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Tuesday, February 18, 2014

Nandigram: It Says India Is Not China

Mangoes are cultivated extensively in Andhra Pradesh, while Kashmir is known for extensive cultivation of apples. But apples cannot be cultivated in Andhra Pradesh and similarly mangoes are not grown in Kashmir. This is a known fact but the question is, ‘why’? It is all ‘atmospherics’, which is a given – what mango and apple need to grow is provided by nature and that is in abundance at these two places. That is the reason why mangoes are cultivated in Andhra and apples in Kashmir but eaten all over India.   

This theory does not however, hold good in the case of manufacturing cars, for they can be made either in Andhra Pradesh or in Kashmir, or for that matter anywhere else. Industrial units – manufacturing facilities specifically erected for turning out a particular consumer goods—being man-made, operating in an enclosure of their own can simply be erected anywhere. Thanks to globalization, factors such as proximity to raw material supply, or nearness to consumers, etc. do not matter any longer: what matters today is how different one’s product is from that of the competitor—in terms of price and quality and its efficacy in serving consumers’ needs. Thus, computer hardware designed in the US is made in China, chips designed in the US are made in Taiwan, and software meant for European businesses is written in India and sold and bought by people across the globe. That being the order of the day, one wonders why the West Bengal government is so bent upon establishing and SEZ as a hub for chemical industries in Nandigram, despite the known resistance from the local farmers. Still bigger question is: Does it warrant police firing killing 14 persons and injuring scores of people? 

This apparently simple question, of course, calls for a complex answer. First, it is in everybody’s knowledge that India’s infrastructure is in a poor state and according to the Prime Minister, it needs an investment of $350 bn in the Eleventh Five-year Plan, if it has to sustain the current growth rate of 9% in GDP and take it to double digits. And it’s commonsensical that with the kind of budgetary allocations, we have been making for infrastructure development, the rising demand for capital from social sectors and the kind of bureaucracy that we have had, we cannot create the required infrastructure overnight. It is in this context that the present government came up with the idea of creating Special Economic Zones—“capitalist enclaves”—to attract private investments by offering over-generous concessions by way of tax holidays, making available huge chunks of contiguous land, and importantly, promising least governmental interventions in their functioning.  This arrangement is hoped to create pockets of excellent infrastructure within a short span of time that can attract private investment—both domestic and foreign—and stimulate economic growth by boosting exports. By creating fertile environment for investment of private capital, these SEZs are tipped to become  ‘islands of prosperity’, and in the process are also expected to create jobs very quickly: the government claims that the first batch of approved SEZs numbering 64 involving an investment of $13.4 bn will alone create 8,90, 000 jobs by 2009. Lured by these prospects, and guided by the economic prosperity that China has achieved through SEZs, the Marxist-led West Bengal government— despite Left-parties disdain for reforms at the national level—too took to the idea of creating SEZs in all earnestness and enthusiasm with a hope to create more employment that could absorb teeming rural youth much faster.

It was thus far good. But, what the government did not realize is that Indian citizens, unlike Chinese, could raise their voice against the government policies, coercing even their withdrawal. The enthusiasm of the government in imitating China and its policies, thus, met with resistance from farmers and other political groups, for India, unlike China, is not under a ‘controlled regime’. No matter how good a policy is it cannot be implemented, unless the people accept it. Secondly, the legal, constitutional, and institutional framework meant to protect and promote human rights is very strong in India. The constitutional empowerment is indeed the main promoter of civil, political, economic and social rights of citizens and it is religiously protected by the judicial activism. The net result is: what can be implemented in China in two weeks takes years for implementation even in the communist-ruled West Bengal.

That being the reality, no amount of power rested with the government can enable them to acquire land for establishing SEZs. Such agitations will only turn more vociferous if political parties succeed in dubbing them as acts of government for promoting private profit. That’s what indeed is happening in Nandigram today. It should not, however, mean the end of SEZs, for they can be established anywhere. Secondly, such resistance would always be less from farmers in dry tracts, and for industries it doesn’t matter where they are located so long they are served by excellent infrastructure. And SEZs being aimed at providing such support, it makes great sense to locate them where they are welcomed.

That’s perhaps the only way to make the country move forward, for the test of progress, as  Franklin D Roosevelt said “is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little”.

(April, 2007)


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