‘Big capital’ versus ‘people’?

In my last post, I ask why the ‘private sector or people’ should exist as a legitimate dichotomy? Obviously, it isn’t. In a previous post, quotes from leading CEOs show how ‘private sector’, better understood in my argument if I call it ‘big capital’, builds up pressure on the government to bring about legislation that is in its favour.

Such lobbying is usually to give the ‘unethical’ a legal garb. Is it ethical for ‘big capital’ to demand of the government that it acquire land at below-market prices and supply to them so that they can run profitable business empires? Is it ethical for the same ‘big capital’ to also demand special SEZ rules where they do can escape from their rightful obligations towards workers? Further, you lobby to demand the lowest rates of corporate taxes possible.

It is said that the objective of ‘big capital’ is to maximise profile through legal means. It is this process of lobbying for what is borderline (and sometimes clearly) unethical to be given legal protection through legislation is what distinguishes ‘big capital’ from ‘people’. ‘Big capital’ or industrialists or shareholders who are continuously working on maximise profits and returns to shareholders, and are governed by short-term interests that do not even include the workers/employees of the same industries or citizens residing in close proximity to their facilities or even the consumer that forms the market for their products are the settings which set up this conflict. How do we start undoing these knots in society? 


Private sector or people? Is this dichotomy necessary?

An interesting round-table at Tehelka – see here. The representatives of the private sector start off with the usual gripe about unclear laws, poor implementation, leakages, populism and politics. Other participants fight back with arguments for people-centric policies, complaining of how public policies have come to support the interests of a small privileged minority. Tehelka clearly leans towards the latter view. The early part of the discussion does show where the fault-lines lie, though. Take for example, Hero’s Munjal’s back-handed compliment to NREGA: 

But there’s another interesting phenomenon that gets overlooked. Many industries that resisted the government’s social programmes in the early days have now realised that these can help in building up a market. Some of these programmes have been very sensible. The NREGA, for example, has allowed millions of people to have a job and earn money. It is true, dole is not a good idea in the long term, and farms and factories in states like Haryana, Punjab, Bihar and Uttar Pradesh, where labour used to come from, are not able to get labour now. This means the cost of doing business in India has moved up

Harsh Mander counters:

I went to Raigarh recently, in Chhattisgarh, where I’d been a District Collector 20 years ago. It’s a forested tribal area. What I saw there — from one point of view — could be celebrated. The Jindals have huge power and mining projects there. “Growth” is certainly happening there, but the forests have been devastated and the tribals have lost their land. Is this a sign of the state’s success or failure? I think we need to at least problematise it

Towards the end, as all enlightened panels do (except on Arnab Goswami’s Newshour), the participants seem to respectfully nod at each other’s views and conclude agreeing to the need for a decisive and honest government policy, along with responsible corporate behaviour. 
The big problem often is the boxes that we try to tick when we think of the private sector or the social sector and those who claim to represent the interests of these sectors. It is a flawed conception in the first place to think of the private sector as that excluding the interests of the common man – even if what we think of the private sector is actually the interest of ‘capital’. Even those who own capital will be foolhardy if they think they can continue to make profits while continuing to overlook the interests of society at large. I support private interests – the right of every private citizen to have access to opportunities to succeed. I also think that it is the duty of the government to ensure equity in access to these opportunities. Is it so wrong to seek balance, in views and in deeds?

What CEOs want

Adi Godrej: Activate the cabinet committee on investments to take quick decisions to clear the large number of projects held up for one reason or the other
Kiran Mazumdar Shaw: A cabinet committee on investments to fast-track large projects
Chanda Kochchar: improve the investment climate and for that you need to clarify the approach towards access to land, natural resources and approach towards environmental clearances. If we bring clarity there, we can improve investment climate in general
Naina Lal Kidwai: The new land Bill has been passed by the cabinet. Industry has some apprehensions with regard to the land Bill and we hope that its concerns will be taken on board and that it will be reviewed. The process of land acquisition also needs to be fast-tracked

All attacking the land bill one way or the other. All CEOs; all want to fast-track. Is there for those displaced/affected?

Mrs. Rajaratnam strikes

Asha P. Rajaratnam  rajaratnamasha@galleon.com
03:38 (19 hours ago)

to undisclosed recipients

Why is this message in Spam? It’s similar to messages that have been detected by our spam filters.  Learn more

My name is Asha Rajaratnam,I am the wife of Raj Rajaratnam founder of  the Galleon Group ,New York.

I do have a proposal for you,which would be of financial benefits to you and myself.

My husband has been jailed in the U.S for 11 years,I need your assistance to help me move some funds from Holland to India  or anywhere where it would at least be of some help to our family.

I would give you more details of this proposal if you show yourself willing to take on it,I assure you that you would most certainly be compensated but please I would kindly request you to keep this matter confidential.

I am currently here in the UK where it is a bit safe for me and my kids.

You can reach me on my personal email id which is rajaratnamasha@rocketmail.com

Sincere regards,

Asha  Rajaratnam

Waiting to hear from Mrs. Gupta next…

An economy shouldered by destitutes

Yet another reminder that a good part of our so-called progress and economic boom is shouldered by destitutes – the story in The Hindu about the exploitation of migrant construction workers in our cities, right under our noses, under the watch of governments, as well as myriad rights activists. And its unlikely to get any better, since the construction industry is made up largely of unskilled workers – 82% of the workforce in the sector in 2005.

First principles: R&R before CSR

In a recent article in livemint, the author Arvind Pandey makes a set of excellent points about the importance of a well-planned CSR programme, especially by companies that initiate large projects that affect and displace communities, such as the metals and mining industry. While the article rightly points out that in the current political scenario, these investments are nearly non-negotiable, one got the feeling that the author mixed up Rehabilitation & Resettlement (R&R) with Corporate Social Responsibility (CSR).

It is important to make a distinction between CSR and R&R. Ensuring Rehabilitation & Resettlement of communities affected and/or displaced by big projects is the obligation of the industry and the government. As difficult as it may be, one needs to assess a fair price for land and houses to compensate communities. Also, the damage caused (and to be caused) to the environment needs to be accounted for and this responsibility sits squarely on the industry, with the government playing the role of a fair arbitrator. The industry needs to play fair and does not attempt to secure any undue benefits through manipulating the license and acquisition processes. This is Step Zero and should be factored into proect cost calculations.

In recent years, we have seen companies ignoring R&R at their own peril. Projects such as Singur were disrupted because basic R&R terms were not agreed and acted upon. The stalled projects in Orissa are awaiting a fair resolution to the R&R terms being offered to the communities.

Sustainability and CSR (which are optional and in principle, determined at the discretion of the industry) comes only once R&R activities have been completed. While the Companies Bill and the Mining Bill, may attempt to stipulate CSR spending, the nature of these projects and the exact details may can be left to the industry and they can explore innovative ways of making a difference to communities that live around their facilities. R&R, on the other hand, must be a non-negotiable, governed by statutes.

R&R is the first step towards building a relationship of trust with local communities. A strong CSR programme would secure this relationship and keep communities invested in the prosperity of the industry and of the economy in general.

Buffett for sale

Not beyond the much feted investor to put himself on sale…well, his time and wisdom, at least. All it costs is the price of a new motor insurance policy

Berkshire Hathaway is now in India, and Warren Buffett will welcome all policyholders* of BerkshireInsurance.com at an event specially hosted for them.

Just a clever investor, this one – not sure what all the nonsensical fanfare is about. Oh yes, he is there is encourage Indian philanthropists to ‘give’; and also to sell some motor insurance while he still can…nice!

A quick sound-byte from someone on the ground

“He’s doing a wrong thing,” said S.K. Sethi, an insurance broker in New Delhi. Next thing you know, Mr. Sethi says companies could try selling insurance by saying “you’ll have an opportunity to see the dance of Katrina Kaif.”