giving a memorandum to the collector. They claimed that in 1948 when Keonjhar was about to merge in Orissa, a memorandum was signed between the then king and the government. As per that memorandum the Bhuyans and the Juangas should in no way be kept refrained from using the jungles and streams. At the time of 1970 bandobast, their areas were not surveyed and consequently their lands are still unsurveyed.

They also allege that as mining is increasing too fast, these mining houses are depositing crores of rupees for compensatory plantation. Unfortunately the forest department is planting eucaliptas and akasia in their lands in the name of compensatory plantation. So far the department has planted these plants on 1,030 hectares of land of 20 villages. And the department is going to undertake the plantation on 4,588 hectares of 32 villages at a cost of
Rs 79,008, 500.

They allege that their lands have been illegally transferred to various crusher owners. While 264 families of 33 villages have lost their 276.46 acres of land, in their six villages, nine crushers are so far operating threatening their livelihood. These rushers are polluting the salubrious air and water. As a result they are suffering from various diseases. This apart as the corridors of wild animals like elephants are being damaged by the mines and crusher owners, they are considerably damaging their lives and property.

They claim that the government is undertaking and leasing the areas where they have been living since ages but is paying little attention for the development these areas.

Violence worries Amnesty

BHUBANESWAR, Dec. 3: The Amnesty International is concerned over reports of violence in Jagatsinghpur and urged the state government to desist from forceful eviction. Farmers of the area are fearful of forced eviction by private militias and the state police have reportedly not taken any action to protect local communities, it observed.

The organisation is further concerned that full consultation on the potential displacement has not been undertaken with the communities by the state government. A note on the organisations observations was circulated amongst media persons here. AI observed that lessons should be learnt from the unfortunate episodes of violence which took place in Kalinga Nagar in 2006 and Nandigram in 2007, where local communities were protesting possible displacement due to the planned construction of an industrial project. The state government has a responsibility to ensure the protection of the human rights of all individuals, it said.

Any action by the police must be proportionate and should avoid unnecessary injuries to civilians, it noted.

It implored upon the state government to carry out full consultations with affected communities on the human rights, impact of its actions, including in relation to plans to carry out evictions. The organisation reiterated that sustainable development cannot be measured solely in terms of economic indicators: it should be seen as a holistic process that embraces a range of factors, including the development of civil society, the strengthening of the rule of law and the fulfillment of the human rights in the civil and political, social and cultural as well as economic spheres.

Workers agitate for absorption

JAJPUR, Dec. 3: Contractual workers locked the main gate of Rohit Ferrotech limited (RFL) located in Kalinga Nagar demanding permanent jobs today. The contractual workers allegedly assaulted workers and officials of the plant and chased them from the plant premises.

Later, they barged into the machine rooms and switched off different machineries of the plant and sat on dharana before the company gate and held a protest meeting. Production of the plant came to a grinding halt following the agitation. Later, the agitation was called off. Workers issued a 15 day deadline to company authorities to fulfil their demands.

The contractual workers claimed that they have been working in the plant for the last three years hence the steel company should make their jobs permanent.

Company source said, the agitators prevented the officials and workers of the company from entering into the plant demanding permanent jobs to them and paralysed the plant over six hours.

“At first the contractual workers, many of them of supply department of our plant prevented our men and materials to enter into the company campus by locking the entrance gate. Later, they assaulted our security officer and other officials mercilessly and took the plant into their control.

They switched off the entire machines of the plant and stopped the production. As they stopped our plant from 9 a.m. to 3 p.m. we incurred a huge loss,” said KC Sasmal GM, personnel and administration of RFL.

They are outsourced and engaged through the labourer contractor. They are not company men and it is impossible to make all of them permanent. This apart, to run the plant smoothly some technical expertise is badly needed and the contractual workers lack technical expertise, he added.

“I have not received any written complaint from the company site. Getting a tip off our police team reached the company premises and persuaded the agitators to unlock the plant gate;” said Kalinga Nagar police station IC, KC Mund.

THE FLORA OF DEMOCRACY - It takes an average of ten years for land acquisition in Britain

Ashok V. Desai
The Telegraph, 4 December

In February, I visited Luxembourg by courtesy of its government. Soon after I returned, I watched the government of West Bengal’s handling of the Singur affair. It made me aware of a difference between the Indian and European practice of democracy, which I wrote about in The Telegraph of March 13. In India, democracy is taken to be a way of deciding who is to rule a state. The party that wins takes it as a licence to do what it likes for the next five years. In Europe, on the other hand, an election is used to decide who will form the government, but even more important, it decides who will take part in a never-ending debate. Members of legislatures come to the house respectably dressed, observe decorum on the floor, listen to whomever the speaker has given the floor, and use debate as a way of settling differences and reaching solutions. The killings by the West Bengal government were a way of settling differences in Nandigram; the channel the Europeans would have used — debate in an elected house — was defunct in Calcutta.

Two months later, the government of West Bengal did call an all-party meeting to discuss Nandigram, but the format — the chief minister staying away, the presence of a single representative from each of too many parties, and a scarce half-day allowed for speeches — ruled out any serious discussion. It was designed to fail, and it did. It was Buddhadeb Bhattacharjee’s failure. But he could not continue to fail. I wrote on June 6 that he should establish lines of communication with the opposition in Singur and Nandigram, listen to his adversaries, and become his own man, not his party’s marionette.

Well, Buddhadeb preferred to dance to his party’s tune, and it next time organized killings on a much larger scale in Nandigram, in the obvious hope that overwhelming violence would teach its opponents that if they resist, they will be “paid in their own coin”, and will learn that violence against the Communist Party of India (Marxist) does not pay. A few days later, Muslim rioters in Calcutta showed that they had not learnt the lesson. And this time, the CPI(M) itself learnt the lesson that it was prudent sometimes to capitulate to violence, and asked Taslima Nasreen to leave Calcutta as the rioters had demanded. Now the CPI(M)’s message is no longer so clear: does it want its subjects to believe that they can bend it to their will by violence, or that it will still put down opposition with an iron hand? Its opponents will just have to endure some more killings, loot and arson from the CPI(M)’s captive police and hooligans before the answer becomes clearer. It may take time for the CPI(M)’s mind to clear; meanwhile, its opponents will have to pay with their lives and property.

Because the government talks with the stick and the gun, there is no one around to talk to it. Recently, the Friedrich Naumann Foundation took me to Brussels to look at how the European Union functions. There I came across another feature of European democracy that I had not been aware of: Brussels simply teems with lobbyists. Daniel Guéguen is a prominent one. For 20 years he worked for the sugar lobby. Then he graduated to working for the agricultural lobby. For the past decade he has been a lobbyist on hire. His knowledge of the political landscape of Brussels is unparalleled. According to him, there are about 3,000 lobbies in Brussels, employing some 15,000 people. The most interesting one I came across was FACE — Fédération des Associations de Chasse et de Conservation de la Faune Sauvage (Federation of Associations of Hunting and Wildlife Conservation). Most are offices of trade associations, corporations or trade unions. But there are also professional lobbyists — consultants and legal firms — who would lobby for anyone who paid them a fee. Then there are NGOs and think tanks. Even some regional authorities and municipalities maintain lobbying offices in Brussels. The most influential lobbies are COPA-COGECA, the agricultural lobby, ETUC, the trade union lobby, and BUSINESSEUROPE, the employers’ lobby. But the largest is CEFIC, the organization of chemical producers; it employs 140 people.

These lobbyists have flourished because the government of Europe provides a structure that is conducive to lobbying. Everyone in the government is required to follow a Code of Good Administrative Behaviour. It requires him to be fair, impartial, independent and objective. He is supposed not to abuse power, and to impose charges or restrict citizens’ rights only to the extent required by his objective. He must reply to every letter in the language of any member of the public who writes to him. Within two weeks, he must reply to every correspondent, give the name and telephone number of the official who is dealing with the matter, and pass on the letter to that official. The relevant official must take a decision within two months, communicate it to the correspondent with the reasons for taking it, and tell him how he can appeal against it if he wishes to. If a citizen needs to make an application or follow a procedure, the official must explain to him how to do it. In sum, it is the duty of every official to help and satisfy every citizen and institution.

That duty extends to lobbyists as well. The European government does not think it enough that members of the European parliament are elected by, represent and take up the complaints of their constituents. The entire government is supposed to satisfy every European; thus, lobbying is a legitimate part of administrative practice. And this is not just in Brussels; the European Commission would ensure that lobbyists had the same access to national governments. The lobbies themselves are generally federations of national or industry associations. So their members have access to every level of the government, from their local authorities to the government in Brussels.

So if Nandigram had been in Europe, it would have had farmers’ associations and trade unions independent of political parties. The government would have appointed a responsible official, and set up quasi-judicial court to manage land acquisition. The court would have given an exhaustive hearing to the local lobbies, and would have worked out a solution that was acceptable to all. On top of the court, there would have been an appellate body; citizens who were dissatisfied with the court’s decisions could have appealed to it. The court and the appellate body would have been set up specially for Nandigram land acquisition; the ordinary courts would not have been burdened with it. The administrative decisions would have been available on the web. The responsible official would have readily given copies of documents to any concerned citizen who asked for them. The entire process would have been designed to ensure maximum acceptance for the process adopted, and an assurance of fairness even to those who did not accept.

It might have taken ten years; but that is actually the average time taken for land acquisition for new towns in Britain. West Bengal is hung up on the outcome — land acquisition — but in a democracy, it is the process that is important.

Pakistan’s crisis A Country In A Constitutional Limbo

Salman Haidar
The Statesman, 29 November

Cascading events in Pakistan since President Musharraf declared emergency on 3 November have added up to a sense of uncertainty about what could happen next. The initial threat to challenge the President’s authority on the streets fizzled out, after being suppressed by harsh police action and the blanking out of the media. Major political leaders were confined, released, detained again, in a cat-and-mouse game that left everyone guessing.

There was a considerable international hue and cry, but President Musharraf did not relent, moving instead to build further on the power he had assumed through the declaration of emergency, and to try to give it some semblance of legitimacy. The reconstituted Supreme Court, which is now packed with handpicked judges, has been moved to endorse his actions since November 3 and legitimise the presidential orders that tamper with the constitution.

Through these means, it would seem that the President has taken to himself the authority he needs to resume the transition to civilian rule and elections that he claimed was his goal, with himself at the centre of it, and to thwart the disruption threatened by violent insurgent groups, a reckless opposition and an irresponsible media.

More problems

But though on the surface there may be a semblance of control, many problems are bubbling up. The shock effect of the emergency has not prevented the political parties and other activist groups from raising a challenge to the President. His formal authority may have been buttressed through the Supreme Court but that has not enhanced his domestic power in some key matters. Insurgent groups in the frontier region are undaunted, witness the continued armed resistance in Swat and elsewhere in the North West Frontier Province. Urban terrorism also shows no abatement, several incidents having occurred, including suicide attacks, and there is no sign that emergency rule will help bring matters under control.

Internationally, the emergency has lost the President support and backing. That was slipping as it was, and the ambiguities of his dealings with the Taliban and Al Qaida were catching up with him. Even earlier, when there were signs that the President was contemplating the declaration of emergency as a way of dealing with his mounting problems, there was an immediate response and much pressure from the USA to head it off. Thus when he finally went ahead with it, he could have been under no illusions about how it would be received. Yet he felt it necessary to proceed as he did, no doubt because an adverse judgment from the court was feared that would have unraveled the presidency.

There has been a great deal of pressure from abroad to compel a change of course by President Musharraf. A spate of statements has come from Washington and other Western capitals bemoaning what has happened. Under pressure, the President has promised to shed his uniform and function as a civilian leader, and he may feel compelled to go through with it very soon. Though overall support for him has been reiterated, US actions do not suggest that he is any longer viewed as the indispensable leader of his country. A few days ago Deputy Secretary of State Negroponte was in Pakistan on a mission of persuasion. Pakistani observers did not fail to notice that Mr Negroponte spent more time with the Vice-Chief, General Kiyani, than he did with President Musharraf. One need not read too much into it but these meetings have been interpreted in some quarters as indicating that he was hedging his bets. And once any notion of finding alternatives to the present regime appears, there is no knowing where it can lead.

Currently, Pakistan is in a constitutional limbo and more than one way of resolving the present situation can be envisaged. For instance, in the fertile political imaginings of local observers, the caretaker Prime Minister Mr Somroo, widely known and well respected, under appropriate conditions could be a credible presidential candidate; and there could be others, depending on how the elections go and on how relations between the major political parties develop. This is not to suggest that anything along these lines is in the works, only to point to the inherent uncertainties in Pakistan’s current situation. The pre-emergency idea of a smooth transition that would retain Mr Musharraf in the presidency, without his uniform, sharing power with the PPP chief Ms Bhutto, appears increasingly remote.

The demand for free and fair elections is being raised from all sides. This is not as straightforward as it might seem, for the fear has been expressed that fair elections will not be possible while the Provisional Constitutional Order is in force, as it gives untrammelled authority to the government. So lifting the PCO is demanded as a necessary condition for the polls. But where would that leave Mr Musharraf? Would his position be affected? There can be a difference of view on this point. Indeed, there is plenty in the constitutional niceties to keep many lawyers engaged and to add to the directions in which the crisis could evolve.

There is also the fast changing political setting. Ms Bhutto is already back home, her power-sharing deal with Musharraf seemingly in tatters. Nawaz Sharif has also returned in time to make a bid for success through the elections. These former Prime Ministers, each heading a strong political party, will surely have a say in the future turn of events.

Political formations

There are other political formations, too, that will have to be taken into account. Beyond that, there is the role of the army. Gen. Kiyani, who is expected to move up to the top when President Musharraf sheds his uniform, is described as a thoroughgoing professional who would like to see the army keep away from politics. But does this mean that the army under him, or under anyone else, will be prepared to shed the part it has played for so many decades in national security affairs? These and other similar questions are reminders of the looming ambiguities about the future.

It is noteworthy that Pakistan’s discomfiture has not stirred India to any attempt to take propaganda advantage of it. Official statements in New Delhi have been restrained, and the media reaction sober. Even the suspension of Pakistan’s membership of the Commonwealth has not had much significance attached to it. It could be that the opening up of contact over the last few years, however limited in scope, has served to blunt the fine edge of animosity between the two countries.
Nobody in India finds it untoward that the Pakistan cricket team is touring the country at a time when civil liberties and the rule of law have been abruptly curtailed in Pakistan. Perhaps there is an underlying realisation that trouble in Pakistan does not necessarily bode any good for India. Rather, what is desired is an early internal settlement and an end to the current uncertainty.

The author is India’s former Foreign Secretary

Put the brakes on nuke race

Anjali Sharma
The Statesman, 4 December

The UN Disarmament Committee has said nuclear threats have become more dangerous and complex, with the emergence of an illicit trade in nuclear technology. Problems become more complex with the reported interest of extremist groups in acquiring nuclear weapons, greater difficulty in verifying nuclear production and insufficient progress in addressing energy security concerns.

More countries are interested in mastering the full nuclear fuel cycle, "a step that brings them closer to a potential nuclear weapons capability”.

The representative of the director-general of the International Atomic Energy Agency, Mr Gustavo Zlauvinen said there are a reported 27,000 nuclear warheads in the arsenals of at least nine countries. The cold war "hair trigger" alert deployment status of a significant number of those weapons contribute to the fears. The critical aspects of the nuclear non-proliferation regime need to be strengthened if a cascade of nuclear proliferation is to be avoided, Mr Zlauvinen said.

There is a need for the security of existing nuclear materials and improved controls over the transfer and production of nuclear material as effective control of nuclear material remained the "choking point" for preventing the production of additional nuclear weapons, he said. The second aspect is the need to strengthen the verification authority and capability of IAEA.

The nuclear watchdog agency's safeguards system had evolved from one focused on declared nuclear material and nuclear facilities to a more comprehensive information-driven system, able to provide credible assurance regarding the absence of undeclared nuclear material and activities. A third aspect was the need to give disarmament the prominence and priority it deserved.

Executive secretary of the Preparatory Commission for the Comprehensive nuclear Test Ban Treaty, Mr Tibor Toth, said a nuclear test provided the "final and irreversible proof" of a state's intentions. The CTBT provided the "last and visible barrier between the peaceful legitimate use and the misuse of nuclear energy. The test-ban treaty that was in force was a "logical and necessary" element of the system, if present and future nuclear non-proliferation challenges were to be addressed credibly, Mr Toth said. Nuclear energy production and nuclear capacity were projected to increase in the coming decades and the differentiation between permitted civilian and prohibited activities was a complex challenge. Mr Sergio Duarte, UN representative for disarmament affairs, said the growth of international organisations in the disarmament field devoted to specific types of weapons had reinforced the UN’s role.

The UN was indispensable in creating a synergy among the diverse activities of international organisations at both the global and regional levels, he said. Highly technical work needs to be undertaken, free from political interference. That collective work on global disarmament challenges is coordinated and integrated must be ensured, so that the international community does not find itself mired in duplication of effort, or worse, working at cross purposes, he added.

Personal representative of the secretary-general for the Conference on Disarmament and the UN Director-General’s Office in Geneva, Mr Sergei Ordzhonikidze, and the director-general of the Organisation for the Prohibition of Chemical Weapons, Mr Rogelio Pfirter, were the other panelists. The US representative said his country's emphasis was not on what to do to control and eliminate nuclear weapons, but rather, on how to create an environment under which such an elimination process would be the most stable and realistic policy choice. There must be an environment in which nobody requires nuclear weapons for security. The key issues are adherence to non-proliferation; suppression of trafficking of weapons of mass destruction; elimination of other forms of those weapons; finding other means of deterrence; use of ballistic missiles; and creating a system of detection, deterrence and response.

The Indonesian representative said in the context of implementation of the Nuclear Non-Proliferation Treaty, there was widespread perception that nuclear-weapons states had attempted to avoid their obligations under the treaty. Post-Cold War, the world had seen more failures than successes in nuclear disarmament. It had emerged in the last review of that treaty that the non-nuclear-weapons states believe it is unfair to demand that they comply with their obligations under the NPT, while the nuclear-weapons states failed to live up to their own obligations and commitments.

Failure to deal with that issue ran the risk of rendering the treaty irrelevant. Statements in the thematic debate on nuclear weapons were made by the representatives of Bangladesh, Mexico, Portugal (on behalf of the European Union), Uzbekistan, Japan, Republic of Korea, Switzerland and Syria. The thematic segment was focused on weapons of mass destruction; outer space; conventional weapons; other disarmament measures and international security; regional disarmament and security and disarmament machinery.

Mr Sergei Ordzhonikidze, personal representative for the Conference on Disarmament and UN Director-General’s Office at Geneva, said disarmament had been neglected in international forums, and the Conference on Disarmament was probably the most neglected.

The origins of the impasse were at the end of the Cold War, which changed the international security equilibrium, and led to a re-evaluation of priorities and a changing perception of security.

He said with the possibility of the acquisition of weapons of mass destruction by terrorists, international relations had become more complex and unpredictable.

Multilateralism had given way to predominance of a particular national interest, and the Conference on Disarmament had been unable to start negotiations on any item on its agenda. Mr Ordzhonikidze said efforts to break the deadlock had not yielded desired results and the conference had been trying to forge a consensus on disarmament priorities, instead of negotiating multilateral agreements.

Disarmament could liberate resources for development, building confidence and strategic stability. It would also be of use to the development agenda and the Millennium Development Goals. He stressed that the multilateral disarmament machinery must be overhauled and called for joint efforts based on new, imaginative approaches. It was vital to develop a political consensus on priorities, and to go beyond national interest. Mr Ordzhonikidze said that without political decisions at the highest level, even the most determined efforts of the Conference on Disarmament would not succeed. The current impasse could not be broken through procedural means, but only through a new political consensus.

Surrender or fight?

Subroto Roy
The Statesman, 4 December

War is not a cricket match or Bollywood movie. Can India fight China if it must?

Armies of the subcontinent, all deriving from rather antiquated British military traditions, have only once since 1947 fought an external army ~ when China’s Communists, using Lin Biao’s military doctrines, attacked India in 1962 and India lost territory, soldiers and self-respect, gaining ignominy for half a century instead. India and Pakistan have fought wars against each other, India’s army has fought Kashmiri, Naga and other rebels, Pakistan’s army has brutalised Bangladeshi and Baluchi civilians and fought Pashtuns in Waziristan, Bangladeshi soldiers have brutalised tribal minorities and shot at Indian border guards, Sri Lanka’s military has fought Tamil rebels, Nepal has fought communist rebels, etc. Other than the 1962 Chinese attack, all warfare in the subcontinent has been domestic and internecine.

Official 1962 history

The official Government of India history of the 1962 war frankly says: “The Indian Army trained and fought like the British Army, unimaginative, elephantine, rule-bound and road-bound. Armies of Germany, Japan, USSR or China were vastly better war machines, and patterned very differently.” During the 1962 war, the US Ambassador JK Galbraith wrote to President Kennedy: “The great question is what the Chinese intend…. The Indians have consistently underestimated Chinese intentions…. the Indian Army in its command, organisation, tactics and equipment is extremely old-fashioned. The individual soldiers carry personal arms that are sixty years old and this can hardly give them the feeling of equality with opponents carrying modern light automatic weapons. The tactics are stuffy and rigid… Some of the commanders are very good. More still are the amiable frauds that rise to the top in any peacetime Army… ”

When diplomacy is exhausted and international conflict arises, there is always an option of surrendering or yielding sovereignty instead of standing up to fight, e.g. Vichy France yielding before Nazi Germany. There is always a choice between submission and fighting. Pakistan’s military has geared itself over decades only to fight India, and chosen to serve the West and China as desired towards that end. Whatever America wants in Pakistan, America gets, e.g., if American missiles need to enter Pakistani airspace to hit Afghan targets, the US Government does not seek Pakistani permission but merely informs them not to think offensive missiles have been sent from India, and they say okay.
India’s Army may be under some suspicion of being similarly geared to fight only Pakistan ~ and when India and Pakistan are armed and obsessed only with fighting one another, they can hardly think of taking on other adversaries. “India’s soldiers now stand sentinel along India’s frontiers; but they perform guard-duties and are not spear-heads for her advancing armies”, Peter Lyon in FS Northedge (ed), Foreign Policies of the Powers, 1973.

Certainly India’s military has not seemed keen to have anything but a highly defensive posture against Communist China. On 23 March 1991, Rajiv Gandhi at his residence released a fat book by a retired Army Chief on Indian military defence titled Prepare or Perish. The book’s author and the present author had been working together for Rajiv, and the former was asked why in the hundreds of pages of the book there was barely a mention of Indian military preparation against China. He replied that our strategy against China would have to be a defensive holding action which relied on the international community’s intervention before matters escalated ~ revealing a rather wild optimism about the efficacy of international relations. Another Army Chief years before him, General Thimayya himself, is reported to have said “as a soldier he could not think of a total war with China and would leave the dispute to be settled by the diplomats” (BN Mullick, The Chinese Betrayal, p. 318).

Thimayya realised India was weak after World War II facing Mao’s Communists who had two and a half million armed men, had acquired large stocks of American and Japanese weapons after defeating Chiang Kaishek, and were aggressive and experienced after decades of fighting culminating in the Korean war. (Three divisions were trained in India by the Americans and sent for Chiang in 1942-45 with supplies along the Stilwell Road or flown across the “hump”.) Indian soldiers had fought mostly under British or American commanders; in 1947, they disintegrated in chaos into the new armies of India and Pakistan who went to war with one another immediately over J&K.
Not only was India militarily weak until 1962, our political and diplomatic policies since 1949 had been consistently ones of flattery and appeasement, betraying our interests as well as our relationships with Chiang’s Nationalist Chinese and, most cruelly of all, with the Tibetans who shared India’s culture. Our first Ambassador to Beijing was a communist sympathiser, his son-in-law a leading Indian communist. India was the first country outside the Soviet bloc to recognise Communist China, the first to help Mao diplomatically in the Korean war, the pioneer of many UN resolutions to have Communist China admitted as a veto-holding Security Council member in place of Chiang’s Nationalists. We bent over backwards to accommodate and appease them over Tibet. All this got us less than nothing ~ Communist China soon enough joined hands with Pakistan’s greedy generals against us.
Zhou Enlai was said to be “one of those men who never tell the truth and never tell a lie. For them there is no distinction between the two. The speaker says what is appropriate to the circumstances. Zhou Enlai was a perfect gentleman; he was also a perfect Communist” (Father Laszlo Ladany, The Communist Party of China and Marxism, 1921-1985, Stanford 1988). Zhou enforced India’s political and diplomatic surrender, and then we failed to fight adequately on the military front. Communist China thus established its dominance over India. After Nixon and Kissinger made their devious opening to Mao and Zhou using Pakistan, American policy changed too, almost betraying Taiwan and certainly stamping American approval on the idea that between Communist China and India, China shall be seen as dominant.
For recent Chinese Ambassadors to New Delhi to brazenly use today the same language as Zhou did half a century ago is not a good sign but an indication of Communist China’s wish not to have a relationship with modern India on the basis of sovereign equality. For them to say Tawang must be theirs because the monastery there was where the sixth Dalai Lama was born and the Dalai Lama is Chinese and not Indian, is to reveal an aggressive subconscious against us. We may next hear it said Buddha himself was Chinese since he was probably born in Nepal, as an excuse for further Communist encroachment.

Diplomatic relations

The last time China’s Communists attacked India the world was distracted by the Cuban missile crisis just as it is distracted today with Iran and Iraq. The Tawang monastery issue today is symbolic of India’s entire relationship with China since 1949. There is no economic reason why bilateral trade in goods and services cannot continue but it may be high time India gathers some remaining self-respect and downgrades and then considers ending diplomatic relations with this aggressive dictatorship, awaiting instead the development of democracy and a free society for all of China’s great people, perhaps on the Taiwan-model. The Dalai Lama was greeted with great warmth in Taiwan and there is no doubt a free democratic China will seek a healthy new relationship with Tibet as befits great cultures. Militarily, India must indeed prepare for the next Communist aggression or perish, which requires real modernisation and efficiency in the armed forces and an end to corruption, indiscipline and incompetence.

(The author is Contributing Editor, The Statesman)

Wheeling ‘N’ dealing - Matter Of National Security And Sovereignty, Not Inter-Party Politicking

Sumer Kaul
The Statesman, 24 November

What the dickens is happening on the nuclear deal? Is it on or off? Or neither? Or both? Some day in the near future we will know. Right now, given the pirouetting party politics, it is impossible to say.
Actually, pirouette is not the right word. Considering that there is more swing than spin on view, trapeze may be a better description. First the Left swung into action and the Manmohan Singh government swerved from its position. Now the Left has swerved from its position and the government has swung into action!

To change the metaphor, after being in intensive care of the government, the deal suffered a seemingly terminal shock, courtesy the Left, and was duly shifted to the morgue, causing its principal protagonist to philosophize about life after death, etc. Then, last week, it was resuscitated, courtesy the same Left, and was promptly shifted to the post-trauma recovery room.

‘N’ for Nandigram

With a view quickly to restore it to good health, the government has dispatched post-haste AEA chief Dr Kakodkar and team to Vienna to negotiate on India-specific safeguards, so-called, with the IAEA. The first of a three-stage follow-up to operationalise the Indo-US deal (other two being a formal “yes” by the Nuclear Suppliers Group and approval by the American Congress), it was this very step that the Left had vetoed just last month.

To change the metaphor once again (forgive me, but then Indian politics itself is a bizarre mosaic of metaphors), what prompted Karat and company to change the red signal? True, they have as yet changed it only to amber; they say they will examine the agreement with the IAEA before deciding whether to make it green or go back to red. Needless to say, they are at liberty to do and undo their acts but people at large certainly want to know what happened in the span of a month to cause the Left to abandon its earlier position.

Could it be a different N-deal ~ N for Nandigram, the bruised and battered area in West Bengal that easily qualifies as the ideologically licentious state CPI-M’s crowning disgrace? The BJP thinks so. There are others too who believe that the Left concession on the IAEA negotiations has to do with the fear that the Centre may break its intriguing restraint and come out with an appropriately adverse reaction, if not also some action, on Nandigram. Although opportunistic trade-off are now a staple of Indian politics, particularly the politics of coalition dharma, the N-deal for N-deal allegation may not be true, or wholly true.

Buying time appears to be as likely a reason for the Left's semi-somersault on Vienna: Time for its ruling formation in West Bengal, time for the UPA government and time for the deal operationalisation time-table to elapse. This impression is strengthened by the fact that even after agreeing to the IAEA talks, the Left has reiterated its opposition to the 123 Agreement and the Hyde Act. An unnamed “senior Left source” has been quoted as saying that in case the safeguards agreement is signed, “the government will be on autopilot”, adding for good measure, “we will not allow the government to go to the NSG”.
If this is the case Mr Karat, why did you retreat on the question of approaching the IAEA? And if, on its part, the Manmohan Singh government knows the Left’s post-Vienna mind, and it cannot but know, why is it going through the motions? Given the Bush administration’s deadline, surely the Left’s okay to the safeguards parleys cannot safeguard the UPA’s full term. In the event, what is the frantic Kakodkar activity all about?

Does it have something to do with the government’s alleged wooing of the also anti-deal BJP as an alternative back-up for its survival in office? One can of course never tell what tidings ~ and turnabouts ~ tomorrow may bring! But as of today, the BJP says it won’t budge. Advani said the same to the visiting Henry Kissinger.

That brings us to the strange and rather disagreeable happenings between the Left’s hundred per cent unconditional “no” last month and its thirty-three per cent conditional “yes” last week. While the first hurt the government and the Prime Minister in particular, the second has the potential to deeply dismay the keen-to-profit NSG and particularly the Washingtonian co-architect of the deal and his overeager nuclear tradesmen.

Involved in seeing the deal through are high-pedestal personal prestige (on both sides) and immense corporate profits. The GoI has expended megabucks on lobbying for the deal in the US Congress (plus quite some “small change” on printing quintals of pro-deal literature). Big money and big effort to boot; among other things, the protagonists stringed together a group of retired high-ranking civil and military functionaries to canvas support for the deal through an open epistle to members of Parliament ~ obviously as a counterblast to a similar move by anti-deal nuclear scientists. Difficult to say what effect, if any, these missives have had on the netalog (we may come to know during the impending debate on the issue), but such activity has rarely been seen before.

Nor can one recall a precedent for what the Bush administration did and is doing to push the deal in India. Even as the under secretary of state, the overtalking Nicholas Burns has been burning the proverbial midnight oil to virtually admonish India to proceed with the deal and do it within the prescribed timeframe, the US ambassador has reportedly been meeting with the political naysayers in a bid to bring them in line.
In this game of overt meddling in India’s political affairs, the man who stole the limelight was Henry Kissinger. Claiming that his visit had nothing to do with the deal, he nevertheless made it a point to tell us how good the deal is for us, throwing in the “friendly” warning that if it gets nixed now, it will not be easy to salvage it. So we had better quickly go ahead with it!

Nobody can accuse him of any impropriety. He holds no official position and is free to visit a free country and meet people and air his views. But one is surprised that some leading politicians of both the Right and the Left let him try to brainwash them about the deal and, worse, feel elated that he chose to meet them.

To the morgue

This Machiavellian former US Secretary of State (under a tricky dick President), the secret bombardier-in-chief of Cambodia, the man who made no (diplomatic) bones about being anti-India, called us bastards and our then Prime Minister a bitch, and sent the US nuclear warship to the Bay of Bengal during the Bangladesh war ~ this man should have been treated as a persona non grata, certainly not as “an honoured dignitary”, as one major politician beamingly called him after their meeting.

Questionable as all this activity on the part of the Bush regime and our hospitality to the interference are, we shall let it pass in the confident hope that the UPA-USA pressure blitz will not alter the stand of the political (as well as non-political) opponents of the deal. Messrs Karat and Advani ~ and the merrily fence-sitting leaders of other parties ~ must realise that the deal is not a party quarrel; it is an issue of the utmost national import.

Whatever its dubious plusses, it has huge minus points for India’s security and sovereignty. It must be sent to the morgue.

The author is a veteran columnist and former editor

CPM supporters to governor: Where were you all these months? CRPF hatao

PRONAB MONDAL AND ANSHUMAN PHADIKAR
The Telegraph, 3 December

Nandigram, Dec. 2: Governor Gopalkrishna Gandhi today held countless hands and a cricket bat in Nandigram, inviting comparisons with the Gandhigiri cliche.

But another — and blunter — version of Gandhigiri was waiting for him when his white Qualis drove up to Tekhali bridge, across which lay Nandigram, at 11.10am.

Around 100 people, including 50 women, formed a human wall, forcing the 30- vehicle convoy to stop.

“Where were you in the past 11 months? Why have you come now? Do you know what we had to face here?” shouted Atashi Jana, a resident of the nearby Gokulnagar, leading the crowd towards Gandhi’s car.

As the governor rolled down the window, Atashi cried out: “We want the CRPF to withdraw immediately.” The others joined in a chorus: “CRPF choley jaak. CRPF hatao (let the CRPF go. Throw them out).”

The governor, patiently listening to them, tried to reason with Atashi. “Ora to bhalor jonnei achhe (they are here for your good).”

He added: “People gained confidence after the CRPF deployment and they will remain here.”

But for that hint of steel, the governor — the highest-ranking authority yet to visit Nandigram — was largely restrained during his tour.

A discordant note was struck with the stated position of the Bengal government when he said Nandigram had a great future for agriculture, and the state and the Centre should look into it for the area’s sustainable growth.


Chief minister Buddhadeb Bhattacharjee had repeatedly cited diminishing returns from farming to say industrialisation was the only alternative to fight poverty.

“I have seen fishing and farming going on side by side. I think Nandigram can be a lesson of a very different kind for India,” Gandhi said, pointing to the multitude of water bodies there.

But the comment was mild compared with his Diwali statement that termed the CPM’s recapture of Nandigram “unlawful and unacceptable”. Today, Gandhi said: “I made the statements that were required at that point of time.”

At Tekhali, the CPM local leadership had decided to block the governor’s car to air “grievances”. “The blockade was a part of that effort,” said Ashoke Bera, the Nandigram I panchayat samiti president.

Before leaving, the governor leaned forward to tell the DIG (Midnapore range), N. Ramesh Babu: “Be impartial.”

The cavalcade then rolled towards Satengabari. The governor covered a 1km dusty road by foot to reach ransacked houses belonging to Bhoomi Uchchhed Pratirodh Committee supporters.

“Sir, where will we live? My daughters and I have only a tarpaulin sheet for shelter,” said Rabeya Biwi, 28, mother of Mumtaz, 3, and Saira, 5, clasping his hands.

Soaked in sweat, Gandhi consoled her: “Reconstruct your house for the sake of your children.”

Without warning, Najma Biwi, 32, ran up to him and fell at his feet. “Sir, please don’t leave our fate in the hands of local police. CRPF ke jete deben na (don’t allow the CRPF to go).”

“The CRPF will not go, they will be here for your security,” Gandhi told her.

When Gandhi was about to leave, a group of CPM supporters whose houses were ransacked 11 months ago blocked his way. “You will have to visit our houses, too,” said Manoranjan Manna. Gandhi promptly agreed.

Outside Manna’s house, two groups started accusing each other. Maneka Biwi caught Gandhi’s hands and started pulling him to her house.

“Aapni oder obostha dekhlen aar amar ta dekhben na? (You have seen their condition and will not see ours?)”

“Of course, I will,” said Gandhi and followed her.

The two groups started pointing fingers at each other, saying: “Sir, he is the person who set my house ablaze. Arrest him,” shouted a villager.

The governor stood in silence, looking at the policemen around him.

Later, at Sonachura, he stepped into the house of Sankar Samanta, a CPM panchayat member who was hacked to death on January 6. Sankar’s widow Sabita and father Sudarshan embraced him and broke down.

“You came to the Raj Bhavan... I recognise you. How is your daughter?” he asked Sabita.

Gandhi told reporters that the process of restoring peace has begun, but it would take time. “What is abhay (fearlessness)? (It is) not just a land without fear, but also a land where fear does not lurk. We should have fearlessness in Nandigram.”

NEVER A FREE LUNCH - India’s dependence on foreign fund inflows is cause for worry

S.L. Rao
The Telegraph, 3 December

The sensitive index of the Bombay Stock Exchange has risen from 5591 at the end of 2003-2004 to 6493 in 2005, 11280 in 2006, a range of 8929 to 14652 in 2007 and in the year 2007-8 so far between 12455 and 18814. Most Indian investors must now believe that there is a Santa Claus after all. Even the small fall last week was followed by another large rise. But is this likely to be sustained? Conditions have become much more difficult, markets have probably reached their peak range, the only direction for the next few months is erratically downwards, and that may be true for gross domestic product growth as well.

Indian economic growth rates stimulated the stock markets. Average growth in the last three years was 8.6 per cent while the investment rate rose by 30 per cent, financed largely by domestic savings, not by savings of others overseas (unlike the United States of America that uses savings of others by a high current account deficit). Our current account deficit — highest among comparable countries despite the rise in the balance of trade deficit (imports in relation to exports) — is lower than before. Expansion in domestic demand accounts for all the growth. The result of this rising demand is that supply constraints rule today in every sphere — tradable manufactured goods, physical infrastructure and social infrastructure.

The last time this happened was in the late Nineties when there were substantial capacity additions as a result of capacity shortages. These capacities became surplus when demand fell and overall growth declined. It was 2003 before new investments took place and additional capacities were created.

That may not be repeated. This time there is substantial and growing public as well as private investment in infrastructure, and a consumption boom. Interest rates came down sharply towards the late Nineties and despite rate increases since, are far lower than in earlier years. However they remain higher than in developed economies. With relaxations in external commercial borrowings, overseas borrowings have surged. Borrowings have been invested in new capacities and domestic and overseas acquisitions. Overseas acquisitions obviously add to the risks of default if the acquisitions fail to produce early rewards or are not serviced on schedule. Defaults will hurt India’s credit ratings.

Equity investments by overseas investors have risen sharply and they have added a continuing and substantial inflow of foreign funds into stock markets. The low interest rates in the US and Japan, the India growth story, relatively lower price/earnings (almost half) ratios in India as compared to China, the perceived security of Indian investments, the easy repatriation of funds, have all combined to produce this inflow. In addition there are the ECBs which have added to liquidity.

The Reserve Bank of India has tried to soften the inflationary impact of this liquidity by hesitant raising of interest rates, and more often by raising the cash reserve ratio. The surge in liquidity continues, with its inflationary potential.

So far, despite the expansion of liquidity (21 per cent in money supply over the year), inflation has been contained. This is largely due to declining import costs, but chiefly due to subsidized fuel and power prices despite rising imported crude prices. Fuel subsidies alone add about Rs 80,000 crore to oil company losses. By leaving them out of the deficit calculation, the government is able to show a fictitiously lower fiscal deficit which is yet higher than that in comparable developing countries.

Apart from concealing inflation numbers by subsidizing consumer prices for fuels, prices of primary products (food and so on) are rising. Hence the claimed inflation in the wholesale price index hides the reality. The wholesale price index shows a much lower rise in price than what most consumers actually pay.

The RBI is obviously concerned by this fictitiously low inflation rate. It has already restrained ECBs and further RBI actions can be expected soon to restrain liquidity. The RBI is unlikely to easily raise interest rates because that will attract further foreign fund inflows, add to liquidity and, also, adversely affect industrial growth.

The question is whether rising stock prices, large foreign fund inflows, apparently low inflation, high levels of GDP growth are sustainable for long. The astonishing rise in equity prices (by 50 per cent in one year) could turn negative because of many factors — a decline in domestic and export demand, rising rupee exchange value reducing export margins, swamping of the domestic market with cheap imports, a monsoon failure, collapse in foreign economies and rise in oil prices. Brazil and China have had much higher rises in stock prices but may not be as vulnerable.

China has for many years managed to hold its currency values at stable levels despite much larger inflows of funds. This is perhaps because a greater part of Chinese inflows are in more stable direct investments and also because of substantial export surpluses. If the inflows into financial markets increase as they are now doing, the volatility of such funds might make currency stability more difficult to maintain.

Export surpluses might fall if the American economy declines, as it shows signs of doing. China may have to impose higher interest rates to contain the adverse impact of decline in the dollar. China also cannot switch to the euro as other countries can, because of its huge dollar holdings, whose value will be hit if it makes such a switch. However, a decline in exports may not hurt the Chinese economy too adversely because the value added within China by exports is relatively small.

In India, the easy availability of cheap foreign funds, the boom in equity markets, and substantially increased government investment in physical infrastructure, social spending and agriculture have stimulated industrial investment, domestic demand and not exports. Hence a decline in the US economy will not have too much of an adverse effect on India. What will hurt us however, is a decline in foreign funds inflows. This can happen if interest rates rise in the US, Japan and Europe; if domestic demand declines; if the monsoon fails (unlikely since it has been quite good till late in the season); if the RBI constrains liquidity by too much or raises interest rates to contain inflation; and if there is political instability.

Equity prices have risen too fast, too quickly. Unlike in the past, Indian shares are responding more to future expectations than current performance. Slowing down of industrial production, rising crude prices — adding to already high government deficits if correctly calculated, rising rupee values, rising imports, falling exports are worrying signs. If fuel subsidies are cut, inflation will rise. If subsidized prices continue, government spending on other sectors must inevitably be reduced. This will hurt growth. Rating agencies might downgrade India into a higher risk category. This will also hit Indian company borrowings and foreign fund inflows. If the US raises interest rates to moderate inflation and improves the exchange value of the dollar, fund inflows will be hit again. If American demand for imports declines, we might not be as badly affected, but will face increased competition from cascading Chinese imports into India.

Thus, while we are insulated to some extent from an American economic downturn, our dilemma is our heavy dependence on volatile foreign fund inflows, and the sharp increase in crude prices. We may exult about our foreign exchange reserves. But reining them in could hurt economic growth. Growth has vastly increased government tax revenues and stimulated public investment in physical and social infrastructure. These could significantly improve the human condition in India.

The Indian economic situation is not as good as it seems. Oil prices are very high and we will have to manage them without raising inflation. The government will have to restrain growth and reduce dependence on volatile foreign funds. Perhaps the next government will have to take this action. The stock markets are unlikely, until the world economy stabilizes, to show the spectacular increases of the last year.

The author is former director-general, National Council for Applied Economic Research