London Calling - May 25 2004

Steel fist, velvet glove

25 May 2004

The resounding defeat of the Hindu nationalist (BJP) government – and many of its political allies - might have taken most folk unawares (as indeed it did London Calling). But no one should be surprised if India's new Congress administration soon demonstrates the adage “plus ca change, plus la meme chose.” After all it was Congress, under the fiscal fiat of Manmohan Singh, that introduced economic “neo-liberalisation” and de-regulation from 1991: Singh is now the prime minister of the world’s most populous democratic state.

Singh is on recent record as saying “We are not against dis-investment if it’s in the national interest”. This anodyne comment conceals sterner material (the Financial Times rather unimaginatively calls it “the steel fist” hiding behind a “velvet glove”). After all, when Singh confronted India’s balance of payments crisis thirteen years ago, he promised his fellow country-people “blood sweat and tears” then came up with a home-grown version of free-marketry about which some observers have waxed lyrical, even ecstatic.

Take Hamish McCrae, the normally sober financial commentator for the British-based Independent: “[H]e is one of my heroes. [Singh’s] reform programme has probably brought more people from a state of poverty to a reasonable middle class lifestyle than that of any other human being alive”.

But at what cost, Hamish, to the other 500-700 million Indians struggling to survive on a resource base which many have seen frittered and ripped away from under their very eyes and feet – and at a galloping pace since 1993?

Within four years of laying down his policies, Singh was inviting majority foreign bids for much of the country’s mines and mineral resources. Ironically, in its own half dozen years of misrule, the BJP continued to vacillate over privatisation. As a result, overseas mining companies considerably cooled towards India compared with Peru, Indonesia and certainly China (in many respects India’s main rival as a destination of foreign mining-related funds). Delays in off-loading key national resources (notably NALCO, the National Aluminium Company) pushed India several notches down the list of global mining’s most favoured destinations.

The more percipient of overseas mining outfits active in India (especially the 'Big Three', BHPBilliton, Rio Tinto and Anglo American) may now privately rejoice that their ventures won’t be so blatantly tainted by accusations of their cosying up to communally-motivated politicians.

For the short term, further major privatisation will probably be set on the back burner. This won’t please Vedanta, the Sterlite trojan which announced two months ago its intention, not only to bid for NALCO, but also snap up what it doesn’t currently own of the notorious BALCO

Nonetheless, Vedanta’s overlords, Brian Gilbertson and Anil Agarwal, last week scored quite a coup in bringing Naresh Chandra onto their tiny board in order to offset criticisms of corporate ill-governance.

Chandra has an impressive history. A member of the Indian Civil Service for nearly fifty years, he’s worked for numerous Indian ministries and agencies (including Atomic Energy), the Commonwealth Secretariat and as Governor of Gujarat. When Home Secretary and Cabinet Secretary from 1990 to 1992, Chandra worked with Manmohan Singh and led the first government delegation to the US, precisely to promote investment flows to India. It’s a task he takes just as seriously today. (Incidentally it was US funds which secured the biggest tranche in Vedanta’s early London listing last December)

Just how Chandra will preserve his relatively unsullied reputation as a career diplomat while tooting the horn for one of the dodgiest of Indian capitalists and the most aggressive of its mining companies, remains to be seen. Many people will be sceptical about his chances of success.

Meanwhile, a moderate success for Indian peoples’ movements may be accounted by the downfall of Chandrababu Naidu who, according to Guardian columnist George Monbiot, led an assault on the people of Andhra Pradesh that dispossessed twenty million farmers. As Monbiot reminded us back in January, Naidu’s pillaging of the state’s natural resources was ably assisted by those free-market freebooters, the Adam Smith Institute, backed by Britain’s Department for International Development (DFID). Though George’s assertion that India has now “rejected Blairite policies” is to be fervently doubted.

On the scrap heaps

According to the Mining Journal a hideous prospect is looming in Bolivia as workless miners try to take over existing pits and find themselves in bloody conflict with the miners’ unions. Could there be a more telling example of a minerals-dependent country reaping the whirlwind of the vicious privatisation imposed by Goni Lozado’s government during the 1980 and 1990s which forced so many former miners (literally) onto the scrap heaps?

Lozado was ousted in disgrace last year, following his aborted plan to sell Bolivian natural gas to the US via Chile. This triggered massive public opposition leaving at least sixty dead from police brutality. But – and here's the British connection – Rio Tinto’s role in financing his private company Comsur, and bolstering his neo-liberal policies, has yet to be widely recognised as the critical intervention in Bolivia’s internal affairs that it was.

Last week the country’s president, Carlos Mesa, promised a July referendum on the country’s future energy sector, including the option of partial re-nationalisation. No mention, however, of a return to state-regulated mining which must surely be a hopelessly lost cause.

Stopping atrocity in its tracks

Mineweb's Dorothy Kosich let fly with a specious challenge to critics last week [link to report now broken], when she posed a reasonable question among a mess of false challenges to the industry’s critics.

The reasonable question was whether CAT (Caterpillar), the world's biggest supplier of bulldozers and similar equipment (not least to mining) is guilty of human rights abuses. Many groups around the world (including MAC) have highlighted the fact that Caterpillar's machines are used by the Israeli occupation forces to demolish Palestinian homes, intimidate inhabitants and even murder civilians. The most newsworthy example of this was last year’s killing of the non violent activist, Rachel Corrie, who was lifted bodily by a bulldozer, dumped on the ground and then run over twice.

Kosich's piece fortuitously came out just before Amnesty International released a hugely damning report on Israeli aggressions in the Gaza strip. The human rights group was especially concerned at the use of bulldozers, calculating that no less than 3,000 Palestinian homes have been destroyed by these machines over the past three and a half years, with at least another 88 homes in the Rajah refugee camp demolished at the beginning of May. The world's leading human rights NGO has no doubt that Israeli forces are violating the fourth Geneva Protocol. Which means that the US administration, by supplying the army with CAT dozers is in breach of the so-called “rules of war”. No surprise there.

Kosich approvingly quotes a former Caterpillar chairman asking how his company could "control a buyer's use of its equipment or merchandise? " The answer is simple: you tell the purchaser not to use them in contravention of United Nations rules. And, if it does so, then you halt any further sales or supplies.

Following the second world war, IG Farben and Krupp proved unable to justify the supplying of Zyklon B gas or materials for the Nazi extermination camps. No more could British Aerospace (BAe) defend its sale, some fifty years later, of Hawk aircraft to the Indonesian regime which were then employed against the people of East Timor, or its vending of parts for the same aircraft to Zimbabwe for use in murderous resource conflicts in the Congo . As the Guardian noted at the time these sales drove "the biggest hole yet" through the government's ethical foreign policy. They also led former Foreign Secretary, Robin Cook, to conclude that there wasn't a British ethical foreign policy.

Name calling

It’s a well-known tactic: changing one’s name when the going gets tough.

RTZ did so when it archly “recovered” its origins as Rio Tinto some years back. Britain’s appalling Windscale Nuclear reprocessing plant was re-christened Sellafield after it became synonymous with rampant environmental radiation and workers’ ill-health. Now, American Mineral Fields which, according to several sources (not least a UN special panel) mightily blotted its copybook during operations in the Democratic Republic of Congo (DRC) is adopting the sobriquet ADASTRA. Setting aside obvious (if unintended) resonances with the Astra supermarket chain (owned by the monstrous Wall-Mart), or to LSE-listed Xstrata, we wonder if AMF intends to covet a little of the limelight cast by the British Royal Airforce, whose motto “Per Ardua ad Astra” has been in use since 1912?

Usually translated as “Through struggle to the Stars” the slogan is believed to derive from a long-forgotten novel by H Rider Haggard (the author of “King Solomon’s Mines”). Among its characters, “People of the Mist” featured two griffins clad in black, one of which displayed the motto on its breast.

Fearsome creature of the night? Now that’s an image some might feel is well suited to American Mineral Fields.

Roger – and out

London Calling has just received the June issue of New Internationalist, the leading news magazine on issues developmental, if not revolutionary. On ripping off the plastic cover, out plopped a promotional leaflet from the World Development Movement – “leading the fight to make governments and businesses end the industries that cause poverty”. Indeed a laudable aim – and a praiseworthy organisation. However, we were a bit taken aback to see WDM claiming to have “forced multinationals such as Rio Tinto and Del Monte to end some of the worst examples of exploitation of workers, local communities and the environment in the developing world”.

During the nineties, WDM’s Rio Tinto campaign was ably assisted by Indonesian activists, Partizans and Minewatch. It was aimed at getting the company to moderate the vast ecological and social attrition caused by the Grasberg mine in West Papua, if not to force the British junior partner into withdrawing from the occupied territory. Well, Rio has now sold off its equity in Freeport McMoran. But it continues to fund and profit from joint exploration. Nothing has changed for the better. In fact, the roll call of disasters affecting workers, indigenous peoples and the Ajkwa river system has become more appalling – as a new report from the Carnegie Council on Ethics and International Affairs points out.

By chance the same issue of New Internationalist carries an interview with Murray Horton of CAFCA (Campaign Against Foreign Control of Aotearoa), the first overseas group to support People against Rio Tinto (Partizans) back in the early eighties. Horton focuses on the Roger Award, introduced by CAFCA and others seven yeas ago to annually pick the “worst transnational” operating in Aotearoa/New Zealand. Both Newmont and Comalco (i.e. Rio Tinto) were on the short list last year. Neither won but it’s worth noting that Comalco has been cited as a culpable Kiwi corporate candidate for the Awards more times than any other company on the planet.

[Sources: Singh and velvet glove: Financial Times (FT) 21/5/2004; Hamish Rae on Singh: Independent 19/5/2004; Chandra to Vedanta: FT 19/5/2004; Congress party and liberalisation: FT 16/5/2994, Guardian, FT 19/5/2004; Singh on disinvestments: FT 15-16/5/2004; Monbiot on Adam Smith: Guardian 6/1/2004; Monbiot on Naidu: Guardian 18/5/2994; Bolivia conflict: Mining Journal (MJ) 14/5/2004; possible Bolivian energy re-privatisation: FT 22-23/5/2004; Dorothy Kosich on Caterpillar: Mineweb 18/5/2004; Israeli bulldozing of Rafah and Amnesty Report: Independent 19/5/2004; Murder of Rachel Corrie: Independent 18/3/2003; Rachel Corrie's letters home from Gaza: Guardian 13/3/2003; CAFCA/Roger Award: New Internationalist June 2004]

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