Captured, Bonded Farming Reintroduced in Marxist Ruled West Bengal Despite Stiff Resistance and The Brahaminical Hegemony Replicates the Indigo Experi

Captured, Bonded Farming Reintroduced in Marxist Ruled West Bengal Despite Stiff Resistance and The Brahaminical Hegemony Replicates the Indigo Experience

Troubled Galaxy Destroyed Dreams: Chapter 83

Palash Biswas
Indigo revolt - Wikipedia, the free encyclopedia
The Indigo revolt (Bangla :নীল বিদ্রহ Neel bidrōhō) was a peasant movement and subsequent uprising of indigo farmers' against the indigo planters ...
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Indigo dye - Wikipedia, the free encyclopedia
The form of indigo used in food is called "indigotine", and is listed in the .... It played an essential part in the Bengali indigo revolt of 1858 called ...
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Chemical Hub: the Dire Threat
[Author: Abhi Datta Majumdar; Professor, Saha Institute of Nuclear Physics, ... Poisonous chemical elements have entered the food chain, which through the ...
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India's death dance demonstrates Green Revolution failure ...
Even in America, the entry of retail chains in the agriculture sector have only shifted ... Northwest Resistance Against Genetic Engineering · PO Box 15289 ...
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Our friends united under the banner of Campaign Against Monopolistic aggression are trying hard to mobilise the masses against Monopolistic Aggression. Retail Chains have been opposed by CPIM while it launched an all out movement against Wal Mart. The Left partner Forward Block was on the verge of withdrawal from the Left Front government opposing Metro Cash and carry License renewal. Abhi Dutt Majumdar,Ratan Basu Majumdar, Shiladitya and other friends are addressing meetings daily in every corner of Kolkata and suburbans. They demonstrated on Metro Cash and Carry Hub in Mukundpur.

India allows foreign multiple-brand retailers to operate only via wholesale or franchise and licence arrangements in its fast-growing retail market, which is forecast to nearly double from an estimated $350 billion by 2015.

Metro's global rivals Wal-Mart Stores (WMT.N: Quote, Profile, Research, Stock Buzz) and Tesco Plc (TSCO.L: Quote, Profile, Research, Stock Buzz) plan to set up wholesale cash-and-carry operations soon, and Carrefour (CARR.PA: Quote, Profile, Research, Stock Buzz) has also said it plans to enter India.

The All India Forward Bloc, an ally of the state's communist government, had last month stopped the state from renewing Metro's licence, insisting on conditions that would prevent Metro from contract farming, which it says will hurt small farmers.The Forward Bloc, which holds the portfolios of agriculture and agricultural marketing in the state, has also opposed the entry of large local corporates such as Reliance Industries (RELI.BO: Quote, Profile, Research, Stock Buzz) and the Goenka Group in retail and contract farming.

But nothing could stop Gestapo head Buddhadeb running blindly on the superhighway of capitalism despite the capitalism collapsing in West and East effected badly, resilience of Indian sensex shining Economy of Imperialist Corporate Zionist Hindu monopoly exposing everything. Ratan tata has left.Buddha defeated in Nandigram as well as Singur is adamant enough to defend Brand Buddha as Indo US Strategic copulation is complete meanwhile!

The people who came to power with Land reform and rural development agenda, reintroduced captured, bonded farming in Bengal replicating Indigo Experience! Metro Cash & Carry was finally issued a fresh license, though with certain conditions imposed by the State Agriculture Marketing Board and the state government! An MoU in this respect was signed following four-hour long negotiations between Metro Cash & Carry representatives, and SAMB and government officials.


The German wholesaler would open its first outlet in Kolkata in “six to eight weeks time”. The Forward Bloc-controlled board, however, was forced to withdraw the condition ~ restricting single purchases to below Rs. 5,000 ~ it had insisted on earlier. Instead, a clause that would restrict the German wholesale giant from doing business other than with traders, as also a stipulation that in case of agriculture produce its customers would require a license from the regional market committee, was included.


West Bengal agriculture minister, Mr Naren De, said the conditions have been imposed to ensure “Metro Cash & Carry does not poke its nose in retail business”.

The Indian retail market will grow at a robust pace to touch $450 billion by 2015 and is poised to become one of the top 10 retail markets in the world, a report published by management consultancy firm McKinsey & Co. said. Metro, Germany's biggest retailer, had planned to invest $120 million in at least four new cash-and-carry centres in eastern West Bengal state, doubling the number of centres in India.

METRO Cash & Carry is the international leader in self-service wholesale operating across Europe and in some countries of Asia and Northern Africa. It is the largest sales division of the German trade and retail giant METRO AG.

METRO Cash & Carry is different from large retail chains such as Billa and Carrefour in that its stores are primarily targeted towards professional customers rather than end consumers. The cash-and-carry concept is based around self-service and bulk buying. To be able to shop at METRO customers need to be duly registered and be issued a card which shows that they are eligible to buy at METRO Cash & Carry. METRO Cash & Carry's customers include retailers, hotels, restaurants, caterers and other business professionals.


The crises in monopoly capitalism mount more severe overt aggressive tendencies, no longer constrained by the might of Soviet Union, as seen in the Middle East and Iraq, and also seen in the attacks on the peoples judicial and democratic rights under the pretext of fight against terrorism.Our anti-monopolistic strategy is developed through the practice of The World Communist Movement in its struggle for the interest of the working class over a long period of time. Our experience in the fight against fascism has a special importance for this development. We had to pay a high price for the left deviation of that time.

The people of Iraq, Palestine and Afghanistan daily feel the aggression of the imperialists, through a brutal occupation of these countries. Not forgetting the brutal in discrepant killing of Lebanese civilian by Israeli bombs. Other countries like Cuba, D.P.R. of Korea, Iran and Venezuela feels the breath of the imperialist forces every day.


The destruction of USSR and the socialist world system has altered important preconditions for our strategy. In spite of this, it is our profound belief that the core of the anti-monopolistic strategy is still valid, but we have to address what consequences the altered situation gives. We are still in the beginning of such a process.



The logic of the ruling Hegemony :
Retail is India’s largest industry, accounting for over 10 per cent of the country’s GDP and around eight per cent of the employment. Retail industry in India is at the crossroads. It has emerged as one of the most dynamic and fast paced industries with several players entering the market. But because of the heavy initial investments required, break even is difficult to achieve and many of these players have not tasted success so far. However, the future is promising; the market is growing, government policies are becoming more favorable and emerging technologies are facilitating operations.

Germany's Metro AG (MEOG.DE: Quote, Profile, Research, Stock Buzz) on Friday received a new licence for its cash and carry wholesale arm in West Bengal state, with the communist government limiting its activities to protect farmers and small traders.



The SAMB chairman, Mr Naren Chatterjee, claimed that the MoU was a “victory” for the state “for it is the first time that a corporate giant would be doing business according to conditions set by a state.” Mr Chatterjee warned that violation of the West Bengal Agriculture Produce Marketing Regulations Act, 1972 would result in revocation of the license. While the conditions would prohibit Metro Cash and Carry from entering into retail business on engage in contract farming, it can sell to traders holding trade licenses and RMC licenses. The board would also benefit, collecting a market fee of one per cent for every purchase made from the German wholesaler.


International operations
As of 2007, METRO Cash & Carry has operations in the 29 countries. On May 18th 2008, METRO Cash & Carry announced its market entry into Egypt under the MAKRO brand name. The first wholesale center is expected to open late 2009.


METRO around the world
Makro logoCountry First Wholesale Center Number of Wholesale Centers
Germany 1964 123
France 1971 89
Italy 1972 48
Russia 2001 40
China 1996 37
Spain1 1972 34
United Kingdom1 1971 33
Poland1 1994 27
Romania 1996 24
Ukraine 2003 20
Netherlands1 1968 16
Hungary 1994 13
Austria 1971 12
Czech Republic1 1997 12
Turkey 1990 11
Belgium1 1970 10
Portugal1 1990 10
Greece1 1992 9
Bulgaria 1998 9
Vietnam 2002 8
Morocco 1991 7
Croatia 2001 6
Denmark 1971 5
Slovakia 2000 5
Serbia 2005 5
India 2003 4
Japan 2002 3
Moldova 2004 3
Pakistan 2007 2
Egypt1 20092 0
Kazakhstan 20092 0

1 operates under the brand name Makro

2 expected opening


[edit] Bulgaria
The first two METRO Cash and Carry hypermarkets in Bulgaria opened in Sofia and Plovdiv on 18 March 1998. As of 2006 the company operates nine stores (the tenth is currently under construction) in seven cities:

Sofia (x2)
Plovdiv
Ruse
Varna
Stara Zagora
Burgas
Blagoevgrad
Pleven (under construction)
Veliko Tarnovo
A number of other stores are planned.


[edit] India
The first METRO Cash & Carry wholesale center in India opened in Bangalore in 2003. Currently there are 4 wholesale centers in operation, two in Bangalore [1] and one in Hyderabad [2]which was opened on 30th November 2006 and one in Mumbai.The Mumbai store opened in 2008 in Bhandup. Calcutta [3] plans are underway.





[edit] Poland
The first Makro Cash and Carry shop was opened in Warsaw, Sosnowiec and Lódz in 1994. Now the copmany has 25 stores in:

Bialystok
Bielsko-Biala
Bydgoszcz
Czestochowa
Tricity (x2)
Kalisz
Katowice
Kielce
Koszalin (planned)
Kraków
Lublin
Lódz
Olsztyn
Opole
Poznan
Rybnik
Rzeszów
Sosnowiec
Szczecin
Warsaw (x3)
Wroclaw
Torun
Zabrze
Zielona Góra



[edit] Romania

Metro hypermarket in Berceni, Bucharest (April 29, 2008)METRO Cash and Carry was one of the first international food and non-food retail chains to enter the Romanian market, opening its first store in Bucharest, near Henri Coanda International Airport.

As of 2007, it operates 23 stores in major cities across the country and is one of the most well-known chains. Metro has stores in the following cities:

Arad
Bucharest (x4)
Bacau
Baia Mare
Brasov (x2)
Botosani (planned)
Cluj-Napoca
Constanta (x2)
Craiova
Deva (planned)
Galati
Iasi
Oradea
Pitesti
Ploiesti
Sibiu
Suceava
Târgu Mures
Timisoara (x2)


The supermarket in Oradea is one of the most successful of the branches and has been especially popular with Hungarians, who are crossing the border to buy products from the hypermarket since prices are significantly cheaper in Romania than in Hungary. This phenomenon has mainly started since Hungary joined the European Union, an occurrence which has increased prices in Hungary.


[edit] Serbia
The first Metro Cash and Carry store in Serbia opened in Belgrade in 2005. As of 2006 the company operates five stores in four cities:

Belgrade (x2)
Kragujevac
Novi Sad
Niš
Belgrade stores are located in Zemun and Krnjaca.


[edit] Ukraine
Dnipropetrovsk (x2)
Donetsk (x2)
Kharkiv
Kryvyy Rih
Kyiv (x3)
Lviv
Chernivtsi
Odesa (x2)
Poltava
Vinnytsia
Zaporizhia
Luhansk
Rivne
Ivano-Frankivsk



"We see this as our victory," said Naren Chatterjee, a Bloc leader who heads the state's agriculture marketing board.

"They got a new licence, but on conditions that deny them entry in retail and contract farming."

Metro, which has four wholesale centres in India, on Friday said it was happy to operate within the limits set by the state.

"We are keen to start our operations in Kolkata," said Martin Dlouhy, managing director of Metro Cash & Carry India, adding the first outlet is expected to be operational in six to eight weeks.

The limits placed on Metro comes on the heels of Tata Motors' (TAMO.BO: Quote, Profile, Research, Stock Buzz) decision to move a factory for the ultra-cheap Nano car out of the state to business-friendly Gujarat state, after violent protests by farmers in West Bengal against the factory.

India's largely "mom and pop" retail market will be transformed during the next seven years by the creation of an organised sector with 300m customers, McKinsey, the management consultants, predicted yesterday.

In a report entitled 'The Great Indian Bazaar' the consultants estimated that India would become a $450bn retail market by 2015, and that organised retail would increase its share of the market from 5 per cent to 14-18 per cent.

A government-commissioned report valued the retail market at $322bn last year. The bullish assessment will make eye-watering reading for international retail groups. But their entry into India's fast growing economy has been slow; the retail industry is one of the least developed of any large country.

Proposed entries into the market by Ikea, the Swedish retailer, and Carrefour, the French supermarket chain, have stalled. However, UK retailers Tesco and Marks and Spencer are expected to open stores soon.

A powerful lobby of 12m small shop owners, together with restrictive regulation, has slowed the advance of both domestic and international big retailers. Emotions have run high, especially over supply chain reforms.

Reliance Fresh, the grocery chain opened by Reliance Industries, the Indian conglomerate, had to close stores in Uttar Pradesh when faced with protests. However, it has joined forces with M&S to open 50 stores selling clothing and homeware.

Wal-Mart, the US retail group, and Bharti, owner of India's largest mobile phone operator, have established a partnership which has yet to launch, while Tesco has teamed up with the industrial group Tata to launch cash-and-carry stores.

McKinsey identified two reasons for the cautious approach taken by big retailers. One was the deterrent effect of regulations, particularly curbs on foreign investment. Single-brand retailers, such as luxury goods chains are allowed to set up shop, but multi-brand retailers, such as Tesco and Wal-Mart, are barred from selling directly to consumers.

The other was that more "immediate" emerging markets such as China, Russia and eastern Europe had soaked up management capacity. Organised retail accounts for about 20 per cent of the retail market in China, while in Russia and Brazil its share is about 36 per cent.

"[Big international retailers] will all be here at some stage or form. But it's not clear what the regulation will be," said Ireena Vittal, one of the authors of the report. "The economic rationale for keeping foreign players out is non-existent."

The consultants said retailers should adapt their strategies to the typical Indian shopper. Its research showed that Indians spent $7-$10 in a typical hypermarket shopping trip, compared with $45 in the US and $10-$18 in China.


Though organized retail would grow from the current 5 percent to 14-18 percent by 2015, yet, mom-and-pop stores (local corner stores) would continue to dominate both large and small towns, the report entitled 'The Great Indian Bazaar - Organized Retail Comes of Age in India,' said.

According to the report, in order to turn profitable, the retailer should adapt their strategies to the typical Indian shopper and keep the following four principles in mind:

[1] Develop innovative formats for material differentiation for which three decisions will be critical - where to participate in the retail value chain, which geographies to play in and what price-points to offer.

[2] Craft a customer-insight driven merchandise strategy to stimulate consumption and lock in core customers.

[3] Create an efficient retail operating platform consisting of a self-sufficient system of suppliers, logistics providers and even loyal shoppers.

[4] Build an evolving organization with an empowered front-end selling team that "owns" local catchments.

McKinsey's retail report also discusses the uniqueness of the Indian shopper: least loyal to a single retailer, dislike for pre-packaged fresh foods, willingness to pay more for convenience and services but not a premium price for a brand and demands ethnicity in apparel accessories. And, in the absence of quality control, information about the product and trust in retailers and brands serve as a proxy for all these factors, the report said.

A typical Indian, it said, would spend $7-$10 in a hypermarket shopping trip, compared with $45 in the US and $10-$18 in China.

The greatest challenge would be to maintain the organization's focus on profitability while cultivating flexibility, the report said.



Retailing in India is gradually inching its way toward becoming the next boom industry. The whole concept of shopping has altered in terms of format and consumer buying behavior, ushering in a revolution in shopping in India. Modern retail has entered India as seen in sprawling shopping centres, multi-storeyed malls and huge complexes offer shopping, entertainment and food all under one roof. The Indian retailing sector is at an inflexion point where the growth of organized retailing and growth in the consumption by the Indian population is going to take a higher growth trajectory. The Indian population is witnessing a significant change in its demographics. A large young working population with median age of 24 years, nuclear families in urban areas, along with increasing working-women population and emerging opportunities in the services sector are going to be the key growth drivers of the organized retail sector in India.

Some Key Facts:

- Retail is India’s largest industry, accounting for over 10 per cent of the country’s GDP and around eight per cent of the employment

- The market size of Indian retail industry is about US $312 billion

- Organised retailing comprises only 2.8 per cent of the total retailing market and is estimated at around US$ 8.7 billion

- The organised retail sector is expected to grow to US $ 70 billion by 2010

The Indian economy and the real estate sector in particular are high on its ride to prosperity. As India’s economic growth curve rises, real estate India has emerged as one of the most appealing investment areas for domestic as well as foreign investors. Indian real estate has huge potential demand in almost every sector, but especially commercial, residential, retail, industrial, hospitality, healthcare etc. But maximum growth is attributed to its growth from the booming IT sector, since an estimated 70 per cent of the new construction is for the IT sector.
Investment scenario has certainly undergone a paradigm shift in India. Gone are the days when potential investors used to sought after investment options like equity bonds and park money in shares where your return ranges between 5.55 to 6%. Data showcased by property surveys show that returns from rental incomes on investment in commercial property in Indian metros, is around 10.5%, the highest in the world.




Retail and real estate are the two booming sectors of India in the present times. And if industry experts are to be believed, the prospects of both the sectors are mutually dependent on each other. Retail, one of India’s largest industries, has presently emerged as one of the most dynamic and fast paced industries of our times with several players entering the market. Accounting for over 10 per cent of the country’s GDP and around eight per cent of the employment retailing in India is gradually inching its way toward becoming the next boom industry.
As the contemporary retail sector in India is reflected in sprawling shopping centers, multiplex- malls and huge complexes offer shopping, entertainment and food all under one roof, the concept of shopping has altered in terms of format and consumer buying behavior, ushering in a revolution in shopping in India. This has also contributed to large scale investments in the real estate sector with major national and global players investing in developing the infrastructure and construction of the retailing business. The trends that are driving the growth of the retail sector in India are

Low share of organized retailing
Falling real estate prices
Increase in disposable income and customer aspiration
Increase in expenditure for luxury items


India tops the AT Kearney's annual Global Retail Development Index (GRDI) for the third consecutive year, maintaining its position as the most attractive market for retail investment. Furthermore a report by PricewaterhouseCoopers foresees India and China to continue as the top sourcing hubs in retail and consumer sector in the coming years.

The Indian retail market, which is the fifth largest retail destination globally, according to industry estimates is estimated to grow from the US$ 330 billion in 2007 to US$ 427 billion by 2010 and US$ 637 billion by 2015. Simultaneously, modern retail is likely to increase its share in the total retail market to 22 per cent by 2010.

Continuing the robust growth of the organised retail in India, according to the Credit Rating and Information Services of India, the industry raked in US$ 25.44 billion turnover in 2007-08 as against US$ 16.99 billion in 2006-07, a whopping growth rate of 49.73 per cent.

India has one of the largest number of retail outlets in the world. Of the 12 million retail outlets present in the country, nearly 5 million sell food and related products. Thought the market has been dominated by unorganised players, the entry of domestic and international organised players is set to change the scenario.

Organised retail segment has been growing at a blistering pace, exceeding all previous estimates. According to a study by Deloitte Haskins and Sells, organised retail has increased its share from 5 per cent of total retail sales in 2006 to 8 per cent in 2007. The fastest growing segments have been the wholesale cash and carry stores (150 per cent) followed by supermarkets (100 per cent) and hypermarkets (75-80 per cent). Further, it estimates the organised segment to account for 25 per cent of the total sales by 2011.

Retail space

Driven by changing lifestyles, strong income growth and favourable demographic patterns, Indian retail is expanding at a rapid pace. Mall space, from a meagre one million square feet in 2002, is expected to touch 40 million square feet by end-2007 and an estimated 60 million square feet by end-2008, says Jones Lang LaSalle's third annual Retailer Sentiment Survey-Asia.

Alongside, Indian cities are witnessing a paradigm shift from traditional forms of retailing into a modern organized sector. A report by Images Retail estimates the number of operational malls to more than double to over 412 with 205 million square feet by 2010 and further 715 malls by 2015, on the back of major retail developments even in tier II and tier III cities in India.

India retail industry is the largest industry in India, with an employment of around 8% and contributing to over 10% of the country's GDP. Retail industry in India is expected to rise 25% yearly being driven by strong income growth, changing lifestyles, and favorable demographic patterns.

It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200 billion. India retail industry is one of the fastest growing industries with revenue expected in 2007 to amount US$ 320 billion and is increasing at a rate of 5% yearly. A further increase of 7-8% is expected in the industry of retail in India by growth in consumerism in urban areas, rising incomes, and a steep rise in rural consumption. It has further been predicted that the retailing industry in India will amount to US$ 21.5 billion by 2010 from the current size of US$ 7.5 billion.

Shopping in India have witnessed a revolution with the change in the consumer buying behavior and the whole format of shopping also altering. Industry of retail in India which have become modern can be seen from the fact that there are multi- stored malls, huge shopping centers, and sprawling complexes which offer food, shopping, and entertainment all under the same roof.

India retail industry is expanding itself most aggressively, as a result a great demand for real estate is being created. Indian retailers preferred means of expansion is to expand to other regions and to increase the number of their outlets in a city. It is expected that by 2010, India may have 600 new shopping centers.

In the Indian retailing industry, food is the most dominating sector and is growing at a rate of 9% annually. The branded food industry is trying to enter the India retail industry and convert Indian consumers to branded food. Since at present 60% of the Indian grocery basket consists of non- branded items.

India retail industry is progressing well and for this to continue retailers as well as the Indian government will have to make a combined effort.

Another credible factor in the prospects of the retail sector in India is the increase in the young working population. In India, hefty pay-packets, nuclear families in urban areas, along with increasing working-women population and emerging opportunities in the services sector. These key factors have been the growth drivers of the organized retail sector in India which now boast of retailing almost all the preferences of life - Apparel & Accessories, Appliances, Electronics, Cosmetics and Toiletries, Home & Office Products, Travel and Leisure and many more. With this the retail sector in India is witnessing a rejuvenation as traditional markets make way for new formats such as departmental stores, hypermarkets, supermarkets and specialty stores.

The retailing configuration in India is fast developing as shopping malls are increasingly becoming familiar in large cities. When it comes to development of retail space specially the malls, the Tier II cities are no longer behind in the race. If development plans till 2007 is studied it shows the projection of 220 shopping malls, with 139 malls in metros and the remaining 81 in the Tier II cities. The government of states like Delhi and National Capital Region (NCR) are very upbeat about permitting the use of land for commercial development thus increasing the availability of land for retail space; thus making NCR render to 50% of the malls in India.

India is being seen as a potential goldmine for retail investors from over the world and latest research has rated India as the top destination for retailers for an attractive emerging retail market. India’s vast middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets. Even though India has well over 5 million retail outlets, the country sorely lacks anything that can resemble a retailing industry in the modern sense of the term. This presents international retailing specialists with a great opportunity. The organized retail sector is expected to grow stronger than GDP growth in the next five years driven by changing lifestyles, burgeoning income and favorable demographic outline.

Another cap to the retailing industry in India is allowing 51% FDI in single brand outlet. The government is now set to initiate a second wave of reforms in the segment by liberalizing investment norms further. This will not only favor the retail sector develop in terms of design concept, construction quality and providing modern amenities but will also help in creating a consumer-friendly environment. Retail industry in India is at the crossroads but the future of the consumer markets is promising as the market is growing, government policies are becoming more favorable and emerging technologies are facilitating operations in India. And this upsurge in the retail industry has made India a promising destination for retail investors and at the same time has impelled investments in the real estate sector. As foreign investors cautiously test the Indian Markets for investments in the retail sector, local companies and joint ventures are expected to be more advantageously positioned than the purely foreign ones in the evolving India's organized retailing industry.

Key Facts

Selling and buying Indian property is now considered as the most profitable and attractive business opportunity in the present real estate scenario in India. New demands have added to strength of real estate markets across the commercial, residential and retail sectors in India. Not surprisingly, demand for Indian property has been increasing steadily for the past few years and it has exceeded supply.

There has also been an upward swing on the real estate price values in the recent years. Due to the huge demand and rising prices, investment and speculative interest in real estate is growing while excess money supply, stock market gains and policy changes are adding to the trend in favor of the real estate sector.


In the last one year, the capital values of the commercial office spaces has increased by up to 40% owing to the increase in the demand from IT / ITES and BPO sector across major metros in India.

India has a distinct regulatory and financing management in place.


Real estate boom in India is supported by its own flourishing economy on a sustainable basis. Here, growth of the property market is not a result of renovation and overhauling; but rapid development that witness for India riding the high growth wave.
Factors Favoring Investments
Tremendous growth has been taking place in both residential as well as commercial segments that is attracting huge investments phenomenal price escalation (more than 100% in several places) in last couple of years.

Lower interest rates, easy availability of housing finance, burgeoning income and better job prospects, increase of nuclear families have given a boost to the demand for residential properties in India. The net yields (after accounting for all outgoings) on residential property are currently at 4-6% p.a. However, these investments have benefited from the improving residential capital values. As such, investors can count on potential capital gains to improve their overall returns. Capital values in the residential sector have risen by about 25-40% p.a in the last 2 years.

The retail market in India has been growing due to increasing demand from retailers, higher disposable incomes and opening up of FDI in Retail. The capital appreciation in this sector is close to 20-35% p.a. However, the risks associated with this sector are higher as retailers are prone to cyclical changes typical of a business cycle. Changing consumer behavior combined with increasing disposable incomes will ensure further growth of the retail sector in India.

In the present day scenario, if there is any powerful investment tool that brings burgeoning financial returns, it is INDIAN REAL ESTATE!!! Investors should consider the parameters minutely and meticulously to find out why investing in Indian real estate now is the best viable option.

Foreign direct investment (FDI) has become an integral part of national development strategies for almost all the countries globally. Its global popularity and positive output in augmenting of domestic capital, productivity and employment; has made it an indispensable tool for initiating economic growth for nations.
India is evolving as one of the ‘most favored destination’ for FDI in Asia and the Pacific (APAC). It has displaced US as the second-most favored destination for foreign direct investment (FDI) in the world after China according to an AT Kearney's FDI Confidence Index. India attracted more than three times foreign investment at US$ 7.96 billion during the first half of 2005-06 fiscal, as against US$ 2.38 billion during the corresponding period of 2004-05.

FDI in India has contributed effectively to the overall growth of the economy in the recent times. FDI inflow has an impact on India's transfer of new technology and innovative ideas; improving infrastructure, a competitive business environment.

FDI policy

FDI up to 100% is allowed under the automatic route in all activities/sectors except the following which will require approval of the Government :
Activities/items that require an Industrial Licence;
Proposals in which the foreign collaborator has a previous/existing venture/tie up in India in the same or allied field
All proposals relating to acquisition of shares in an existing Indian company by a foreign/NRI investor.
All proposals falling outside notified sectoral policy/caps or under sectors in which FDI is not permitted.
An ongoing review of the FDI policy is carried out so as to initiate more liberalization. Change in sectoral policy/sectoral equity cap is notified from time to time through Press Notes. This is done by the Secretariat for Industrial Assistance (SIA) in the Department of Industrial Policy & Promotion. Policy announcement by SIA are subsequently notified by RBI under FEMA.

FDI Policy permits FDI up to 100 % from foreign/NRI investor without prior approval in most of the sectors including the services sector under automatic route.
FDI in sectors/activities under automatic route does not require any prior approval either by the Government or the RBI.
The investors are required to notify the Regional office concerned of RBI of receipt of inward remittances within 30 days of such receipt. They will have to file the required documents with that office within 30 days after issue of shares to foreign investors.
Automatic Route
Areas/sectors/activities till now not open to FDI/NRI investment shall continue to be so unless otherwise decided and notified by Government. An investor can make an application for prior Government approval even when the proposed activity is under the automatic route.

Procedure for obtaining Government approval- FIPB
The Foreign Investment Promotion Board (FIPB) considers approving all proposals for foreign investment, which requires Government approval. The FIPB also grants composite approvals involving foreign investment/foreign technical collaboration.

Other than NRI Investments and 100% EOU, applications seeking approval for FDI in form FC-IL, should be submitted to the Department of Economic Affairs (DEA), Ministry of Finance.

FDI from NRI & for 100% EOU
Applications for FDI with NRI Investments and 100% EOU should be submitted to the Public Relation & Complaint (PR&C) Section of Secretariat of Industrial Assistance (SIA), Department of Industrial Policy & Promotion.

Proposals requiring Government’s approval
Application for proposals requiring prior Government's approval should be submitted to FIPB in FC-IL form. Plain paper applications carrying all relevant details are also accepted. No fee is payable.

All the proposals submitted to FIPB seeking FDI approval should include the following information:

Whether the applicant has had or has any previous/existing financial/ technical collaboration or trade mark agreement in India in the same or allied field for which approval has been sought;
If an applicant has any approved proposal earlier, details thereof and the justification for proposing the new venture/ technical collaboration (including trademarks) has to be submitted.
Applications can also be submitted with Indian Missions abroad who will forward them to the Department of Economic Affairs (DEA) for further processing.
Foreign investment proposals received in the DEA are placed before the Foreign Investment Promotion Board (FIPB) within 15 days of receipt.
The decision of the Government in all cases is usually conveyed by the DEA within 30 days of submission of the FDI proposal.

Liberalization of FDI
Beside 100 percent relaxation of FDI in real estate, the government policies on FDI also offer opportunities for foreign investors to invest in different sectors. This includes 100 percent in power trading, processing, development of new airports, laying of natural gas pipelines, petroleum infrastructure and warehousing of coffee and rubber. Limit for telecoms services firms have been raised from 49 per cent to 74 per cent.

Another cap to the retailing industry in India is allowing 51% FDI in single brand outlet. The government is now set to initiate a second wave of reforms in the segment by liberalizing investment norms further. And this has also brought about a conspicuous interest by towards investments in the Indian hospitality sector. Industry reports suggest the inflow of about US$ 500 million into the real estate sector over the past six months and is expected to rise to a massive $ seven to eight billion over the next 18-30 months.

Most Preferred Cities for Investment

Delhi and NCR
Delhi and NCR with the happening and investment hub cities of Gurgaon and Noida are the hot markets for real estate in India. This is due to the good infrastructure and quality of life provided in the city and remains the basic cause for the large scale investments in the IT, ITES and the BPO sector in this region.

Delhi’s residential real estate market is driven more by investors rather than by end-users. The overheated markets like Delhi and NCR had as much as 100 percent escalation in property prices but now there are already corrections happening in the market. The overheated property market in Delhi which witnessed over 100 percent escalation in prices, still continue to rock as a hot destination for real estate investment.

Delhi has been losing steadily to its suburban counterparts in office market share primarily due to poor quality of buildings and high real estate cost in the CBD. The residential property is going to witness increase in prices on the strength of high-end housing. Even the rentals in CBD are expected to go up with Delhi Metro becoming operational in that area this year.

Noida with well-defined master plan, good connectivity to Delhi and impressive infrastructure is fast turning into an investor’s paradise both in the residential and commercial sector. Moreover, the government’s initiative to invite investments has transformed Noida into an IT hub of the country.
Gurgaon on the other hand apart from being the corporate addresses of many MNCs is fast turning into a city to hunt for luxury homes. And with job opportunities flourishing and burgeoning disposable incomes, the cities in India are experiencing a shift towards premium living.

Mumbai
Mumbai continues to reign as the commercial and financial capital of India, the real estate prices in the city are at an all time high. A survey reveals that an office space in Mumbai is more expensive than Manhattan; ranking it as the world’s 15th most expensive city. There has been a lot of real estate investments in the retail and residential sectors in Mumbai and the growth of the IT and ITES sector is reflected in the real estate boom in the satellite city of Navi Mumbai.

Pune
Pune which has emerged as the IT, research and academic destination of India apart from being a major industrial belt is seen as a winner in terms of real estate investments.

IT and retail are key drivers of real estate in Pune that is witnessing its transition from a sedate industrial destination to a vibrant corporate city. With a wide range of population and service sectors to cater to and its close proximity to Mumbai has made Pune a hot destination for real estate investors.

Also the IT revolution in Pune has made it home to all major IT companies, both Indians and multinationals, making it today one of the most preferred IT /ITES and BPO investment destination in India. IT and ITES boom has given a big fillip to commercial space with demand touching 1.2msf annually.

Pune has witnessed frantic activity in the residential sector. To make most of this opportunity, several Pune developers like Kumar, Magarpatta Panchsheel, Kolte, Embassy etc have joined the race to develop township projects. The Magarpatta project is spread over 400 acres with IT, residential and retail developments.

Kolkata
Kolkata is another emerging city in the real estate investors list. Apart from offering lucrative business plans for investors in IT and retail sector, Kolkata is becoming one of the hottest cities for real estate investors as the city is witnessing resurgence in its economy after years of stagnation; into being the business destination of India.

Much of the credit for Kolkata’s emerging as the investment destination goes to the West Bengal government, which is promoting knowledge industry in a big way.

The IT boom in Kolkata is clearly evident from the huge investments by IT companies to set up their base in the city.

The 10,000 hectare Rajarhat is emerging as the next hot destination for the IT and ITES. More IT parks are also growing up in Kolkata with Ascendas, DLF, Videocon-Salarpuria, Bengal Intelligent Park, Technopolis, Infinity Benchmark, Infinity Waterside, Millennium and The Hub together set to create over 37 million square feet of space in Rajarhat and Sector V.

Hyderabad
Hyderabad once famous as the city of pearls, Hyderabad is today known for it’s IT and IT Enabled Services, Business Process Outsourcing (BPO) firms Pharmaceuticals, Biotechnology and Entertainment industries. The city harboring a number of IT Parks have established themselves as the IT hub of India.

Hyderabad is a major center for pharmaceuticals with companies such as Dr. Reddy's Laboratories and is fast developing into a centre of biotechnology sector in India. Genome Valley and Nanotechnology Park are some of the upcoming projects. This sector is surely going to spur up the economy of the city with more companies willing to set up its operations in the coming years.

But as of now, IT and ITES sector attract the maximum investors to Hyderabad. Several MNCs have opened their base in Hyderabad and both Indian and global companies are changing from smaller operation to big operations. A few names among them are: Motorola, Google, Dell, Deloitte, Microsoft R&D India Pvt. Ltd., Wipro Technologies Ltd, Tata Consultancy services and Infosys Technologies Limited.

Bangalore
Bangalore over the years has transformed itself from being a ‘Pensioner’s Paradise’ to the ‘Silicon Valley’ of India. It is recently evolving into a R&D destination attracting real estate investors to cash on into the demand for residential and commercial properties in the cities. Riding high on the IT boom, Bangalore is maintaining its position as a prime destination for property investments.

The booming IT sector which is responsible for the real estate growth in the city has also collaborated to making it one of Asia’s fastest growing cities with annual growth rate of 3.5 percent. The city also accounts for more than 35 percent of the software exports of our country with largest number of software companies; which is the main driver of commercial property in Bangalore.

Chennai
Chennai, the automobile capital of India has also developed into an IT and ITES hub in the recent years; mobilizing the real estate investors to take note of it as a promising destination of the future. The IT & ITES boom coupled with expats choosing Chennai as their operational bases has given a real boost to the real estate. The commercial real estate has been on the upswing as IT companies were the prime occupants of commercial spaces.

Areas with proximity to the IT/ITES hubs have emerged as localities with major demand for residential development in Velachery, Madipakkam and Tambaram to name a few. Prices have been significantly going up in southern Chennai because of its proximity to IT/ITES nerve centre and as the preferred locality of the expats.

Localities like Alwarpet, Boat Club, and Poes Garden have come up as upmarket residential areas. On the other hand, places such as Velachery, Mogappiar and Thiruvanmixur are the favourite spots for budget apartments.


People's Democracy
(Weekly Organ of the Communist Party of India (Marxist)

--------------------------------------------------------------------------------
Vol. XXIX
No. 24

June 12, 2005


No To FDI in Retail! No To Wal-Mart!



Swadesh Dev Roye



THE ceaseless craze of ardent advocates of the Fund-Bank prescribed imperialist globalisation for foreign direct investment (FDI) has constantly been heightening, not less so under the changed political regime in the country. At the same time, while clearly opposing unconditional open access to FDI, the Left political forces have been consistent in their resolute demand that latest developed technology and technical know-how as well as green-field manufacturing ventures ensuring generation of employment must be the pre-conditions with FDI.



FDI IN THE RETAIL SECTOR



While speaking on the occasion of the mid-term appraisal of the tenth five year plan of his government, prime minister Dr Manmohan Singh had announced that his government was considering permitting FDI in retail sector ostensibly to attain the target of employment generation! However, one may better look under a magnifying glass certain facts pertaining to the period prior to his statement and also the subsequent developments.



By now it is widely known that the US retail giant Wal-Mart has been demonstrating an extraordinary eagerness to open a retail chain throughout India. However, prior to its entry into the Indian market, the company has done everything possible to see that the government of India gets inclined to liberalise the retail sector for FDI. The retail MNC has been using all power at its disposal to accomplish their mission. As the Business World says, “The world’s largest company, Wal-Mart, is leaving no stones unturned to lobby for its entry into India.”



Wal-Mart president John B Menzzer visited India in the second week of May this year. To prepare the ground for Menzzer’s visit, according to a media report, David Mulford, US ambassador to India, met the prime minister, finance minister and commerce minister. Thus, even before the Wal-Mart president’s arrival here, the government had publicised its their intent to liberalise the retail sector for FDI.



The purpose and outcome of the visit is clear from a report published by The Financial Times (London). It said: “Prime minister Dr Manmohan Singh said the country would soon allow foreign direct investment in an industry still dominated by small family owned businesses.” The newspaper also quoted the prime minister: “There are many fears, particularly among small traders and small shopkeepers, but I believe we can soon move forward.” Based on the statement of a bureaucrat, the paper said “the cabinet might lift the foreign direct investment ban before Mr Singh (the prime minister) flies to the US for as meeting with President George W Bush in July.”



In the meantime, the confident Wal-Mart chain has swung into action to rope in an Indian partner. Obviously, it has to be from among the big business houses of the country. Silent competition is sweeping the country. The names of the business houses doing the round, as one gleans from the press, are Anil Ambani, Mahindra group, Godrej etc. Such developments only testify as to how swiftly but silently things are moving.



WAL-MART’S PROFILE



The Wal-Mart made its debut as a “tiny variety store” in Arkansas, a small town in the southern US in 1962. However, it is rather intriguing to note that within a surprisingly brief period the company has amassed so much fortune that today it is at No. 1 among the Fortune 500 companies in the world. It is the top retail chain in the world and even bigger than the giant MNCs like ExxonMobil, General Motors and General Electric. The sky-high profit lust of the company can be imagined from a report that, in Canada, Wal-Mart “earns three times as much revenue per square foot of store space as Zellers Inc, its nearest competitor.”



The huge multinational retail chain operates in more than a dozen countries and has around 5000 retail outlets throughout the world. Worldwide, more than 138 million customers visit Wal-Mart stores per week. The monstrous monopoly stature of the company within the United States itself has been narrated thus: “It is America’s largest employer with nearly 1.5 million workers… The company accounts for 9 cents of every US retail dollar and sells around 20 per cent of the nation’s groceries and pharmaceuticals. Last year 82 per cent of American households bought at least one item at a Wal-Mart” (Times News Network). The experience with Wal-Mart in Canada is that “since entering the country 11 years ago by buying the failing Woolco chain, Wal-Mart Stores Inc now takes 52 per cent of the retail market share in Canada.”



FEROCIOUS ANTI-TU CHARACTER



“Wal-Mart has built up an expertise, like a labour relations team, whose entire job is to frustrate registration of trade union and employ terror with employees not to join trade union.” The “skill” of blocking the formation of trade unions or busting them has been part of a crude training curriculum for the company’s managers. In the company’s parlance it has been codified as “a manager’s toolbox to remaining union free.”



Thus there is totally prohibition on the formation of a trade union in Wal-Mart stores --- in the land of Yankee imperialists who are the biggest drumbeaters of democracy these days. There exists not a single trade union for about 1.5 million workers in 3,600 stores. This avowed onslaught of Wal-Mart on the trade union movement has been focused in a report published in The Washington Post Foreign Services. It says: “The world’s largest retail chain has fiercely and successfully resisted unionisation attempts at its 3,600 stores in the United States.” The report then adds: “The Food and Commercial Workers is mounting a fresh campaign to organise Wal-Mart workers in the United States, a push, it says, has been given impetus by recent legal action and a former company vice president’s confession that he surreptitiously organised anti-union activities.”



How the government of a country feels forced to succumb to the diktat of powerful foreign multinational companies is demonstrated by Wal-Mart in Canada. At the instance of the company, Canada amended its labour law to deny trade union right to workers. Often referred to in Canada as “the Wal-Mart amendment,” these changes imposed severe restrictions on registration of trade unions and drastically stripped the registrar of trade unions of its authority. It has been written about Wal-Mart’s former vice president Tom Coughlin that “on behalf of Wal-Mart, he used company funds for undercover union busting operations and for paying informers who report on pro-union workers.”



In a letter dated May 19, 2005 and addressed to the premier of Ontario, Toronto, president of the National Union of Public and General Employees (NUPGE) has raised, inter alia, two very shocking questions: (a) “Wal-Mart’s ability to influence the rewriting of Ontario’s labour laws to suit themselves is an affront to all Canadians.” (b) “But what is in question, and what all citizens of Ontario have the right to know, is whether there is a connection between Wal-Mart, the former premier’s office and the change in the Ontario Labour Relations Act to make it easier for Wal-Mart to engage in the wholesale denial of workers rights.”



BUSINESS STRATEGY



Obviously, a “trade union free company” is the cornerstone of Wal-Mart’s business strategy. Such an unethical and inhuman labour exploiting policy has contributed most in pushing it to the position of top retail chain in the world and No.1 among the Fortune 500 companies.


Extreme cost cutting is the tool for grabbing customers in the shortest possible time wherever the chain opens an outlet. “Cut costs (read: wages of labour) to the bone and keep cutting, so you can offer the competitive prices.” Take, for instance, the Canadian experience. There the Wal-Mart paid to its workers 6.20 US dollars per hour against the “union wages of 21 to 35 US dollars an hour found in the paper and aluminium plants.” The consequence: “In an area built on union jobs with higher wage scales, it wasn’t long before some employees tried to organise.” Soon 51 per cent workers of the said retail outlet of Wal-Mart signed the union cards and the authorities declared the legal existence of the union in that store.



But how could Wal-Mart tolerate a trade union! It campaigned that the store is incurring losses and ultimately closed it down, throwing the workers on the street. The media reported: “…the chain sacrificed the store to make a point to its employees across Canada and the United States, where union organisers are involved in dozens of organising drives and court battles.”



The US House of Representatives committee on ‘Education and the Workforces’ published in 2004 a review report on Wal-Mart’s labour practices, and some of its observations are shocking. It said: “Wal-Mart’s record on the right to organise recently achieved international notoriety…Wal-Mart’s labour law violations range from illegally firing workers who attempt to organise a union to unlawful surveillance, threats and intimidation of employees who dare to speak out.”



In its concluding chapter, the report noted: “Wal-Mart’s success has meant downward pressures on wages and benefits, rampant violations of basic workers’ rights and threats to the standard of living in communities across the country. The success of a business need not come at the expense of workers and their families. Such short-sighted profit-making strategies ultimately undermine our economy.”



THE MOOT POINT



The moot point is that FDI in the retail sector shall only harm and not help the economic interests of the country. There cannot be any justification of allowing FDI in retail business in our country. It is a matter of serious concern that Dr Manmohan Singh’s government finds merit in it and gives priority to the entry of Wal-Mart over everything else that concerns the interest of the country and the people. The UPA seems to have forgotten the message of the last general elections --- that rural India needs crash priority attention of the government.



Retail markets in our country are dominated by small businesses whom the entry of Wal-Mart and the like can only bulldoze. The vast number of retail shops run by self-employed small owners shall perish, jeopardising the life and livelihood of crores of people connected with retails business.



That is why the liberalisation for FDI and entry of Wal-Mart and the like in our retail sector has to be stopped. For, such a suicidal step will not only be the beginning of another imperialist onslaught against our economic sovereignty; our political sovereignty too may come under the evil influence of this notorious US multinational.



The Canadian experience noted above and the ongoing struggle against anti-worker changes in labour laws must be enough for our working class movement to come forward to stop the government from allowing FDI in our retail sector.

Venezuela tax agency closes McDonald's temporarily

By Ian James
The Associated Press
October 10, 2008

Caracas, Venezuela - The Venezuelan government has ordered nearly all
McDonald's restaurants in the country closed for 48 hours for what it calls
irregularities in the fast-food chain's financial books.

The tax agency said it ordered more than 100 McDonald's restaurants
temporarily shut on Thursday. Agency head Jose David Cabello announced on
state television that "inconsistencies" were found in sales and purchases
books, as well as in taxes collected. The restaurants will be allowed to
reopen on Saturday.

Of the 132 McDonald's restaurants in Venezuela, 118 were closed, including
all 80 of the outlets run by Caracas-based franchisee Alimentos Arcos
Dorados de Venezuela CA, spokesman Rolando Chavez told The Associated Press
on Friday.

Arcos Dorados - "golden arches" in Spanish - said it has obeyed Venezuelan
laws and regulations and is abiding by the sanctions. It said the order
stemmed from "formal issues affecting purchasing and sales records."

Under President Hugo Chavez, the tax agency has carried out inspections of
companies and frequently punished those it says aren't complying with rules.
Both domestic and foreign businesses are regularly affected.

The agency took a similar action against McDonald's three years ago,
ordering a three-day closing of 80 restaurants as a penalty for allegedly
failing to follow tax rules. Last year, the Venezuelan subsidiary of
Coca-Cola Co. also was shut down for 48 hours, and last month, the offices
of Pepsi were ordered shut for the same period.

Chavez's supporters often accuse U.S. companies of exploiting Venezuelan
workers and have called for boycotts in the past against the likes of
Coca-Cola, McDonald's and Nike.

But analyst Pedro Palma of the Venezuelan economic consulting firm
MetroEconomica said the closing of the Oak Brook, Illinois-based McDonald's
shouldn't be interpreted as an attempt to pick on U.S. companies.

"They've closed many Venezuelan businesses also," Palma said, noting that
tax inspectors often take such measures for even minuscule record-keeping
lapses.

Despite political tensions between Chavez and Washington, Venezuela is a
major importer of U.S. goods. Trade between the two countries grew to more
than US$50 billion last year, much of that in Venezuelan oil sales.

Three businesses that operate McDonald's restaurants were fined some US$535
each, tax agency chief Cabello said, according to the state-run Bolivarian
News Agency.

Arcos Dorados says it is the largest fast-food restaurant manager in Latin
America, with more than 1,700 locales in 18 countries.

Cabello said two other franchisees, Alimentos Nasif CA and Compania
Operativa de Alimentos-Corp CA, were affected by the shutdown, the state
news agency reported.

Copyright © 2008 The Associated Press. All rights reserved







Who committed the real violence at Graziano Transmissioni?
Who committed the real violence at Graziano Transmissioni? - Kavita Krishnan
Graziano Workers Solidarity Forum formed

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Farmers defeat first referendum on an SEZ in India, in Raigad, Maharashtra
Farmers in Raigad district have defeated Reliance Industries SEZ referendum that the government had organized to know people’s impression about the Reliance Industries’ mega SEZ. The defeat of referendum means that the Special Economic Zone may not come up at the site where it was originally planned. The yet to be launched SEZ was being described as mother of all SEZ that have come up so far in India.

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The sinister ways of Chhattisgarh police: updates on Dr. Binayak Sen’s trial
Questions on Dr. Sen’s trial - PUCL update, September 15, 2008
Events of the third phase of Binayak Sen’s trial and incidents preceeding Ajay TG’s bail - By Kavita Srivastva, Secretary, National PUCL
Dr. Sen’s trial observation - By Abhay Shukla, NHRC

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Supreme Court tells Chhattisgarh government to implement NHRC recommendations on Salwa Judum
Salwa judum ‘atrocities’: Apex court seeks report
Anti-Naxal Salwa Judum faces axe over rights abuse
Implement NHRC recommendations on Salwa Judum, Supreme Court asks Chhattisgarh government

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Recommendations for a new POTA
If the government agrees to have tough a anti-terror law as recommended by the Administrative Reforms Commission (ARC), Naxalites will also be treated as “terrorists” as the panel has termed them nothing but those who follow “ideology-oriented terrorism” — a departure from the official line which has so far preferred to call them “Left-wing extremists”.

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Singur replay threat in Katwa
Durgapur, Sept. 9 2008: Farmers protesting land acquisition plans for a power plant in Katwa today warned of a backlash like the ones in Singur and Nandigram if the government resorted to forcible takeovers. The Krishi Jomi Krishak Khetmajur Raksha Committee, which is leading the protests, held a meeting this morning in Katwa, 180km from Calcutta, and iterated its stand against forced acquisitions.

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Jindal converts proposed Salboni plant in West Bengal to SEZ status
August 31, 2008

This is very recent news, and not very widely known yet. The Jindal group, which is planning to set up a mega steel plant in Salboni in West Bengal, had applied for SEZ status for their plant in September 2007. The SEZ status was granted by the government of West Bengal on August 28, 2008. This might become a new, and disturbing pattern, as every industry which will be planned to be established will apply for SEZ status, with the accompanying suspension of labour laws, huge tax rebates etc. Things are moving fast, and quietly. The SEZ-Birodhi Prachar Mancha, a SEZ watchdog and awareness forum in Kolkata, is also going to move against this. - Partho Sarathi Roy, Sanhati

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Uranium Corporation of India’s track record: 4 leakages in Jadugoda in last 20 months
On 16th August, 2008, pipes carrying uranium tailings in Jadugoda (Jharkhand) burst again, spewing the village of Dungridih in Jadugoda with radioactive waste for the third time since Dec 2006. Records obtained from UCIL (Uranium Corporation of India Ltd, which owns and operates the mines and operations in Jadugoda) through RTI filings reveal that there have been three previous tailing pipe leakages in recent months, where radioactive material was released into the environment- - on 24th December 2006, 10th April 2007, and 22nd February 2008. In an additional incident in July this year, excessive rains caused the tailing ponds to overflow and contaminate the village ponds and canals.

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Violence in Chengara, police complicity, and the CPIM
The wretched of the earth are standing up in Kerala and re-defining the politics of agitation. Their young middle class supporters are rewriting the grammar of protest. All this has stumped the political establishment, of which the traditional Left is now the dominant element. It all started when CK Janu marched into Thiruvananthapuram with hundreds of her tribal followers in 2001 demanding restoration of their alienated forest lands. Breaking with the tradition of staging rallies or holding meetings, they erected makeshift hutments in front of the State Secretariat and camped there.

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Statement by Dave Pugh on his detention during his Fact-Finding Trip to India
by Dave Pugh August 16, 2008

Yesterday I returned to the U.S. after spending three and a half weeks gathering information about the anti-displacement movement in India. I traveled across five states in central and eastern India to the sites of projected industrial and mining projects and real estate developments. I spoke with hundreds of villagers who are threatened with displacement and with many dedicated activists who are helping to organize the people’s resistance.

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Land acquisition protests: five farmers shot in Noida, Uttar Pradesh
Greater Noida, Aug 13, 2008

Five people were killed Wednesday in firing by police on farmers protesting inadequate compensation for their land being acquired in Uttar Pradesh’s booming Greater Noida region bordering the national capital.

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Protima Das, Pradeep, and David Pugh detained in Orissa on Maoist charge
Visthapan Virodhi Jan Vikas Andolan Press Statement, 12 August 2008

The Orissa police detained Mr. David Pugh, a teacher from US on 12th August along with advocate Miss Protima Das and an anti-displacement activist Mr.Pradeep who accompanied him assisting in translation and showing the area in Kalinganagar and Sukinda on their way back to Bhubaneswar.

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What is the state of workers in the new industrial zones of Tamil Nadu?
This conversation with a worker from Tamil Nadu, appeared in Shramik Istahar, May 2008. It has been translated by Koel Das, Sanhati.

I was conversing with Sudhakarda. Sudhakar Raut, originally from Orissa, used to work in a reputed private engineering factory in West Bengal. He lost his job after being victimized in a lock-out while fighting against the injustice of the factory owner. I met him a couple of days back when he talked about his experiences over the last one year.

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Flashpoint Chengara - landless Dalits, the Left Democratic Front, and terror
A historic land struggle has been unfolding at Chengara in Pathanamthitta district, Kerala, involving about 7500 families, which includes all sections of landless people, the majority of them being Dalits and Adivasis. Landless people have claimed land in the Chengara estate, a rubber plantation, which had been leased to the Harrison Malayalam Plantation by the government of Kerala. At present, the lease is invalid and the property has lapsed back to the government. The landless people who have flocked there from all parts of Kerala demand that this government land be redistributed to them. These marginalised people have thereby demanded a say in what must be done with government land in Kerala: given the present political and economic climate, the likelihood is that this land will be taken over by the state only to be assigned unconditionally, or with minimum conditions, to the multi-nationals.

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Ajay TG granted bail, plans to make film on political prisoners
August 5, 2008.

1. Release News
2. Ajay’s future plans - prison diaries of a suspected Naxal

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The Bhopal struggle: Historic statement by the Minister of Chemicals and Fertilizers
August 8, 2008

The Government of India has announced that it will take legal action on the civil and criminal liabilities of Union Carbide and Dow Chemical for the ongoing disaster in Bhopal, India. This landmark announcement comes after over 5 months of campaigning by Bhopal survivors and their international supporters, which included a 500-mile march and a 130 day sit-in on the streets of Delhi by survivors of the 1984 Bhopal Gas Disaster.

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Supreme Court okays Vedanta and POSCO projects in Orissa
August 11, 2008: India’s Supreme Court has said two huge and controversial mining projects can proceed in the eastern state of Orissa. Dongria Kondh tribespeople say their livelihood will be destroyed. A BBC report.

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The role of NRI lobbies: from the nuclear deal to Dow Chemicals to Nandigram
Powerful NRI lobbies in the U.S.A. such as the US-India Business Council (USIBC), US-India Friendship Council, Indian American Forum For Political Education, the US-India Political Action Committee, Coalition for Partnership with India and others have consistently pushed for the US-India nuclear deal, the chemical hub at Nandigram, and deals with Dow Chemicals.

1. USIBC pledges support for securing nuclear deal - July 23, 2008
2. US-India Friendship Council: ‘Finally, Congress party showed some spine’ - July 12, 2008
3. USIBC: Nandigram Investment Plans on track despite violence
4. NRI groups, Dow Chemicals, and the Bengal government - read RTI documents: Questions and Response from government.

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Death in the afternoon: the murder of NAPM Karnatka convenor A.D.Babu and other rights activists
The Karnataka convener of the National Alliance for People’s Movement, A.D. Babu, was killed recently. He was on his way, along with two colleagues, to a NAPM meeting on an anti-liquor campaign at Ramnagaram, when a group stopped his vehicle at Mayanagram, a few km from the venue, and attacked him with knives and swords. He died on the spot. It is believed that a Karnataka liquor mafia is behind the gruesome murder.

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Human Rights Organization Masum under attack for coordinating People’s Tribunal on Torture
June 12, 2008

Manabadhikar Suraksha Mancha (MASUM) had organised a People’s Tribunal on Torture (PTT) on 9-10 June. The police have started a case against MASUM claiming the tribunal to be illegal. On June 12 a huge police force raided MASUM’s office (26 Guitendal Lane, Howrah 711101). To protest against this, a meeting has been planned at MASUM’s office, today, on 13 June at 4pm. Please come and send this news to all.

Detailed report on incident from The Observatory for the Protection of Human Rights Defenders.

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People strike back at CPIM’s neoliberal policies: Tremor after tremor at the Panchayat Elections
Panchayat Elections 2008 Final Tally:
Panchayat Samiti: Total - 329. LF - 189, Opposition - 131, No Result - 9.
Gram Panchayat: Total - 3220. LF - 1585, Opposition - 1498, No Result - 137.
Brutalized Singur and Nandigram vote out CPIM’s anti-people policies

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Nandigram from May 5-11, 2008 - APDR report
Factsheet on incidents regarding Nandigram from May 5 to 11, 2008 - APDR report
Government vs. CRPF: Lakshman Seth and his arm-twisting - May 12, 2008

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Nandigram on the eve of the Panchayet Elections - A MASUM report
May 10, 2008. Click here for a cartoon of today’s Nandigram!

On getting information of the continuing disturbances and police inaction in Nandigram, our fact finding team reached violence-torn Nandigram today and has gathered shocking information from the villagers. Since last night musclemen and goons alleged to be supporters of the largest ruling party CPI(M) flaunting red flags resorted to bloody violence in the area. These miscreants snatched away voter identity cards of many villagers and beat them mercilessly even on the mere suspicion of not being supporters of the ruling party.

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Mahamichhil for Nandigram and reflections on the people’s movement
Kolkata witnessed another Mahamichhil on May 9, 2008. To (a) protest against the reign of terror unleashed by the CPI(M) on the eve of the panchayat elections, aimed at cowing down voters all over the state, and (b) especially to condemn the atrocities being perpetrated by CPI(M) workers in collusion with the state police in Nandigram.

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Who is Ajay TG? Political arrests and the tightening noose
Update May 12, 2008: PUDR condemnation statement, Petition of solidarity

The People’s Union for Civil Liberties (PUCL) strongly condemns the arrest of Ajay TG, widely recognized film maker, journalist and human rights activist by the Chhattisgarh police in Raipur on 4 May 2008 and calls for his immediate release.

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No choice for forgotten Santhals in Bengal
By Shyam Sundar Roy

About 500 voters, belonging to over 160 Santhal families living under Shiromoni gram panchayat in Midnapore Sadar block, do not know which party to vote for in the ensuing panchayat elections, as they say none of them are ready to help them.

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My Name is Radharani Ari and This is How My Consciousness Was Raised.
Honourable Chief Minister, I am the same Radharani Ari of Nandigram. How many more times will your cadres rape me?

Yes, I am the same person. The same Radharani Ari, resident of Nandigram Block, village – Gokulpur. Whether or not you remember me, I am not too sure, although by now the entire state of West Bengal has heard about me. I did not catch the limelight due to some creditable act of mine but on account of my misfortunes. I am a housewife of, by now infamous, Nandigram.

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Sibpur BESU - Coercion to join the SFI - Terror and the administration-police-criminal nexus
The political landscape in colleges across West Bengal is barren - the SFI wins mainly uncontested almost everywhere, through an intricate mechanism of nepotism, selection and campus terror.

The students of Sibpur BESU are facing an assault of the college administration- local goons-police. The Vice-chancellor Nikhil Ranjan Banerjea is orchestrating the assault, the aim of which is to terrorize students into joining or supporting the students’ wing of the major ruling party. It is not an accident that all those who are being arrested by the police are distinguished by their non-allegiance to this students’ organisation.

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Implementation of Forest Rights Act in Bengal - Questions on the process
The Government of West Bengal has begun the implementation of the Forest Rights Act with great delay and reluctance. It is clear that a process of sabotage is going on in the implementation, and this requires constant vigilance and protest. Following are two documents - (1) a press release from the North Bengal Regional Committee of the National Forum of Forest People and Forest Workers (NFFPFW), raising questions of legality of a recently issued order (number 1220/PN/O/I/1A-2/07, dated March 17, 2008) and (2) Letter to the chief secretary to the Government of West Bengal from Nagarik Mancha on the issue, March 27, 2008.

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Citizens’ Report on Nandigram with specific stress on gender violence
As a result of an initiative by women’s groups, organizations and individuals, an 11-member team of citizens from Kolkata comprising teachers, social activists, researchers and students visited Nandigram on November 24, 2007. Concerned about the repeated disruption of peace in the region, the team decided to go to the affected areas and talk to the local people with the objectives of expressing solidarity with the survivors of violence, documenting people’s needs in the current circumstances, and drawing up recommendations. One of the chief aims was also to investigate the nature and range of sexual violence and its use as a political weapon, towards pre-empting further such occurrences of violence against women.

Click here to read Independent Citizens’ Report on Nandigram [.doc, English 330KB] »

Nude mentally challenged patients - Bengal’s public healthcare at a time of private bonanza
It has been argued that big capital investment in West Bengal “creates a wonderful opportunity to make much larger investments in public education, healthcare, public transport, environmental protection, and other public goods.” (Amartya Sen). On the other hand, the argument has been made that a government with a neo-liberal mindset does not care about people who, because of their purchasing power, are outside the market. If the government has money, it will make malls and flyovers, at the cost of public health. The problem is not one of intention but definition.

The situation in a state mental hospital, a mere 6 km from the seat of government at Writers Building in Kolkata, displays the typically dysfunctional nature of public healthcare, amidst all the rhetoric of development.

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Dankuni - Resistance to Massive Land Acquisition for Real Estate
The “development” process in West Bengal is taking place in a two stage mechanism - conversion of agricultural land into industrial land, and conversion of industrial land into real estate. Land acquisition in Dankuni clearly demonstrates how the aim of the “development” process is really the extraction of maximum profits by private enities from resources, in this case, land. Real estate provides the maximum profit, therefore functioning factories in Dankuni are being shut down to acquire land for a housing project by the powerful DLF group.

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Agro-Science Fair in Bolagarh, West Bengal
The ‘Agricultural Science Fair 2008’ was organized by Bolagarh Gana-Bijnan Samiti on 25-26 January, 2008 at the Jeerat Colony High School in the Hooghly district of West Bengal, India. Extensive discussions and programs were carried out on the role of multinationals like Monsanto in promoting genetically modified seeds, pesticides, and fertilizers. Alternative bio-friendly methods of agriculture were discussed.

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Anti-POSCO rally and program in Kolkata
February 13, 2008. Kolkata: A rally from College Square to Utkal Bhavan (an office of the Orissa govornment) took place and was followed by a mass-deputation in Utkal Bhavan against the proposed POSCO project in Jagatsingpur district, Orissa. The program was organised by 18 organizations. After a demonstration in front of Utkal Bhavan the protesters conveyed their solidarity to the POSCO movement in the form of a memorandum to the government of Orissa. The authorities at Utkal Bhavan received the memorandum on behalf of the government of Orissa. Afterwards, anti-POSCO activists including Biswajit Roy shared their experiences with political organisations and human rights activists at the Indian Radical Humanist Associations Hall in a discussion called Posco Ebong Tar Protirodh. Activists involved in the protest movement against illegal and extensive stone quarrying in Asansol and Birbhum were also present to express their solidarity to the people of Orissa and speak about the conditions in the regions where they work.

The 18 organisations which organised the program were: APDR, Chhatra-Chhatri Sanhati Mancha, Little Magazine Samannay Mancha, Lok Seba Sangh, Nandigram Ganahatya Birodhi Prochar Udyog, Sahanagarikder Jukta Mancha, Hawker Sangram Committee, TASAM, USDF, NAPM, Sanhati Udyog, PaschimBanga Khetmazoor Samiti, Ganamukti Parishad, Janasangharsha Samiti, West Bengal Gandhi Peace Foundation, Bondi Mukti Committee, West Bengal Government Employees Union, and National Fishworkers Federation.

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Malnutrition death in Singur and the Nano-flyover syndrome
1. February 10, 2008 : Kalipada Majhi, a sharecropper rendered jobless in Singur after land acquisition, died from malnutrition.
2. In an article called The Nano-flyover Syndrome, Sunita Narain examines what subsidises the cheap Nano, and who actually pays.

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Burma’s Freedom Fighters: From Port Blair to a Kolkata Jail
February 4th, 2008, marks the tenth anniversary of the illegal detention of 34 Burmese freedom fighters in Bengal. The Solidarity Committee for Burma’s Freedom Fighters, whose members include Ashok Mitra, Lakshmi Sehgal, and others, carried out a Dharna in protest.

Personal accounts of prisoners and press release of the protest are included.

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Protest Rally In Singur Against High Court Verdict
January 22, 2008. A report by Anuradha Talwar, Paschim Banga Khet Majoor Samity

Picture of rally (1) »
Picture of rally (2) »

The High Court dismissed all the petitions against the land acquisition in Singur on 18th January 2008. After waiting for over almost six months to give its verdict (the last date of hearing was 31st July 2008) the High Court dismissed all the 11 public interest cases against forcible land acquisition by the State Government for Tata Motors Company. The Division Bench of the Calcutta High Court comprising the Chief Justice, Mr. S.S. Nijjar, and Mr. Justice P.C. Ghose, by a common order, on 18th January, Friday held that the land acquisition by the State Government at Singur for construction of a small car manufacturing unit by Tata Motors is valid. While dismissing all the public interest litigations challenging land acquisition at Singur, the court held that those petitions are not maintainable.

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Updates on Singur: AIFB wants Tatas to move; Tata’s car an “environmental nightmare”
January 6, 2008: The Forward Bloc demanded that Tata Motors be asked to shift its Singur plant to West Midnapore on a day the CPM patted itself for changing with the times. “The factory can’t be built here, on this fertile land. The government must accept this verdict of the local people, admit its folly and ask the Tatas to shift it to Kalaikunda,’’ Bloc state secretary Ashok Ghosh told a rally near the boundary wall of the car plant site.

January 10, 2008: Chief U.N. climate scientist Rajendra Pachauri, who shared last year’s Nobel Peace Prize, said last month that “I am having nightmares” about the prospect of the low-cost car.

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Forest Rights Act implementation in Bengal - Front allies join protests
A The Telegraph report, January 9, 2008

The RSP and the Forward Bloc have joined NGOs in alleging violation of forest villagers’ rights following a government notification declaring vast swathes of the Sunderbans and the Buxa Tiger Reserve “critical wildlife habitats”. It has, they said, made hundreds of forest villagers vulnerable to the threat of eviction, though the CPM had been championing their cause at the Centre.

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Goa scraps all SEZs, Center says not so fast!
PANAJI: The Goa government on (1/1/2008) decided to scrap all Special Economic Zone (SEZ) projects in its bid to end the long-drawn public agitation which at one stage threatened to jeopardise New Year celebrations.

The Centre on Wednesday questioned the authority of the Goa government to recommend scrapping of notified special economic zones (SEZs). After a meeting of the board of approval (BoA) commerce secretary G.K.Pillai said: “There is no provision under law (for states) to recommend de-notification. They have no locus standi to withdraw the notifications to the SEZs.”

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Press Conference: Recognition of Forest Rights Act and its sabotage - rallies in North Bengal
Nagarik Mancha and NFPFW invite you to a meeting at the Calcutta Press Club on Wednesday 9 January 2008 between 3pm and 5pm to discuss and to develop a strategy for a broader campaign for forest people’s rights.

How long will a Government that talks about people’s rights keep on betraying the interests of more than a crore of forest-dwellers? How long tribals and other forest dwellers will be treated as intruders, thieves and destroyer of national property in their own forests? We solicit your support in this Campaign which seeks to find an answer to these and many other questions.

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Binayak Sen - A mother’s appeal
By Anasuya Sen

I am a woman in my eighties. When we were young, people were inspired by the examples of karmayogis who were patriotic, motivated by ideals of service, wise and virtuous. We considered ourselves blessed if we could follow in their footsteps. I had so far been a silent spectator to the injustice and violence that pervades our free democracy today, but only because I was personally untouched by it. But now, as an aged mother, and outraged by the blows of injustice, I wish to break my silence. Inconsolable in my pain at the age of eighty-one years, I now wish to make a humble appeal to the people of free, democratic India.

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Democracy at Gunpoint - A Report on the Repression of Anti-Posco Movement as of 5th December 2007
This report, and many other resources on Posco, are available from the Environmental Protection Group, Orissa

Contents: (1) Message from Rajendra Sadangi, Convenor, Loka Pakhya (2) Summary of situation (3) Detailed Report: (a) Government of Orissa’s moves (b) Local Administration’s moves (c) Police moves (d) Posco’s moves (e) Situation in Dhinkia (f) Situation in Nuagaon (g) Situation in Gadakujanga (h) Political Responses Against The Govt’s Moves (i) Status of the Movement (j) Overall Situation (k) Demands

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An open letter to The Hindu on its Nandigram coverage
By academics from Harish-Chandra Research Institute Allahabad, Indian Institute of Technology Bombay/Kanpur/Madras, Institute of Mathematical Sciences Chennai, Jawaharlal Nehru University Delhi, Tata Institute of Fundamental Research Mumbai. (A complete list of signatories is given.)

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Nandigram: Our men or their men - nowhere men
An eyewitness report by Sahana Roy, Department of Applied Psychology, University of Calcutta

This eye-witness report is from a team of psychologists who visited Khejuri and Tekhali, where thousands of the CPI(M)’s dispossessed members have supposedly been living for months, hounded and in the direst emergency. It makes the observations that: (1) the team did not see more than around 150 people at any time (2) people complained of poor living conditions (3) children when asked their name replied “Without industry there can be no development” (4) children have been in contact over telephone with their friends on the other side, who “want them to come back” since school is starting (5) according to at least one member of the camp, there is considerable coercion to join anti-BUPC rallies everyday.

Click here to read the report [PDF, Bengali, 47 KB] »

Interim report by womens’ team on Nandigram November violence
30 November 2007

As a result of an initiative instituted by women’s groups, women’s organizations and individuals, an eleven member women’s team of concerned citizens from Kolkata comprising teachers, social activists, researchers and students visited Nandigram, on November 24, 2007. Concerned about the repeated disruption of peace in the region, the members decided to visit the affected areas and talk to the local people, with the objectives of showing solidarity with the survivors of violence, documenting people’s needs in the current circumstances, and drawing up recommendations based on our understanding of the situation.

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Response to Chomsky et al. from Arundhati Roy, Sumit Sarkar, Saroj Giri and others
This report has been published at Kafila

We read with growing dismay the statement signed by Noam Chomsky, Howard Zinn and others advising those opposing the CPI(M)’s pro-capitalist policies in West Bengal not to “split the Left” in the face of American imperialism. We believe that for some of the signatories, their distance from events in India has resulted in their falling prey to a CPI(M) public relations coup and that they may have signed the statement without fully realising the import of it and what it means here in India, not just in Bengal.

We cannot believe that many of the signatories whom we know personally, and whose work we respect, share the values of the CPI(M) - to “share similar values” with the party today is to stand for unbridled capitalist development, nuclear energy at the cost of both ecological concerns and mass displacement of people (the planned nuclear plant at Haripur, West Bengal), and the Stalinist arrogance that the party knows what “the people” need better than the people themselves. Moreover, the violence that has been perpetrated by CPI(M) cadres to browbeat the peasants into submission, including time-tested weapons like rape, demonstrate that this “Left” shares little with the Left ideals that we cherish.

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Susan George withdraws her signature from statement - Nov. 24, 2007
A communication was sent from Sanhati to Susan George, asking her to check our website (www.sanhati.com) and come to independent conclusions regarding the happenings in Nandigram. She has withdrawn her signature from the statement issued by Noam Chomsky and others. Her response is given below.
******************************************************************************************************************************
Dear Friends, thank you for getting in touch. Please see my […]

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Nandigram: The Beating of Medha Patkar
By Satya Sagar, Znet

On 8 November when a mob of Communist Party of India (Marxist) supporters in West Bengal beat Medha Patkar, after dragging her out from a convoy headed to the troubled area of Nandigram, they bestowed a rare honour upon this brave woman.[i]

In that instant, she achieved the distinction of becoming India’s only well known social activist to be physically assaulted by thugs from both the right and left wing of the mainstream Indian political spectrum.

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A pointwise rebuttal of Chomsky etc.’s statement on Nandigram
By Rajesh Ramakrishnan

Two points are very striking about this statement. One, for people who are distant from the scene and still trying to make sense of events, they have some pretty definitive conclusions. One of the conclusions is that Nandigram is somehow dividing the Left in the midst of a larger battle against US imperialism. This is nothing but spin, as can be seen from my comments below. The second striking point is that the lone Indian signatory to this statement is anything but distant from the scene. His links to the CPI(M) are well-known, and there is no way he can be equated with the other signatories so far as objectivity and open-mindedness are concerned.

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An Open Letter to Tariq Ali - Nov. 21, 2007
By Kunal Chattopadhyay, Radicalblogger

Dear Tariq,

When I was a very young radical, still a Maoist rather than a Trotskyist, it was your name, rather than that of Ernest Mandel, or of anyone else, that we came across, here in our part of India. There are still older comrades in West Bengal, who talk about a certain period of Fourth International history, in terms of “in those days of Tariq Ali”. This is why, a statement, even though signed by Chomsky, Zinn and others, along with the man who seems to have carried out the coup, a gentleman named Vijay Prashad, becomes most painful because you are among the signatories. As you once wrote in one of your wonderful books, about another comrade of yours, ‘there was fire in his belly in those days’. Perhaps we have all grown older, but some of us have refused to grow “wiser”.

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Relief Appeals: Details
Recently few activists from a student organization PDSF, went to Nandigram for relief work. They prepared a docu based on the conversation with the people at relief camp.
Here is the link….
http://video. google.com/ videoplay? docid= -71229283029598450
They are collecting text books for the Madhyamik and Uchchamadhyamik candidates (and also for other students) of Nandigram, since the […]

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November in Nandigram: A Citizens’ Report
This report comes from one of the first teams of civil society organizations to visit Nandigram after the events of early November, 2007. The team of activists comprised, among others, Medha Patkar, Anuradha Talwar, Debjit Dutt, Swapna Tripathi, Bijoya Chanda, Atmaram Saraogi, Chhabi Roy, Chandan Pal, Amita Bag, Gautam Bandyopadhyay, Pusparaj, Biswajit, Swapna, and Kalyan Sengupta.

Contents: (1) Visiting the relief camp and villages under attack - Kamalpur, Takapura and Satengabari (2) Operation Nandigram, as per investigation reports (3) Women and children (4) The Procession and its aftermath (5) Subduing the population (6) The Divide in the Villages (7) Gokulnagar Adhikaripara - before and after (8) The role of the administration: Relief and Security, (9) Conclusions

Annexure 1: A detailed timeline for Nandigram: 31st July, 2006 to November 13, 2007.

Annexure 2: Document of injured persons attending Nandigrm B.M.Pal, B.P.H.C. on 10th November, 2007.

Click here to read Nandigram report, November 12-18, 2007 [English, PDF, 584KB] »

Terror in a microcosm - Taipara, Burdwan - the Party GRIP.
The following is an appeal sent by Suparna Goswami. It tells the story of her uncle Balaram Goswami, who has been fighting the corrupt Party machinery through civil and judiciary channels for years, and what that struggle entails. The appeal has been put forward unedited. Her phone number has been removed.

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Bangalore Protests over Nandigram violence
Nov.19, 2007, Bangalore: Protest staged against Nandigram atrocities
Protests in Bangalore, November 14, 2007

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Protest Nandigram through arts - Bangalore, 18 Nov. Join Now.
Join the protest-through-arts against the massacre at Nandigram
On: Sunday, 18/11/’07, 2:00 PM – 8:00 PM
At: (Gandhi statue, MG Road, and pavement in front of Cauvery Emporium, MG-Brigade crossing)
Contact: Mail: nandigrambangalore@gmail.com Or call: 9845820971 (Arundhati), 9902989764 (Kallol), 9880966313 (Arka). Or leave your contacts in the form of a comment on nandigram-bangalore.blogspot.com (latest […]

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The No-spin Zone - Nandigram, facts and myths (ongoing commentary)
Nov. 26, 2007 - Ration riots - The Disconnect and the Connections - Debarshi Das
Nov. 24, 2007 - Sushilbabur Maaneboi, or how to tell a Sushil from a Harmad and other exam questions - Cheatsheet by Saikat Bandyopadhyay
Nov. 24, 2007 - The Fig Leaf Falls - Debarshi Das
Nov. 21, 2007- An Autumn of Discontent - Debarshi Das
Nov. 18, 2007: The spark of Nandigram - Debarshi Das
Nov.16, 2007: The CPI(M)’s Harmad Bahini - human shields, rape as a weapon and other parallels with private militias the world over - Siddhartha Mitra
Nov. 16, 2007 - Which side are you on, Mr Bhattacharjee? Neo-liberal games and the cloak of turf war - Debarshi Das
Nov. 15, 2007 - How long shall we sing the TINA tune? Nandigram comes to me as burning torch of courage. - Suvarup Saha
November 13, 2007 - “Bol ki lab aazad hain tere” - Debarshi Das
November 12, 2007 - The struggle of memory against forgetting… - Debarshi Das
November 11, 2007 - Are Maoists the new WMDs? - Debarshi Das
November 11, 2007 - Who is fighting this turf-war, and why sides need to be taken - Partho Sarathi Ray

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Unity of anti-SEZ forces - an appeal from Lokshashan Andolan - November 3, 2007
Since we may have to discuss several questions on the issue and a significant amount of time may be required for arriving at consensus on several aspects we suggest that we meet for 2 days some time in the middle of December 2007 (or as per the suggestion of the different forces being invited) in Delhi. The venue of the meeting can be fixed later on and can be communicated separately once the date is finalized based on the suggestions of invitees. May we request you to please acknowledge the receipt of this letter through return post or e-mail and send in your suggestions (including a list of organizations who according to you should be invited) for the preparatory meeting in advance (say by end November 2007).

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Nandigram - November 2007 violence: Archives
Dozens of articles, detailed chronological reporting, commentary from Sanhati, pictures.

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Nandigram under siege - State prepares for CRPF deployment
November 5, 2007

Hundreds of CPI-M gunmen rained bombs and fired shots at Nandigram areas from Khejuri side this evening. Bhumi Uchched Protirodh Committee leader Mr Swadesh Adhikari alleged that CPI-M cadres had called their colleagues to join them in their attack on the BUPC and reinforce their presence in the area. The CPI-M’s intention, it seems, is to capture Nandigram before the arrival of Central forces this week.

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The march of the landless - Janadesh 2007 - commentary and pictures
The March in pictures
Janadesh For A National Land Policy - commentary by Vidya Bhushan Rawat
New York Times coverage

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SANHATI NEWSLETTER - October 2007
1. Introductory Words 2. How are you, Chandmani, after the Change? 3. Ranihati - an SEZ silently in the making 4. Tea garden closures, underfed families, and starvation in Bengal - some hard facts
5. The Chemical Hub - what are the socio-economic costs and why should we bear them?

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Many Feet One Step : The Dispossessed March to Delhi
October 21, 2007

As you read this, some 25,000 men and women from across India’s Scheduled Castes and Scheduled Tribes are making their way up the Grand Trunk Road, walking over 340km from Gwalior to the capital, covering 12km a day on a single meal. Their sole slogan: “Hal karo, bhai, hal karo, zameen ki samasya hal karo (Solve, please do solve the land problem).”

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Pratibadi Pooja in Barrackpore to protest market demolition
Place : Nona Chandanpukur Bazaar at Barrackpore
Directions : It is easy to go there from Barrackpur station; you just take a 5 minute, Rs 5 cycle ricksha ride to “Nona Chandanpukur Bajaar”.
Time : On Saptami Dibas, that is on Thursday Otober 18, 2007, at 10. 30 a.m.

The Nona-Chandanpukur Bajaar Byabshayee Bachao Committee will mount a Pratibadi Pooja. They will do so to protest the fact that

i) A market that provided many of the people of Barrackpur with their daily necessities since the early 1950’s has been wantonly destroyed;

ii) The same market had provided a means of livelihood to many hundred traders (they are all members of the Committee), and to their many dependents;

iii) when the Barrackpur Municipality demolished the market, on December 29, 2006, it did so in violation of a Court order enjoining status quo in a case previously filed by the Bachao Committee, a case that is still not disposed of;

iv) the municipality is in contempt of Court, but it cares nothing for that…. and therefore for the rule of law;

v) the interests of the traders were wantonly disregarded by a municipality hungry for the fruits of “development” i.e, for the kick backs that such development would bring to them (Residents of kolkata, remember the case of the Park Circus market).

Meher Engineer, Sabyasachi Deb, Sumit Chowdhury, Aditi Chowdhury, Dipanjan Rai Chaudhuri, Manash Joardar, Pranab Banerjee, Ladly Mukherjee, Shyamal Chakrabarty, Tarun Nashkar have all agreed to be there. So has the Paschim Banga Khet Majdoor Samiti (PBKMS).

Partha Majumdar’s disappearance - Press Conference on Oct 12, 2007
Police abducted Partha Majumdar (30) in front of witnesses. Since 5 September 1997 Partha has disappeared.
The West Bengal Human Rights Commission in its enquiry report confirmed disappearance from police custody.

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Ration pilferage, food riots and PDS protests - People speak up against organized thieving and hunger
Food Riots continue in South Bengal - October 7, 2007

A ration dealer’s house and the office of the ruling Communist Party of India-Marxist (CPI-M) were set ablaze in Burdwan district of West Bengal Sunday in the continuing protests against alleged corruption in the public distribution system (PDS) and food grain hoarding that have claimed four lives.

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‘Quit Retail’, protestors plan rally on Oct 10
On October 10, 50,000 to 100,000 people - representing associations of farmers, traders, hawkers, and even chemists from all over India - will converge on Mumbai’s Azad Maidan to demand that big corporations quit the retail business.

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Documents from the National Anti-SEZ Convention in Kolkata, Oct 1-2, 2007
These discussion documents were presented from MKP during the national anti-SEZ convention in Kolkata, Oct 1-2, 2007.

Click here to read first document [PDF, Bengali, 66KB] »
Click here to read second document [PDF, Bengali, 75KB] »

Students attacked while protesting corruption in Aushgram, Bardhaman - Sept 27, 2007
On September 27th, 2007 a protest rally had been organized by PDSF at Aushgram, in Bardhaman, West Bengal. The protest was against ongoing corruption in managing mid-day meals at the local Telota Primary School. Accounting of rice has shown severe arrears and corruption. It may be recalled that three years ago, near Dignagar locality of Aushgram, CPIM goons had fired on a deputation of farmers and agricultural laborers. The issue at that point had been the local Panchayat scamming in rice and BPL cards. Since then, CPIM local corruption and lawlessness has been exposed time and agian, and their base among common people has consequently eroded.

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Rizwanur Rehman’s death - APDR Protest Rally
APDR PROTEST RALLY.

Issue——To condemn the role of police supporting domestic violence leading to unnatural death of Rizwanur Rehman

Date——-26th September

Venue—– Rizwanur’s house - - 7/B Tiljala Lane near Park Circus 4 Bridge. Important Spots close to the venue—–Indian Science Congress Association Hall on Humaun Kabir Road

Time—-2 pm

Please join and request your friends to join. Bring some posters using the matter written bellow:

* Demand Judicial Enquiry regarding Rizawanoor’s Death
* Produce Priyanka before Judicial Magistrate

*Suspend those Police Officers who have supported domestic violence in Priyanka / Rizwanoor episode

Environmental Scientists in Kolkata speak out against Chemical Hub in Noyachar
Translated by Soumya Guhathakurta, Sanhati. Sept. 5, 2007

Scientists Amalesh Choudhury, Shubhash Datta, Manju Bandyopadhyay and Manosh Joardar assess the effects of the proposed Chemical Hub at Nayachar. Developing news regularly updated.

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Migrant Labor exploited at IITK, boy dead
The Indian Institute of Technology, Kanpur, has often been the site of extreme labor exploitation.

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Singur - An update, post land-acquisition, from APDR and Manthan
August, 2007

This extensive fact-finding report on Dobadi village in Singur covers the following: (1) Dobadi before Tata’s fences came up (2) Dobadi after Tata’s fences came up, with details of Ruidaspara, Madhyapara, Beraberi Purbapara (3) Present economic condition of Khetmajoor by name, amount in debt, and amount of work available. APDR reports that one of its stated aims is to prevent another Amlashol in Singur.

Click here to read Manthan report [PDF, Bengali, 223KB] »
Click here to read APDR report [PDF, Bengali, 51KB] »
Click here to read report on Khetmajoor [PDF, Bengali, 105KB] »
Map of Dobadi [PDF, 84KB] »

Reliance Fresh war heats up in Bengal - Forward Bloc takes stand
August 20 - The Forward Bloc-run agriculture marketing board today threatened a “law-and-order problem” if the government doesn’t stop Reliance from entering Bengal’s farm retail market.

August 18 - Forward Bloc supporters ransack Reliance outlet

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Peoples’ Tribunal on Nandigram - Summary of Report - August 11
Contents:

About the Tribunal
The Context
The Road to March 14
What happened on March 14?
The Toll of Dead, Missing, and Injured
The Medical Response
Developments after March 14
Findings and Recommendations

Click here to read Report [PDF, 316KB] »

Click below to read Press Release.

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Genetically Modified crops - testing and plans in West Bengal,
Genetically Modified (GM) Crop Testing in West Bengal - report from July 27
No safety checks for GM seeds - report from August 1
Vandana Shiva’s paper Seeds of Suicide covers aspects of the policies of liberalization on the seed sector
Also included is a Znet activist introduction to GM crops, which makes the point that hunger is a political problem, not a biological one.

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Sanhati Newsletter - Issue 1, July 29, 2007
TABLE OF CONTENTS

1. About Us
2. Penetrating the Retail sector in Bengal - the Reliance Juggernaut - Partho Sarathi Ray
3. Mahishadal - SEZ war looms over proposed Chemical Hub
4. Rejoinder to Amartya Sen’s interview in The Telegraph, July 23 - Prof. Dipanjan Rai Chaudhuri
5. U-Turn of Industrial Policy Erodes the Very Base of Agriculture - Analytical piece on economic policy by Prof. Abhijit Guha

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Andhra cops fire on land agitators, 8 killed
Sign online petition

Statement from Sanhati

Today India again witnessed the felling of protesting farmers by police bullets. Eight people, including a woman and an eight year old boy, were killed in a brutal police firing in Khamman district of Andhra Prdaesh. They were agitating for the implementation of land reforms and housing for the landless. The protests were a part of the day long strike called by the left parties for the implementation of land reforms in Andhra Pradesh.

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Arrest of activist Saroj Mohanty: An Urgent Appeal
July 17, 2007 - Message from Kashipur Solidarity Group
Saroj Mohanty, poet and long-time activist with Prakrutik Sampad Surakhya Parishad (PSSP), which has over 15 years been opposing the entry of large bauxite mining companies in Kashipur, has been arrested. Saroj was picked up at a railway station in Rayagada District, on Saturday, 14 July. He […]

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JNU students expelled protesting exploitation - Act Now
Stand in solidarity with the student and worker community in JNU against the continued attacks of the administration.
Write to /Call/Fax Vice Chancellor and others - contacts inside

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Dilip Singha (PBKMS member) illegaly detained - June 28, 2007
An active member of our union, Dilip Singha , was picked up on 28th June 2007 at 1 AM from his house by the police. No custody memo or arrest warrant was given. Till now ( 5 PM ), no case has been filed, nor has Dilip been produced in court so far. He has been in illegal detention for the past 16 hours.

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CPI(M) lies about Tapasi Malik’s death - apologist Vijay Prasad disseminates untruths
June 29, 2007 - Two CPI-M activists, Mr Suhrid Dutta and Mr Debu Malik (no relation), who were arrested in connection with the Tapasi Malik murder case, were remanded in CBI custody by the additional chief judicial magistrate of the Chandernagore SDJM court in Hooghly today.

Untruths by CPI(M) : The Central Bureau of Investigation (CBI) probing the case now believes that the young woman’s father and brother might have had something to do with her murder. (Peoples Democracy, May6, 2007)

Vijay Prasad lies in Counterpunch : “Stories were blown out of context, and allegations flew around (sexual assaults, murders) that have since been shown to be false. The most sensational was the murder of a young woman, Tapasi Malik, who had been a leader in the Singur struggle against the land acquisition. The blogs and the capitalist media blamed this death on the CPM. The Central Bureau of Investigation is now of the view that she was killed by her father and brother.”

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Chemical Hub - Ek Nihshobdo Ghatok (A Silent Killer)
From Platform publications, 45 Beniatola Lane, Kolkata 700009

The government of West Bengal has decided to build a chemical hub in the aftermath of Nandigram - the only question right now is where. This article analyses the effects of such a plan. Topics covered include the experience of other countries with chemical industries ( Brazil’s Valley of Death, Japan - the Minamata Disease), the bloody histories of chemical corporations such as Dow, and the effect on the environment and public health.

Click here to read article [Bengali, PDF, 23 pages] »

Compensation protests in Purushottampur, Asansol
The Purushottampur villagers are agitating over 240 acres of non-farm land, earmarked in 1989 for modernising the IISCO Steel Plant. Unlike in Nandigram, villagers here are ready to give up and, but they want a higher compensation and jobs in the plant.

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SEZ war looms over Mahishadal, West Bengal
Land-war clouds now threaten to gather over Mahishadal, 10km from Nandigram across the Haldi, with the Centre on Friday approving “in principle” a special economic zone there.

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GAJALDOBA: Resisting Eviction In North Bengal
“As refugees from Bangladesh we had settled down on a piece of land Teesta had left behind. Then came the devastating floods. It doesn’t really matter any more as to whether it was only nature’s fury or unannounced release from the barrage. Fact is we lost everything again! We came to Gajaldoba. All around was fallow marshland having risen from the bosom of Teesta. It was 1967. Parimal Mitra, The Forest Minister of the United Front was from North Bengal. He settled us here. We worked hard. After four decades the land is giving us enough. Now they say we’ll have to give up our land and vacate our homes!”

Click here to download article [PDF, 372KB] »

JNU students expelled for protesting worker exploitation - The Facts
In November it came to light that some 15 construction labourers on the campus were laid off work because they had demanded Rs. 70 as opposed to the Rs. 65 per day that they had been getting. Shocked by the fact that this wage was far less than the minimum wage (then Rs. 127 in Delhi), the Students’ Union and several other students had taken up a campaign to ensure minimum wages.

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Meghalaya’s people protest Uranium Mining. Starvation in Jalpaiguri’s tea gardens.
June 12, 2007 - Tribal groups blockaded highways in India’s northeast Meghalaya state on Wednesday, the start of a five-day campaign to protest government plans to mine uranium. I shall never allow my land to be used for uranium mining. I am prepared to die but never give up my fight said Spillity Langrin Lyngdoh, an 80-year-old woman from Domisiat area.

Siliguri, June 5 - At least one person dies every day in Jalpaiguri’s closed tea gardens where workers have been battling poverty and hopelessness for the past five years.

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WBEN Panel discussion on Development
The West Bengal Education Network (WBEN)is holding a panel discussion on Development and Industrialisation on June 23, Saturday, at 3p.m. at the University Institute Library Hall (2nd floor). This is the first in a series of Panel Discussions that WBEN has planned for the next few months in the wake of the recent controversy over development issues.

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Singur Update : June 19, 2007 - from APDR (Association for Protection of Democratic Rights)
If one visits today Gopalnagar, Bajemelia, Beraberi, Khaser Bheri or Jaymolla–the five mouzas in the Singur block one will find able bodied people sitting at their doorsteps or street crossings. They have no work to do–their lands have been forcibly occupied for so called ‘development’. “Development” to them have become synonymous with loss of job, loss of livelihood. Till recently these places were bubbling with activity related to the agriculture–seeing someone walking along the zigzags of the rustic village road, people would leave their work at the field and spare a few minutes for a chat regarding their harvest regarding their movement. While talking about their land, their work, the face would lighten up, the chest would broaden up with pride, while talking about their struggle signs of uncertain future and determination for resisting the onslaught would alternate their body language. Seeing a stranger at the doorstep a few months ago a peasant woman would have welcomed him with her smile and a glass of water, may be with some eatable.

But the protest is still on, occasional attempts to smash the illegal boundary wall has become an added feature along with meetings and demonstrations. The people are confident that their movement will be victorious, very soon they will be able to set foot on their own land which is now behind the walls guarded by armed police.

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All India Citizens’ Initiative forms committee to steer country-wide Anti-SEZ movements
June 19, 2007

Eminent jurists, lawyers, educationists, teachers, poets, litterateurs, scientists, artists, social activists, doctors, engineers and people from all walks of life, gathered at Hindi Bhavan, New Delhi today for the All India Citizens’ Convention Against Atrocities on the People of Nandigram and Against Special Economic Zones. Delegates from Punjab, Haryana, Chandigarh, Delhi, Rajasthan, UP, MP, Bihar, Jharkhand, West Bengal, Orissa, Gujarat, Karnataka and Kerala.

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NREGA, PDS, MDM - rural schemes and their implementation
18 June, 2007 : Today an indefinite “Gana dharna” (sit-in demonstration) has began in front of Kakdwip S.D.O office under South 24 Paraganas district of West Bengal- PBKMS
2 February, 2007 : PBKMS rally : Instead of creating job under the NREGA the State Government is now reducing existing employment by grabbing the agricultural land for big and foreign capital in the name of ‘Industrialisation”.
November 1, 2006 : Over 500 landless labourers gathered at a convention in the city to discuss how their search for 100 days of work per year under the National Rural Employment Guarantee Scheme has met with opposition. They complained of assaults, threats and intimidation — mostly by the ruling party cadres and leaders at the grassroots
March 31, 2006 : More starvation deaths, more lies in Murshidabad, West Bengal INDIA: Starvation death; abject poverty; government neglect and inaction

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National Convention Against Displacement & SEZs - Kashipur, Kalinganagar, Jagatsinghpur, Raigad, Dadri, Singur, Nandigram
Three major mass movements of Orissa, the Kalinganagar Movement, the Movement Against POSCO’s Steel Plant near Paradeep and the Kashipur Movement along with the Raigad Movement of Maharastra and Dadri Movement of UP have decided to hold jointly a National Convention of mass movements fighting Displacement and SEZs on 26th and 27th June 2007 at Bhubaneswar, Orissa. The Nandigram Movement and the Singur Movement have been approached to become the co-organisers of the convention.

Included are the Background note summarizing the nature of these struggles, the invitation letter, and a leaflet for circulation

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Indefinite Hunger strike of Narmada oustees Begins - June 6, 2007
On June 6, the dharna of the oustees of the Indira Sagar dam and Omkareshwar dam entered its third day, with over 5000 people sitting in protest against the complete failure of the Rehabilitation & Resettlement (R&R) process in the two dams, and to protect their right to productive livelihoods and the right to live with dignity. Five of the oustees and activists of the Narmada Bachao Andolan also began their indefinite fast and satyagraha today with a resolve not to leave their struggle till all the affected people get their due rights.

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Reliance Fresh gets Park Circus Market - retail, displacement, and joblessness
The Calcutta Municipal Corporation mayor-in-council cleared its deal with Reliance to “redevelop” the Park Circus market on June 8, 2007.

India has 35 towns each with a population of over one million. If WalMart were to open, on an average, one store in each of these 35 cities and if each achieved the average Wal-Mart performance per store, the turnover would amount to over Rs 8,033 crore and number of employees to only 10,195. Extrapolated to the rest of the country, it would mean displacing around 4,32,000 persons. In other words, every new Wal-Mart employee will render 40 retailers surplus.

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Acquisition of Agricultural Land in Singur and Its Protest — An Incomplete Timeline (May 31 - December, 2006)
From Manthan, April 2007 issue. Translated by Alita Nandi, Sanhati

Click here to download Timeline [MSWord, 60 KB]

Press Release of Peoples’ Tribunal on Nandigram, 28 May 2007 and TASAM Report on Nandigram Massacre
Members of TASAM (Teachers and Scientists Against Maldevelopment) visited Nandigram to distribute aid and find out what the situation was. This is their report, prepared by Debasish Sen, Kunal Chattopadhyay, Kuntal Ghosh, Maroona Murmu, Safiul Mollick, and Soma Marik.

Click here to read TASAM report on Nandigram massacre [PDF, 0.2 MB]

The Peoples’ Tribunal on Nandigram was set up by the All India Citizens’ Initiative, comprising of eminent citizens from various sections of society of India. Its members include Justice Bhargava, Ex-Chief Justice Sikkim High Court; Prabash Joshi, Editor, Jansatta; Minakshi Sen Bandopadhyay, Ex-Member, Womens Commission, Tripura; Lalita Ramdas, Social Activist; John Dayal, Journalist and Human Rights Activist; Jyotirmay Samajder, Doctor; and others. Their aim was to to inquire into the background, causes, course, nature and motive, if any leading to the incident of 14th March.

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Appeal to save the life of Dr Pradip Das, serving Nandigram victims
The long and short of it is, Dr. Das has been prevented from attending those patients through the totally illegal interference by the DISTRICT SARBADHIPATI Sri Niranjan Sihi, a non-medical person, with active (willing and unwilling) collaboration of the Hospital Superintendent and some other doctors attending the victims. Sri Sihi, a party man, directly threatened Dr. Das in uncivilized language, over phone while latter was attending the victims on 3rd April morning. Doctor’s crime was that he refused to be a party to the effort of the hospital administration, obviously at the instance of Sarbadhipati to release (i.e. to get rid of) the patients before they are medically fit to go home.

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Amnesty International Statement on State force build-up in Jagatsinghpur, Orissa
Amnesty International is deeply concerned at reports that farmers in Jagatsinghpur in the eastern Indian state of Orissa, protesting against their proposed displacement by the state government for a new industrial project, currently fear forced evictions at the hands of the state police force.

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New, updated APDR Report on Nandigram in Bengali (April 8)
Click here to read New APDR report in Bengali [PDF, 46 pgs] »



A Nation wide Quit India Campaign against Coke and Pepsi ... 2005 the community at Plachimada celebrated 1000 days of resistance against Coca-Cola. ...
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Farewell to the Tatas: Costs and benefits of the Tata-Singur Project, a detailed dissection of the deal
http://sanhati.com/front-page/1001/

October 3, 2008

By Dipankar Basu, Sanhati. Open for comments

Summary of findings:

Costs: the total cost of the Tata-Singur project incurred by the exchequer, and hence ultimately the tax payers, will be approximately be Rs. 3000 crores on a net present value basis when we add up the costs pertaining to the land subsidy, the tax holidays, the soft loan, the real estate gift and the subsidized electricity using an interest rate of 11%. This is about 58% of the total realized industrial investment in the state of West Bengal in 2007.

Benefits: Maximum cap of 12,000 direct jobs with 10% unskilled employment, minus employment destruction. The other claim about the Singur project generating prospective investment in the future rests on equally shaky foundations. The question really boils down to whether the Tata plant can attract other major investments and lead to an industrial rejuvenation of Bengal. The example of Jamshedpur in neighbouring Jharkhand should be carefully looked at. Tata’s factories in Jamshedpur did nothing for the overall industrialization of the state of Bihar or now Jharkhand. It remained an enclave of industrial activity, without forging strong forward or backward linkages in neighbouring areas.

Tata’s net worth versus what they demand from tax-payers: If we add up the figures for the Tata Group’s overseas acquisitions, we arrive at a rough figure of $14,062 million, which converts to roughly Rs. 56,248 crore (using an exchange rate of Rs 40/$), and this is not even a complete list of Tata’s recent acquisitions. And, what does all this lead to? It inevitably leads us to the conclusion that a corporation which can invest more than Rs. 56,000 crores for acquisition of strategic foreign corporate assets requires the financial support of India’s impoverished taxpayers, to the tune of Rs. 1140 crores in real terms, to set up a small car manufacturing plant in India!

A discussion of TINA is given.



***************************

Introduction
Cost and Benfits
The Agreement
Land “Acquisition” and Use
Total Cost of the Project
Hidden Land Subsidy
Cost of Circumventing the Law
Soft Loans and Tax Holidays
More Gifts from Santa: Real Estate and Subsidized Electricity
Adding up the Costs
What are the Benefits?
Oh! So Poor Tata
TINA Logic
Conclusion
Agreement between Tata Motors Ltd., Government of West Bengal and WBIDC

***************************


Introduction

Singur stands for many, often contradictory, things. It stands for the model of neoliberal industrialization that the Indian state is trying to push down the throats of it’s citizens at the behest of big capital. It stands for the unprincipled and populist politics of dormant right-wing forces. It stands for the abject surrender of an erstwhile communist party to the dictates of capital, the full flowering of a tendency that surfaced in the Indian political firmament circa 1967. But Singur also stands for the struggle of labour against capital, decidedly in confused and masked manners, but a struggle that has the potential to galvanize resistance against neoliberalism. When the Tata Group, forced by the long-standing struggle of the small farmers and landless labourers in Singur, was reported to be planning a move to Pantnagar in Uttarakhand, there were simultaneous reports of a possible Singur waiting for them in Pantnagar. A Singur in Pantnagar! That is the real significance of the struggle of the landless labourers and peasants of Singur.

Right from day one, the West Bengal government and the mainstream media has been building up the case for the manufacturing plant in Singur on the basis of half-truths and untruths. For a long time, the West Bengal government continued denying the fact that it had “acquired” a large tract of the proposed 1000 acres from unwilling farmers by using coercion, strong-arm tactics and certainly without their consent. Towards the later part of 2006, after considerable protests and a public hearing organized by intellectuals and activists, it had to finally accept it’s own earlier statements as false. Now it is known by all and sundry that 411.11 acres of the total 997.1 acres has been acquired without consent of the relevant farmers. For a long time, again, the West Bengal government continued denying the fact that most of the land that was sought to be “acquired” was fertile and multi-cropped agricultural land. It was only when earlier this year the Supreme Court pointed towards a possible violation of the Land Acquisition Act, responding to a petition filed for immediate halt of the Nano car project, that the West Bengal government finally accepted that it had been willfully misleading the public in this regard for so long; the SC had pointed out that acquiring and using fertile, multi-crop agricultural land for industrial purposes goes against even the Land Acquisition Act, which the West Bengal government was, paradoxically, trying to use to “acquire” that land. Now it has been established beyond any shadow of doubt that the land on which the proposed plant is to come up is, in the main, fertile, multi-cropped agricultural land. Another myth that had been in circulation for some time was the following: the land in Singur could not be used for agricultural purposes for most parts of the year because of water logging. This claim has also been contested and shown to be untrue. Now it is accepted by all serious commentators that the land had, before being fenced off by the West Bengal police, been in constant use throughout the year for growing various agricultural crops, and that it provided livelihood for more than 12,000 families. Even though these and other such claims of the West Bengal government and the mainstream media have been refuted point by point, over and over again, with facts and arguments and lot of patience and care, they keep turning up ever and ever again like bad coins. They will, as long as the social forces whose interest they represent continue their efforts to hegemonize society; and we will continue refuting them point by point, with patience and care and logic and facts.

But even when these particular canards are discounted, there seems to be a larger argument for industrialization that Singur purportedly represents. The West Bengal government and large sections of the mainstream media tend to equate Singur with industrialization and portray any and every opposition to Singur as opposition to industrialization. The apparent strength, or shall we say charm, of this argument becomes obvious when we see even an preeminent thinker like Amartya Sen falling for it. But this argument is deeply flawed. Opposition to Singur is not opposition to industrialization, it is opposition to neoliberal capitalist industrialization. Opposition to Singur is opposition to the conflation of industrialization with neoliberalism, a scenario where the State steps up it’s efforts to subsidize capital and shore up it’s profits while capital externalizes it’s costs onto labour and the environment with impunity. It is this model of industrialization that we oppose.

An alternative model of industrialization, as far as we can see, would operate in an exactly opposite fashion. It would tax capital and not subsidize it, prevent capital from externalizing it’s costs onto labour and the environment rather than facilitating it, intervene in decisions related to the choice of technique to be used in production, force private capital to do proper cost-benefit analysis before embarking on a (socially) costly industrial project, intervene through fiscal and monetary policy to maintain overall levels of aggregate demand and try to ensure full employment with living wages for workers. In the alternative vision, the State would use tax revenues to build infrastructure, provide social sector services and closely monitor and improve the well-being of the people. Singur, and the model of industrialization that it stands, takes us in the exact opposite direction; that is why it needs to be opposed. It destroys livelihoods tied to agriculture without creating compensating jobs in industry, it willfully snatches away fertile, multi-crop agricultural land for industrial purposes when so much fallow (and other unused and misused) land is there to be used, it externalizes the costs of production on the most vulnerable sections of the population and the environment, and all this while the State steps in to massively subsidize private capital even further. If, therefore, due to the struggle of the project affected people the Tata’s finally leave West Bengal, it should call for rejoicing not for middle-class chest-beating that is so much on display these days. For it would be one of the important victories in the emerging struggle against neoliberalism in India.

Cost and Benfits

In this article we will try to study details of the costs and benefits of the proposed manufacturing plant in Singur on the basis of information that is available in the public domain. But a caveat is necessary. This is not a full blown cost-benefit analysis because we shall not venture to quantify the indirect benefits of possible net employment generation and the income that might arise from there. At this point, it is not even clear whether there will be positive net employment generation; it is not at all obvious, in other words, that the employment destruction entailed by the project will be exceeded by the employment generated by it. Moreover, a full cost-benefit analysis would require much more information than has presently been made available by the West bengal government; on the basis of the available information, which pertains mostly to the benfits that the West Bengal government plans to make available to the Tata’s, we shall mainly try to approximately quantify the costs to the exchequer, and ultimately to the people of the state.

A careful study of the details relating to the proposed project in Singur, to the extent possible by the publicly available information, is important for two main reasons. First, it is important to do a dispassionate analysis of the costs and benefits of this project; since the West Bengal government has been continually making largely unsubstantiated claims about the putative benefits of this project, it is high time we carefully analyzed the foundations of this claim. Second, this project is very much in line with the current trend of neoliberal capitalist industrialization in India anchored tightly in the visions of the Special Economic Zones (SEZs); hence a study of this project will highlight, and help us evaluate, many of the important characteristics of neoliberal capitalist industrialization that has been envisioned and aggressively pushed by the Indian state since the early 1990s. Parenthetically, one should also note how acceptance of the logic this project signals the gradual dissolving of social democracy in India: from”managing” the conflict between labour and capital, social democrats are increasingly moving towards “managing” labour for capital.

The main document that we will use for the purposes of this study is the text of the recent “agreement” signed between the Government of West Bengal, the West Bengal Industrial Development Corporation (WBIDC) and the Tata Motor Ltd. (TML) pertaining to the proposed manufacturing plant in Singur. By a careful analysis of the information contained in this document, and complementing this with some more information from other sources we will, hopefully, be able to arrive at a true picture of the costs and benefits of this project. But before we get into the nitty-gritty of the agreement, let us remind ourselves about the severe difficulties that we have faced over the past few years in just trying to get hold of the information that is relevant to this project. Recall that the details of the “deal” wasn’t made public initially because the West Bengal government believed it was a “trade secret”. Once this argument was properly trashed, the government shifted gears. During this period, it wasn’t made public despite repeated Right To Information (RTI) applications because, according to the government, the Tatas didn’t want it to be made public! Finally what has been made public, mainly because of pressure from the standing committee on industry of the West Bengal state assembly, are only parts of the “deal”; this all we have for the purposes of study and analysis. The TML filed a case in the Calcutta High Court and got a stay against the rest of it being made public. What is there in the rest of it? We, and the more than 12000 project affected families in Singur, can only guess. The entire episode, to say the least, is patently undemocratic, and makes a mockery of the intent of the recently passed Right to Information Act. One does not, of course, discern even an iota of concern about this important matter displayed by the “peoples’ government” in West Bengal!

The Agreement

The “agreement” between the West Bengal government, WBIDC and TML is a remarkable document by all means. Starting from the premise that the state of West Bengal must match, rupee for rupee, every fiscal and financial incentive offered to TML by other states like Uttarakhand and Himachal Pradesh, it goes on to lay out the details of the same. This, the agreement states, should be read as the state government’s eagerness to “take appropriate steps for rapid industrialization in West Bengal”. This, to the best of our knowledge, is the clearest admission by the West Bengal government and the “communist” party standing behind it of the acceptance of neoliberalism. By accepting that the road to “rapid industrialization” winds it’s way through huge subsidization of private capital in the form of tax breaks and soft loans with the concomitant costs borne by labour and the environment, the West Bengal government has finally announced it’s participation in the Indian State’s neoliberal industrialization program. We will discuss this issue in greater detail below.

The text of the agreement is also remarkable in it’s enormous onesidedness. Every concrete detail in the agreement refers to what the West Bengal government will do for TML; there is no mention of what TML will do in return! It is as if by accepting to invest in the state, TML has bestowed an enormous favour on the people and it’s government. Overwhelmed by this boundless magnanimity of TML, the West Bengal government has decided to offer everything in it’s power to return that favour. The favours offered to TML come in four concrete forms: (a) subsidized land for setting up the manufacturing plant, (b) loans in the form of tax holidays, (c) soft loans to get started, and (d) subsidized electricity. There is no mention of anything that the state can expect in return from TML. Loans do not require collateral, failure to make timely payments do not require penalties, there is no mention of what employment generation TML’s investment will entail, there is no mention, in short, of anything at all that might inconvenience private capital or hold it accountable to the people. Below, we will look at the each of the components of the favours, what we will quite realistically refer to as costs, and also try to take seriously the claims of the government about the purported benefits of the project, but first, let us briefly remind ourselves about the land “acquisition” and it’s proposed use.

Land “Acquisition” and Use

The agreement - scroll down to read the text of the agreement - states that land “of approximately 1000 acres chosen [by TML] in P.S. Singur of District Hoogly” was finalized as the site for the construction of the proposed plant. Subsequently WBIDC “commenced the process of acquisition of this land”, an euphemism for the veritable terror unleashed on the farmers of Singur to give up their fertile, multi-cropped agricultural land for neoliberal industrial “development”. Using the colonial era Land Acquisition Act of 1894, the WBIDC coerced - with the support of the police and cadres of the ruling party, CPI(M) - several hundred families to give up their land, and according to the agreement, it is now “in possession of 997.1 acres of land”.

Out of this forcibly-acquired 997.1 acres of land, 647.5 acres will be leased to TML to set up it’s proposed plant, what the agreement calls the “Automobile Project”; another 290 acres will be leased to “the vendors to this Automobile Project approved by TML”, the vendors being the ancillary and component manufacturing units. An area of 14.33 acres will be given to the West Bengal State Electricity Board (WBSEB) for the construction of a 220/132/33 KV substation to provide and uninterrupted supply of subsidized electric power to the “Automobile Project”; and the remaining “47.11 acres will be used by WBIDC for rehabilitation activities for the needy families amongst the Project affected persons”. Note in passing that only 4.74% of the “acquired” land has been earmarked for purposes of rehabilitation of the project affected persons.

Total Cost of the Project

According to the details available in the agreement, the total cost to the people of West Bengal of the proposed project in Singur, as we have already pointed out, can be broken down into the following four categories: (a) subsidized land for setting up the manufacturing plant, (b) loans in the form of tax holidays, (c) soft loans to get started, and (d) subsidized electricity. Point 7 of the agreement provides details about each of these. Point 7(a) is about the tax holiday; point 7(b) is about the hidden subsidy in land; point 7(c) is about the soft loan, and point 7(d) is about the subsidized electricity. The sum of these “fiscal incentives”, excluding the subsidy in electricity, add up to what the Uttarakhand/Himachal Pradesh governments offered to TML. How do we know this? From point 7(a) of the agreement which states: “This benefit [i.e., the tax holiday] will continue till the balance amount of the Uttarakhand benefit (after deducting the amount as stated in para 7b and 7c below) is reached on net present value basis, after which it shall be discontinued.” In other words, the sum of the benefits offered by the West Bengal government in the form of (a) subsidized land, (b) tax holiday, and (c) soft loan will equal what the Uttarakhand/Himachal Pradesh governments were willing to offer; the subsidized electricity (and other real estate, as we will see below) are bonuses, which make the West Bengal government’s offer exceed the Uttarakhand/Himachal Pradesh. But this also means that we can indirectly arrive at the total cost of the project in Singur if we can somehow figure out the amount of the Uttarakhand/Himachal Pradesh package.

Point (1) of the agreement mentions that the “incentive package in Uttarakhand/Himachal Pradesh consists of:-

(a) 100% exemption from Excise Duty for 10 years.

(b) 100% exemption from Corporate Income Tax for first 5 years and 30% exemption from Corporate Income Tax for next 5 years.”

How much is this package worth? Let us try to think this through. We have collected some information from annual financial reports of TML in Table 1 that will help us get an approximate figure for the Uttarakhand/Himachal Pradesh package using points 1(a) and 1(b).



Table 1: Financial Position of Tata Motors (Rs. Crores)
Year Gross Revenue Revenue net of excise Excise Profit Before Tax Profit After Tax Taxes Paid Excise/Gross Revenue (%) Tax/Gross Revenue (%)
2005-06 27266.41 23718.17 3548.24 2348.98 1728.09 620.89 13.01 2.28
2006-07 36987.82 32426.41 4561.41 3088.14 2169.99 918.15 12.33 2.48
2007-08 40340.79 35651.48 4689.31 3086.29 2167.7 918.59 11.62 2.28

Source: http://ir.tatamotors.com/index.php?CardID=4

There are some remarkably stable patterns in the data. TML seems to be paying about 12% of its gross revenue as excise duty and 2.35% of it’s revenue as corporate income tax. If TML were to set up shop in Uttarakhand or Himachal Pradesh, it would be manufacturing about 250,000 small cars per annum. If each car were to sell for Rs. 1 lakh, TML’s gross annual revenue would be approximately Rs. 2500 crores. If the TML would have to pay excise duty, assuming the above ratios, it would pay about 300 crores (12% of Rs. 2500 crores) per annum; if it had to pay corporate income tax, it would have to pay about Rs. 58.75 (3.5% of Rs. 2500 crores) crores per annum. If TML set up shop in Uttarakhand/Himachal Pradesh, according to the agreement, it would not have to pay these taxes as stated in point 1(a) and 1(b).

Summary of the Uttarakhand/Himachal Pradesh package: for the first 5 years, TML gets Rs. 358.75 crores every year (100% excise duty exemption + 100% corporate income tax exemption); and for the next 5 years, it gets Rs. 317.63 crores every year (100% excise duty exemption + 30% corporate income tax exemption). The NPV of this benefit package is Rs. 2062.79 crores (using 11% for calculating NPV).

According to point 7(a) of the agreement, the West Bengal government’s “benefits package” will equal this sum if we compute the benefit coming from subsidized land, soft loans and tax holidays. Let us now look at the different components of the package promised by the West Bengal government.

Hidden Land Subsidy

What are the terms of the rental structure on the land lease agreed upon by WBIDC and TML? Two different set of rules apply, one to the 647.5 acres leased to TML and another to the 290 acres that will be leased to the vendors approved by TML. Both leases, however, will come up for possible renewal 90 years down the line. For the 647.5 acres of land that is leased to TML, the annual rental will be Rs. 1 crore for the first five years, increasing by 25% every five years till 30 years. Thereafter, the annual rental will be fixed at Rs. 5 crore, to be increased by 30% every 10 years till the year 60; the rental from year 61 to 90 will be Rs. 20 crore per year. For th vendors, the rental structure is simpler: for the first 45 years, they will pay an annual rental of Rs. 8000 per acre, and for the next 45 years will pay an annual rental of Rs. 16000 per acre. Since the vendors are leasing 290 acres of land, this means that for the first 45 years, they pay a total of Rs. 0.232 crores per year and Rs. 0.464 crores per year for the rest of the time.





Table 2: Rental Payment Structure over Time
Years
Payment per year (Rs. Crore)
Payment for the period (Rs. Crore)
Cumulative Payment starting from Year 1
Period Payment as % of Total Payment Cumulative Percentage NPV of period payment (@ 11%) Cumulative NPV of Period Payment Cumulative percentage of NPV











Tata

1-5 1.00 5.00 5.00 0.58 0.58 3.70 3.7 21.83
6-10 1.25 6.25 11.25 0.73 1.31 2.74 6.44 38.02
11-15 1.56 7.81 19.06 0.91 2.23 2.03 8.47 50.02
16-20 1.95 9.77 28.83 1.14 3.37 1.51 9.97 58.92
21-25 2.44 12.21 41.04 1.43 4.80 1.12 11.09 65.52
26-30 3.05 15.26 56.29 1.78 6.58 0.83 11.92 70.42
31-40 5.00 50.00 106.29 5.84 12.42 1.29 13.21 78.02
41-50 6.50 65.00 171.29 7.60 20.02 0.59 13.8 81.5
51-60 8.45 84.50 255.79 9.87 29.89 0.27 14.07 83.09
61-90 20.00 600.00 855.79 70.11 100.00 0.33 14.4 100.00










Vendors

1-45 0.23 10.44 10.44 33.33 33.33 2.09 2.09 88.94
46-90 0.46 20.88 31.32 66.67 100 0.04 2.13 100.00





Details of the payment schedule, for both TML and the vendors, is summarized in Table 2. This is similar to, but more detailed than, a table used by Madhukar Shukla for commenting on the Nano project; the main difference is the inclusion of figures on net present values (NPV). What is net present value? It is a conceptual device used to compare sums of money at different points in time, which I explain in greater detail below. Why is NPV relevant here? Because an investment project like the proposed plant in Singur involve costs and benefits flowing in at different points in time. Columns (2) through (6) give the actual payments to be made at various points in time, while the last three columns give the net present value (NPV) of the payments, where NPV has been calculated using an interest rate of 11% per annum (exactly as done by the WBIDC in Annexure II of the agreement). Note in passing that the Annexure where all the computations relating to the project has supposedly bee done has not been made available to the public; all we know is that the NPV calculations used an interest rate of 11%.

To arrive at figures about the costs of “acquiring” the land and the revenue earned from leasing it to TML (and the vendors), we need to remind ourselves that the WBIDC spent anything between Rs. 150 crore and Rs. 200 crore to “acquire” the land from the unwilling farmers. How much will WBIDC get for letting TML use that piece of land? Columns (4) shows that the TML will pay a total amount of Rs. 855.79 crores over 90 years as rental fees for using the land. So the cost incurred by the WBIDC is Rs. 150-200 crore, while revenues will be 855.79 crore. Does this mean that the WBIDC made a good bargain with the TML on behalf of the people of the state? Does it men that the WBIDC is actually making a “profit” in leasing out the land to TML? Let us think about this a little more.

A rupee today is not equivalent to a rupee next year. Why? One can put the rupee that one has today in the bank and earn an interest income at the going interest rate to augment the original sum. If the current interest rate is 11%, then one would have Rs. 1.11 at the end of the year if the rupee were to be invested in an interest-bearing asset today. Put another way, Rs. 1.11 at the beginning of next year is equivalent to Rs. 1 today (at the beginning of this year). Let us go further, and suppose that we let our rupee lie in the bank for two years. How much do we have at the beginning of the third year? Rs. 1.21 (because at the beginning of the second year one has Rs 1.11, and then one earns 11% on that amount to arrive at Rs. 1.21 at the beginning of the third year). Inverting things, we see that Rs. 1.21 two years hence is equivalent to Rs 1 today when the market interest rate is 11%. This logic can be extended to any number of years and is the basis of computing net present values (NPVs). In the jargon of economics, if the market interest rate is 11%, Rs. 1.1 one year hence has a NPV of Rs. 1; and Rs. 1.21 two years hence has a NPV of Rs. 1. Thus, NPV is a device to make sums of money at different points in time comparable to each other. What does this mean for us?

It means that we cannot just add up all the rental payments that TML is supposed to make over the next 90 years (which is Rs. 855.79 crores) and compare it to the cost incurred by the WBIDC to “acquire” the land today (which is Rs. 150-200 crores). To make the stream of rental payments of the TML (over the next 90 years) comparable to the cost of “acquisition” today, we need to calculate the NPV of the rental payment stream. That is precisely what we have done in column (7) in Table 2. Column (8) gives the sum of the NPVs of the rental payments. On the basis of this calculation we arrive at a very striking fact at the end of column (8). The NPV of the rental payments that the TML will make over the next 90 years is Rs. 14.4 crores! The NPV of the rental payments that the vendors will make is Rs. 2.13 crores.

Summary: while the cost to the WBIDC for “acquiring” the land was anything between Rs. 150 crores to Rs. 200 crores, the NPV of the revenue from rental income that will accrue to the WBIDC is Rs. 16.53 crores, sagging the WBIDC with a loss of anything between Rs. 130 crores to Rs. 180 crores! Which is just another way of saying that taxpayers are subsidizing a big corporate entity like the TML to the tune of Rs. 150 crore just in terms of the land that the WBIDC “acquired” for it.


Cost of Circumventing the Law

A moment’s reflection on the time structure of rental payments for TML brings another characteristic of the transaction to the fore. The time structure of payments has been arranged in such a way that the bulk of the rental payments come in later years. From column (6) in Table 2 we see that the TML makes only 5% of it’s total payments in the first 25 years of the lease; in the first 50 years, it pays only 20 percent of it’s total payment commitments. The Comptroller and Auditor General of India (CAG) had pointed out in March 2008 that, according to Government of India laws, long-term leases of 99 years required that the lessee pay 95% of the market value of the land as a one-time premium at the beginning of the lease and pay annual rent at the rate of 0.3% of the market value of the land. The same report went on to note that the agreement between the TML and the WBIDC should have entailed an immediate payment of Rs. 91.88 crore and subsequent annual rents of Rs. 29 lakhs for the next 90 years. As opposed to this, the TML, according to the agreement, would pay nothing upfront and would only pay Rs.1 crore at the end of the first year!

Of course it would have been illegal if the lease was for 99 years. Hence, it seems, the WBIDC cleverly decreased the span of the lease by 9 years to circumvent the letter of the law. In spirit, though, this still amounts to a violation of the law. Why? Because the law states that for long-term leases the majority of the payments should be paid upfront by the lessee; and the WBIDC agreement with TML shows an exactly opposite time structure of payments, with most of the payments pushed off far into the future. Thus, even though in letter the agreement clears legal hurdles, it is obvious that it fails miserably in terms of the idea behind the law. No wonder the CAG faulted the WBIDC on several counts regarding it’s agreement with the TML. But let us pause for a moment and think why the CAG (or the laws) wanted the bulk of the payment upfront.

There are two basic reasons why the law might want to ensure bulk of the payments for a long-term lease upfront. One, large upfront payments for long-term leases increases the NPV of the rental payment stream. Since these long-term leases generally require the government to hand over public land for private use, it makes sense to structure rental payments in such a way that the government exchequer gets a good value in return; that is why a large upfront payment is usually written into lease contracts for long-term leases. The second reason for having a large upfront payment relates to considerations of risk. When a stream of payments has relatively large amounts pushed far away in the future, the NPV of that stream of payments is more liable to change when market interest rates change.

Let us take an example to understand both these points. Suppose, for simplicity, we want to compare two payment streams, A and B. A has Rs. 1 lakh today and Rs 9 lakhs in 10 years; B has Rs 9 lakhs today and Rs .1 lakh in 10 years; note that both entail a total payment of Rs. 10 lakhs over a period of 10 years and are similar in this respect. But they also are very dissimilar. To understand why suppose that the market interest is 10% at the moment. NPV of A is Rs. 4.47 lakhs, while the NPV of B is Rs. 9.39 lakhs. Thus, the NPV of B is much higher than that of B, which clarifies the first point. Now suppose that the market interest rate increase to 15%; this will obviously diminish the NPV of both A and B. But which will fall more? A’s NPV falls by about 39% while B’s NPV falls by only 1.5%! Thus, the risk of loss of revenue that comes from a payment stream (payment of rent for instance) is higher when most of the payments come in during relatively later periods. It is probably because of these two sound economic reasons, among others, that the CAG urged the West Bengal government to reconsider it’s lease agreement with the TML. By structuring the rental payments such that most of it come in during later years, the West Bengal government is not only losing revenue but is also bearing a higher risk of loss of even that minimal revenue.

So, how much is the WBIDC losing in real terms by using the rental payment structure that is summarized in Table 2 instead of the one recommended by the CAG? If TML were to pay Rs. 91.88 crores upfront and then subsequently pay a rental of Rs. 29 lakhs per annum for the next 90 years (as suggested by the CAG ), the NPV of this payment scheme would be Rs. 94.52 crores (using an interest rate of 11% per annum for calculating the NPV). The NPV of the currently agreed upon rental payment scheme (as per the agreement) is Rs. 16.53 crores (sum of entries in column (7) of table 2). Hence, the WBIDC is losing Rs. 77.99 crores due to the chosen rental payment structure.

Summary: the total financial loss to the WBIDC due to the agreed upon rental payment structure, as opposed the one suggested by the CAG, is Rs. 77.99 crores; the WBIDC, in addition, has to bear extra risk arising from possible fluctuations in the market interest rate.

Soft Loans and Tax Holidays

Point 7(c) of the agreement provides information about the soft loan: “The West Bengal Govt. will provide TML a loan of 200 crores @ 1% interest per year repayable in 5 equal annual installments starting from the 21st year from the date of the disbursement of the loan”. This loan, moreover, “will be disbursed within 60 days of this agreement”. Point 7(a) of the agreement refers to the loans that the WBIDC will give to the TML in the form of tax holidays. The tax holiday will continue, as we have already noted, till the sum of the land subsidy, tax holiday and the soft loan equals the Uttarakhand/Himachal Pradesh package.

So, what is the total loss to the exchequer due to the tax holidays and soft loans. There are two ways to arrive at approximate value of this loss. First, if we knew the exact amounts of the loans (in the form of tax holidays) and the exact repayment shedule and interest rates, we could calculate the net present value of the loss. But unfortunately, we do not have enough data in this regard, and so we will adopt an indirect method to arrive at the notional cost of the tax holiday and the soft loans. This second, indirect method, begins by recalling that, according to point 7(a) of the agreement, the total benefits from the land subsidy, taxt holidays and soft loans offered by the West Bengal government will equal the benefits that was offered by the Uttarakhand/Himachal Pradesh govenrment. We have seen above that the total value of the Uttarakhand/Himachal Pradesh package was approximately Rs. 2063 crores on a net present value basis. We have also seen that the cost to the exchequer of the subsidized land was about Rs. 228 crores (Rs. 150 crores for direct subsidy and Rs. 78 crores lost due to the time structure of the rental payment scheme). Thus, the total cost of the tax holiday and the soft loans will be Rs. 1835 crores (which is Rs. 2063 crores less Rs. 228 crores) on a net present value basis. Note that this is a notional cost.

The last part of 7(a) seems even better. It says: “WBIDC will ensure that the loan under this head is paid within 60 days of the close of the previous year (on 31st March) failing which WBIDC will be liable to compensate TML for the financial inconvenience caused @ 1.5 times the bank rate prevailing at the time on the amount due for the period of such delay”. What does this mean? It means that if the WBIDC is not able to make the loan to TML within 60 days of the close of the financial year, it will penalize itself by compensating TML at 1.5 times the prevailing bank rate. So, if the prevailing bank rate is 10%, which is close to what is the case right now, the WBIDC will penalize itself for any delay on it’s part by paying back the TML for the “financial inconvenience” at 15%.

Summary: the cost of the soft loans and tax holidays to the TML by the West Bengal government will be about Rs. 1835 crores on a net present value basis.

More Gifts from Santa: Real Estate and Subsidized Electricity

Industrial development requires infrastructural support from the government, as we all know. And so the West Bengal government displayed it’s commitment to “rapid industrialization” by offering a “virtual gift of 650 acres of prime land to Tata Housing Development Company (THDC) in Rajarhat New Town and in the adjoining Bhangar Rajarhat Area Development Authority for building an IT and residential township along with WBIDC as a partner”. What better way to provide “infrastructural assistance” for the industrialization effort that to hand over prime land for real estate speculation! Some reports suggest that this “gift” to TML will cost the exchequer about Rs. 160 crores.

The West Bengal government has also promised to supply electricity at Rs 3 per kilo watt hour (kwh), which is around half the price charged to high-tension industrial consumers in the West Bengal at the moment. It has also promised to absorb any increases in electricity costs to the TML in Singur. Point 7(d) of the agreement states: “In case of more than Rs. 0.25 per KWH increase in tariff in every block of five years, the Government will provide relief through additional compensation to neutralize such additional increase”. This will mean, at the least, shelling out Rs. 70 crores annually for subsidizing the electricity requirements of the whole project at Singur. The NPV of this subsidy for the 90 year period of the lease would be Rs. 706 crores.

Summary: the cost to the exchequer of the real estate gift and subsidized electricity will be about Rs. 865 crores.

Adding up the Costs

Let us now take a moment to put all this together. The subsidy that TML gets, according to the terms of the agreement, on the land in Singur is anywhere between Rs. 100 and Rs. 150 crore; the subsidy due to the rental payment structure is Rs. 78 crores; the implicit subsidy due to the tax holiday and the soft loan would be about Rs. 1835 crores; the real estate “gift”, also known in WBIDC terminology as “infrastructural assistance”, is worth Rs. 160 crores; and the subsidized electricity will cost another Rs. 706 crores. So, the Tata conglomerate, one of the largest corporate entities in the country, is awarded a “gift” of about Rs. 2928 crore by a “communist” government so that it can be induced to set up a car manufacturing plant in the state and lead it on to the path of neoliberal industrial development. To put this figure in perspective, let us refer to the 2008-09 budget speech of the Finance Minster of West Bengal. Pointing to the emergence of what he called the “industrial potential” of the state, he offered some concrete figures to bolster his argument. In 2005, the annual realized (industrial) investment in West Bengal was Rs. 2515.58 crores, which then jumped up to Rs. 5072.26 crores within the next two years. Thus, a sum close to 58 percent of the total realized industrial investment in the state in 2007 would be the cost borne by the people of the state if the Tata-Singur project too off.

Summary: the total cost of the Tata-Singur project incurred by the exchequer, and hence ultimately the tax payers, will be approximately be Rs. 3000 crores on a net present value basis when we add up the costs pertaining to the land subsidy, the tax holidays, the soft loan, the real estate gift and the subsidized electricity using an interest rate of 11%. This is about 58% of the total realized industrial investment in the state of West Bengal in 2007.

What are the Benefits?

What are the purported benefits of the Tata-Singur project? The West Bengal government has advanced two claims regarding the benefits: employment generation and improvement in the investment climate of the state. These two claims about possible employment generation and future investments need to be looked at closely, because the rationale offered by the West Bengal government for giving the stupendous bonanza to the Tatas rests precisely on these. Both these claims are dubious. Regarding the claims about employment generation, there have been figures ranging from a high of 12000 (2000 in the Nano plant proper, 10000 in ancillary and complementary units) to a low of 750 (some recent local newspapers have put the figure at 650). The upshot of all this is that there is no certainty about the employment generated. However, if we look at a recent BBC report on this matter it becomes clear that 62% of the projected employment in the automotive sector is going to be skilled labour, 28% is going to be management jobs, leaving only 10% jobs for unskilled labour. Now, the displaced population in Singur, if at all they get absorbed in the mother plant or in the ancillary units, would typically be offered employment as unskilled labour. So, the prospect of much employment being generated, especially for the people in Singur, is dim. Moreover, all these calculations ignore the employment destruction that the project will inevitably entail. If we were to properly take both possible employment generation and possible emplyment destruction into account, we could arrive at a figure for the net emplyment generated by the project. At the moment, it is not even clear that the net employment figure will be positive.

The other claim about the Singur project generating prospective investment in the future rests on equally shaky foundations. The question really boils down to whether the Tata plant can attract other major investments and lead to an industrial rejuvenation of Bengal. The example of Jamshedpur in neighbouring Jharkhand should be carefully looked at. Tata’s factories in Jamshedpur did nothing for the overall industrialization of the state of Bihar or now Jharkhand. It remained an enclave of industrial activity, without forging strong forward or backward linkages in neighbouring areas. The other issue to think about, in the context of the claim about TML drawing future investments, is whether other industrialists coming to invest in Bengal would also demand similar bonanzas from the government. Will the government refuse them the goodies that they have offered TML and let them turn away or will it repeat the Tata-like agreements and put further burdens on the exchequer. Either option does not seem to be beneficial from the perspective of the working people of the state.

Summary: while the costs of the proposed Singur-Tata project is obvious, tangible, immediate and large, the benefits seem to be uncertain, residing far away in the future and their magnitudes small.

Oh! So Poor Tata

A few months back, the finance minister of West Bengal presented a budget with a Rs. 2 crore deficit; a net subsidy of about Rs. 3000 crores would certainly be extremely costly for the people of the state; after all it is about 1500 times the budget deficit in fiscal year 2008-09. Given that a small, poor, fund-starved state like West Bengal is making such great efforts to subsidize the Tata’s, it must mean that they (the Tata’s) are in a dire financial situation. But is that true? If we merely cast a glance at the recent international buying spree that the Tata’s have been engaged in, we might be able to understand how far from the truth would be any assertion that the Tata’s require financial assistance from a poor state like West Bengal to start an industrial project.

The Tata Group of Companies, let us remind ourselves, is one of the largest business conglomerates in India with about 100 large companies in it’s fold. With the might of the Indian State firmly behind it, monopoly capital in India has started a move to aggressively acquire foreign assets, what it calls strategic corporate assets. In the last few years, the Tata Group has been leading this acquisition spree on behalf of Indian big capital, making forays not only in Asia and Africa but also in the heartland of world capitalism: USA and Europe. Let us briefly take a look at the record of the Tata Group with regard to foreign acquisitions.

In January 2007, the Tata Group pulled off India’s biggest ever takeover of a foreign company to buy Anglo-Dutch steel-maker Corus for $12 billion; this acquisition made the combined entity (Tata-Corus) the world’s fifth largest producer of steel. In March 2004, the Tata Group acquired South Korea’s Daewoo Commercial Vehicle Company for $102 million; this was followed by the acquisition of a 21 percent stake in Spanish bus maker Hispano Carrocera for $18 million with an option to pick up the remaining stake at a later date. Around the same time, Tata Technologies, another company in the Tata fold, which provides automotive engineering and design services, bought Britain’s Incat International for $53 million.

Tata Consultancy Services, which was earlier a division of Tata Sons and a rising star in the Tata Group, has been among the most aggressive shoppers for foreign companies. It has acquired six companies in the past few, with the net value of the deals close to $100 million; these include FNS of Australia, which was acquired for $26 million and Chile’s outsourcing major Comicrom, which was bought for $23 million. When the Tat Group acquired the former state-run, international telecom carrier, VSNL, a few years ago, it was on it’s way to becoming a major telecom player in the global markets. To enhance it’s position, it acquired undersea cable company Tyco of the US for $130 million, Internet service provider Dishnet’s India division for $64.28 million and international telecom service provider Teleglobe of the US for $239 million.

Following its acquisition of Hindustan Lever Chemicals, Tata Chemicals was on the lookout for a steady supply of phosphoric acid for its newly acquired plant at Haldia, West Bengal. Accordingly, it took over two overseas companies for a total value of $215 million: Indo Maroc Phosphore of Morocco in March 2005 and Brunner Mond Group of Britain in December 2007. Morocco, by the way, produces over 50 percent of the world’s rock phosphate.

In 2000, Tata Tea bought British giant Tetley for a $407 million, and started looking for similar deals to strengthen it’s global position in the tea and related drinks business. This search led to acquisition of 33 percent stake in the South African company Joekels Tea Packers for an undisclosed amount and 30 percent stake in the US-based favoured water manufacturer Glaceau for $677 million, the acquisition of the US-based Good Earth Corp for $32 million and acquisition of the Czech Republic’s firm Jemca for an unknown amount.

India Hotels, the hotel branch of the Tata Group, acquired several hotels abroad for $121 million in the past few years. It is reported to have set aside $100 million for future acquisitions in Europe, the Middle East, Asia and the US. In December 2006, it had acquired W, a hotel at the Woolloomooloo Bay in Sydney; it was followed by the taking over of the management of The Pierre, a luxurious landmark hotel on New York’s Fifth Avenue. India Hotels, which runs the Taj Group of hotels, has 39 hotels in India and 18 worldwide. A recent acquisition of India Hotels was Campton Place Hotel in San Francisco.

If we add up the figures for the Tata Group’s overseas acquisitions, we arrive at a rough figure of $14,062 million, which converts to roughly Rs. 56,248 crore (using an exchange rate of Rs 40/$), and this is not even a complete list of Tata’s recent acquisitions. And, what does all this lead to? It inevitably leads us to the conclusion that a corporation which can invest more than Rs. 56,000 crores for acquisition of strategic foreign corporate assets requires the financial support of India’s impoverished taxpayers, to the tune of Rs. 1140 crores in real terms, to set up a small car manufacturing plant in India! That, in a nutshell, is what we would like to call neoliberal industrialization, pushing which down our throats has become the almost single-minded purpose of the West Bengal Government and the “communist party” that is at it’s helm of affairs.

TINA Logic

But even after all these facts and figures and arguments have been read, understood and absorbed, sympathizers of the West Bengal government will no doubt come up with a supposedly unbeatable argument: TINA. There is no alternative. This argument points to the magnanimous offers made by other states in India to attract private capital, and then goes on to plead the inability of the West Bengal government to follow any route other than to offer even more largesse. Recall that the text of the agreement starts precisely with this argument. It builds up it’s case for the huge hidden subsidies that is offered to TML, and which we have seen in great detail above and which add up to about Rs. 3000 crores on a net present value basis, by emphasizing the incentive package that the States of Uttarakhand and Himachal Pradesh has offered to the Tatas. That is why the West Bengal government must offer more than the value of the offers by the other states if it is to attract private capital, like the TML, to industrialize the state. Since, other states are offering huge tax breaks and soft loans, West Bengal must also do so, the argument goes. West Bengal cannot fight this trend, caught as it is in the competitive struggle between the states of India.

One must begin by acknowledging that there is some truth to this assertion. It is true, in other words, that in the neoliberal set-up private capital has managed to generate competition between political entities, both within nations and between nations, to ensure higher profits on it’s investments. But acknowledging this fact, the fact of the existence of this strong pressure for competition among states, does not mean accepting it as inevitable; it does not mean accepting the logic, championed by the proponents of neoliberalism, that there can be no alternative to the present framework. If the fight against neoliberalism has to be taken forward then this logic must be fought. One cannot succumb to this logic in practice and claim to be fighting against neoliberalism.

And to fight this logic, one must understand what it implies. The competition that capital manages to enforce on political entities (for instance states in India or countries in the global context), one must understand, is akin to a “race to the bottom”. As soon as one state lowers taxes, reduces social sector spending, loosens labour laws, cracks down on political dissent in order to make the atmosphere “conducive” for investments, another tries to outdo the first by reducing taxes even further, reducing social sector spendings even further, making labour even more “flexible” in order to “attract capital”. And thus, as the logic of this competition unfolds in all dimensions, people of all the states taken together lose. Lower tax revenues means lower resources for the State to invest in educations, health, nutrition, poverty alleviation; it means increased misery for the common people, with sub-optimal infrastructure and public amenities. And who benefits from this fierce competition? Capital. Thus accepting this as the only way to industrialize is to accept this “race to the bottom”, with all it’s deleterious consequences for the population, as the West Bengal government seems to have done.

So what can be done? One has to act on several fronts at the same time. First, it is undeniable that fighting the neoliberal logic will require concerted political action at the Central level to thwart moves to implement central-level neoliberal policies; the largest “communist” party standing behind the West Bengal government must shed it’s fears of radical mass political activism and launch, with other like minded political forces, a nationwide offensive against neoliberalism, instead of using all it’s energies in parliamentary antics. It will also mean not succumbing to the pressures of capital at the state level as the West Bengal government has pathetically done. If private capital wants to move out of the state because taxes are high and social sector spendings are growing and the labour laws are favourable for the workers, and the health and educational status of the people are improving, then so be it. The state need not hanker after such capital for, at the end of the day, massively state-subsidized investments of such capital is not beneficial for the people.

Second, one must understand that, if attracting capital is all one wants to achieve, capital can also be attracted in a very different fashion, by reversing the harmful, negative competition between states and instead initiating a “race to the top” to replace the “race to the bottom”. For it is a fact, recently noted by several observers of the Indian economy, that India is very rapidly moving into a regime marked by serious shortages of skilled labour. A state which wants to attract private capital can, therefore, invest massively in building up the education and health system for the workers; a healthy and skilled labour force can be a stronger incentive for capital to set up shop in a state than huge tax holidays. In fact, instead of giving tax breaks to capital, the state will need to tax them aggressively and use the tax revenue to further improve the conditions of the working people. Equally true is the abysmal conditions of physical infrastructure - transportation, housing, power, etc. - in most of the states of India. A state can, therefore, start investing in building up basic infrastructure for the people by taxing capital and citizens in the high-income brackets; solid infrastructure can be as strong an incentive for private capital as soft loans and hidden subsidies. The point of these interventions would be, in the medium and long urn, to initiate reversal of the “race to the bottom” that every state seems to be in the grip of. Unfortunately, the West Bengal government seems hell bent on going the opposite way.

Third, complementing these interventions have to be efforts to revitalize mass political activism at the grassroots level. Imagine, for a moment, a strong, countrywide mass movement against neoliberalism. If Singur in re-enacted in Uttarakhand and Himachal Pradesh and Karnataka, then where will the TML go? Wherever it sets up shop, it will have to do so without the luxury of externalizing the costs onto the working people and the environment. Simple economic logic suggests that forcing capital to internalize it’s costs by an active mass political movement would in fact ensure that the decisions taken by capital will be closer to what could be considered socially optimal. Mass participation in planning and implementation would, further, increase much-needed accountability of both the state and capital. Unfortunately again, the West Bengal government wants to go the other way.

Conclusion

This brief analysis of the details of the proposed Tata-Singur project in West Bengal offers us an unique opportunity to think about the industrialization strategy of the Indian state today. One of the major thrusts of this strategy is to build up so-called Special Economic Zones (SEZs) all over the country. As of August 11, 2008 there were 250 notified SEZs across the country. Since each of these SEZs more or less replicate the policy regime applicable to the proposed Tata-Singur project - with magnanimous tax holidays and soft loans and subsidized power and “flexible” labour laws and absence of all environmental regulations - it would probably not be far from the truth to suggest that each of these SEZs would entail at least the amount of loss that we have calculated above for the Tata-Singur project. This suggests that the total cost to the people of this country of the current neoliberal policy regime would be about Rs. 750,000 crores. How large is this figure? For comparison, consider the fact that the total expenditure of the Indian government was slated to be Rs. 750, 884 crores in budget 2008-09; thus, an amount which is roughly equal to the total expenditure of the Indian government in 2008-09 would be the loss to the nation for embracing neoliberalism. Isn’t it high time we sharpened our struggle against neoliberalism in earnest?

(Comments from Debarshi, Kuver and Partho have substantially improved the argument of this article).

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Agreement between Tata Motors Ltd., Government of West Bengal and WBIDC

1. Tata Motors Ltd. (TML) was intending to set up a manufacturing Plant for Automobile Products including “Tata Small Car” to manufacture 250,000 cars per annum on 2 shift basis which could be expanded to 350,000 on 3 shift basis. In addition, it would have several Vendors and act as a mother plant for many aggregates to tune of 500,000 cars. In this connection, TML was considering locating the plant in the States of Uttarakhand/ Himachal Pradesh in view of the fiscal incentive package for the rapid industrialization being made available by the Govt. of India to new Industries in these States which has been attracting a large number of industries to these States. The incentive package in Uttarakhand/Himachal Pradesh consists of:-
(a) 100% exemption from Excise Duty for 10 years.
(b) 100% exemption from Corporate Income Tax for first 5 years and 30% exemption from Corporate Income Tax for next 5 years.

2. The Government of West Bengal (GoWB) is keen to take appropriate steps for rapid industrialization in West Bengal and in this connection wanted to attract some major Automobile Projects to the State. The Government of West Bengal approached TML to persuade them to locate an Automobile Project including the project to manufacture “Tata Small Car” in West Bengal. TML showed interest in locating the plant in West Bengal, provided the State gave Fiscal incentive equivalent to the value of total incentives it would have received by locating the plant in Uttarakhand / Himachal Pradesh. GoWB offered to match the financial incentives in equivalent terms and invited TML to set up the Small Car plant in West Bengal entailing investment of over Rs. 1500 crores by TML. In addition, Vendors supporting the project are likely to make further investment of over Rs. 500 crores.

3. Since then numerous discussions have been held and based on this understanding, GoWB proceeded with identification of various lands for this mega project. Land of approximately 1000 acres chosen in P. S. Singur of District Hooghly was finalized with TML. West Bengal Industrial Development Corporation Ltd. (WBIDC) commenced the process of acquisition of this land. The process was completed with the Declaration of Award under Section 11 of the Land Acquisition Act, and thereafter WBIDC has obtained mutation of ownership in its name in the Record-of-Rights, and conversion of usage of the land from agriculture to factory.

4. WBIDC is in possession of 997.11 acres of land, which has been acquired under the Land Acquisition Act. Out of this, an area admeasuring 645.67 acres will be leased to TML for setting up the Automobile Project including the small car plant, while an area admeasuring 290 acres will be leased to the vendors to this Automobile Project approved by TML (ancillary and component manufacturing units), 14.33 acres will be handed over by WBIDC to WBSEB only for construction of 220/132/33 KV substation and the balance admeasuring 47.11 acres will be used by WBIDC for rehabilitation activities for the needy families amongst the Project affected persons.

5. The terms of lease to TML for the 645.67 acres of land for the mother plant are described below. In addition, WBIDC will provide on lease 290 acres of land to the Vendors selected and approved by TML on payment of Premium equal to the actual cost of acquisition plus incidentals, to be calculated on the basis of the total acquisition cost and other incidental expenses expended by WBIDC or any of its subsidiaries (duly certified by its auditor) averaged over the total land acquired. The lease rental payable per year per acre by the vendors will be Rs. 8000/- per acre for the first 45 (forty five) years and Rs. 16000/- per acre for the next 45 (forty five) years. The initial lease tenure will be 90 years. On expiry of 90 years, the lease terms will be fixed on mutually agreed terms at that point of time.

6. The parties also discussed mutually to finalise the package of incentives required in order to enable GoWB to fulfill its commitment to match in equivalent financial terms the fiscal incentive foregone by TML in Uttarakhand. The Net Present Value (NPV) computation of benefits that the project would have received in Uttarakhand is attached in Annexure I which is agreed to by all the parties. Sample computation of benefits in West Bengal with stated assumptions is given in Annexure II which is accepted by all parties as agreed basis of computation. The NPV is calculated @ 11%.

7. Accordingly, it is finally agreed, in supersession of all previous decisions and agreements in this regard, that for this mega project, the fiscal incentives under Industrial Promotion Assistance in terms of the West Bengal Incentive Scheme (WBIS 2004), assistance towards land cost and interest subsidy in the form of a loan against a quantum of the term loan to be taken by TML for this project will be offered by GoWB as follows:-

(a) WBIDC will provide Industrial Promotion Assistance in the form of a Loan to TML at 0.1% interest per annum for amounts equal to gross VAT and CST received by GoWB in each of the previous years ended 31st March on sale of “Tata Small Car” from the date of commencement of sales of the small car. This benefit will continue till the balance amount of the Uttarakhand benefit (after deducting the amount as stated in para 7b and 7c below) is reached on net present value basis, after which it shall be discontinued. The loan with interest will be repayable in annual installments starting from 31st year of commencement of sale from the plant. The loan availed in the first year will be repaid in the 31st year and the loan availed in the 2nd year will be repaid in the 32nd year and so on. WBIDC will ensure that the loan under this head is paid within 60 days of the close of the previous year (on 31st March) failing which WBIDC will be liable to compensate TML for the financial inconvenience caused @ 1.5 times the bank rate prevailing at the time on the amount due for the period of such delay. TML & GoWB will make best efforts to maximize sale of products from the “Small Car Plant” in the State of West Bengal.

(b) WBIDC will provide 645.67 acres of Land to Tata Motors Ltd on a 90 year lease, on an annual lease rental of Rs. 1 crore per year for first 5 years with an increase @ 25% after every 5 years till 30 years. On expiry of 30 years, the lease rental will be fixed at Rs. 5 crores per year, with an increase @ 30% after every 10 years till the 60th year. On the expiry of 60 years, the lease rental will be fixed at Rs. 20 crores per year, which will remain unchanged till the 90th year. On expiry of 90 years the lease terms will be fixed on mutually agreed terms at that point of time. The benefit on account of land would be calculated as the total land area leased out to TML multiplied by the cost of acquisition calculated in the manner as provided in para 5 less NPV of rent payable during 60 years.

(c) The West Bengal Govt. will provide to TML a loan of Rs. 200 crores bearing @ 1% interest per year repayable in 5 equal annual installments starting from the 21st year from the date of disbursement of loan. This loan will be disbursed within 60 days of signing of this Agreement.

(d) The West Bengal Government will provide Electricity for the project at Rs. 3/- per KWH. In case of more than Rs. 0.25 per KWH increase in tariff in every block of five years, the Government will provide relief through additional compensation to neutralize such additional increase.

8. It is also agreed that the computation of the comparison of benefits in Annexure I and II will be changed if there are any changes in the rates of excise duty and corporate income tax during the next 10 years.



5 Responses to “Farewell to the Tatas: Costs and benefits of the Tata-Singur Project, a detailed dissection of the deal”
devdulal das Says:
October 4th, 2008 at 3:27 pm
Dear sir,

This is a wonderfully crafted document fit for research reference. Though not living in Kolkata anymore, I am a bengali and completely appreicate the amount of time and research you must have out into the article.Also having been a journalist with Times of India for many years ( am not a journalist any more)…i like the way the questions have been raised….very sharp argument.

Robu Says:
October 4th, 2008 at 7:39 pm
I am sorry this is will be huge loss for Bengal and its reputation.

Debojyoti Bhattacharya Says:
October 6th, 2008 at 4:59 am
Dipankar,
This is an excellent article. The computations provided in the article will help us to understand the exact loss. I hope if WB govt + TATA can come u with some numbers regarding the net employment generation so that we can come with figure which shows negative employment generation. Though I am not very sure, I heard that there is a model which gives the number of employment generation per $/Rs. Could you try quote that in that article to get an approximate number of employment generation?

Anonymous Says:
October 7th, 2008 at 7:20 pm
In the text of the article, I had stated that a full-blown cost-benefit analysis was not possible with the available information; that is primarily because information about net employment, and therefore the corresponding income, generated in the Tata-Singur project is lacking. There is lot of uncertainty about the possibilities of new employment flowing from the project, and figures for net employment generated varies from a high of 10,000 to a low of 500, the highest figure unsurprisingly coming from TML and the West Bengal government. Though it remains true that a full-blown cost-benefit analysis is not possible, what can certainly be done, as a complement to my previous analysis, is to find the benefits of the net employment generation for the best possible scenario and compare it to the costs entailed by the project. In carrying out such an exercise, we would be conducting a rough cost-benefit analysis with the most favourable assumptions for the West Bengal government and TML. Let us see what we the results are.

To proceed, let me state my assumptions clearly:

(1) There is a net employment generation of 10,000 this year in the Tata-Singur project.
(2) The average wage attached to this new employment is Rs. 60,000 per year.
(3) Due to the multiplier effect of this new income generated in the Tata-Singur project, i.e., due to the backward and forward linkages that it will supposedly establish, income will grow at the rate at which the Indian economy has been growing for the past few blazing years, i.e., at 9% per annum.

Thus, the net income generated during the current year will be Rs. 60 crores (which is 10,000 multiplied by Rs. 60,000); during the next year, the total income generated will be Rs. 65.4 crores; the year after that Rs. 71.29 crores, and so on…

Here is the question that I want to pose: how many years will it take for the net present value of the income stream generated due to the Tata-Singur project (and it’s multiplier effects) to equal the cost of the project? How many years, in other words, will it take for the total benefits, under these generous assumptions, to equal the total cost incurred due to the project? Recall that, as we have seen earlier, the total cost of the project is roughly Rs. 3000 crores on a net present value basis? So, how many years will it take for the benefits to equal Rs. 3000 crores?

And here is the answer: 127 years!

What does this imply? Let us think a little carefully. The net employment generation figure is by all accounts a gross exaggeration. As we have argued earlier, the component of employment that will go to unskilled labour is relatively small. Given the fact that the semi-agricultural labour population in Singur is most likely to be absorbed, if at all, as unskilled labour, the employment prospects of these people are extremely limited. Additionally there is the aspect of job destruction which we have so far ignored; it is most likely the case that the quantum of jobs destroyed due to the project is higher than the jobs that will be created. Hence, in all probability, the net employment generated by the project is negative. Thus, in assuming that the net employment generated by the project is 10,000 we are inflating the figure many times over. The fact that we have also assumed the wages to be Rs. 60,000 per annum only adds to the exaggeration. Since most of the employment for the people of Singur will be in the form of unskilled labour, a salary of Rs. 5,000 per month is a certainly high figure.

Similarly, the assumption that the total multiplier effect of the new employment will be a growth of 9% per annum year after year is also an exaggeration. If the multiplier effect of the new employment would generate 9% additional every year, it would mean generating about Rs. 5.4 crores of additional income in the second year, about Rs. 5.9 crores of additional income in the third years and so on… Even the Indian economy is expected to slow down, from it’s current 9% growth rate, due to the global financial crisis. Hence, an annual growth rate figure of 9% for income generated most certainly inflates the benefits accruing from the Tata-Singur project in terms of employment and income.

What all this means is that even under extremely favourable assumptions, the cost of the Tata-Singur takes 127 years to be recouped. A reasonable time frame to recoup the costs of the project would require an unrealistically high rate of income growth, something which is anyway unlikely given that the world economy seems headed towards a deep recession. Thus, it seems that the costs of the Tata-Singur project far outweighs the benefits that can reasonably be assumed to flow from undertaking it.

Suman Chakraborty Says:
October 8th, 2008 at 11:28 am
I am wondering that you finally conclude with ’struggle against neoliberalism’. We ,the common people see this incident as a GREAT LOSS OF WEST BENGAL. This is indeed. We do not care about so called ‘neoliberalism’. The bottom line is we lost the opportunity of being a important hub of car manufacturing wing of a company which can be called GE of India. It’s a pain…and Shame.