‘Prohibiting the use of agricultural land for industries is ultimately self-defeating’

Q: What are your views on farmland acquisition for industry and the Singur-Nandigram controversy?
Amartya Sen: That is a very complicated question and has many aspects. Let me separate them out.

First of all, the need for industrial priority in West Bengal, which is a big long-term question and an extremely important issue.

It is sometimes underestimated the extent to which Bengal has been de-industrialised. Bengal was one of the major industrial centres in the world, not only in India. In European writings, Bengal has again and again come up as being one of the most prosperous areas in the world as an industrial base. The kind of reputation that some parts of Italy gained later.

It is often said that historically, Calcutta was founded 300 years ago by Job Charnock but it is also true that there was an urban settlement based on trade and industry, apart from agriculture, in this area. This we see not only from Indian records but also from the writings of Ptolemy and Pliny the Elder. The Europeans were aware of that.Very near from Calcutta, there were industrial areas of huge prosperity. There is also mention in the writings of Fa Hien who came here in 401 and spent 10 years. He went back by boat. He took the boat from Tamralipta, which is very close to Calcutta. Effectively, it was greater Calcutta. So this has been a trading and industrial area for a very long time.

When Charnock came and the Battle of Plassey happened, there was not only English but the French, the Portuguese, the Spanish, the Flemish and the Danish merchants. They were all interested in the industrial products of this area. Under the British, there was de-industrialisation of classical industry but new industries came in the form, for example, of jute. But gradually that went off after Independence and there was further de-industrialisation.

The policy of the Communist Party itself was not well thought-out. The industrial agitation may have given the workers a little bit more rights, but they lost many more rights by the industries withdrawing out of Calcutta.Jyotibabu was aware of the problem and Buddhadeb Bhattacharjee has tried to carry the understanding forward by trying to make it possible to have a big industrial base here. And it is extremely important.

It is also very important to recognise that production of industrial goods was based on the banks of the Hooghly and the Ganges, which are fertile areas anyway. So to say that ‘this is fertile agriculture land and you should not have industry here’ not only goes against the policy of the West Bengal government but also against the 2,000-year history of Bengal.

This is where industry was based because even though the land may be very fertile, industrial production could generate many times more than the value of the product produced by agriculture. The locations of great industry, be it Manchester or Lancashire, these were all on heavily fertile land. Industry has always competed against agriculture because the shared land was convenient for industry for trade and transportation.

Q: What about land acquisition?
Sen: I think some mistakes were made and the government should admit it and to some extent the government has admitted it.

Singur’s location could be questioned because there were some other locations one could have thought of like Kharagpur. But one of the difficulties is that Calcutta has such a huge attraction that it is very much easier to attract engineers and managers to an industrial base near Calcutta for the Tatas than in Kharagpur. And this is a dominant factor. Because Calcutta has such reputation.

I recently wrote in a book edited by Gopal Gandhi on Gandhi and Bengal about Gandhi’s relationship with Bengal. Interestingly, the first day he arrived in Calcutta in 1896, he went to see a play. In his stay of six days, he went to see another play. So here is a Gujarati arriving here, but he is so interested in the cultural life of Calcutta that he goes to see two plays in six days. So you just can’t say that because it is fertile land, you cannot allow managers and industrialists to be based in Calcutta and they have to be based in district towns. So the locational decision of Singur was probably not wrong.

Q: What are your views on the compensation paid for land?
Sen: The government paid much higher price than the value of the land in the free market. From that point of view, it was fair. Had there been no industry, they would have got the best value for the land. (Had the land not been taken for industry, the price they got would have been considered the best value, Sen explained.)

Where there is a mistake in the government’s thinking, and I think it is a big mistake of a tactical kind, is not to recognise that if this land were available for industry in general, and not just for the Tatas, the value of the land would have been much greater. While the compensation paid is greater than the value of the land seen as agricultural land, the compensation paid by the government is less than what the value would have been had it been free for competition with industries. If you are part of the market economy, then you have to take into account what the value of the land would have been had it been freely available for industry. So there is an issue to be addressed. I think it is a mistake, an honest mistake and it can be corrected in the future.

Nandigram is a much more complex issue. There is a question whether that kind of operation was needed, whether it was the right place. But I have not studied it in the way I have studied Singur. So I won’t comment.

Q: What, according to you, are the other issues here?
Sen: It is now very important for both the government and the Opposition to avoid violence. There is never a case for violence. The government’s policing has been in some cases over-strong. I understand that some Opposition parties have now created ‘free regions’ where they would not allow anyone to come in. That is also violent activity. It is not in line with Indian tradition of non-violence. The government and the Opposition have to recognise that. It is possible that in the past, the violence committed by the government was greater, but from what I hear, it is possible the opposite might be the case now.

Whichever way it may be, we don’t have to judge. But it is extremely important that in a free country, any people can come in and go out from any place they like and you cannot establish restriction of movement either by the government or the Opposition. This is a subject for rational discussion, which has become so impossible as everything is politicised now. Ultimately, those who want to prevent industrialisation of Bengal do not look enough at the interest of the people of the state. They may intend well, but they are not serving the interest of Bengal’s working class or peasantry. The prosperity of the peasantry in the world always depends on the number of peasants going down. That is the standard experience in the world.It is not that historically agricultural production goes up so much that they become hugely rich on that basis. Bengal has done very well in terms of agriculture compared to other states. But that has not made Bengal immensely prosperous. In countries like Australia, the US or Canada, where agriculture has prospered, only a very tiny population is involved in agriculture. Most people move out to industry. Industry has to be convenient, has to be absorbing.When people move out of agriculture, total production does not go down. So per capita income increases. For the prosperity of industry, agriculture and the economy, you do need industrialisation. Those in effect preventing that, either by politically making it impossible for an industrialist to feel comfortable in Bengal or making it difficult to buy land for industry, do not serve the interest of the poor well.

The Communist Party made a mistake earlier when it drove industries out by union action, which was intended to create benefits for workers but ended up making the workers having no job. Second time it is happening now, not from the Communist Party but from the Opposition, preventing industrialisation, which is not in the interest of Bengal in general and the poor in particular. So if Bengal is to regain what it used to be — being one of the richest in the world — industrialisation has to happen.Prohibiting the use of agricultural land for industries is ultimately self-defeating.

Q: Why not develop other areas in Bengal where land is less fertile and build infrastructure so that industry goes there?
Sen: You have to bring industry everywhere. But there is no way in which you will be able to avoid industrialisation around Calcutta, any more than you could have avoided it in London, Lancashire, Manchester, Berlin, Paris, Pittsburgh. You will find industry will come up where there are advantages of production, taking into account also the locational preferences of managers, engineers, technical experts as well as unskilled labour.

But we should not make the mistake of thinking that somehow while you are trying to attract business based on the market that the government can say: ‘I want you to go to Siliguri and that is where you are going to be.’ That is not the way the market economy works. The market economy has many imperfections, on which I have written extensively. But it also creates job and income and if the income goes up, government revenues go up, so there is money available for education and healthcare and other things.

So in order to do that, you have to give the market economy the operational rational of choosing one location over another, depending on their market-based calculation. You cannot be governed by the market but nor can you ignore the logic of the market if you want to use the market as one of the instruments in advancing the country. So the whole idea of thinking in highly bureaucratic terms that ‘I want it in Siliguri and Bankura but not here’, that is not going to work. That is not the way industry functions in a market economy.

By Amartya Sen
(Nobel laureate Amartya Sen in conversation with Sambit Saha of The Telegraph on land acquisition for industrialisation, one of the most important issues facing Bengal and large parts of the country.)

Open Letter for Release to the Press

We are deeply troubled at the repression unleashed by the MeghalayaGovernment against activists of a movement against the proposed UraniumMining by the Uranium Corporation of India Limited (UCIL) in theDomisiat/Wahkaji area of West Khasi Hills district of MeghalayaThis popular non-violent movement has from the mid nineties opposed thesecretive anti-people behaviour of the Indian Nuclear establishment, andwith considerable courage and popular participation managed to stop themining of Uranium from the area. Instead of respecting the people'sopinions, UCIL, supported by the State Government has tried to split theindigenous community's solidarity through bribes, and attempted tosilence any dissent through use of the draconian Meghalaya PreventiveDetention Act (MPDA).On 12th June, 2007 after announcing a Public Hearing on the issue,without sharing any independent environmental assessment of UraniumMining, a hearing which the movement opposed as flawed, the governmentmade all attempts to get a farcical assent to its plans through riggingthe public hearing by creating a situation of police terror in the area.Although the movement , led by the Khasi Students Union and LangrinYouth Welfare Association had opposed the hearing in principle, itdecided to break through the security blanket, and attend the hearing.Even this rigged Public Hearing had a surprise for the government: morethan three-fourth of the villagers opposed the project . Rather thanaccept the people's verdict, the government has since unleashed avindictive campaign against the activists.Following the hearing, 16 activists have been arrested so far (many ofthem have reported torture), and 7 of them have been booked under theMeghalaya Preventive Detection Act (MPDA), which allows the governmentto hold them under custody for six months without bail or judicialtrial. Most of the other activists have been forced to go underground.We demand that these activist be released, and Governments heed to thevoices of people who do not want Uranium Mining in the state of Meghalaya, or indeed anywhere else.

Signed
Tarun Bhartiya
Sanjay Kak
Himanshu Thakkar __._,_.__

Govt tries to cleanse Dow investment of Bhopal stain

NEW DELHI: In a bid to clear Dow Chemicals, the American giant that took over Union Carbide in 2001, of civil liabilities in the Bhopal gas tragedy — said to be the worst industrial disaster in the world — the Centre is making a concerted effort for an out-of-court settlement with it. The victims of the tragedy may find this hard to believe, but documents with TOI show that the PMO, backed by finance and industry ministers and the vice chairman of the Planning Commission are trying to find ways to clear Dow Chemicals of any legal liability, so that the company agrees to invest in India. Key issues of the 1984 disaster remain unresolved. While direct victims of the poisonous gas leak have been compensated, toxic waste from the plant in a 7-hectare area is said to have contaminated Bhopal's ground water. While the case is going on at the Jabalpur bench of the Madhya Pradesh HC, Union Carbide was bought over by Dow. With that, it would have taken over Carbide's civil liability. In the Jabalpur court case it is named as one of the respondents and the chemicals and fertiliser ministry has raised a demand of Rs 100 crore from Dow to clean up the contaminated factory site in Bhopal. Faced with this, as well as the prospect of higher demands if the court holds it responsible for the ground water contamination, Dow first offered in 2005 to invest in a giant petrochemicals hub, covering 250 sq km, and then showed its reluctance to do so, citing the potential risk to its investment should liability come on it from the Bhopal case. This is where, it appears, government machinery got whirring to allay Dow's fears by seeking to reach an out-of-court settlement and thus pave the way for the investment in the petrochemicals hub. Documents acquired through an RTI application show a series of rapid-fire moves.If settled out of court, Dow won't have any liability

NEW DELHI: Documents in TOI's possession show that an offer by Ratan Tata, who heads the Indo-US business council, to take up 'remediation' - in plain words, cleaning up - of the Union Carbide plant site has been picked up by the PMO and top ministries to find a way out for Dow. The problem with this, say activists, is that once settled out of court, Dow will no longer be responsible for compensating for the water contamination. In other words, while the site might be cleaned up with the help of Tata and other industrialists, the indirect victims of Carbide's cavalier factory management might be left high and dry. What do the documents show? They consist of several notes generated by the PMO, finance and industry ministers, the Planning Commission and the Cabinet Secretary. Commerce and industry minister Kamal Nath wrote to the PMO in February 2007, ''While I would not like to comment on whether Dow Chemicals has a legal responsibility or not, as it is a matter for courts to decide, with a view to sending an appropriate signal to Dow Chemicals, which is exploring investing substantially in India, I would urge that a group under the chairmanship of the Cabinet Secretary be formed to look into the matter in a holistic manner.'' He added," In a similar manner as was done with respect to the Enron Corporation with respect to Dabhol Power Corporation.'' In the Dabhol case, an out-of-court settlement was reached with its now defunct promoter, Enron. Deputy Chairman of Planning Commission Montek Singh Ahluwalia wrote to the PM, Finance Minister P Chidambaram and Kamal Nath in December 2006: ''Ministry of Industry has granted foreign collaboration approval for a technical collaboration between Dow and Reliance. This was greatly appreciated as a signal that Dow was not blacklisted. ''However, they have sought a statement from GoI in the court clarifying that GoI does not regard Dow as legally responsible for liabilities of Union Carbide. Similarly Shri Ratan Tata has written to the FM suggesting that we should launch an industry led intiative. Dow Chemicals indicated that they would be willing to contribute to such an effort voluntarily, but not under a cloud of legal liability.'' Ahluwalia goes on to advise: ''Cabinet secretary should be asked to try and resolve the issue in an inter-ministerial meeting including Ratan Tata or his representative.'' Earlier, Tata wrote to Ahluwalia in November 2006: ''Dow has mentioned in their letter that it is critical for them to have the ministry of chemicals and fertilisers withdraw their application for a financial deposit by Dow against remediation costs, as that application implies that the Government of India views Dow as liable in the Bhopal Gas Disaster case. This is obviously a key aspect and I want your assessment as to whether it is possible.'' He also wrote to Chidambaram. The finance minister concurred with Tata while writing in December 2006 to PMO: ''I think we should accept this offer and constitute a Site Remediation Trust under the chairmanship of Shri Ratan Tata and including executives from the private sector.'' Dow, in the meanwhile, was in touch with top officials in PMO, in which they got the advice to consult top lawyer and Congress spokesman Abhishek Manu Singhvi. Documents show the legal advice given by Singhvi saying that Dow could not be held responsible for the disaster and also not be held liable for any alleged contamination and consequent cleaning up of the Bhopal site. This advice forms part of the PMO file. When contacted on the advice given, Singhvi said, ''I have been appearing as a senior counsel in this case for over 18 months. I was engaged by a leading solicitor firm. I am not in any manner engaged in any matter of the case except appearing at the Jabalpur High Court case and advising Dow on various legal aspects involved in those proceedings. I am not aware of anything else.'' Eventually, in April 2007, the cabinet secretary put up a note that says: ''It stands to reason that instead of continuing to agitate these issues (Dow's legal liability) in court for a protracted period, due consideration should be given to the prospect of settling these issues appropriately. An important aim is to remove uncertainties and pave the way for promoting investments in the sector.'' It adds that instead of leaving the matter to be settled by the court, the government should reconstitute the existing group of ministers (overseeing the work at Bhopal site) with an appropriate mandate.

30 Jun, 2007
Courtsey TIMES NEWS NETWORK
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