News Wrap


The results of the state assembly elections at end 2013, particularly the national capital region Delhi, indicate that the young, educated and urban voters want economic growth and skilled employment. They are scarcely impressed by populist policies of food subsidies and rural job schemes, dynastic leadership and communalist passions between Hindus and the Muslim minority. Millions of Delhi voters voted the Aam Aadmi (Common Man) Party (AAP), an organization founded only a year ago by former tax official Arvind Kejriwal to fight against corruption. The 150 million first time voters in 2014 Lok Sabha General elections, will be a force to be reckoned with. The AAP is supported by idealistic volunteers and financed by small donations from the public, 80% of AAP funds emanate from outside Delhi. Delhi has contributed only 20% or Rs 4.5 crore to AAP’s total collections of about Rs 22.3 crore. NRIs contributed 30% or about Rs 6.7 crore, while the rest came from across the country, with Maharashtra alone contributing Rs 2.8 crore. The big cities are the major sources of funding, with the top eleven cities contributing 73% of the total. Greater Mumbai, including Thane and Mumbai sub-urban is the second largest contributor after Delhi.

Illegal Iron Ore Mining
It has been estimated by the M B Shah Inquiry Commission that the size of illegal iron mining in Orissa is around Rs 60,000 crore. Half of the profits from the illegal mines in Orissa, should have gone to the local population. Tata Steel, Essel Mining (Birla Group) and SAIL are guilty of over extraction from their mines. The incentive to mine the ores can be curtailed only if the export of iron ore from the state is banned. High export duty, low demand from China, and a hostile regulatory environment have, of late, led to a fall in export of iron ore from Orissa from 10.01 million tons (2011-12) to 4.34 million tons (2012-13). Illegal miners have been submitting false excise certificates to claim a lower freight rates from the railways, as the railways charge lower rates for domestic transport of ore compared with exports. The lower charges were used by the miners to earn about Rs 1900 crore in six years, while exporting the ore too. In the South Eastern Railways zone, the scale of evasion is particularly high. Illegal miners are generally wealthy and well connected people, who obtain leases easily, pay meagre royalty, and earn windfall profits. Most illegal mines are located in tribal dominated zones. The illegal miners violate the green norms under Forest Conservation Act. The tribals have remained a deprived lot, notwithstanding a number of Acts to protect their traditional rights.

Prisoners in Russia
Prior to two months before the Winter Olympic in Sochi (February 2014) parliament in Russia approved a broad amnesty bill, that frees prisoners convicted after controversial cases. Mikhail Khodorkovsky was arrested in 2003, on allegations of tax evasion and fraud at his oil company Yukos. Widely seen as a political prisoner, Khodorkovsky’s troubles started only after he confronted president Vladimir Putin over corruption. He helped introduce corporate governance in Russia, by installing independent directors at Yukos. Following a request for pardon without admission of guilt, he was released from prison, and allowed to fly to Berlin, in the third week of December 2013. The Russian Amnesty Bill covers two members, Nadezhda Tolokonnikova and Maria Aloykhina, of the punk band Pussy Riot, jailed over a protest staged in a cathedral. The 30-strong crew of activists seized by Russian coast guards from the Arctic Sunrise, a Green Peace Ship, at an Arctic drilling platform, have also been freed. Legislation requiring foreign funded lobby groups to register as ‘‘foreign agents’’ and banning ‘‘propaganda’’ for non-traditional sexual relations among minors had led to fears of Russia failing to protect human rights. More than 20,000 people are expected to be affected by the Russian parliament’s amnesty, although only about 2000 of them are in prison.

Gdansk Shipyard
Job layoffs are widespread at the historic Polish Gdansk Shipyard, which now employs about 1200 workers, down from 18000 in 1980, when the yard was named after Vladimir Lenin. Earlier it was part of a core industry in communist Poland, and also the site of strikes that created the solidarity labour union. The yard has been facing economic trouble for a quarter century, and has twice been declared bankrupt. Numerous union contracts, past debts, part ownership by the state, and a thriving private sector competition is creating a looming third bankruptcy on Gdansk shipyard. The Gdansk Shipyard Group, the Ukrainian company owns 75% of the yard, and the rest is owned by ARP, the Polish Government’s industrial development agency. In 2007, the yard was rescued by Industrial Union of the Donbass (ISD), a steel and heavy industry conglomerate from eastern Ukraine. The shipyard had received  public help, and needed a restructuring plan approved by the European Commission. The yard made a loss of 250 million zlotys in 2011-12. The ISD has pumped in 500 million zlotys. Even though the shipyard is closer to breaking even, it still requires an additional 180 million zlotys to rescue. Across the Baltic  bay, the Christ shipyard, a new private shipbuilder makes vessels to service Baltic and North Sea oil and gas wells. Workers of the Gdansk Shipyard plant are being paid half of their monthly salary, with promises that the rest will come later. Pay cheques have been delayed for months. In the world of Polish capitalism, Gdansk Shipyard is struggling to avoid a collapse.

Vol. 46, No. 32, Feb 16 - 22, 2014