| India's Dirty War 05.10.10 Early one morning last October police forces surrounded the residents of Gompad, a remote village in the state of Chhattisgarh in eastern India, and attacked. Sixteen people were killed, including an older couple and their 25-year-old daughter, who was stabbed in the head with a knife and had her breasts sliced off. Her 2-year-old son survived, but three of his fingers were chopped off. A neighbor who witnessed the massacre was shot in the leg as she tried to escape. What prompted the rampage? The cops suspected the villagers of sympathizing with Maoist insurgents, believing that some were informants. A criminal case has been filed by the survivors against the state. Business as usual in this part of the world. The Indian government is trying to exterminate Maoists known as Naxalites and since 2004 have killed 1,300 of them; trapped in the crossfire, 2,900 villagers have also died. The Naxalites have claimed their share of victims, too. A few months before the Gompad attack Vimal Meshram, a village head, was gunned down by Maoists in a market in the same district (Bastar). His crime: He was an outspoken supporter of a plant that Tata Steel, one of India's luminary companies, has been trying to build for the past five years . He is one of 1,650 or more people--villagers, police and police-backed vigilantes-- This is India's dirty war: a brutal struggle over valuable real estate that pits the Naxalites against some of the nation's most powerful commercial interests. What began 43 years ago as a small but violent peasant insurrection in Naxalbari, a West Bengal village, is now a full-fledged conflict led by the banned Communist Party of India (Maoist) across 20 of the country's 28 states (see map), affecting 223 districts. The fight is over land, much of it in the interior, that has rich deposits of coal and bauxite. On one side of the struggle are the rebels--perhaps 10,000 of them armed and out in the field every day, and a militia of 100,000 who can be called up on short notice. Driven by a violent ideology, the Naxalites claim to be fighting for the land rights of the poor, especially farmers and small indigenous tribes who know only an agrarian way of life. On the other side are the wealthy families behind Tata Steel, Jindal Steel & Power and Vedanta Resources, who want to develop the untapped resources. Caught in the middle of the conflict between Maoists and billionaires are thousands of villagers. In principle there ought to be an economic answer to the economic question of whether a steel mill is a better use of land than a farm. If the mill is so valuable, why can't its owner offer the peasants an irresistible sum to leave? But here the market takes a backseat behind politics and thuggery. It's no mystery why things have gotten worse. "India's boom period has coincided with maximum dissent and dissatisfaction in rural India," says Ajai Sahni, executive director for the Institute for Conflict Management, a New Delhi think tank. Over the last decade the Indian government has been trying by legal and other means to lock up the land for public projects like power plants and, more recently, for private enterprises like Tata. (Under the Indian constitution nontribal people are prohibited from directly acquiring land in certain parts of the country, so the government must obtain it on their behalf and sell it to the companies.) That trend has put the state more and more in conflict with the Maoist rebels, and it has ratcheted up paramilitary operations against them. The government has also squared off more frequently against those who have farmed the land for centuries, using various legal entitlements- Dantewada in Bastar is the epicenter of Naxal activity, where the New Delhi government launched a "cleansing" operation last fall. It also happens to be 50 miles from the town of Jagdalpur, the site of a planned factory by Tata Steel that will produce 5 million tons a year, and close to iron ore mines that could feed the plant. For the past five years the government has been trying to acquire 5,050 acres across ten villages that will affect 1,750 landowners but has met with resistance even as it is being accused of bullying and pressure tactics. Tata washes its hands of those allegations. "Land acquisition is the government's job," says a spokesperson. Acres of rice, chickpeas and lentils stretch to the horizon. Standing among rows of chickpeas on his 6 acres, Hidmo Mandavi, the village head, says Tata reps have been telling him and other farmers to sell the land and have offered them jobs in the new steel factory. "We're not engineers," he says. "We'll get jobs--but jobs where we'll be serving water to others or sweeping the floors. Right now we live like owners. Why should we become servants?" Red Tide The spread of the Maoist insurgency.  Their defiance doesn't go down well, even in the world's largest democracy. The police have been breaking up gatherings of as few as five people. A couple of winters ago two busloads of villagers were on their way to meet the governor of Chhattisgarh to complain about being bullied into selling their land for the Tata plant when the police stopped their buses and hauled them off to jail. Mashre Mora, 46, a farmer in the nearby Dabpal village who refused to sell out, was arrested a third time after returning from a weekly village gathering where farmers discuss issues like water supply, crop infestation and disputes with their neighbors. Charge: disturbing the peace. That evening about 40 cops came to his house, broke the lock and dragged him out. "I've told them I won't give up my land," he says. "I'm uneducated and can't get a job in an office, so once the money runs out what will I do? I only have the support of my farming, I don't have anything else." (The police say they have no involvement in land acquisition and show up only to hunt Maoists.) Some villagers have found their names on lists of people who have sold their land--even though they say they haven't. Kamal Gajbiya, 40, is a towering, muscular figure with a thick beard. A resident of Kumbli village, he owns 8 acres along with his brother, sister and mother, and has met the same fate as Mora. On each trip to prison, he says, people he thought were Tata reps, accompanied by government officials, asked him to part with his land. (In its blanket denial of abuses, Tata declined to address specific incidents.) "They said, 'We'll let you go; take the money,'" Gajbiya recalls. "I said, 'I'm a prisoner, and I cannot talk to you.'" Last May he found out his name and those of his sister and mother had been struck from the revenue records because they had supposedly sold their farms. Gajbiya filed complaints with the Ministry of Information before he finally received a copy of the records. He also got copies of letters from 1,750 farmers--all of whom had purportedly sold their land--stating their opposition to selling. There's nothing subtle about the threats. A teacher, Retu Ram, was told he'd be transferred to another district if he didn't sell. That's what happened to a colleague. In another village, Banga Peeta Aito, a farmer of 60 or so, had been in prison for a month on charges of disturbing the peace. His sons were told that unless they agreed to take the check from Tata, their father would rot in jail. They finally accepted it--and their father was released the next day, they say. Tata says it was invited in by the government of Chhattisgarh and that it is bringing economic opportunity to the area, a frequent claim made by corporations. "Although rich in mineral resources, Bastar is among the most backward regions of the country," says a Tata spokesperson. "[The plant] will give a fillip to all-round development in the region." The company, he adds, paid double the amount per acre set by the government; it plans to offer to exchange real estate, perhaps acre for acre for up to 2.5 acres of land lost, as well as technical training and jobs to one member from each affected family. Moreover, Tata says that 70% of the residents have accepted its offers and the rest are coming around. (Villagers dispute the assertion that the payments were generous and say there are still many holdouts.) "Youth of the area is in favor of industrialization, in which they see their future," says the spokesperson. Roughly 400 miles north, the thickly forested area in Raigarh, Chhattisgarh gives way to black, as soot blankets shrubs, the road, everything. Jindal Steel & Power dominates the region with its steel plant, coal mines and a 1,000-megawatt coal-powered plant. Naveen Jindal, executive chairman and Member of Parliament (Congress Party), has transformed the company from a moderate performer into a star. (His mother, Savitri, is chairman of the holding company, O.P. Jindal Group, and ranks number 44 on the forbes billionaires list with an estimated net worth of $12.2 billion.) Naveen's is among the lowest-cost steel producers, thanks to supplies of iron ore and electric power and use of sponge iron, which takes cheap bituminous coal transported by a 4.2-mile-long pipeline instead of the more expensive imported anthracite. To keep up this cycle of growth, Jindal needs more land. That push has created strife. Residents say they aren't allowed to voice their concerns at public hearings to decide whether Jindal can build an additional $2.4 billion, 2.4-gigawatt coal-fired power plant in the same region. At one such meeting in January 2008 seven people, including Harihar Patel, the Khamaria village head, were beaten by police; some were hospitalized for a week. "The company has a 'no objection' certificate okaying the project, but we never gave it," says Patel. "Most of these hearings are being forged," adds Ramesh Agrawal, who runs an Internet cafe that funds his efforts to pursue court cases against Jindal and to inform villagers about their legal rights. "[We] had no role in conducting the public hearing except for making a brief presentation about the project," says Jindal. "I believe some people wanted to create trouble and the police had to intervene to maintain peace." Krishna Lal Sao doesn't seem like a troublemaker. In 2003, he says, Jindal Power dumped 1,100 truckloads of mud on his 2 acres of arable land before his crop was harvested. Sao, a police employee who farmed on the side, says fellow cops wouldn't let him register a complaint and harassed him to the point that he resigned in late 2005. In March 2007 a district court gave him title to his land and directed the police to restore his property. However, without his permission, Jindal put up a cooling tower and warehouse on that same acreage. Sao has given up and started a stationery store. Raghunath Choudhary lost his 5.5 acres, he says, after Jindal put a boundary wall around it in 2004. He tried to fight in court, to no avail. Choudhary blames both the 2007 suicide of his younger son and his wife's recent fatal heart attack on stressful circumstances caused by Jindal. A separate 1.5-acre plot, he says, fell to the company in October when it set up a mixing plant there. Now he and his remaining son are forced to farm someone else's land. Jindal Steel says Sao's and Choudhary's land was acquired after the Chhattisgarh Industrial Development Corp. followed due process. The two farmers say their land was seized to develop a "greenbelt." (Today the belt consists of a cooling tower and warehouse.) Their review petitions were rejected by the High Court of Chhattisgarh. Naveen Jindal adds: "There is some initial resistance as villagers are obviously aspiring to obtain maximum prices for their land and other benefits." Many villagers--some driven out by the Naxalites, others by police on orders from state officials--end up in refugee camps. Dornapal, in the heart of the conflict-riddled Bastar district, is one of 23 camps, containing 45,000 or more people, run by a state-backed civilian militia known as Salwa Judum (literally, "purification hunt"). Row after row of single-room mud huts with thatched roofs line the camp, punctuated by occasional piles of garbage and hand pumps, where women fill buckets and children (who should be in the camp's elementary school) bathe. There is no work for the farmers. A few may chance a day trip to check on the land they were forced from, even sneak sowing a crop. Most just hang out; the air is filled with the acrid smoke of bidis, the cheapest cigarettes. Kathar Ganga arrived at Dornapal roughly five years ago. He says that Maoists held a meeting in his village and accused his son, then 20 years old and newly married, of being a police informant. They killed him in front of everyone. Another resident, Markam Joge, 21, earns $46 a month as a police officer for the Judum and supposedly protects the refugees. He's married and has a 5-year-old child. "I will raise my daughter here in the camp," he says. "I do miss my village, but now that I've picked up arms I can't go back." Salwa Judum members aren't merely the protectors of the villagers, as they claim. "There is a complete collapse of the rule of law--with the root cause of violence in the area being the Salwa Judum and Naxal counterattacks, Some 15 miles from the Dornapal camp, deep in the forests and inaccessible even by mud road, is Naindra village, inhabited by an indigenous tribe. In 2006 the Salwa Judum raided the old part of Naindra and burned down homes before attacking new Naindra. Those who didn't escape, like Muchaki Ganga's father, were killed. "They slit his throat with a knife and left [his neck] hanging by a piece," he says. "I'm too scared to go to the police. They'd finish us off if we complained." Not so, says Amresh Mishra, superintendent of police for Dantewada. "There are many incidents where Naxals have done this and blamed it on Salwa Judum and the police." After the houses were torched, Maoists came and gave the villagers clothes. The Judum returned twice more, set fire to the homes and abducted two boys and a girl who have never been seen since. The village was lately rebuilt by Himanshu Kumar, who has run an ashram and a nonprofit to teach literacy and basic hygiene in the heart of Naxal territory for the past 18 years. An ardent supporter of the tribals, he has recorded atrocities by the police, the Judum and the government. He has also supported perhaps 600 legal complaints against them, many still grinding through the court system. The cops are now trying to tag him as a Maoist. Kumar says there's an easy way out of this mess: "If you want peace, give the tribals schools, hospitals, ration shops--the Naxals will never interfere with any of this." Not so easy, says Dilip Choudhary, Additional Secretary to the Home Ministry. The Maoists, he says, "have refused to respond to the simple call to give up violence"--the condition the government has set for talks. Next door, in the state of Orissa, villagers have been fighting off a five-year push by South Korea's Pohong Iron & Steel Co. to acquire 4,400 acres in order to build what would become the world's third-largest steel plant, producing 12 million tons a year. The resistance is headed by Abhay Sahoo, a leader of the leftist Congress Party of India--unlike the party of the Maoists, it is legal and largely supported by farmers and some labor unions. Farmers from four villages have barricaded and patrol all access roads to keep out police, government and company officials. The area is rich in cash crops, particularly cashew nuts and betel nut leaves that sell for 2 cents apiece. "[Everyone] from a 10-year-old boy to an 80-year-old man can earn at least $109 per month just from harvesting these leaves," says Sahoo. "If Over the last couple of years, in two episodes, pro-Posco sympathizers have thrown homemade bombs at anti-Posco villagers, resulting in one death and multiple injuries. In January 2010 four Posco employees entered the villages to carry out a land survey and were captured by Sahoo's men. They were held the entire day and released only after they signed a letter promising not to return. (Similar tactics have been used by the toughest labor unions.) "We told them this is a warning--come back at your own risk," says Sahoo, who has 37 police cases against him for his resistance and has served 101TK2 months in prison on charges that include attempted murder and kidnapping. There are 150 or so cases against the villagers and warrants for 642 others hiding there. "If the state will create violence, retaliation is a must," says Sahoo. The land belongs to the government, says a Posco spokesperson. Villagers, he adds, have encroached on it for at least a couple of generations. "India is in grave danger of losing the development race against China," he says. "India produces a twelfth of China's steel and wants to double this in the next two years but can't do that without such megaprojects. On the western side of Orissa there is push-back against Vedanta Resources. Run by mining tycoon Anil Agarwal (number 113 among the forbes billionaires, with an estimated fortune of $6.4 billion), Vedanta is trying to mine bauxite from the Niyamgiri Hills to produce aluminum. For generations the Dongria Kondh, an indigenous tribe of 8,000, has been has been living off the bounty of the thick forests--home to tigers, barking deer, elephants and bison, as well as to hardwoods like the flowering sal trees. The region also holds an estimated 2 billion tons of bauxite along a 300-mile belt. Mukesh Kumar, Vedanta Aluminum's chief operating officer, says the mining and land lease is with the state-owned Orissa Mining Corp., which plans to acquire just 1,800 acres of Niyamgiri and intends to mine only half of that. Because of tribal opposition, though, Vedanta has been able to build only an aluminum refinery nearby. Profits are minimal because it must import bauxite from other regions. The refinery's emissions, along with the waste-disposal pond, may well be making life hazardous for residents. Last year villagers say nine people died of complications from tuberculosis and bronchitis; the government admits to only one. Kumar says the state is aware of the health problems and is investigating. In February Amnesty International issued a damning report on the refinery and the proposed mine--harsh enough that the Church of England and the Joseph Rowntree Charitable Trust sold their $5.7 million and $2.9 million investments, respectively, in Vedanta. "Local NGOs are anti-industry and instigating people," Kumar fumes. "This is not an agitation against a project but a movement against industry in Orissa." That may be. The Dongrias still come to sell their wares at a weekly market in the heart of the forest, bearing lentils, rice, dried fish, tobacco, potatoes, ginger, turmeric and bananas. "Other than salt I get everything from these hills," says Ranga, a tribal member, through a translator. He earns his living with the ax that casually rests on one shoulder. But he's apparently prepared to use it in defense of his way of life. "We will kill with this," he says, gripping the handle. "We will not let the company come in here." Safe Harbor Statement: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints. Nothing in this article is, or should be construed as, investment advice. |
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INVESTMENTS IN INDIA
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Stocks, mutual funds and the entire investment gamut. Only financing/investment avenues in India will be discussed.
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