Middle-class suffer, corporate gets richer
A question many are asking this week with oil prices increasing by record 13th time in less than two years and food inflation crossing nine-month high of over 12 % and the government expressing helplessness to deal with the situation.
Some may term the question as nonsensical but many have reasons to believe it to be true. Two substantial documents this week had indicated that corporate greed was robbing India of its precious land and mineral wealth.
A United Nations report said that land grab was increasing in developing countries like India and an NGO report indicated that profit from mining was increasing whereas employment for the locals was falling.
The UN Human Development Report said the governments in India, China and Saudi Arabia has handed over 45 million hectares of land to private, public-private joint ventures, usually from capital-rich countries, between 2008 and 2010 as compared to 20-30 million between 2005 and mid-2009.
A World Bank report was quoted to say that expected benefits from this land transfer have not been achieved. Other studies quoted by the UN report speak private highhandedness resulting in human right violations, forcibly displacement of local population and restricted access to natural resources.
In India, most of this has happened in the mineral rich land of poor tribal people of Central India. A Centre for Science and Environment report found that even though one lakh hectares of forestland was diverted for mining companies the total employment of locals in the sector declined by 27 percent since 1991.
Here is state of affairs in some of the best mining districts in India. Bellary, in news for rampant illegal mining of iron ore by Reddy brothers for export, has third poorest Human Development Index (HDI) in Karnataka. Koraput, in Orissa, which produces 40 % of India’s bauxite have 78 % population living below poverty line. Bhilwara, which produces India’s 81 % zinc, is among lowest HDI districts in Rajasthan.
The companies operating in these environmentally hazardous districts are not at all poor. The profit after tax of six public sector companies increased to 33 % of gross sales in 2009-10, a rise of about three percent from the pervious year. “Hurt most (from the land grab) were smallholders, indigenous people and women, who often lack formal title to lands on which they live and farm,” the UN report said.
Despite increasing profits of companies the price of finished products from these mines are on the rise, just like food inflation.
What has been baffling for aam aadmi, or the Indian middle class, is the rising food cost inspite of bumper crop in 2011 and Food Corporation of India (FCI) silos overflowing with grains.
The reason for this, to me, is that the corporate world controls the food market unlike earlier times when traders used to run the show from wholesale food grain market to the retail shop. The day to day wholesale prices helped in regulating end consumer price to some extent. Now, most shops in Delhi sell packaged food products such as rice and flour, where role of market in regulating prices is limited as corporate control the prices.
Here, even the government cannot rule out the possibility of corporate greed leading to food prices being high for the last two years. Or else, one will have to buy planning commission deputy chairperson Montek Singh Ahluwalia’s argument that Indians are eating more food than before even though per capita protein and calorie intake is falling.
Further, bad news for the embattled Indian middle class has come from Prime Minister Manmohan Singh, who had sought regulation of prices of all fuels including diesel, LPG and kerosene. And, the middle class feels betrayed by Singh, considered a product of fighting spirit of country’s middle class, as there is not much in offer to help them.
The government has promoted policies, such as Manufacturing Policy notified on Friday, for enriching chests of the corporate world and has provided cushion to the poor through targeted schemes such as Public Distribution System and Rashtriya Swasthya Bima Yojana, but there appears to be middle-class policy vacuum.
I, on behalf over half of middle-class Indians, urge the government to rise above vote-bank politics and have a compensate look at us.