• Condemn the state repression on the fighting peasants of Rajasthan!
  The just struggle of the peasants of Rajasthan enjoys the support of the toilers and tillers of the whole country!

• Mass Rally in Nohar

• Muzzafarabad-Srinagar Bus Service

• Rumsfeld’s visit

• Destruction of Fallujah

• Stock market boom and farmers suicides

• Steep hike in cost of water in Delhi:
  Privatisation of water on the agenda

• Water privatisation accompanied with conditions that benefit the monopolies and jeopardise rights and sovereignty of the people

• IMF imposes loan conditions on Nicaragua demanding water privatisation

• DJB authorities fudge facts to justify the water cost hike!

• Petroleum price hike — who benefits?

• New Exploration Policy

• Oil and gas exploration

• Refineries in India

• India and Russia to collaborate in weapons system production and sale

• Vigorous protest greet Bush during Canadian visit

Condemn the state repression on the fighting peasants of Rajasthan!
The just struggle of the peasants of Rajasthan enjoys the support of the toilers and tillers of the whole country!

At the mahapadav in Anupgarh on December 3, the peasant leaders declared that their struggle was not led by any bourgeois political party and condemned the Rajasthan Chief Minister for portraying the agitation as a struggle inspired by the opposition parties. Former MLA Hetram Beniwal, prominent leader of the Kisan Mazdoor Vyapari Sangharsh Samiti (subsequently arrested under the NSA) declared that the peasants were forced to start the agitation because they faced acute shortage of irrigation water, their lands were parched, and they were being forced to migrate in search of livelihood. The main and only issue was adequate water for irrigation. Leaders of the BJP from the first phase area of the Indira Gandhi Canal have also joined the agitation and resigned from their party. Peasant leaders pointed out that far from succeeding in breaking the agitation through repression, the government was contributing indirectly to the spread of the agitation as a consequence of its obstinate anti-peasant stand. The entire Bikaner division is in the grip of the peasant movement. In the entire region, government officials are being gheraoed and all government work is at a standstill. The peasants and traders have declared they will not pay taxes or any other dues to the government. The peasants declared that their stern and unrelenting struggle will soon force the government officials to completely abandon their posts and then the peasants will themselves run the Indira Gandhi canal water distribution.

The mass character of the present agitation is revealed by the fact that women, teachers, students and lawyers are actively participating in the agitation. Lawyers are boycotting the courts. After 65 days of struggle, it is still being conducted in a disciplined manner. Mahapadavs and rallies have taken place in a number of towns of Hanumangarh, Ganganagar and Bikaner Districts.

What are the peasants of Rajasthan agitated about?

The construction of the Rajasthan Canal began in the 1960’s. The stated aim was to irrigate the parched lands of old Ganganagar District of Rajsthan (currently the two bifurcated istricts of Ganganagar and Hanumangarh) with the surplus water from Bhakra Nangal Dam.

In November 1969, the peasants of old Ganganagar rejected the leadership of the bourgeois political parties and launched their own independent agitation which came to be known as the Ganganagar Kisan Aandolan. The immediate cause of the agitation was the decision of the then Chief Minister of Rajasthan, Mohanlal Sukhadia, to auction 16 lakh acres of government land along the canal project area to the highest bidder. The peasants opposed this move and demanded that land be distributed to the tillers, to the landless peasants of the area. Over 25,000 peasants courted arrest in this agitation. Dozens of peasants were martyred in this struggle which resulted in partial victory for peasants. The government was forced to backtrack on its decision to auction the government land. At very nominal cost, peasants obtained 25 bighas of land each in the canal area.

The peasants in the Canal Project region turned the once parched land into green fields, producing high quality wheat, paddy, cotton, groundnuts and other crops. By 1992, the region was one of the most advanced agricultural regions of the country, rivalling Punjab and Haryana. Many towns mushroomed in the region as trading centers. However, since 1992, for a variety of reasons, primarily reduction in supply of irrigation water, the lands have begun to once again become parched. The livelihood of the people of the region has taken a savage beating. In 1992, peasants organised themselves under the banner of Bhakra Kisan Sangharsh Samiti and launched an agitation in Hanumangarh. Since 1992, peasants have been agitating in defence of their livelihood with increasing intensity.

The successive governments in Rajasthan have used irrigation water as a means to garner votes by promising the Indira Gandhi Canal water to newer and newer areas. While the total water in the Canal has actually reduced, governments have kept extending the main canal as well as building new feeders. As a result, the water for the Phase I and Phase II areas of the Indira Gandhi Canal has greatly reduced.

According to peasant leaders, 8401 cusecs of water was to be provided in the Phase I area and 5766 cusecs of water in the Phase II area. The government has reserved 65% of the total water for itself which means it will use this reserved water for vote bank politics as well as favour some and discriminate against others. Thus only 35% of the water is being distributed in the two phases, resulting in an acute shortage of irrigation water. Earlier, it had been decided that the canal would have water for 270 days a year, but now situation is that it has water only for 55 days. In Anupgarh water due in September for sowing of the mustard crop was not distributed, hence crop not sown. More than half the people from region are migrating for lack of water. The peasants of the phase I area are demanding that 8401 cusec of water be reserved for them, which they feel is their rightful share.

Another problem is that the successive governments in Rajasthan have proved incapable of getting the Punjab and Union governments to ensure that the agreed upon share of the Bhakra water for the Indira Gandhi Canal and from Sutlej for the Nohar Canal is obtained. Even in those years where figures are touted to prove that Rajasthan has got its share of water, the ground reality is that the water is released when there is flooding in the Bhakra and in Sutlej and not when it is needed in Rajasthan or according to any time table.

To compound the miseries of the peasants, the government departments work hand in glove with powerful vested interests to organise stealing of water. Those at the head of the feeders tap more water than is their due leaving those at the tail starved for water. It is noteworthy that precisely after the present agitation was launched, the officials of the Rajasthan government have begun to show great enthusiasm to catch and penalise water stealers. The biggest problem is that in regulating the distribution and use of water, the government machinery keeps the peasantry marginalised. All talk of peasant participation have proved to be merely empty words. The peasants are demanding a real say in deciding how the water should be distributed.

Instead of discussing solutions with the peasantry and addressing their genuine concerns, the state has adopted fascist repression as the method.

All this has boiled over to the present agitation that has spread to Rawatsar, Pilibhanga, Suratgarh, Anoopgarh, Gadsana, Rawla, Chattarharh, Raisinghnagar, Vijaynagar and other areas.

Significance of the present agitation

There are several important lessons to be drawn from the ongoing struggle of the Rajasthan peasantry.

It reveals the utter failure of the First Green Revolution in ensuring security of livelihood for the peasantry. That the peasants of the Canal areas of Rajasthan have to leave their parched fields and migrate in search of livelihood is a damning indictment of this "Green Revolution". The peasants in Punjab and Haryana are also facing similar problems. So are the peasantry in other areas of the country which are touted as the examples of the Green Revolution.

Capitalist development in agriculture, which is what the First Green Revolution ensured, has led to devastation for the peasantry. The Indian state is planning to usher in a "Second Green Revolution" which will lead to even further destruction of productive forces in the countryside. The path to the Second Green Revolution will be littered with the dead bodies of countless toiling peasants. Hence it is extremely important that the workers and peasants of India find a way out of this cycle of death and destruction and establish their own state power. The call that is reverberating in the mahapadavs of rural Rajasthan for the peasantry to establish their rule in India is extremely significant. So is the demand that from the base upwards, peasants be involved in the control and distribution of irrigation water, as well as in fixing the prices for crops, and in running the mandis.

The determination of the peasantry of Rajasthan to keep their struggle in their own hands and not allow it to be hijacked by bourgeois political parties to serve their narrow political interests is another significant feature of this struggle. They have thus far prevented the political parties of the bourgeoisie from manipulating and dividing their struggle. They have also thwarted attempts by reactionary forces to divert their struggle along chauvinist lines. By focusing their struggle on the anti-peasant policies of the Central and State governments, they have forged the political unity of the tillers and toilers.

The just struggle of the Rajasthan peasants enjoys the complete support of the working class and peasantry of the whole of India.

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Mass Rally in Nohar

In the evening, a delegation of peasant leaders met the government officials and discussed the 14 point charter of demands. Following a written agreement by the government, the peasant leaders agreed to suspend their agitation for a month. According to news reports, a meeting of top government officials is slated in Hanumangarh on December 12 to review the agreement.

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Muzzafarabad-Srinagar Bus Service

The media have reported that talks for the resumption of bus services between parts of divided Kashmir that were stopped after the 1948 war between India and Pakistan have broken down, because officials from India and Pakistan have been unable to agree on the documents that passengers need carry, which would be checked at the entry points on the so-called Line of Control. The sticking point has been the insistence of India that the documents be passports, or equivalent of international travel documents, while Pakistan has argued this would be a de-facto recognition of the LOC as an international boundary.

This is a simple illustration of several contradictory trends that face the relations between these two countries, which have been traditional enemies, after having been born out of the brutal partition of colonial India. The first trend is that the of the repetitive impulse towards the unification of Kashmir which was divided between the two countries in the aftermath of the partition, and also (importantly) by waging several wars. It is a fact that there are several nations that constitute what are today called India and Pakistan, which had been in various stages of development and consolidation, until the interruption by colonial rule These nations have been divided and the spoils of these divisions went to India and Pakistan. Where the division could not find a solution that suited the ruling circles in each of these countries is one where the problem continues to fester, and poses a grave danger to all the peoples of these countries, due to each of them being of imperialist ambition and each seeking to carve out spheres of influence beyond their own boundaries.

The people of India and Pakistan have repeatedly made their desire for peace, friendship and camaraderie known, through various peace iniatives at the people to people level. Whatever little attempt towards such peace is made by the respective ruling cricles is a response to this pressure from below. Matters did change, however, after the cataclysmic events in the international sphere including the invasion of Afghanistan and Iraq by the United States of America and its allies, since matters could no longer be as they were earlier. These have manifested themselves in statements from the ruling circles of Pakistan, which have made this or that offer, which have suggested this or that plan, none of which of course suit the ambitions of the Indian ruling circles, and not necessarily those of the people of Kashmir. In this contradictory climate, one finds that the relations between these countries are in the doldrums, with neither motion towards a resolution of the problems being possible, nor the possibility of going back to earlier combative positions, of the type seen soon after the Parliament attacks in 2001.

It must be pointed out that despite all the sweet talk of peace, the Governments of these countries are going all out on the path to arming themselves more or more. Pakistan has just been offered all kinds of fighter aircraft which are likely to upset the ‘strategic balance’, which will force the Indian Armed Forces to shop around for hardware to restore this balance. On the other hand, India has been shopping for all kinds of maritime warfare hardware, which begs the question as to what the objective of such purchses is, except that one may conclude that the interest is in carving out a sphere of influence in the Indian Ocean. Progressive forces must point out that this kind military expenditure is a burden that the impoverished populations of these countries cannot tolerate. They must raise the slogan that the solutions to the problems of these countries is in dialogue and not in military methods.

G. Rajan, Chennai

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Rumsfeld’s visit

This letter is to express my indignation at the Indian Government’s invitation to the Secretary of Defence, ‘His Excellency’ Mr. Donald Rumsfeld to visit the country earlier during the month of December 2004. The people of India would certainly not like this well-known war criminal, ultra-militaristic imperialist war lord to visit the country. It is well known that this ghoul from the past. e.g, as a figure from the notorious administration of Mr. Richard Nixon, the latter being infamous for its genocidal adventures in Vietnam and other countries of Indo-China, exceeded all bounds of international law in being the primary architect in the war against peace, and in the imperial war of conquest in Iraq. He is also supposed to have trained his sights on Syria and on Iran, as was evident from his remarks soon after the commencement of the Iraq war in 2003. The question arises how the present UPA Government, which derives support from the CPM, could go against all the wishes of the people, expressed in innumerable public demonstrations, meetings, writings and deliberations of several sections of society, across the political spectrum, and extend this invitation to this war criminal.

The answer to this must surely lie in the fact that the ruling circles in India are still groping for a role in the changing world situation. For instance, it is their hope that by cozying up the USA, they may be able to realize their long standing dream of a permanent seat in the Security Council of the UN. This issue keeps appearing and disappearing, for the simple reason that there is simply no real support for this dream from the five permanent members of the Security Council. This is evidenced by the contradictory remarks that were made by Mr. Vladimir Putin, the President of the Russian Federation, during his visit to India just preceding that of Mr. Rumsfeld. One other matter in which the ruling circles in India have not compromised, is their own militaristic ambitions and to carve out their own sphere of influence. Mr. Rumsfeld’s visit was to pave the way for many defence deals and contracts to further arm the Indian armed forces to their teeth. It is business as usual for the ruling circles in India, with the party being spoilt somewhat by the offer of advanced fighter aircraft and reconaissance aircraft by the USA to Pakistan. It may also be noted that Mr. Putin’s visit also saw the signing of several defence deals between India and Russia, thereby signalling that it is business as usual between these traditional ‘friends.’

The path of militarization and engagement with big imperialist powers is one that is fraught with danger. Indian foreign policy must be guided by principle and international law, and not simply by pragmatism and convenience, and one that seeks to ally India with the adventurist and illegal policies of the United States.

A. Narayan, Bangalore

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Destruction of Fallujah

If there is one coherent set of events that illustrate the bestiality and brutality of the US occupation of Iraq, it must be the consolidated attacks on the city of Fallujah. It belies all logic, that a city of civilians and common people be reduced to rubble so that ‘democracy’ may be established in Iraq. Even by the standards of occupation, based simply on reports of mainstream media, and even from those of so-called ‘embedded’ reporters, one can fathom the scale of destruction and devastation wreaked by the occupying forces there.

A pathetic Mr. Ayad Allawi, the so-called Prime Minister of Iraq granted ‘permission’ to the US forces, and we are told to Iraqi forces, which were probably no more than a small fraction of the entire aggressive force, to go ahead and secure the city from the so-called ‘rebels.’ It had been so that the rebels are those that refused to accept the authority of the interim (read puppet) administration of Mr. Allawi, and it was for this reason they were targeted for elimination. Even before the assault the city had come under large scale aeriel bombing against so-called safe houses of a certain al-Moussaoui, who the US says is behind the insurgency.

This kind of bombing of civilian neighbourhoods under this or that pretext even in modern warfare is unprecedented. What emerges from all this is the resolve and the determination of the occupying forces to break the spirit of the Iraqi people, and to send them the message that they must meekly accept their humiliation and subjucation under the jackboots of military might, or face the consequences, which are those of physical liquidation.

What is now a challenge to the anti-war and other movements across the world is to oppose this kind of brazeness of the US, which believes that might is right, and which believes that what is good for oil-companies, and financial oligarchs is good for everybody. Never mind that these activities have brought death and destruction to the peoples of a sovereign nation, and never mind that in the minds of the billions across the world, these atrocities will stand out as some of the most extreme examples of imperialist domination, perhaps not since the time of the destruction of Carthage by Rome. Progressive forces in the USA and elsewhere must rally behind the cause of peace and that of bringing back the occupying forces at the earliest.

S. Grover, New York

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Stock market boom and farmers suicides

It has been said that there is a great exuberance in the Indian Stock Markets, with sustained rallies and boom in stock prices. All this is as the Manmohan Singh Government completed its first six months in office. It is a sign of the new found confidence of the Indian speculators that the UPA Government will continue to favour pro-market policies, and will therefore be indistinguishable from its illustrious NDA predecessor. What has been conspicuously absent is gloating and bragging in the media circles about these events. The big players must have realized that the gloating and the ‘India shining’ campaign of the BJP prior to the Lok Sabha elections have nauseated the Indian voting public to the extent of booting them unceremoniously out of power. The message must have sunk in that one may take home the loot, but not necessarily talk about it!

In these cynical times, the media has also reported that over 3000 farmers had taken their own lives in Andhra Pradesh, where the darling of the new economic reforms Mr. Chandrababu Naidu had been equally unceremoniously booted out, and had been replaced by the ‘pro-farmer’ Y. S. Rajasekhar Reddy. It therefore emerges that as far as the common man is concerned these political parties have nothing to offer him. It is so that while sections of the Indian economy march ahead either due to their proximity to booming sections of the international economy, e.g., the IT sector or certain sectors of manufacturing, Indian agriculture has been suffering enomorously under the policies of economic reforms initiated by Mr. Rajiv Gandhi and later by Mr. P. V. Narasimha Rao, and carried forwarded in phases by the Governments of Mr. A. B. Vajpayee and now by Mr. Singh. Thus illusions are now being created that Mr. Singh will offer a ‘new deal’ to farmers, while experience shows that these will be unfulfilled. The country has heard over and over again, slogans like ‘Jai Jawan, Jai Kisan,’ ‘Garibi Hatao’, from the very forces that have presided over a brutual and inequitous economic system, that condemns over half the population of the country to permanent famine, while there is accumulation of vast riches and wealth at the other people, which allows this latter section to engage in wild speculation in the likes of the stock market.

The times are calling for a thorough discussion on the foundations and basis of the Indian economy and economic relations that has led to this intolerable state of affairs, and that of the political system that safeguards this parasitic and inhuman system. I request the editors of PV to carry this letter as an appeal to this end.

S. Lakshmi, Madurai

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Steep hike in cost of water in Delhi:
Privatisation of water on the agenda

The hike in water prices follows the appointment of the multinational company Price Waterhouse Coopers as advisor to the DJB, according to the recommendations of the World Bank, as a condition for DJB to receive a huge loan of Rs. 1640 crore for "structural adjustments" and for recovering its "losses". The vision report and white paper prepared by Price Waterhouse Coopers as well as the UNDP report and technical paper indicate that with this, the first steps towards privatisation of water are being taken. The setting up of a Water Regulatory Commission and now the steep hike in cost of water are also indicative of this.

Some time earlier, Fortune magazine referred to water being the "blue gold" of the 21st century. Multinational companies like Vivendi, Suez Dagremont, Tex Water, RWE, Anglican Water, Bechtel, Monsanto, Enron and others have already entered the world market for privatisation of water. According to a UN and World Bank report, India is listed among 31 countries that are likely to face a severe crisis in the coming years. For some time now, the World Bank and some of these multinational companies have been keenly interested in DJB as a starting point for privatisation of water on a large scale in India.

Multinational companies such as Suez Dagremont are interested in DJB hiking up the cost of water and then handing over to them the distribution and revenue collection rights. According to informed sources, Price Waterhouse Coopers has for some time now, been pressurising DJB to increase the rates of water prior to its privatisation.

This price rise is being justified by DJB authorities as "necessary to recover losses incurred by DJB". But a careful scrutiny of the income and expenditure of DJB (See Box 3) show that is an outright lie, that the hike in water charges will actually enable DJB to make huge profits at the expense of millions of suffering consumers.

The "losses" that the DJB authorities are claiming as an excuse to justify the steep price hike, are first and foremost due to corruption at the highest levels, defaulting on payment of bills by big capitalist companies, tampering of meters, as well as by large scale wastage of water due to lack of maintenance. They are certainly not due to water supply being ensured or even being attempted to be ensured for large sections of the working population of Delhi. In many resettlement colonies, residents have remained without regular water supply for more that 25 years, i.e. ever since those colonies were set up. In the slums of Delhi, there is little or no water supply.

Water supply is not a luxury, but an essential condition for life. But safe drinking water and running water supply is not available to a large section of the working population living in the urban slums, even in the capital city of Delhi. Water supply is the responsibility of the state and it is the duty of a modern state to ensure that safe clean drinking water and adequate water for all other purposes should be available to all at extremely nominal charges. There is no question of looking at water supply to urban population from the motive of profit or loss. It has to be looked as an investment in human beings.

Ever since the launch of the privatisation program by the Narasimha Rao regime in 1991, the mantra promoted by successive governments in the center and in the states is that people must fend for themselves. Applying this reactionary philosophy to the question of water, the state has refused to invest in actually providing for the evergrowing needs of the urban population for water for drinking and sanitation. Instead, its unwillingness and inability to meet the needs of the people is being used as an excuse to privatise this sector.

Behind the decision to privatise water stand the interests of the biggest monopolies which see the chance of raking in huge profits from turning even water, a basic public resource, into a marketable commodity. Privatisation of water supply is a massive source of profit for the big monopoly capitalist companies, by bleeding millions of people dry for a commodity whose availability is their basic right and essential for survival.

Evidence of countries where water supply has been privatised shows that the cost of such a basic input for life as water has skyrocketed. In Britain, the experience was that the price of water rose by as much as 450% when supply was privatised. In Bolivia, water bills for individual users amounted to as much as one-third of the minimum wage. This led to huge protests and demonstrations, in which people were killed and injured in police firing, forcing the Bolivian government to eventually cancel the contract with the private water supplier. The examples of privatisation of water in South Africa, Bolivia, Philippines and Brazil has shown that privatisation of water led to increased corruption and increased spread of epidemics of water-borne diseases.

The interests of the big multinational companies are being pushed by institutions such as the World Bank and the IMF, which have been heavily promoting the privatisation of water distribution in different countries, in the name of "efficiency" and cutting down on wastage of public expenditure. In many countries, these financial agencies of world imperialism have been imposing privatisation of water and increased charges for water supply and other services as a condition for granting aid and loans. (See Box 1 and 2) It is claimed by some that possibly as much as 40-60% of water supplied is not accounted for, as a result of leakage, theft by industrial houses, etc. It is also true that the demand for water is rising all the time, leading to depletion of presently known and accessible water resources. In fact, some of the biggest damage to existing water bodies has been done precisely by big Indian and foreign monopolies, that have used the water bodies as convenient sewers for their waste products, rendering the water resources of millions of people virtually unusable. Far from dealing with these problems, various governments, like our Indian government, and international funding agencies are chanting the refrain of "privatisation", because of the huge profits to be gained by them and the big monopoly players in this field. The cost and suffering to the people, the consumers, is of no concern to them. Nor are the other vital questions that are being thrown up by the privatisation of water distribution, about the ownership and ultimate control over this vital resource, and about a country’s sovereignty.

The moves towards privatisation of water are a damning indictment of the capitalist system, which puts maximisation of private profits in command, over and above the well being of the working population. It is yet another evidence of the utter parasitism of capitalism which seeks to turn even water into a commodity from which superprofits can be made.

The recent hike in water charges as well as the moves of the government towards privatisation of water supply must be opposed tooth and nail. The lies of the government and its agencies as well as of the private monopolies and the international monetary agencies, seeking to justify privatisation of water as something allegedly in the interest of development and providing more efficient water supply to the people, must be ruthlessly exposed. We must demand as our basic right, that the state provide all citizens with clean drinking water and adequate water for all other purposes, at affordable rates. We must heighten our vigilance and intensify our struggle against the hike in water cost as well as moves to privatise our water resources and water supply.

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Water privatisation accompanied with conditions that benefit the monopolies and jeopardise rights and sovereignty of the people

The Camdessus report was widely opposed by activists from India, Bolivia and other countries at the forum. Why were people so opposed to this report?

The first thrust of the Camdessus report is to call for a doubling of financial flows into the water sector, supposedly to meet the U.N. Millennium Development Goals of halving the numbers of those without access to water (1.2 billion) and sanitation (2.4 billion) by 2015. According to the Camdessus report, these funds would come from "financial markets, from water authorities themselves through tariffs, from Multilateral Financial Institutions, from governments, and from public development aid, preferably in the form of grants".

The timing of this appeal for greater funding for water is no accident. In many countries of the world, such as Phillipines and Argentine, private water companies - the two biggest of which are Suez-Ondeo and Vivendi, both French, with RWE from Germany, which has bought Thames Water from the U.K. - are on the retreat, facing opposition from consumers and heavy financial risks due to foreign exchange volatility.

According to Corporate Europe Observatory, "After a decade of sweeping privatization, 460 million people around the world are now supplied water by private corporations (up from just 51 million in 1990). Water industry analysts expect the privatization trend to accelerate and predict the number to reach 1.6 billion people in 2015."

The second thrust of the Camdessus report is to minimize the risk to foreign investors of exchange fluctuations. "Governments taking up options to grant private concessions should provide adequate safeguards to create investors’ trust and confidence in the sustainability of long-term contracts," the report states.

The third thrust of the report is to channel aid - which has fallen to an average of $3.1 billion annually to water and sanitation in 1999-2001 from $3.5 billion in 1996-98 - through private hands. "The panel believes that water projects can be financed by combining funds with private financing," the report says. "Overseas Development Assistance and Multilateral Financial Institution lending should be available to facilitate water projects managed by private operators under private control."

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IMF imposes loan conditions on Nicaragua demanding water privatisation

Despite widespread opposition to the prospect of a corporate takeover of Nicaragua’s vital water resources, the executive directors of the IMF were to vote on new conditions that require Nicaragua to sell its major hydroelectric dams and the state hydroelectric company called Hidrogesa. The IMF has pushed forward with these loan requirements despite a law passed unanimously in August by the Nicaraguan National Assembly that suspended all private concessions involving water uses until a national regulatory framework could be established.

The new law stemmed from concerns about corruption and the lack of any regulatory framework governing water use by whatever private company would run the hydroelectric facilities. The law safeguards the country’s water resources until further notice, although the IMF would, in effect, supercede the national law if it approves the new loan conditions today.

The privatization process has been fraught with alleged corruption and irregularities. Early in 2002 - before the IMF loan conditions - Enron bid to buy the hydroelectric dams. But when Enron failed to comply with conditions of the sale, the contract was transferred to Coastal Power of Texas. However, the bid was so low, estimated at only 20 percent of the plant’s value, that the comptroller general of Nicaragua began a review of the process. This incident prompted the National Assembly to pass the water law.

In addition to violating Nicaraguan law, the new IMF loan conditions contain requirements that violate U.S. law by imposing user fees for Nicaraguan children to attend schools. The new agreement will require the government of Nicaragua to implement "school autonomy" legislation that reduces national government funding for schools. Only parents who can afford the fees for textbooks, supplies, uniforms and other items - costs known as user fees - will be able to send their children to school.

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DJB authorities fudge facts to justify the water cost hike!

The budget of DJB for 2002-03 shows an annual revenue of Rs. 217 crore 45 lakh, from collection of water bills alone. In 2003-04, this rose to Rs. 267 crore 24 lakh, i.e. an increase of Rs. 49 crore in just one year.

The operation and maintenance costs of DJP amount to roughly Rs. 344 crore annually, so that its annual revenue falls short by only Rs. 77 crore. If its debt servicing costs are added, this would amount to a total additional burden of Rs. 300 crore.

But, with the imposed hike in water costs, DJB is expected to rake in more than Rs. 2500 crore annually. For the first time, a monthly rent has been introduced on each water connection. Of an estimated 15 lakh consumers in Delhi, 13 lakh are domestic consumers, who will have to pay a fixed average rent of Rs. 75 per month. From the estimated 1.5 lakh commercial consumers, a rent of Rs. 350 per month will be collected. The nearly 50,000 industrial connections will each have to pay Rs. 600 as monthly rent. Thus, through rent alone, DJB will net Rs. 205 crore of revenue annually. According to the census figures of Delhi, there are 26 lakh dwellings that have applied for and are yet to get a water connection. Once these are taken care of, DJB will net in a monthly rent of Rs. 41 crore. Till now, DJB did not charge anything for getting a water connection, but now each domestic water connection will have to be bought for Rs. 1,500, each commercial connection for Rs. 4000, and each industrial connection for Rs. 6000.

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Petroleum price hike — who benefits?

It must be noted that by March 2002, government of India has completely deregulated petroleum prices so that they would be "market driven". The exceptions remain LPG and Kerosene which are allegedly subsidised. Prices of petrol and high speed diesel are supposed to be revised every two weeks, the first and 16th of the month for the following two weeks, to ensure "import parity". The baseline for prices of petrol and diesel will be determined by the cost of crude oil landing at the nearest port in India, mainly Mumbai.

Price of crude oil has fallen from a peak of US $56 a barrel in early November to US $44 by December 1 This is a fall of nearly 21%. According to government’s own logic, the petrol prices should have fallen by almost Rs. 7-8 and diesel prices by at least Rs. 5 as a result of fall in crude prices. This has not happened. Someone is pocketing the money. It is going to the oil trading companies, primarily to Indian Oil Corporation and Reliance.

India’s petroleum needs and energy policy of government and the petroleum sector

Today, India is one of the top 10 oil-consuming countries in the world. Oil and gas represent over 40 per cent of the total energy consumption in India. The rest 60% comes from thermal, hydel, nuclear, wind and other sources of energy.

The consumption of petroleum products in the country is on the rise and demand already far exceeds domestic supply. Therefore, the country has to depend largely on imports. This is what the government of India said in its website, when it unveiled the new policy in 2002.

In 2002, domestic crude oil production was 32 million metric tonnes (MMT) as against the demand of 110 MMT. Whereas in the decade of the seventies, over 70% of crude oil used in India was from domestic production, it has come down to 30% now and it is estimated that it will become 14% by 2010.

In the years following independence, the oil sector was in hands of foreign companies until nationalisation in the seventies. It was most profitable for the multinational oil companies to buy crude from assured source abroad and sell at huge margins rather than invest in oil exploration. Following nationalisation in the late sixties, an effort was made for some years to secure self reliance in crude oil and gas, resulting in reduction of dependence on crude imports. However, in the wake of the modernisation program of Rajiv Gandhi in the nineteen eighties, even the pretence of self-reliance in petroleum was increasingly abandoned. Instead the course of opening up India’s petroleum sector to private players, Indian and foreign, and relying on imports was pursued with vigour. Exploration of new sources of crude and gas by the state companies was given the go by. That is, the typically capitalist approach of maximising profits of the oil monopolies was pursued, instead of the long term concern of ensuring energy self-reliance. The consequences can be seen in that domestic crude production has dropped from a peak of 34.52 MMT in 1995-1996 to 31 MMT in 2003.

The attitude of the Petroleum Ministry to nautral gas production provides a good example of this approach. Till the beginning of 2004, the country was not importing any natural gas. Begining this year, following the setting up of terminals in Gujarat for gas import, the gas imports are going to rise phenonmenolly. Union Minister for petroleum Mani Shankar Aiyyar has declared that with the present controlled price of gas in India, it will not go in for tapping gas fields in Eastern India and elsewhere. In other words, the government will prefer to import natural gas from foreign countries under the claim that it is "cheaper", refuse to develop gas fields in India saying it requires too much investment, and later on, at a suitable date, auction gas blocks to Indian and foreign multinationals when it becomes profitable for these companies to do so and when the market prices of gas are higher.

The government has plans to end the "gas subsidy" in 3 years time, so that the price of cooking gas will become something of the order of Rs 400 per cylinder. This concept of "gas subsidy" itself is misleading. What the government terms subsidy is the difference between domestic gas prices and international gas prices. This "subsidy" includes the import duty that would have been paid in case gas was imported!

It must be noted that the crude oil produced domestically by ONGC and Oil India (the 30% produced in India) is also sold at import parity prices. One can imagine the huge profits that are made by these oil companies

Kerosene is sold through ration cards to consumers. A typical working class family is allotted 6 litres of kerosene a month. at Rs 10 a litre. In fact, in many cases, the dealers cheat the workers and give only about 4.5 litres instead of 6. The average monthly consumption for a working class family is about 15 litres of kerosene. The workers are forced to buy the remaining 10 litres in the black market at Rs 24 a litre. In other words, much of the "kerosene subsidy" actually goes to fill the pockets of the distributors of kerosene.

According to the government, the "subsidy" on gas and kerosene will be reduced to zero by 2007. The government subsidy is estimated at about Rs 2500 crores. This figure is indicative of the extremely small "subsidy" in relation to the profits made by the oil companies.

Oil pool account

In 1975, the government established the oil pool fund. Among its stated aims was to protect the country from vagaries of international prices, ensure common prices of petroleum products across India. In 1989, this account had Rs 8,900 crore in surplus, on which interest should have amounted to about 50,000 crore at the present time. However, the
VP Singh government used the oil pool surplus for balancing the budget. This too is not the end of the matter. The government had imposed a special cess on petroleum in 1975 for the purpose of investment in oil exploration. (In March 2002, this cess amounted to Rs 800 per tonne). The amount in this account now comes to Rs 1 lakh crore rupees. Only about 9000 crore rupees have been spent from this fund for oil exploration. Between 1993 and 2004, not a single rupee has been spent from this fund on oil exploration. This 1 lakh crore rupees has simply been eaten up by the successive Central governments.

Taxation policies

The maximum price per barrel of crude has been US $ 56 in early November. One barrel has 158.6 litres of crude. The cost of transportation of a barrel of oil from West Asia to Mumbai is 1.28 dollars. Refining costs per barrel are estimated to be $1.50. Thus total cost per barrel after refining should be under $59 assuming $ 56 as the crude cost. This comes to Rs 16.74 per litre. As against this, the petrol prices in Delhi, Mumbai, Kolkata and Chennai are
Rs 37.84, Rs 43.23, Rs 40.89 and
Rs 41.25 respectively. Diesel prices are Rs 26.28, Rs 32.83, Rs 28.72 and
Rs 29.30 respectively. The difference is eaten up by the oil trading companies, the governments at the center and at the states. The government levies an import cess of 20% which amounts to Rs 2.50 per litre roughly. This import cess is distrbuted to the Indian Oil Corporation (IOC) and Reliance Petrochemicals, the two major refineries. Just last year, Reliance Petro obtained Rs 2000 crores from this account of import cess! These figures give a picture of the huge, profits guaranteed to the private and public oil companies in India, as well as to the government, by bleeding the people. The high taxes on petroleum products are justified by the centre and state governments in the name of (1) development of the economy and providing subsidies for the people in other sectors and (2) subsidies on kerosene and cooking gas. Both are to hood wink the people, and hide the fact that the oil trading companies, and the oil refineries are making windfall and secure profits and the government is plundering the people and their resources through taxes for the benefit of the rich.

Conclusion

The price hike in petrol and diesel are a method of the Indian big bourgeoisie to extract money from the broad masses of workers, peasants, and the middle strata and ensure windfall and guaranteed profits for the big trading companies in the oil sector. The surplus extracted from the people is used to "balance the budget", i.e. it is used for the non-productive expenditure of the Indian state, defence and debt repayments. The oil policy of the Indian big bourgeoisie is in tune with its imperialist strategy of becoming a major imperialist power. It seeks secure sources of oil internationally, and does not mind mortgaging the sovereignty of the country for the foreign imperialist players in the oil sector. It is a policy that is based on the joint plunder of the labour and natural resources of India by the Indian and foreign monopolies.

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New Exploration Policy

The Policy:

• lays down no minimum expenditure on exploration, and no compulsory state participation

• provides a seven-year tax holiday from the date of commencement of commercial production, zero customs duty on imports required for petroleum operations

• promises 100 per cent cost recovery on exploration, production and development

• offers full recovery of all royalties (pegged at 12.5% for oil and 10% for gas) paid to the Indian government for the oil or gas extracted

• offers the option of a 10-year amortisation of all exploration and drilling expenses.

The successful bidder who hits black gold can sell it in the domestic market at import parity prices. This is the price of the crude or gas were it imported, including the transportation cost right up to the nearest port.

Considering that most of the blocks are proven basins, thanks to the substantial resources already invested in proving them, the terms offered under NELP V are attractive. There is no stipulation of targets for investments in exploration and each contractor can stretch the exploration up to seven years in three phases. Hence, bidders can pre-empt other bidders and corner the blocks. The fact that there is no government control over the oil fields leaves the room open to the private companies to speculate at will, announce bogus oil finds to boost their share prices, as well as suppress discoveries while waiting for oil prices to rise higher.

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Oil and gas exploration

ONGC and Oil India Limited (OIL) are the two companies primarily involved in oil and gas exploration in India, with the area of operation of OIL limited to Assam and the North East and some fields in Rajasthan.

The Indian bourgeoisie is pursuing a two pronged strategy regarding getting control of new oil resources.

Within India, both onshore and offshore, the Indian state is auctioning prospective oil and gas blocks to foreign exploration companies as well as Indian companies including Reliance. It is offering extremely attractive terms to foreign investers. Simultaneously, it is trying to establish collaborations with international oil exploration giants. For instance, great efforts are being made to sign a deal with Statoil of Norway for oil exploration in the deep seas both in the Arabian Sea and Bay of Bengal. Statoil has earned a reputation for successful exploration and tapping of the North Sea Oil.

Outside India, the Indian oil companies have set up collaborations with state companies of other countries for oil exploration with buying arrangements. Sudan, Vietnam, Iran and the Sakhalin Islands of the far east coast of Russia are among the areas where Indian state companies have been investing monies. Gas production has already begun in the fields of Vietnam.

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Refineries in India

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India and Russia to collaborate in weapons system production and sale

The two countries decided to extend the duration of the Joint Commission on Military and Technical Cooperation till 2010 and signed a series of defence protocols including providing for an agreement on the key issue of protecting Intellectual Property Rights in case of weapon systems produced jointly.

Russia has been traditionally India’s major arms supplier meeting almost 70 per cent of India’s defence needs. The Russian defence minister said New Delhi and Moscow had decided to take their relationship from buyer-seller to partners in the research and development of futuristic weapon systems and marketing them to third countries. Apart from inviting investment in the Sukhoi aircraft, the Russians have offered similar terms on the co-development of the heavy duty, multi-functional transport aircraft. Delhi, too, has been increasingly keen on joint production with its military hardware suppliers. Indian officials say co-production arrangements are more secure.

India and Russia have jointly developed the Brah Mos supersonic cruise missile and, besides inducting it in their respective Defence Forces, they are jointly marketing it in the global Arms Bazaar. The two sides agreed to step up investments in the BrahMos missile project. Ivanov said the Russian stake in this joint venture company would go up from 50 to 60 percent. According to Russian officials, it is proposed to produce 360-370 missiles per year and also market it together in third countries.

The two countries have almost finalised plans for India’s acquisition of the 60-km range Smerch multi-rocket system. Under the proposed plan, India will buy 36 of the multi-barrel rocket systems at an estimated cost of over Rs 25 billion.

The handshakes and agreements came after two days of intense discussions, which focused on a couple of contradictions between the two sides. The first issue was the non-fulfillment of the terms of the Gorshkov (aircraft carrier) deal signed in January 2004 by former Defence Minister George Fernandes and Ivanov. A complement of 16 MiG-29K ship-borne fighters were to be delivered as well, But the MiG Corporation had run into financial difficulties and there have been doubts on whether the company would be able to stick to the production schedule for the aircraft. The Indian defence establishment is reportedly aggrieved over the delay and this led to its demand for a bank guarantee.

Another imbroglio was over the upgradation of the Indian Navy’s Russian Tu-142 maritime surveillance aircraft. Russia refused to take part in a tripartite upgrade programme for the fleet with Israel. On their part, the Russains have voiced serious concern over India using Israeli technology in conjunction with Russian hardware. Russian officials in the talks sought an Intellectual Property Rights Agreement with India. The Russians are also said to be pushing for an upgrade of the Indian Navy’s TU-154 aircraft, a project India wants Israeli involvement in. Moscow is reluctant to enter into a tripartite arrangement or sharing its know-how with Tel Aviv.

The discussions between the two defence establishments succeeded in sorting out the differences and moving ahead. From the order of things, it appears that the Indian state will be investing hundreds of billion rupees in these joint production and technology transfer deals; and this with just Russia. Likewise, the Indian state is collaborating with Israel, the US, France, South Africa, etc. More and more, it is becoming evident that India’s military establishment has big plans for growth and expansion that cannot be justified by "defence" needs.

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Vigorous protest greet Bush during Canadian visit

Between 15 and 20 thousand people participated in a vigorous mid-day action in the capital city Ottawa on November 30, which was followed by a 3,000-strong demonstration to the Museum of Civilization in Hull where Bush and Martin were attending a dinner. They shouted slogans: Arrest War Criminal George W. Bush! We Want Self Determination, Not Occupation! Bush Out of Canada! Bush Out of Ottawa! Bush Out of Baghdad! End the Occupation Now! Go Home Bush — Take Paul Martin with You! Early morning December 1, 2004, activists gathered for a "Breakfast with Bush" rally in front of the Chateau Laurier Hotel in Ottawa, followed by a march to City Hall where effigies of Bush and Martin were burned.

On December 1, over 4,000 people marched through the streets of Halifax where Bush delivered the main speech of his visit to Canada. In addition to youth and university students, a large contingent of high schools students also took part in the demonstration. A thunderous chorus of "Bush Go Home!" could be heard throughout, as well as slogans such as "From Iraq to Palestine, Occupation is a Crime!" The war machine commanded by Bush was condemned and it was demanded that Canada should not participate in the aggressive policies of the US around the world, particularly its ballistic missile defence program. Protest actions were also organised in several other towns and cities across Canada, including Montreal, Toronto, Calgary, Edmonton and Vancouver.

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