India’s booming image is shaken by massive strike wave

by Theo Russell

INDIA is being swept by a mounting wave of strikes, as anger mounts over out of control price rises. Two national strikes were held in April and another in July and a third, predicted to be the biggest ever, has been called in September.

Despite growth of eight per cent a year and a booming corporate and financial sector, living standards for workers and even many of the middle class are being steadily eroded.

India’s the economic reforms since the 1980s have transformed a semi-socialist economy into one of extreme wealth imbalance, in which hundreds of millions live in constant crisis, and according to official figures almost 200,000 farmers committed suicide between 1997 and 2008.

Unlike China, the fruits of India’s growth go to business and individuals rather than being ploughed back into the country. In India only four per cent of gross domestic product (GDP) is invested in public services and infrastructure, compared to nine per cent in China.

While China is pouring billions into building infrastructure in every region of the country, India’s growth has been extremely uneven, benefiting a fortunate few in the cities while leaving millions of urban slum dwellers and the rural population, still over 70 per cent of the total, worse off than they were 30 years ago.

The technology services sector employed only 1.6 million people in 2007 out of a population of 1.15 billion, while 10 million young people enter the workforce every year.

While China announced a £382 billion in spending to boost the economy in 2009, India is effectively at the mercy of international lenders with a public debt of 82 per cent of GDP, the 11th -worst in the world.

Literacy in India has risen from 12 per cent at the end of British rule to 66 per cent in 2007, but remains well behind the world average of 84 per cent and over 93 per cent in China.

While China now has the largest network of high-speed railways in the world — 4,300 miles with speeds of up to 220 mph; the maximum train speed in India is 93 mph.

Wave of strikes

In April this year a national strike called by the Left parties over rising prices affected the whole country, and was followed by an “All-India Bandh (strike)” on 5th July, which according to the Indian press the was the biggest strike for 30 years, and probably the biggest since the Bombay textile workers’ strike of 1982.

The 5th July strike was particularly effective because although it was called by the Left parties (the CPI, CPI(M), All India Forward Bloc and Revolutionary Socialist Party), the right-wing Hindu BJP also decided separately to support it, reflecting the economic hardship facing small businesses, farmers and shopkeepers. The BJP-affiliated Bharatiya Mazdoor Sangh trade union centre, is the largest in India, with 6.2 million members in 2002.

There are 13 recognised national trade union centres, most of which are linked to political parties. In 2002 the Congress-linked Indian National Trade Union Congress had 3.9 million members, the Hind Mazdoor Sabha, affiliated to the All India Forward Bloc (a left party) had 3.3 million members, the CPI(M)-linked Centre of Indian Trade Unions 3.2 million members, and the CPI-linked All-India Trade Union Congress 2.6 million members.

In 2004 total union membership in India was over 40 million, about 10 per cent of the total workforce and 25 per cent of wage and salary earners. However the impact of strikes is magnified by mass demonstrations and protest actions such as blocking road and rail links and persuading shops and businesses to take part.

“An unprecedented success”

The Left parties described the 5th July strike as “an unprecedented success” and said the government had “tried everything to suppress the voice of the people”.

According to the Times of India: “In many places, bandh supporters brazenly flexed their muscles as they sought to enforce the ‘people’s bandh’, “ and the strike “was like a shot fired across its bows” for the ruling Congress Party.

Almost every part of India was affected, with Chennai (Madras) the only major city to escape serious disruption. The Federation of Indian Chambers of Commerce and Industry estimated the cost of the strike at £1.8 billion, while the London Financial Times noted that “trading volumes on the Bombay Stock Exchange plummeted”.

Two of the country’s largest Bangalore-based software exporters, Infosys and Wipro, were closed along with 11 coal mines in Orissa, hundreds of inter-city trains and flights were cancelled and government offices closed around the country. Violent clashes between police and strike supporters took place in many cities.

In Mumbai the entire force of 48,000 police were deployed and the streets were deserted. Transport companies joined the strike taking thousands of trucks off the roads, and the port was shut down.

Over 3,500 people were arrested in Mumbai and the surrounding Maharashtra state, and 4,000 more “detained”, including 33 state assembly members and four national MPs. The CPI(M) paper People’s Democracy reported that in Kolhapur a senior policeman aimed a pistol at strikers, “bringing back memories of British rule”.

In Delhi protestors blocked roads and the brand-new Metro was hit for the first time; 77,000 police officers were deployed and over 4,300 activists detained, including leaders from the BJP and Left parties.

In Bihar over 8,500 activists were arrested and the police baton charged protestors. An opinion poll of one million people in cities across northern India found over 60 per cent supporting the strike.

Economic reforms — a disaster for India’s masses

In last year’s election the Congress Party won a landslide victory pledging to maintain petrol price controls, but now they too have been removed in order to reduce the budget deficit and meet the demands of international lenders.

The latest decision to completely deregulate petrol pricing includes diesel, cooking gas and kerosene on which millions depend. It is just the latest in three decades of dismantling subsidies and price controls, often on the advice of British and American government think tanks.

In May the government increased taxes on petrol and diesel by £3.6 billion, the seventh increase since Congress returned to power in 2004, yet in the same budget it cut taxes on corporations and the wealthy by over £11 billion.

Back in 1976 the foreign oil companies were nationalised and strict price controls introduced, but now according to People’s Democracy “Burma Shell, Caltex and ESSO might have gone, but their pricing regime is back”.

Prices for staple foodstuffs have surged in recent years. Since 2008 the price of sugar has increased 73 per cent and potatoes and onions by 32 per cent. Investors are now speculating on food prices, after the government decided to allow futures trading in staple foodstuffs.

India’s subservience to corporate and financial interests has had devastating consequences for millions of farmers. In the 1980s and ‘90s India was granted IMF loans in return for assisting bio-tech companies led by Monsanto to market genetically modified crops.

Sold to farmers as “magic seeds”, they fell victim to lack of water and parasites. Farmers were left burdened with debts as the GM crops produce no viable seeds, after paying up to 1,000 times more than for normal seeds.

This reactionary government actively eased the path for the GM giants by banning traditional varieties from many government seed banks.

Rising tide of anger

It is hardly surprising when tens of millions of Indians are experiencing suffering and impoverishment due to these ruthless economic policies that there is a rising tide of anger among the country’s workers and peasant farmers.

At a “national convention of the workers” on 15th July, nine national trade union centres called yet another general strike for 7th September, the third this year, which according to AITUC general secretary Gurudas Dasgupta will be “the first time in the history of India that all the central trade unions are together”.

This time even the Indian National Trade Union Congress, affiliated to Congress, will be joining the strike, which Dasgupta predicted would be “the biggest ever workers’ strike in the country”.

Even if the government acts to head off the strike by reversing its previous decisions, it will only postpone the resolution of the country’s fundamental economic problems.

Despite its rapid growth India is at the mercy of international finance, and the only solution to the problems its people face is socialism.