‘A New Epoch’


After the Lok Sabha polls this year, the corporate houses and big newspapers were gung-ho at the victory of Narendra Modi, and their enthusiasm has not subsided yet. The corporate tycoons were not pleased with Manmohan Shigh's 'policy paralysis' and hence threw their weight behind Modi. After Modi's victory, Jagdish Bhagwati hailed it as India's 'second revolution'. Bhagwati was correct in one sense; he hoped that Modi would push the already marginalized working masses further to a corner. Already Modi has proceeded far in accomplishing this 'second revolution'.

The failures of Manmoban Singh are many. He could not change the Land Acquisition Act in accordance with the demand of the corporate investors, could not privatize the banking and insurance sector, while failing to cancel the law regarding environmental protection and finally could not reform the labour laws according to the principle of 'hire and fire at will.' On the other hand, he introduced the NREGP and the Food Security Act. which were disliked by big business and land owners.

Narendra Modi has been frantically trying to overcome Manmohan's policy paralysis. Already his government has taken the initiative to alter the NREGA, and the central allocations to different states have been substantially reduced. Modi's second step is to reform the labour laws, which is the long-standing demand of the chambers of commerce, who had wanted the policy of 'hire and fire' in place. The BJP-led government of Rajasthan has already introduced a 'reform', which empowers owners to close a factory without prior consent of the state if the number of workers is 300 or less. The previous legal upper limit was 100. Under the new regulation, 80% of the factory owners, managers will be able to 'hire and fire' at will. The central labour minister is elated and expressed the hope that other states will follow the Rajasthan model. The Director-General of the CII has also hailed this phenomenon as the beginning of a new epoch.

Thirdly, the Modi government is proceeding towards privatization of the coal mines. On 21 October, an ordinance was brought forward, which provides for auctioning coal mines and allowing foreign control of mining, processing and marketing. According to the Coal Mines Nationalization Act 1973, only the Coal India is entitled to do this, and the Supreme Court had ordered that closed or rejected coal blocks were to be returned to the Coal India. The present central government, in defiance of this order, is moving towards privatization. On the other hand, the number of permanent workers employed in the Coal India has gone down from 8 lakh to 3.5 lakh, while the number of contract labourers has increased to 2 lakh, and these workers are victims  of intense exploitation, having no social security rights.

Fourthly, the amendment to the Land Acquisition Act effected during the period of the UPA rule made it compulsory to secure the consent of 80% of the farmers for acquisition. In order to lessen the difficulties of the investors, domestic as well as foreign the Modi government wants to bring down this limit, at the same time seeking to exclude the agricultural labourers and sharecroppers from the list of the compensated through their recent Land Ordinance which is out and out unconstitutional.

The fifth aspect of the reform, programme is to hand over the banking and insurance sector bit by bit to domestic and foreign private hands. The foreign banks and insurance companies that had earlier been permitted to do business in India could not secure the confidence of the customers, and this lack of trust was particularly evident after the collapse of large banks and insurance companies in the USA in 2008. In this situation, preparations are afoot to hand over state-owned banks and insurance companies to private hands. The Modi government has already proposed a reduction of the share of the state in nationalized banks to 52%. Besides, it has opened up the vital defense sector to foreign investment within a few days of the swearing-in of the central cabinet. Going to the USA, Modi has raised the slogan, 'Make in India', which is an exhortation to come to India and plunder the resources of this country.

It is also significant that the Planning Commission has been abolished. It is certainly true that ever since the inception of the New Economic Policy, the Planning Commission had been losing its importance. By doing away with this institution altogether, the Modi government has given the signal that investments will be made only where the rate of profit is higher and that the market will decide everything.

Narendra Modi and his US-Japanese mentors know it very well that these economic policies will bring great sufferings to the lives of the Indian people, and the people will not meekly accept them. Hence a fascist rule is required. This fascist rule also requires dismantling of the pluralistic structure of the Indian society and destruction of working class unity by means of communal polarization.

Vol. 47, No. 28, Jan 18 - 24, 2015