![]() Subscribe to Dollars & Sense magazine. Recent articles related to the financial crisis. Open Letter on Military Offensive in Central IndiaWe encourage readers of D&S and the D&S blog to consider signing the following open letter. Hat-tip to our friend Taki. —csSanhati (www.sanhati.com), a collective of activists/academics who have been working in solidarity with peoples’ movements in India by providing information and analysis, took the initiative to bring together voices from around the world against the Government of India’s planned military offensive in Central India. A statement (Hindi, Bengali, and Telugu versions are available on our website) and a background note were drafted in consultation with Indian activists, and duly circulated for endorsement. Readers are encouraged to endorse the statement by e-mailing sanhatiindia [at] sanhati [dot] com with their full name and affiliation. To: Labels: India, Manmohan Singh, Sanhati, West Bengal HR Manager Beaten to Death by Angry WorkersFrom CNN/Asia. Yikes!By Harmeet Shah Singh | Wednesday, September 23 2009 NEW DELHI, India (CNN) -- Angry workers beat to death a human resources vice president after he laid off 42 employees at an auto-parts manufacturing company in southern India, police said Wednesday. Roy George was vice-president for human resources at Pricol, the auto-parts company. Some four to five workers, belonging to a union not recognized by the company, barged into his office and beat him up with iron rods, said N. Kannan, a police superintendent of Coimbatore in Tamil Nadu state. George, 47, died from his head injuries Tuesday, Kannan told CNN. Police have arrested nine people and are expected to round up more. Last year the Indian head of an Italian company died after allegedly being beaten by a mob of sacked employees. More than 60 people were charged with the murder of the chief executive of Graziano Transmissioni near New Delhi. Earlier this month, India's Jet Airways had to cancel hundreds of flights after pilots struck work over the sacking of two of their colleagues in August. Companies in the South Asian nation, despite its rapid economic growth in recent years, have often been faced with tough labor issues because of archaic laws and company policies on hiring and retrenchment. Business consultants in India blame such labor standoffs on what they call lack of transparency in retrenchment or layoff policies. Hiring and firing conditions are often not explained to workers by their companies, said Rajeev Karwal, founding-director of Milagrow Business and Knowledge Solutions. Issues could spiral out of control if the businesses and bureaucrats are seen in a "corrupt nexus" by the employees seeking reprieve from labor authorities, he said. Labels: human resources, India, layoffs Oligarchs' Threat To Indian DemocracyNice FT piece from yesterday:Brotherly shoveBy Joe Leahy Financial Times Published: August 11 2009 20:40 | Last updated: August 11 2009 20:40 Murli Deora, India's oil minister, normally relaxes by playing bridge at the weekend with his wife and friends. But in recent weeks, a rather less genteel contest than that has been intruding on his free time. Mr Deora was a close confidant of Dhirubhai Ambani, the rags-to-riches entrepreneur who built his Reliance polyester group into a corporate titan but died in 2002 without leaving a will. This sparked a succession war between his sons Anil and Mukesh, now Asia's richest siblings. Dropping into Mr Deora's Mumbai home one weekend in June after his customary jog on the seafront, Anil Ambani complained to "uncle" about how he believed Mukesh Ambani's Reliance Industries was trying to corner the spoils of the KG Basin, a giant gas field discovered by the group off India’s east coast in 2000, says a person familiar with the matter. Late last month, frustrated by suspicions that the minister was siding with his brother in the dispute, Anil Ambani went public. He used the podium of the annual meeting of one of his companies, Reliance Natural Resources, to lambast Mukesh’s Reliance Industries and the oil ministry. The nationally televised onslaught--and the release of an earlier letter to Manmohan Singh, prime minister, that contained the same allegations--sent reverberations through the halls of power in New Delhi and has elevated the long-running Ambani succession war into an issue of national importance. "Motivated by corporate greed, RIL [Mukesh Ambani's Reliance Industries] is dishonourably trying every trick in the book to get out of its binding commercial obligations," Anil alleged later in e-mailed answers to questions from the Financial Times. (Mukesh Ambani and Reliance Industries declined to comment for this article.) Not only is the row, which is being heard in the Supreme Court in New Delhi, threatening to disrupt sales from the KG Basin, India’s most important natural resource discovery in decades, but it has also raised questions about how business is done in the world's fastest-growing large economy after China. Read the rest of the article Labels: Ambani family, development economics, energy, India, infrastructure, Manmohan Singh, natural resources, project finance Analysis of Indian Election ResultsFrom D&S collective member Smriti Rao; I am posting this belatedly:India-watchers across the world celebrated the unexpectedly strong victory of the Congress-party–led coalition in Indian elections, interpreting it as a victory for centrism over extremism of both the religious and (left) economic kind. Journalists for the mainstream press in the west seemed as relieved about the poor performance of the left parties in India as they were about the defeat of the right-wing nationalist party, the BJP. Every report on the Indian elections seems to end by predicting that the Prime Minister, Manmohan Singh, can now push forward with reforms—the codeword for economic liberalization—now that his hands are no longer 'tied' by a strong Left party presence in the government. And yet, as these same journalists attempt to explain why the Congress won, they usually point to India’s relative insulation from the current economic crash—a result of its moderation in the pursuit of economic liberalization (staying away from further financial sector liberalization, for example)—and its institution of some social safety net programs—particularly a national employment guarantee scheme in rural India. As left commentator Vijay Prashad points out, both 'achievements' were at least partly the result of pressure from the very same Left parties these journalists seem to criticize as holding India back and neither would suggest that this government should interpret its victory as a mandate for further liberalization. (See this Counterpunch article.) The recent appointment of Congress Party veteran Pranab Mukherjee as Finance minister suggests that while the Prime Minister is planning to push the liberalization process forward, he may be willing to proceed cautiously. While Mukherjee cut his political teeth in the Congress' socialist days, he is best known for being a political survivor, able to reinvent himself as the environment around him changes. He was instrumental in pushing forward the recent nuclear deal with the US—a far cry from the days when political upheavals in India were routinely attributed by the Congress Party to the foreign hand' of the US. And he is clearly on board with the broad idea of economic reforms—the government yesterday announced it was considering removing its decades-long program of subsidizing gas prices (see this Reuters report). However, unlike one of the other possible candidates for the Finance Ministry post, he is not considered a free-market ideologue. Let us hope he, and the Prime Minister, vindicate the faith the Indian voter has placed in them. Labels: BJP, Congress Party, elections, India, Manmohan Singh, neoliberalism Mass Suicide By Broke Indian FarmersFrom the wires:Over 1,500 farmers in an Indian state committed suicide after being driven to debt by crop failure, it was reported today. The agricultural state of Chattisgarh was hit by falling water levels. "The water level has gone down below 250 feet here. It used to be at 40 feet a few years ago," Shatrughan Sahu, a villager in one of the districts, told Down To Earth magazine "Most of the farmers here are indebted and only God can save the ones who do not have a bore well." Mr Sahu lives in a district that recorded 206 farmer suicides last year. Police records for the district add that many deaths occur due to debt and economic distress. In another village nearby, Beturam Sahu, who owned two acres of land was among those who committed suicide. His crop is yet to be harvested, but his son Lakhnu left to take up a job as a manual labourer. His family must repay a debt of £400 and the crop this year is poor. "The crop is so bad this year that we will not even be able to save any seeds," said Lakhnu's friend Santosh. "There were no rains at all." "That's why Lakhnu left even before harvesting the crop. There is nothing left to harvest in his land this time. He is worried how he will repay these loans." Bharatendu Prakash, from the Organic Farming Association of India, told the Press Association: "Farmers' suicides are increasing due to a vicious circle created by money lenders. They lure farmers to take money but when the crops fail, they are left with no option other than death." Mr Prakash added that the government ought to take up the cause of the poor farmers just as they fight for a strong economy. "Development should be for all. The government blames us for being against development. Forest area is depleting and dams are constructed without proper planning. All this contributes to dipping water levels. Farmers should be taken into consideration when planning policies," he said. Just What We Need: Another Mega-ScandalThis time in India's Vaunted IT Outsourcing Industry, which has contracted with much of the Fortune 500, as well as the World Bank, and in which an even greater premium is put on trust than is the case with most other industries. From the Financial Times:Satyam lifts the lid on Indian corporate fraud By John Elliott Financial Times Published: January 8 2009 10:43 | Last updated: January 8 2009 10:43 I have often mentioned to businessmen visiting India how remarkable it is that many of the appalling business practices of the country's traditional old family-controlled companies do not seem to have spread to the booming software sector--and then add that I wonder whether there are some skeletons in unopened IT cupboards. If I am talking very privately, I have mentioned Satyam, rated till today as India's fourth biggest software and outsourcing company, as one whose governance has been frequently questioned. This week's resignation and confession of fraud--vastly inflating company results for "several years"--by Ramalinga Raju, Satyam's founder and chairman, means the company can now be openly named for dubious business practices that have concerned (some) investors in the past. (It also means that Satyam is presumably not India's fourth largest IT company and should not have been rated along with the other market leaders Infosys, Wipro and TCS.) Raju has admitted inflating the figures--for example by well over $1bn in September --and has admitted that his attempt to merge the family's Maytas construction companies into Satyam last month "was the last attempt to fill the fictitious assets with real ones". (The Maytas attempted merger, aborted after about ten hours triggered a series of events that culminated in today's news). Read the rest of the article Labels: financial crisis, India, Information Technology, Ramalinga Raju, Satyam Outsourcing Corporate Crime To IndiaThe CEO of one of India's largest outsourcing companies, Satyam (Irony alert: the word means "truth" in Sanskrit), has resigned in what may be the country's largest case of corporate fraud. Analysts are likening it to the Enron scandal. The New York Stock Exchange halted trading on the stock after the news broke.Ramalinga Raju, company founder and now ex-CEO, announced in a statement that about $1 billion (or 94%) in cash on the company's book was fictitious. The company's auditors, US-based PricewaterhouseCoopers, said they are "looking into the matter." The World Bank, one of the firm's major clients, recently cut off business relations citing "improper benefits" given to Bank officials. The company was recently recognized with a "Golden Peacock" award for corporate governance by an Indian business association. Early reports indicate that the accounting scandal could spread quickly to other firms and imperil India's huge outsourcing industry. A full report from Reuters is here. Labels: Corporate Fraud, Corporate Swindles, India, outsourcing |