From Singur to Nandigram and beyond or DEVELOPMENT AS DISPOSSESSION

Kashmir Times
29 January 2007
From Singur to Nandigram and beyond
or DEVELOPMENT AS DISPOSSESSION

by Praful Bidwai

If and when ordinary mortals like you and me buy land, we search high and low for an affordable piece, hire brokers, make several trips to different sites, and borrow bank loans, which we must repay through our nose over 10 or 15 years.
Besides these high transaction costs in time and money, we also pay stamp duty to the government, which is usually a good eight percent of the land's value. None of this applies to India's biggest business house (and one of its oldest industrial families), namely, the Tatas-at least as far as the Singur car project is concerned. The Tatas are no ordinary mortals. In fact so special are they that West Bengal's Left Front woos them with the choice of six different sites, besides the Uttarakhand and Orissa governments. They choose one at Singur, next to an expressway, in one of Bengal's most fertile tracts, just 45 km from Kolkata. But they do so after stipulating a series of conditions.
• The government must procure the land for them. This will cost it Rs 140 crores. But the Tatas will pay only Rs 20 crores, after five years.
• They will pay no stamp duty.
• They must have a contiguous plot of 997 acres (almost 400 hectares, or 40 lakh square metres). No Indian car factory has anything approaching this area. (Even Tata Motors's giant Pune factory has only 188 acres, including housing for employees.)
• The factory proper, say the Tatas, will have a built-up area of only 1.5 lakh sq m, or under 4 percent of the land acquired.
• The land must be fenced off and protests suppressed. The Tatas mendaciously accused their "competitors" of fomenting the protests, but couldn't name them when challenged.

That's not all.
• The Tatas demanded "compensation" for "sacrificing" the 16 percent excise duty exemption offered by Uttarakhand for locating the car factory.
• This means "upfront infrastructural assistance" worth Rs 160 crore on a Rs 1,000-crore project. Besides, the hyped-up "Rs 1 lakh car" will probably cost a fair bit more. It be must be "cross- subsidised."
• So, says The Statesman, the Left Front government has gifted 50 acres of prime land to the Tatas in Rajarhat New Town
• and another 200 acres in the Bhangar-Rajarhat Area Development Authority for building IT and residential townships.
This is an obnoxious "sweetheart deal".
• The Left Front government isn't promoting healthy development or even straightforward risk-taking capitalism. It's the most detestable form of risk-free investment which dispossesses people to generate super-profits.

The Tatas claim:
• the project will directly generate 2,000 jobs
• and indirectly, 8,000.

But noted economist Amit Bhaduri estimates:
• it will produce just about 300,
• besides indirect employment for 1,000.

In the process, Singur's flourishing economy, where two-thirds of land is multi-cropped with vegetables and paddy, will be devastated, along with the livelihoods-of landowners, sharecroppers (bargadars), but of landless workers and rural artisans.
Singur will witness counter-reform, a reversal of the most successful land reform ever undertaken in West Bengal. Even the bargadars' share in the land (75 percent, against the absentee landlord's 25 percent) will be reversed in the land compensation formula. No wonder, the West Bengal government had to resort to repression, including mass arrests, Sec 144 and physical attacks, to enforce the "sweetheart deal".
Singur's injustice was soon compounded by the government's ham-handed attempt to take over an even larger 10,000 acres at Nandigram for a Special Economic Zone for Indonesia's unsavoury Selim Group. Here, the resistance was even more fierce. It came not from the Trinamool Congress, but from the Left, including the Communist Party of India, the Revolutionary Socialist Party and the Far Left. Nandigram, at the heart of the Tebhaga movement of the 1940s, is a CPI stronghold.
Chief Minister Buddhadev Bhattacharjee had to admit that Nandigram was a mistake. But he blamed the Haldia Development Authority for it: for issuing the land acquisition notification without "authorisation". This won't wash. The involvement of Communist Party (Marxist) cadres, the police, and the very composition of the Authority, militate against the explanation.
Nandigram is part of the larger SEZ syndrome which afflicts India. SEZs have become the main instrument of dispossession of peasant farmers. They are a despicable combination of private greed and state collusion. SEZs, as this Column argued in mid-September, are costly ways of promoting enclave-style elitist export-oriented industrialisation. They'll grant wholly undeserved tax cuts to promoters and inflict a loss upon the exchequer, estimated by the Finance Ministry, at a horrifying Rs 160,000 crores. Yet, the government has approved 237 SEZs with 34,509 hectares and notified 63 of them. Another 165 SEZs have been approved in principle, for which another 148,663 hectares is to be acquired. Applications for another 300 are pending.
SEZs have not proved a success in most countries, including China. In fact, Shenzhen, China's best-known SEZ, has turned out a nightmare for workers. The mere loss of an identity card can turn them into destitute overnight. Above all, SEZs are a gigantic real estate scam. Most are meant to grab land close to the big cities and extract monopoly profits. SEZs also put the cart before the horse: displacement without prior rehabilitation, with potentially disastrous social, cultural and political consequences. Prime Minister Manmohan Singh has himself acknowledged this by calling for a "humane" approach to resettlement. The government is now redrafting the National Policy for Resettlement and Rehabilitation.
Its Group of Ministers has temporarily put the SEZ land acquisition process on hold. It knows pushing acquisition could cost the United Progressive Alliance dearly in the coming elections. The Congress party has made an internal assessment of SEZs in a 16-page document prepared by Mr N Veerappa Moily. This says that SEZs will create conflict due to "dispossession and displacement", including urban conflicts through infrastructure bottlenecks. "They (SEZs) have the potential to cause embarrassment to the government of the day."
The publication of a story quoting this assessment has certainly embarrassed the UPA! Although Mr Moily has publicly dissociated himself from it, the judgment is basically sound. But the UPA is fighting shy of radically revising its SEZ policy. It has only called for a cap on the number of SEZs. What is needed is the scrapping of SEZs altogether because they are economically irrational, socially divisive, and thoroughly inequitable.
This is not to argue against industrial projects per se. We must vigorously promote industry, but with a balanced, reasoned approach. We must make it mandatory for the government to consult the people likely to be affected in advance, and establish institutional norms for compensation, resettlement and rehabilitation. Equally crucial is thorough socio-economic examination of the consequences of industrial projects and strict environment regulation.
It won't do to commandeer land first and then look for ways of compensating the affected people. It's especially inadvisable to offer them equity shares in companies related to the projects that take away their land. This will, in most cases, transfer risks to vulnerable groups who are least capable of making decisions about stocks and shares. The number of shareholders in India is a minuscule 30 million; most people don't understand share markets.
Offering shares could be an option in rare cases, where organised cooperatives exist, which are run by financially literate volunteers accountable to the gram sabha, and who have a proven commitment to collective welfare. That concept includes not just landowners, but also the landless and other economic actors, from the sanitation worker to the mechanic, and from the ironsmith to the barber, whose livelihood depends on the rural economy.
However, supporters of industrialisation-at-any-cost, including Mr Bhattacharjee, contend that very little fallow land is available in India (in West Bengal, only one percent of the total), and hence cultivable land must be "sacrificed" to industry. Historically, they say, industrialisation has never been painless. It has always extracted a price from peasants-even in the USSR and China. India follows that model of expropriation.
This argument is profoundly mistaken-not only because it imposes pain disproportionately on the weak. Industrialisation in much of the West did expropriate the peasantry through "enclosures", systematic impoverishment, and mass-scale human rights violations. The same happened in the Soviet Union under Stalin. But we should not imitate and repeat the blunders of a period when democracy was non-existent and human rights unknown.
In India, we have launched a Grand Endeavour-based on the aspiration to modernize society and develop the economy in balanced, equitable ways within a robustly democratic and inclusive framework which respects human rights and social justice. We have a unique opportunity to create a shining example of inclusive industrialisation for the world. We must not turn our face against the Grand Endeavour.