May 4, 2007


Sandeep Banerjee

For generations of Calcuttans, the Blue Fox at 55, Park Street was the last word in continental fine dining. Fashioned out of blue neon lights, the restaurant’s logo — a giant fox, its snout nearly touching the tail — has, for decades, marked time over one of Calcutta’s most fashionable streets. Over the years, the Blue Fox has seen much change; it too has changed much. It had shut down for a while owing to labour union-management troubles. It revived and there were plans to turn it into a chaat shop. In March this year, came the final transformation — on the thirtieth year of uninterrupted Communist rule in West Bengal, Blue Fox became Calcutta’s first McDonald’s outlet.

The arrival of Maharaja Mac in the city is more than just another gastronomic option before the average Calcuttan — it’s perhaps the most telling signal that Bengal’s Communists have made peace with American capitalism.

Key to this truce is the Bengal Left’s reassessment in recent years of the role of private capital in the state’s economic development. The state government wants Bengal to industrialise rapidly, arguing that this is the only way to generate jobs and lift the population out of poverty. The West Bengal government is keen to turn the state into a manufacturing hub as that sector generates both skilled and unskilled jobs. The latter is crucial for absorbing the surplus labour the agriculture sector jettisons every year. Setting up factories, however, needs money and that’s not something the state government has in abundant supply. This leaves it with little option but to woo private investors, both domestic and foreign.

So, the Bengal chief minister, Buddhadeb Bhattacharya, once the Left’s Cultural Commissar, has now metamorphosed into the poster boy of economic reforms. Having candidly acknowledged at various fora that his party — the Communist Party of India-Marxist (CPI-M) — has erred on the issue of private capital, he is now asking industrialists to set up shop in Bengal to help him rectify those mistakes from the past.

These efforts have met with more than moderate success with a number of companies jumping on to the Bengal bandwagon. Tata Motors is in the process of setting up its small car factory; Jindal Steel has proposed a Rs100 billion investment to build a steel plant while both Videocon and Indonesia-based Salim Group are keen to set up Special Economic Zones in the state. Even Reliance has plans: taking a leaf out of the Walmart-China relationship, it wants to turn Bengal into the sourcing hub for its agri-retail business.

But the Bengal Left’s active soliciting of private capital puts it at ideological loggerheads with the Left of the Centre. In New Delhi, where their help is crucial for the Congress-led United Progressive Alliance (UPA) to remain in power, the Left is usually making sure the UPA refrains from pursuing ‘neo-liberal’ and ‘anti-people’ economic reforms. While the Buddha line of wooing industrialists may well presuppose the primacy of private investment in the process of industrialisation, the CPI-M’s central leadership still remains keen to convince the UPA that the path to true economic salvation is paved with public investments.

The contradiction between the Bengal Left and its counterpart at the centre stretches well beyond just this. The central leadership has been frowning on the state government’s eagerness to acquire land for the companies that were keen to invest in the state. For them, this meant a decisive shift away from the ideology that inspired the CPI-M’s land reforms programme in the state in the late seventies. Those reforms, which consolidated the CPI-M’s grip on rural Bengal, were two-fold: it provided security to sharecropping tenants through a process of registration popularly known as Operation Barga while ceiling-surplus and other vested lands were acquired and distributed among the landless labourers and farmers. The state government, however, contends it’s crucial for them to step in and acquire land as neighbouring states like Orissa were dangling the land acquisition carrot to lure away potential investors.

Of course, the land question across India has now reached a stalemate since the tragic events at Nandigram, much to the relief of key members of the party’s politburo.

Bengal is also trying to woo Information Technology (IT) majors such as Infosys and Wipro to set up Business Process Outsourcing (BPO) centres in Calcutta. At the same time, the CPI-M’s trade union wing has been harping on — much to the horror of the chief minister and the IT industry — the fundamental right of these BPO workers to form unions and strike work.

In New Delhi, it’s this stark contrast between the Bengal line and the one taken by the CPI-M at the centre that is cited by the UPA to silence its Left critics. In fact, speaking to McKinsey a couple of years ago, Prime Minister Manmohan Singh took an uncharacteristic dig at his Left allies. On being asked about the progress of economic reforms in India, the man behind India’s economic reforms quipped, “Our role is to convince their national leadership that what is good for West Bengal can also be good for the rest of the country. I haven’t given up hope.”

Dr Singh’s persuasive skills perhaps haven’t quite worked their intended magic on India’s Left Front. Even today, this schizophrenia remains the hallmark of the relationship between the CPI-M’s central leadership and the West Bengal government the party heads.

Recently, I asked one of my acquaintances at the CPI-M headquarters in New Delhi about this abiding paradox of his party. I got a rather illuminating reply: There was no contradiction — The West Bengal chief minister was doing his job of running his government; the politburo doing its job of pushing for a greater role of the state.

The West Bengal government, I was told, could not ask its citizens to wait for the people’s democratic revolution before proceeding with industrialisation. They were hamstrung because all states had to work within the capitalist framework provided by the centre. This, of course, wasn’t the best way forward and things would change if the CPI-M came to power in Delhi.

The Left Front currently has fifty-nine MPs in the 545-member Lok Sabha, the lower house of the Indian Parliament. This is also their best electoral showing since independence. So, it will be a while before the party can paint the capital red.

This is the final part of a three-part series published in Daily Times, Lahore on May 4, 2007. The original article can be found here.

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