• Nepali people in India organise massive rally in New Delhi

• Denial of US visa to Narendra Modi
  Exposure of the bankruptcy of the Indian State

• Nepal: Continuing Struggle Amidst Growing Threat of Foreign Intervention

• What is the annual budget?

• Expenditure targets: Where will the Rupee go?

• On whom does the tax burden fall?

• Jobless growth - a manifestation of increasing capitalist exploitation

• Reforms in the Banking Sector

WORLD

• Plans of US President Bush to privatise social security resisted

• What is Social Security?

LETTER TO EDITOR

• Tit for Tat

• Narendra Modi Retreat

• Exit Policy

VOICE OF TOILERS & TILLERS

• Unorganised workers come together to fight for their rights

• On the changing pattern of employment in cities

Nepali people in India organise massive rally in New Delhi

As a ten-day general strike paralysed Kathmandu and other towns of Nepal from April 2, over ten thousand Nepali workers and students resident in India participated in a massive rally in front of the Indian Parliament on April 6. The rally was organised by the Nepali Janadhikar Suraksha Samiti (Bharat).

The people came from all parts of India, with the banners indicating the area they came from as well as their demands. There were delegations from West Bengal, Maharashtra, Jharkhand, Tamilnadu, Andhra Pradesh, Goa, Punjab, Haryana, Uttar Pradesh, and other states of India. "Down with the Monarchy, For a Republic!" was the main slogan of the rally. In a festive atmosphere, reflecting the confidence of the people that the downfall of the monarchy was fast approaching and that the people would certainly take power into their own hands, young girls and boys in the rally performed skits, songs and other cultural items. With great keenness, activists in the rally read copies of Mazdoor Ekta Lehar which were being distributed by activists of the Communist Ghadar Party of India.

The proceedings of the rally were conducted by Ishwari Bhandari. It was addressed by Laxman Pant, President of the Nepali Janadhikar Suraksha Samiti (Bharat), Prakash Rao, spokesperson of the Communist Ghadar Party of India, Krishna Chakravorty, member, Central Committee of the SUCI, Aparna Sarin from IFTU, journalist Anand Swaroop Verma of the Bharat Nepal Jan Ekta Manch, and others.

Laxman Pant unequivocally condemned the fascist autocratic rule of King Gyanendra, and expressed his firm conviction that the monarchy was on its last legs as a result of the blows of the fighting people and would soon be overthrown. He pointed out that the Indian state and US imperialism had armed the monarch to the teeth in the name of fighting insurgency and the so-called 'war against terrorism', and that they should not be believed when they now shed tears about 'democracy' in Nepal. India and the US were fully involved in preventing the people from coming to power in Nepal at any cost, and they were engaged in all kinds of manoeuvres.

Prakash Rao, spokesperson of CGPI, made a hard-hitting speech exposing the conspiracies of the US, India and other imperialist countries against the Nepali people. Right now in Swtizerland, he said, the US, India, Britain and some other countries are manoeuvring to declare Nepal a 'failed state' as a prelude to imperialist intervention in Nepal under the guise of monitoring human rights violations. They are demanding that the king restore multi-party parliamentary democracy. The Indian Ambassador in Nepal is busy organising meetings with the leaders of the parliamentary parties to come to an agreement with the King. What gives India and other imperialist powers the right to interfere in the internal affairs of Nepal? What gives them the right to decide what the form of rule in Nepal should be? Why are they so interested in restoring the multi-party democracy in Nepal? If the Indian state and other foreign powers stopped assisting the monarchy in Nepal, it would not long survive the blows of the people’s movement. He pointed out that the Indian government is now talking of Pakistan sending arms to Nepal, and is using this to prepare grounds to send its own military expedition there.

Comrade Prakash Rao further noted that the imperialists and reactionaries are desperate that the workers and peasants of Nepal do not establish their own republic, their own rule. They know that multi-party parliamentary democracy is the best form of rule for the bourgeoisie and the best vehicle for imperialist plunder and domination. Fifteen years of constitutional monarchy and multi-party democracy in Nepal has confirmed that, in the name of rule by political parties, it is the bourgeoisie and imperialists who have been ruling. Now the people of Nepal are emerging on to the centre stage of history. They want political power in their own hands. Communist revolutionaries in India and the entire Indian people are one with the Nepali people in the great and just struggle they are waging against the monarchy for a Republic. If the Indian state dares to send the armed forces into Nepal, the workers and peasants of India will rise up and burn the ground on which the reactionaries stand. The CGPI spokesperson’s intervention was greeted with repeated applause from the gathering.

All the other speakers also expressed their full solidarity with the struggle of the Nepali people for a Republic.

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Denial of US visa to Narendra Modi
Exposure of the bankruptcy of the Indian State

The whole furore surrounding the denial of a US visa to Narendra Modi has served to expose an important truth about the prevailing political system in India – that the really big criminals and mass murderers, who have the blood of countless innocent people on their hands, are never brought to book or punished for their crimes. Four years after he played a crucial role in engineering one of the worst cases of communal terrorism in India’s recent history, Narendra Modi’s crimes are still being covered up by both the Central and state governments, by his own party the BJP as well as the Congress, and by the judicial system, police and intelligence agencies. Far from being arrested or punished, Modi has been allowed to go scot-free, and every attempt has been made to portray him as a respectable leader and, even more, as a symbol of ‘Gujarati pride’. This hyped-up image was punctured by the news of his being denied a US visa last month on the grounds of violation of rights of religious minorities.

Of course, it is ironic that Modi’s condemnation as a violator of human rights at this time has come from none other than the government of the United States, the greatest violator of the rights of peoples on a world scale, and especially of the rights and dignity of Muslim people all over the world in the name of its so-called "war on terrorism". The US probably finds the denial of a visa to Modi a cheap way to cover up its own crimes against humanity, particularly in Iraq and West Asia, and to paint itself as a defender of religious and other freedoms. However, this does not in any way turn Modi into a "patriot" being victimized by imperialism, as the BJP and the Congress-led government at the Centre have tried to make out. Rather, it is clear that in the eyes of people both in India and around the world, the crimes of Modi have not been forgotten, that he is an outcast and a butcher in the eyes of humanity. The efforts of the BJP to whip up a campaign on the visa issue in the name of ‘opposing imperialism’ have fallen flat.

However, the real issue that needs to be understood is that Modi’s crimes are not just those of an individual but of the prevailing system in our country. Why do horrendous communal massacres such as were organised in Gujarat take place again and again? Why is it that the real perpetrators and beneficiaries never get the punishment they deserve, no matter who is in power? Communal violence is one of the preferred methods adopted by the rulers of this country to divide the people, to divert attention from their own anti-people activities, and to terrorise and suppress all opposition. This is the lesson that our people learned in the course of the struggle against British colonialism, and from the horrors of Partition. But communal violence is also the legacy of "secular" India, where the rulers talk of "respect for all religions" on the one hand, while they connive at organising communal bloodshed on the other hand. It is up to our people to grasp this truth fully, and to organise and fight for an end to a ruthless system that gives rise to and promotes Modis and his like on a daily basis.

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Nepal: Continuing Struggle Amidst Growing Threat of Foreign Intervention

The struggle of Nepali people against the fascist repression imposed on February 1 by the king, Gyanendra, continues to develop. On April 2, there was an 11-day general strike which among other things severely restricted the movement of goods throughout the country. On April 6, thousands of Nepalis from all over India held a vigorous protest demonstration in Delhi. On April 8, the anniversary of the movement for democracy of 1990, protests were held in Kathmandu and various other towns in Nepal, and hundreds of activists were attacked and jailed by the police and armed forces. Clashes continue to take place on a daily basis between the revolutionary forces and the Army.

Efforts are on amongst the political forces in Nepal to bring all those opposed to the current situation together on one platform. Increasingly, sentiment among the Nepali people is coalescing around the demand that the monarchy must go. The history of more than five decades in Nepal has shown that the monarchy is the bastion of the most reactionary, regressive forces in the country that want to deny the people even their most basic rights. It bars the way to any progress, and has shown itself incapable of changing. The abolition of the monarchy, and the establishment of a democratic republic in which the people will decide the nature and shape of the political power, are the basic demands of the forces fighting repression in Nepal, and must be supported by all those in favour of a lasting and democratic solution to the present crisis.

However, there is every indication that various foreign powers are not in favour of such a solution, and are stepping up their efforts to intervene. For so many decades, the UK, US and other powers have watched without any qualms while the people of Nepal have languished under one of the most feudal and backward regimes in the world. They have watched while the country was bled white by its ruling class, and the lives of ordinary people in the towns and countryside became more and more wretched. They have assisted the armed forces of the cruel regime to put down the people’s struggles with helicopters and bullets, with money and advisors. Now, these same powers have declared themselves to be terribly worried about "democracy" and "human rights" in Nepal. Under their sponsorship, international conferences are being organised to "condemn" human rights violations in Nepal and, under the excuse that Nepal is turning into a "failed state", to jump in and intervene directly. It is clear that the purpose behind these moves is to pre-empt the fighting masses of Nepal from taking the centre stage and adopting any measures that are not to their liking. They also want to take advantage of the crisis and weakness of the regime to strengthen their control over this country which, though small, occupies a strategic position in Asia.

The Indian state has been one of those powers that have all along supported the status quo in Nepal. While it too is preparing to intervene in the situation there in its own interest, it is cautious about the moves being made by the US, UK and other Western powers to intervene in the form of an "international monitoring force", because it considers that Nepal falls within its own sphere of influence.

In these conditions, it is very important that the Indian working class and other democratic forces organise and come out actively against the fascist monarchy in Nepal, and in support of the right of the Nepali people to determine their own destiny free of foreign interference. Any attempts by the Indian state or other foreign powers to put their foot in and impose their own "solutions" to the present crisis, are against the interests of the people of Nepal and must be opposed!

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What is the annual budget?

One of the illusions created by the bourgeois propaganda and reporting of the Union Budget is that this event, which takes place once a year, decides who will enjoy how much of the economic resources of India in the coming year. In actual fact, the distribution of the value created by human labour in the country during one year, the annual Gross Domestic Product, is determined independent of the government and its budget. It is determined by the distribution of the means of social production among the different classes of Indian society. What the budget does is to redistribute the values that have already been distributed unevenly among the different classes, reinforcing this pattern of distribution even more.

Those who own enormous quantities of the means of production as their private property, that is, the big capitalists and their monopoly corporations and banks, pocket the lion’s share of the GDP in the form of interest, profit, rent and royalty. They expand their capital from year to year at the maximum possible rate, faster than anyone else in society. The majority of the medium-scale non-monopoly capitalists, including rich capitalist farmers, earn something less than or equal to the average rate of capitalist profit, with some of them suffering losses and going out of business every year. Those who own nothing except their own labour power, the workers, receive wages or salaries that are in most cases even less than what is required for the reproduction of a worker’s family at the same standard of living. Those with small property, the masses of peasants and the urban petty bourgeoisie, struggle to keep their families afloat, with many sinking into the ranks of the working class constantly.

The policies and programs of the Central Government are instruments to steer the course of an economy that is already geared towards the general direction of maximising the profits of capital, with the maximum rate accruing to the monopoly capitalists. The Union Budget is one of the important instruments of the big bourgeoisie to coordinate the system of plunder in its own interest.

The Union Budget is the annual financial statement of the Central Government. It presents estimates and targets of the revenues to be collected and expenditures to be incurred in the coming year, by the Indian Union. It shows how the gap between expenditure and revenue is to be financed, how much will be borrowed from internal and external sources and how much will be financed through money creation.

As a result of the domination of the big bourgeoisie over the Indian Union, the budget is designed to redistribute the already unevenly distributed incomes in favour of the big monopoly corporations. In simple words, the budget robs from the poor and middle strata of society to fatten the rich exploiters, and especially the super rich among them. This basic class character and orientation has not changed as a result of the replacement of the NDA Government by the UPA Government.

What Mr. Chidambaram has introduced are measures to further streamline the system of robbing the broad masses of workers, peasants and other small propertied sections of society in the interest of guaranteeing maximum profits for the big monopolies, Indian and international, and in the interest of the imperialist strivings of the Indian big bourgeoisie.

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Expenditure targets: Where will the Rupee go?

Within the category called the Central Plan, the most significant increase in allocations are for investment in roads and other physical infrastructure, as well as for education, health, rural employment, and special programs for the northeastern states. This is a reflection of the economic and political compulsions of the big bourgeois class and the UPA Government at this time.

The big bourgeoisie is very anxious and impatient to upgrade the road and communication network, and other aspects of the infrastructure needed to convert India into a world leader in industrial and agro-based exports and an IT superpower. The 2005-06 budget reflects the decision of this class to use public funds to address the infrastructure needs of this strategy, even if this means a sharp increase in the burden of public debt.

The big bourgeoisie is also anxious about the political stability of the UPA coalition government, which depends on the support of the ‘Parliamentary Left’ for its survival. In order to keep its allies reasonably happy, allocations for social programs promised in the National Common Minimum Programme have been increased significantly. In interviews held after the presentation of the Budget, when the Finance Minister was questioned about his over ambitious revenue projections, he remarked that his expenditure targets were also ambitious and some ministries may not be able to expand programs as rapidly as envisaged. In other words, budget allocations on social programs are being enhanced to pacify the ‘Parliamentary Left’, with the presumption that actual expenditures are likely to fall short of these targets.

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On whom does the tax burden fall?

Government levies taxes on income earned by individuals such as salary or professional income, on earnings from business in the form of corporate income tax; there are also taxes to be paid on goods sold (sales tax), goods manufactured (excise), goods imported (customs and import duties). Government also levies certain charges for use of a service, which are called user charges.

The 2005-06 budget of Chidambaram claims that everyone has benefited from the tax proposals in this Budget. But, the fact is that it has contributed further to the unequal distribution of the social product between the propertied and the propertyless.

The bourgeoisie makes out that it is only fair that people who are earning income pay tax. But in the capitalist system, salary or wage income is the compensation paid to a worker for his labour power, and there is no element of surplus value in it. The worker does not earn the full value of his labour power, and it is the owner of capital who expropriates the surplus. The brunt of the tax should be falling on those who expropriate the surplus. On the contrary, direct taxes collected from the capitalist corporations (corporate income tax) account for less than 20% of the gross revenue collected by the Central Government.

In the Indian economy, the principal means of social production is owned by private capital, with some state capitalist ownership, individual petty production and the remnants of feudal property and common property resources in the villages. As a result of these relations of production, and the high degree of monopoly in the ownership of capital, owners of large amounts of capital, who make up less than 5 percent of the Indian population, pocket about 37 percent of the social product as profits, interest and rent; but they pay less than ten percent of their incomes. At the same time, the class of wage and salary earners pays as much as 18-20 percent of their incomes as tax. A comparison of the current budget estimates with the estimates for the previous year reflects a 30 percent increase in taxes from income, compared with a 20 percent increase in corporate tax. This indicates the general trend, which is to increasingly tax labour income while reducing the tax on the surplus expropriated by a minority.

Each year, the chief executive officers of the biggest Indian companies meet with the Finance Minister before his ministry begins the calculations for the Budget. They present their "wish list" to the Finance Minister, and demand maximum concessions and relief from tax, which are granted through one mechanism or another. This year's budget proposal has granted corporate India a relief of 3 percent in the effective tax rate.

In addition to levying taxes on labour income, everyone is made to pay indirect taxes on almost everything they purchase for their daily consumption needs. The price of the goods they purchase includes an element of excise duty, an element of sales tax, and so on. Likewise, with more and more services being brought under the service tax net, people are paying taxes on common services purchased by them. The bulk of tax revenue is collected in this indirect way, without the people knowing how much is being squeezed from them.

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Jobless growth - a manifestation of increasing capitalist exploitation

In a part of his budget speech entitled "Assault on poverty and unemployment", the Finance Minister, P Chidambaram, while pointing out that India is not a poor country but a country of poor people, vowed that he would put an end to this jobless growth. He promised that irrigation facilities for an additional 1 crore hectares would generate employment for an additional 1 crore people at the rate of 1 person per hectare. The food processing industry will supposedly create 2.5 lakhs more jobs every year, and the textile sector another 1.2 crore jobs over the next 5 years. The IT industry should be creating another 70 lakh jobs by 2009. The construction industry is expected to "throw up lakhs of jobs". Thus, according to Chidambaram, the phenomenon of unemployment should vanish in the next few years because the economy is growing!

The Indian people are in no mood to believe in this pack of lies once again. Far from creating new jobs, the bourgeoisie has actually cut down jobs in the organized sector to maximize profits. All these years, the bourgeoisie has been trying to accelerate economic growth not to address the huge problem of unemployment, but to capture new markets and earn windfall profits. In its drive to become competitive, the bourgeoisie has shrunk the organized working force, and resorted to outsourcing production to smaller units employing casual labour.

Chidambaram is now shamelessly promising to create one or two crore jobs over five years. Even if the bourgeoisie performs this miracle, will it make a dent in the number of unemployed in India?

In India, a very small part of the working force gets full-time work and wages throughout the year. Out of the 407 million working people reported by the 55th Round of the National Sample Survey in 1999-2000, only 14% were in the ‘organised’ sector employed throughout the year and earning a ‘salary’. About 52% of the labour force was ‘self-employed’ consisting of people such as vegetable vendors and home-based bidi rolling workers, who cannot afford even two square meals a day. Nearly one-third of the labour force consists of ‘casual’ workers, who are not sure where the next day’s bread will come from, if it comes at all. About 9 million people are ‘unemployed’, those whom capitalist society has condemned to en existence worse than the leper.

In India, a worker can be ‘employed’ but also poor. While the official unemployment rate is 7%, the official poverty ratio is nearly 30%! Thanks to the perverted definition of ‘livelihood’ by the bourgeoisie, millions of people work but starve in this country.

Seen against this magnitude of unemployment, Chidambaram’s promises cannot be dismissed as well-intentioned but misplaced, but must be seen as a thoroughly depraved attempt to poke fun at people living on the margins of life.

Even among the 55 million wage-earning workers, 84% are males showing the extent of regular unemployment among females. In most industries capitalists prefer trained male workers, who can work extra hours in shifts, over female workers. Of the organized work force, 62% are living in urban areas. With 70% of the population living in the countryside, this incongruous ratio shows that jobs are created where capital accumulates, not where people live and need them.

Throughout the period of reforms when the bourgeoisie did not stop even one moment extolling the virtues of capitalist growth, a fascist anti-social offensive was let loose to steamroll the opposition of the working people. Some workers were sent home through voluntary retirement schemes. Others were driven home through anti-worker laws and the strike breakers of the capitalists. Through a spate of privatization, the big bourgeoisie rolled back many of the rights that public sector workers had won, deprived them of the assets which rightfully belonged to them and to society, and broke down larger manufacturing units into smaller ones and it outsourced part of the production to small scale units where workers worked for a pittance with absolutely no job security and rights.

During these years, the Taj Mahals of the Indian working class, the huge textile mills in Mumbai, Kanpur, Coimbatore and other cities, were reduced from beehives of activity to grave yards, and their land sold away by the capitalists to real estate sharks. Their families were left to starve, their activists thrown into prisons, and their children forced to discontinue their studies. How dare the bourgeoisie continue to fool the people so cruelly?

The bourgeoisie has been constantly spreading the illusion among younger sections of the working population that with India being an IT superpower, millions of business process outsourcing (BPO) jobs are going to flood the Indian shores. When the IT bubble burst in the late nineties, this illusion also faded, but the bourgeoisie is desperately trying to blow new breath into this dead carcass. If a glint of hope has still survived among a section of the young working force, it is getting rapidly erased by the back breaking long hours in this industry, and the killing monotony.

The IT industry is, in a way, even more self-serving to the capitalists than other industries. Manufacturing industries source raw materials and intermediate goods from inland, thus creating more jobs and accessory industries. The goods produced by these industries are normally consumed by the home market. The IT industry is very different. It does not need any raw material and is driven by the needs of the foreign multinationals. It basically survives on "body shopping" and by doing low-grade chores for the big software monopolies. The IT industry may still lull the frustration of some job seekers from the middle strata, but all told, this industry employed a pathetic 0.2 percent of the total workforce in 2004. The most extravagant estimates place the job potential of this industry at around 3 million by 2015!

The vast majority of the employed and under-employed are in the countryside. The agriculture sector provides 57% of the total employment even today. Did the bourgeoisie nurture this sector? No. In the second half of the nineties this sector created zero percent additional employment. The anti-social offensive of the bourgeoisie on the peasants in the form of reducing procurement, employing a credit squeeze in conditions of increasing input costs, reducing import tariffs for agricultural commodities at the behest of monopolies, saw to it that lakhs of peasants became landless and agricultural production went into a crisis. (The proportion of landless households among total rural households rose from 35 per cent to 41 per cent between 1987-88 and 1999-2000). It is the small and marginal farms which provide the bulk of employment because of their labour-intensive operations. When these peasants became bankrupt, many more were rendered jobless. Mechanisation in agriculture in some areas contributed further to a shrinking of the labour force.

It is only in the services sector that some additional jobs were created. Within this, the ‘trade, hotels and restaurants’ sub-sector created an additional 10.7 million jobs between 1993-94 and 1999-2000, looking set to become a larger employer than manufacturing. What the bourgeoisie has christened a ‘trade’ includes all kinds of petty vending businesses, largely one-man or one-woman operations. The workers in this sector eke out a desperate existence. The agriculture sector is notorious for its disguised unemployment, where millions lead some sort of paltry subsistence and basically belong to the vast pool of those who could not get jobs elsewhere. The bourgeoisie is now grooming the services sector to take over this role.

Such is the phenomenon of jobless growth, which Chidambaram wants to wish away in the manner of an ostrich burying its head in the sand! But the problem can vanish only when capitalism vanishes. It is the working class of India which can make the problem vanish, by seriously taking up the program of establishing the rule of workers and peasants, and reorienting the economy to fulfil the needs of the masses of the people, not a minuscule rich minority.

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Reforms in the Banking Sector

The focus of the ‘reforms in banks’ was spelt out by the Finance Minister in his own speech: "competition, consolidation and convergence". A few simple words with big implications! The Finance Minister felt very sorry that "there are many banks in India but none among the top twenty in the world. Our largest bank, the State Bank of India, ranks 82 in terms of business". The objective of reforms becomes clear from this statement - the Indian bourgeoisie wants big banks, fewer banks, and banks of global size and reach to fulfill its imperialist ambitions. Let us understand what each of these three words really mean for people of our country.

‘Competition’ in the banking sector implies that public sector banks must be made to compete with private banks, and private banks must be made to compete with foreign banks. Banks which are not able to compete should either close down or merge with a stronger bank or be taken over by a stronger bank to survive. The social objectives of banks to serve the poor and needy, to serve farmers and artisans, to provide banking facilities to all the people of the country, irrespective of where they are located, will obviously not find a place in the proposed free competition in the banking world based on the survival of the biggest and the strongest.

Private banks and foreign banks will obviously have an upper hand over public sector banks. So under the garb of the policy of competition, the plan for dismantling public sector banks through privatization has been launched. Free entry of private banks and regulated entry, for the time being, of the foreign banks has been assured through a number of changes proposed in the banking laws and regulations of the country.

The next focus of ‘reform’- consolidation – implies disappearance of small banks through mergers and acquisitions (M&A) by big banks. Most M&As led to reduction of workforce. So the number of bank employees will be reduced, using the argument that banks need to merge, as a bank below a certain size is not profitable. In order to facilitate M&As among banks, a number of tax benefits have been announced in the budget.

All the existing rules are being changed to encourage consolidation of the banking sector.

Fewer banks necessarily means that there will be monopoly of a few large banks and customers will have fewer choices. The cost of banking transactions will go up, which has already started with the introduction of private banks. So while the reform in banks is being justified to people by saying that it will lead to more competition and hence better service, this leg of the reform is actually meant to create monopolies or oligopolies among banks. Both bank employees and customers are like to suffer by the consolidation of banks.

The last leg of ‘reform’ – convergence – implies that all arms of finance capital will converge, and banks will play all the finance capital roles. Convergence will lead to what is called ‘universal banking’, which means all kinds of financial transactions and operations can be done under one roof. Most large foreign banks have moved to universal banking. Private banks like ICICI Bank in India are also moving in the same direction.

What does "universal banking" mean? Some financial transactions are considered "safe" but not profitable, while others like retail credit (lending to individuals) is highly profitable for the bank but risky too; some deals involve long term funding for big projects. Till recently in India, banking was regulated so that banks could carry out only certain types of transaction; customer funds were secure, but this was not so profitable for the banks. There were all sizes of banks, big and small, operating according to their mandate. Now, this regulation is being withdrawn and banks can carry out many operations that were earlier closed to them. However, you cannot do universal banking without being large and without having global presence. While the Indian market is being opened to foreign banks, Indian banks are aspiring to be global banks. The two phase approach, proposed by the RBI, is to allow time to Indian banks to become large enough through M&A, so that they can not only take on foreign banks in India, but also give competition to foreign banks in their home markets.

A week before the Budget presentation itself, The Ministry of Finance on 22 February offered an autonomy package for public sector (PSU) banks "aimed at creating a level-playing field vis-à-vis their private sector counterparts". The real objective of the package was to facilitate banking reforms of competition, consolidation and convergence.

The package permits PSU banks to undertake acquisitions of companies or businesses, close or merge unviable branches, open overseas offices, set up subsidiaries, take up a new line of business or close down an existing business - all without the need to seek prior government approval.

It is important to remember that public sector banks (PSBs) are still today the backbone of the banking sector in our country. Of the 100 banks in India, 27 are PSBs (including eight in the State Bank of India group). There are 31 private sector banks, of which eight are of recent vintage (for example, ICICI Bank and HDFC Bank); and there are 42 foreign banks with branches in India. Despite this, the 27 PSBs account for 81 per cent of all bank deposits; the 31 private banks account for 13 per cent; and the foreign banks 6 per cent. The position is almost similar in the case of advances by banks. The profitability of PSBs is lower not merely because of higher wage costs, but because of their lower per-branch business. This, in turn, is largely on account of the extensive reach of their business, particularly in the rural areas.

It is obvious that PSBs have fulfilled the role the bourgeoisie wanted them to play after nationalization. Savings of people from all over the country have been mobilized by PSBs and made available to big for the bourgeoisie for its growth. Now the big bourgeoisie wants to own the banks themselves. It can now access capital from anywhere in the world with the help of foreign banks. the big bourgeoisie wants Indian banks to provide loans to people so that they can buy more and more goods. The presence of foreign banks in India will make it easy for the big bourgeoisie to do business not only in India but also internationally.

The big bourgeoisie now wants Indian banks to help in achieving its global ambitions. Big Indian banks must therefore grow to global size by acquiring other banks. They must be focused on making maximum profit if they are going to be owned by the big bourgeoisie. Employee costs must therefore be reduced to the minimum possible. The number of workmen must be reduced; the workload on the remaining employees must be increased. All costs will be recovered from customers. Banks will focus only on profitable customers. If higher risks, taken by banks to maximize their profit, put the savings of masses of people in danger, so be it.

The new wave of reform in the banking sector launched during February 2005 through a number of announcements of the Finance Minister, Ministry of Finance and the Reserve Bank of India, is yet another attack on the people of the country and on the employees of the banks. It is yet another step towards globalization through liberalization and privatization.

The people of our country should not be fooled by all the benefits being promised by the reforms in banks. No previous reforms have helped to improve the lives of the toilers of the country nor will this wave of reform. They have to be resolutely opposed to defeat the plans of the bourgeoisie. Leaving the opposition to reforms in banks to political parties who oppose them outside the Parliament, but support the government and its policies inside the Parliament, will not be in the interests of the proletariat and people of the country.

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Plans of US President Bush to privatise social security resisted

Social security in the US is a right the working people have won after decades of struggle in the twentieth century. Part of the taxes paid by all people is used for providing social security, especially after retirement. According to the administration, the government will have to pay out much more in social security than what it will collect as taxes in ten years' time. Hence, they claim that there is urgent need to 'reform' the program in order to make it viable. The plan for 'reform' includes privatisation, by allowing younger workers to deposit part of their taxes into personal investment accounts in order to receive a pension when they retire. However, it is clear that diverting taxes into private accounts will in fact increase the budget deficit by trillions of dollars and moreover will leave people stranded in their old age if their private accounts lose money. The path that the Bush administration wishes to lead the country into will completely negate the rights of the people won through decades of struggle. It will negate the concept that the state is responsible for the welfare of all and not merely the richest and most powerful people.

The Bush administration is spending millions of dollars on campaigns to make people accept the proposed reforms and privatisation of social security programs. It projects the proposed reduction in subsidies to farmers, and lower spending on environment, education, and health, as measures to cut the alarming budget deficit. However, even the most adroit and glib of its spokesmen cannot hide the fact that the deficit is largely the result of massively cutting the taxes paid by the rich in Bush’s first presidential term. Moreover, military spending is to be increased by 4.8% to $419.3billion in 2006. This does not include the cost of running military operations in Iraq and Afghanistan, for which the administration is expected to seek an extra $80billion from the US Congress later this year. In meeting after meeting in cities and towns across the US, people have vociferously opposed the plans to privatise social security, making Bush backtrack on the issue. The administration is now running a campaign highlighting the need to make the social security program ‘viable in the long run’.

The House of Representatives voted to cut spending on Medicaid by $14 billion. But in the Senate, Republicans joined Democrats on 17th March 2005 in voting 52-48 to eliminate all $14 billion in Medicaid savings that the budget had proposed. Senators also voted to roll back Bush's plans to cut billions of dollars from education, community development, water projects and other programs. This reflects the profound opposition that people all across the US have mounted to the proposed cuts and ‘reforms’ that negate their social security. However, the battle of the budget in the US is far from over. The budget is to be decided finally by a joint session of the Senate and the House of Representatives sometime in April this year.

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What is Social Security?

The original Act that provided for this scheme was passed in 1935 in the period of the Great Depression when the US imperialist bourgeoisie was confronted with the danger of the American working class taking the path of revolution and socialism. At that time, it provided only retirement benefits, and only to the worker. Subsequently, there have been several amendments that have made some fundamental other changes in the Social Security program. The major 1939 Amendment added new categories of benefits and beneficiaries, and this transformed Social Security from a retirement program for workers into a family-based economic security program. The Social Security Amendments of 1954 initiated a disability insurance program, which provided the public with additional coverage against economic insecurity. In 1965, a new social insurance program was established that extended health coverage to almost all Americans aged 65 or older.

Today, one in seven Americans receives a Social Security benefit, and more than 90 percent of all workers are in jobs covered by Social Security. From 1940, when slightly more than 222,000 people received monthly Social Security benefits, until today, when over 44 million people receive such benefits, Social Security has grown steadily. The beneficiaries are retired workers' and aged spouses, disabled workers' spouses and children, aged widower and dependents, and survivors of deceased workers.

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Tit for Tat

The refusal by the US State of a visa to Narendar Modi has sparked off much debate among many Indians here and abroad, and the media has, naturally, revelled in this sensational news. More seriously, this event has thrown up some contradictions for people who have been fighting for the trial of Modi, demanding that he be held accountable for the genocide in Gujerat. He has been seen to be guilty of not just Chief Ministerial neglect at that time, but of organising the most criminal acts of murder, rape and looting of people across the state. Many people are feeling vindicated in the refusal of his visa by the US authorities. At the same time, there is the undeniable issue of the hypocrisy and fraud of the US state.

What is and should be of the greatest concern to self-respecting Indians is the fact that despite the arrogance and disdain that is revealed in such acts, representatives of the Indian state want to visit the USA. Not many months ago, the Defence Minister of the then BJP-led NDA government was so blatantly insulted even as he entered that country. Under the guise of "security concerns", George Fernandes was stripped and searched! This fact was kept under cover and came to public knowledge only later, after which some feeble protests were made. But at that time, George Fernandes, and the Indian government chose to endure this shame and insult.

On the other hand, when Clinton visited India when he was president, the entire floor of the five-star hotel where he was to stay was cleared of all other guests, the US embassy sent sniffing dogs to smell out any "dangerous" objects, and security staff of the President were sent ahead to check the hotel. They very openly gave the message that they could not rely on our security measures. And the ruling classes let them do all this even as thousands of people were protesting Clinton's visit.

Such incidents reveal the toadyism of the Indian ruling classes to the Americans. They are prepared to swallow insults, just to be able to set foot in that "great" country. What an insult to the dignity of all self-respecting Indians. We cannot expect such toadies to uphold the proud traditions of Bhagat Singh and his compatriots who defied the "might of the British Empire"

The people must take a stand and demand that we "do to them what they do to us." No war-mongerers, murderers or thieves should be allowed to enter India, and this principle has to be followed for all visitors. Bush, Blair, Rice should not be able to take it for granted that they can enter our country with impunity and dictate to us as to how we should receive them!

Radhalakshmi, Chennai

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Narendra Modi Retreats

Narendra Modi represents the arrogant, brazen, remorseless face of the fascist Indian bourgeoisie. This bourgeoisie and especially its two major political parties – the Congress and the BJP – have time and again used the tested and hated methods of the British colonialists– that of inciting communal violence, of killing, raping, maiming and rendering thousands homeless. These are crimes which are thoroughly repugnant to all those who cherish human values and democracy. Unfortunately, the perpetrators of these genocidal crimes are hardly ever brought to book in India. Witness the manner in which the criminals responsible for the massacre of people of the Sikh faith in 1984 have not only gone unpunished, but actually hold positions of public office today in our country! Narendra Modi just wanted to go one step ahead and swagger through various countries of the world as an emissary of ‘modern’ India. Is this not akin to rubbing tons of salt in the unhealable wounds of those thousands of people who lost their near and dear ones in the Gujarat genocide of 2002?

The people of Britain, and especially the people of South Asian origin there, have done a great job by organising militant protests which would have greeted Modi had he dared to set foot in that country. When Modi visited the UK in 2003 too, he faced some protests by human rights organisations. This time, from all accounts, the demonstrations against him would have been much bigger and more vocal. It is also reported that some groups were trying to obtain an arrest warrant on Mr Modi for the crimes he had committed against the people. This would have been a big embarrassment, to say the least, not only for Modi and the BJP, but the entire Indian ruling class that uses the method of communal violence to perpetrate its rule. They ran the risk of getting arrested and facing trial ignominiously, like common criminals, as the ‘Great Dictator’ Pinochet of Chile had to recently. In view of these ‘security’ concerns, Narendra Modi decided, in consultation with the Indian Prime Ministers Office, that discretion was indeed the better part of valour. Setting foot even in the land from which the colonialists of yore themselves originated would be perilous for the present-day chauvinist. The anti-fascist forces have thus won a well – deserved victory, as Narendrabhai nahin aaye! This fight should be kept up and all fascists should have no place on earth where they can spew venom. Fascists have no right to speak, no right to organise!

Yours, etc.
H. Patel
Gandhinagar

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Exit Policy

Indeed, in the reactionary bourgeois media the 'organized sector' has been the favourite whipping boy for all that ails the Indian economy. No blame is ever attributed to the bust and boom cycle inherent to capitalism which is as old as that system. The notion that all economic parameters must only reflect the balance books and the 'bottom line', without any heed being paid to the human factor, is at the root of this kind of discourse. For instance, the paragraph that follows the quote from the article above reads "The reason was obvious: the opening up of the Indian economy would expose domestic industry to competition from highly efficient international firms. To survive and prosper, and above all to compete successfully in the international market, they would have to trim their costs to the bone." The author has set up the possibility of some simple word play here, that it is to the bone of the workers that the costs will be trimmed, while all the profits of the industry must go into the bank accounts of the money bags and the capitalists. All organized sections of the industry must be ever watchful of this kind of discourse and must unite to evolve and advocate an exit policy for the likes of Mr. Jha and that of Mr. Manmohan Singh instead.

A. Narayan, Bangalore

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Unorganised workers come together to fight for their rights

We are a country of well over a hundred crore people. We have a total work force of forty crore men and women. The vast majority of them, accounting for 93% of the work force and numbering about 37 crore, with a substantial number of women among them, are in the unorganised sector. This includes agriculture, fishing, forestry, animal husbandry, sericulture, handlooms, beedi rolling, leather work, salt making, garment making, repair shops, small eating establishments and domestic work. Unorganised workers include artisans, hawkers, vendors, rag pickers, and countless others who toil in very difficult conditions. In recent years, the increasing incidence of contract labour and casual labour consequent on the policy of liberalisation and privatisation, has been swelling their numbers.

By the very nature of their employment and work, the workers in the unorganised sector stand apart from the workers in the organised sector. Their lack of organisation, caused mainly by the nature of their work and employment, has resulted in accumulated neglect over the years at the hands of the State. The large number of labour laws in our country has meant very little to these millions in terms of satisfactory conditions of work and security of employment. They have no social security of any kind to fall back on in the event of old age, disability, sickness, loss of employment and the like. The absence of a regular and continuing employment relationship of a worker with his employer has made the existing labour laws of little relevance to this vast mass of unorganised sector workers. That a high proportion of them are "self employed" has only added to the problem.

There is therefore great and urgent need to have a new kind of self-contained labour law for these workers, which will not merely ensure satisfactory conditions of work, social security and security of employment, but also enable them to have a say in their conditions. This can be achieved by setting up tripartite Labour Boards for specified groups of employment. These Boards should have the responsibility and authority to implement appropriate schemes, including regulation of employment, fixation of wages, provision of social security, resolution of disputes, and so on. The workers and their representatives must have a deciding voice in the deliberations and activities of the Board at all levels of its functioning. In this way, they will not be mere beneficiaries but will also be active participants in the implementation of the law and the various schemes that affect them.

It is only a law of the above type that will confer on these workers and their dependents a minimum of protection, which could help them to lead a life of dignity. Generations of neglect and deprivation have resulted in these millions of workers – whose labour accounts for nearly two-thirds of our gross domestic product – being powerless and penniless, leading to widespread social evils like forced labour, bonded labour, child labour and so on. Hence, the fight for an appropriate law for them comes not a day too soon.

This fight has now assumed a campaign mode. The National Campaign Committee for Unorganised Sector Workers, under the chairmanship of Justice V. R. Krishna Iyer, Retired Judge of the Supreme Court, has started a signature campaign. It proposes to collect a crore of signatures from all parts of India, and to move the Petitions Committee of Parliament for such a law. The signature campaign is currently on, and it is expected that all other organisations working in the field for the protection and welfare of these workers will also join in the effort. A mass rally of workers from different parts of our country will assemble in Delhi to present the petition to Parliament on the May 5.

Join this Mass Rally!

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On the changing pattern of employment in cities

A seminar on the changing pattern of employment in cities was organised on March 23 in New Delhi by the Nirman MazdoorPanchayat Sangam in collaboration with other organisations, including Lok Raj Sangathan. Over 150 activists of the working class and people’s movements participated.

Nikhil De elaborated on the experience of the National Campaign Committee to get an Employment Guarantee Act for rural workers passed. He pointed out that the activists had prepared a draft law for ensuring that all rural workers were covered under an Employment Guarantee Act, and had agitated for its acceptance by the government. The government was forced by the pressure of the mass movement to accept in words that there would be an Employment Guarantee Act. Yet, the experience of the movement was that the government had watered down all the proposals in the draft legislation prepared by activists in the movement, and was instead pushing for an act that guaranteed nothing for anyone, least of all employment. However, the activists were determined to continue the struggle while exposing the government's two-timing activity. He requested all the activists in the cities to frame a draft act covering employment and right to work in the cities, as this would be another pressure point on the government.

Lalit Batra spoke about the changing employment pattern in Delhi in the past five decades. He pointed out that Delhi traditionally had a strong concentration of organised sector workers in the form of government and PSU employees, being the seat of the Central and State governments. However, since 1990, the workforce in the organised sector had gone down and the workforce in the unorganised sector had gone up immensely. Unemployment had also increased phenomenally. In 1992, there were 1.96 lakhs unemployed persons in Delhi. By 1999, this number had risen to 5.69 lakhs.

Leaders from the DTC Workers Union and the Delhi Electricity Supply Company explained the increased attacks on workers in the organised sector. Comrade Shukla of the DTC Workers Union explained how the company was using contract workers as drivers and conductors in the buses. In an introspective mood, the leader of the electricity workers pointed out that power sector workers had to look into their own shortcomings to see why they were unable to get the sympathy of the people. The leader of the auto-rickshaw workers also explained how they were being fleeced systematically by the authorities, and how there was now a move to eliminate auto rickshaws altogether from the city.

In the next session, activists from various branches of the unorganised sector—construction workers, headload workers, street vendors, cycle rickshaw and auto rickshaw drivers, home workers, kabaadi collectors, call centre workers and others — discussed their problems and experiences. These women and men pointed out that there was a need first of all for a law which recognises their work and provides them a modicum of security. Even more, there was need to ensure that such a law would actually be implemented in practice.

In the concluding session, a serious discussion was initiated on the necessity, possibility and content of a campaign for ensuring the right to work for urban workers. It was decided that a draft charter would be prepared for such a campaign. Overall, the spirit of the seminar reflected two things — the understanding that the capitalist system was fundamentally anti-people, and that the working people should unite under one banner for the solution of both their immediate and long term problems.

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