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HOME | BUSINESS | COMMENTARY | MAHESH NAIR |
October 14, 1997 |
Business Commentary/Mahesh NairAnd the drama will fade awayRecently I met the managing director of a Tata company. During the course of our conversation I asked him what he thought of the allegations made about Tata Tea Ltd funding militants in Assam. "There's a difference between funding and extortion payments," he replied. "It's not just Tata Tea which has paid these people. Everyone else does. And it's not just limited to Assam. It's all over the country For instance, in the Thane-Belapur industrial belt in Maharashtra, we have to regularly pay off extortion threats and contribute to hafta (weekly bribes). So why is everybody making such a noise about Tata Tea and Assam?"
Why indeed? Much of India's press has been featuring front page news
on the Tata Tea-ULFA nexus. The disclosure of the contents of the
infamous Tata tapes, in which Bombay Dyeing chairman Nusli Wadia
along with Tata Group chairman Ratan Tata have been on a damage
control exercise confabulating with other industrialists, politicians
and bureaucrats has the press and everyone asking three questions:
But we are missing out the larger picture. The question to be asked is: "Is our law and order situation becoming increasingly inefficient to help business operate without fear or favour?" It is. All businessmen and enterprises start with a basic social assumption: The State will protect your life and property. But then what do you do when a businessman steps out of his Nariman Point office and gets shot point blank? What do you do when a garment exporter in New Delhi has his son kidnapped for a ransom? What do you do when the mafia in Mahatma Gandhi's birthplace of Porbandar decide who will get to transport, and at what rate, soda ash from India's top three soda ash manufacturers? What do you do when the local goons in Bihar's Dhanbad mines tell Government of India officials that they want to revise their 'commission' per tonne of coal? Do you give up your right to life and property? Remember these are questions that business has to deal with in peaceful areas where daily normal life are in operation. We are not talking about Punjab where business houses like the Hero Group, Oswal group, JCT Mills or thousands of smaller enterprises have paid up millions of rupees as extortion money to militants because the state and central government machinery was incapable of dealing with the law and order situation. We are not talking about Assam where companies like the Tatas and thousands of small entreprenuers are still paying up militants because they want their life, property and businesses to be safe. In the case of Assam and the Tata Tea controversy, the official view is that by helping militants financially you are helping their anti-national cause. In short, if you pay up, you are a traitor. But if you don't, you are dead. Or you can pull the shutters down and go somewhere else to set up shop. So what should you do? Ideally nothing. It should be the State that should act. If it extinguishes the problem, which is militancy in this case, businessmen won't have to pay up. More importantly, they can continue doing business which will help the economy of the region. But then that is an ideal situation. What the State and businessman can actually do is two things. The State should ameliorate conditions for conducting business rather than doing business itself. It should spend more money on providing well-paid law officers who will be willing to take on the task to improve law and order situation -- rather than spending money on public sector units which produce cycles or on textile mills which haven't produced a yarn of cloth for the past five years. Private industry in India can easily make cycles and cloth on its own. Businessmen, on the other hand, should plough at least a certain percentage of profits in developing the area from where they operate. This would make them socially more responsible and it will also enhance their business interests. For instance, if you set up a school for your employees's children, it will make your employees happy, you will have a literate population, and you can get a better second generation of workers. The sad thing is that business often does not plough back its profits. In Assam, for instance, the local population is unhappy with the tea companies because the companies have not been investing their huge profits in development of the region. And when you don't share your profits, why should they give a damn when you scream out every time the local goon knocks on your door? The unfortunate thing is that these issues will never be deliberated upon. The government has ordered a CBI inquiry into the phone tapping episode. Months later it might reveal some names, against whom a legal case will be slapped. Judges will listen to the parties. Warrants and bails will be issued. Business rivalry will come to light. In Assam, it will become an election issue. And then gradually the entire drama will fade away. It will only be a storm in a teacup. And the question how can we improve our law and order machinery to make business operate without fear or favour will remain a byte in cyberspace. Or will it?
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