GIM: Selling Karnataka, Krishna Style

There was a rush of accolades from a cross section of India’s comprador bureaucratic bourgeoisie in June for Karnataka’s 69 year old Chief Minister SM Krishna.

The praise showered on Krishna was as magnanimous as the volume of imperialist and big bourgeois investment that made its way into Karnataka during the three-week long Global Investors’ Meet (GIM) organised jointly by the Confederation of Indian Industry and the Government of Karnataka, starting 5 June 2000.

In Krishna, an old generation Congress bandicoot enamoured by the new generation of reforms, the Indian ruling classes have found a fresh enthusiast who wants to go all hog to sell Karnataka to the imperialists and their big lackeys.

JH Patel, Karnataka’s former Chief Minister tried to jealously lap up some of the credit that went to Krishna. He said that the grounds for the GIM were laid by his government. What this rogue had to say was not totally untrue.

However, it was during SM Krishna’s visit to Davos, Switzerland, in February this year for the World Economic summit, that the plans were really hatched.

Under the initiative of India’s compradors such as Mukesh Ambani of Reliance Industries Ltd, Azim Premji of Wipro, Arun Bharat Ram of Delhi Cloth Mills, Narayan Murthy of Infosys and others, a meeting was held with the CEOs of some TNCs. And it was here that the sale of Karnataka was planned. Obviously, the state cabinet had been totally bypassed while taking this decision.

In an interview on 14 June, Krishna spoke unabashedly of events leading to the GIM. The tout patted his back and revealed: "When I had the privilege of taking part in the annual meeting of the World Economic Forum at Davos early this year, I was astounded at the kind of enquiries and response I got from global investors. In fact representatives of several Fortune 500 companies queried me on what Karnataka has to offer and how it could attract funds…."

The Karnataka government agreed to pay Rs 5 crores for publicity for the GIM. The man that bagged the contract was Arthur Anderson, owner of the foreign company that goes by his name.

On their part the Chief Minister, Industries Minister RV Deshpande and a select coterie of bureaucrats such as VP Baligar, N Sriraman, BS Patil and Vishwanath flew to and from Mumbai, Calcutta, Chennai, Kualalumpur, Singapore, London, Sydney, Tokyo, Toronto, Dubai, and New York meeting Indian and Asian compradors as well as managing brief interviews with the directors of imperialist companies. RV Deshpande later revealed that Rs 5 crores was spent for these jaunts.

The government sent 2,000 invitations worldwide. 462 delegates, 32 diplomats and 260 invitees finally turned up for the GIM.

The Vidhana Soudha which houses Karnataka’s Legislative Assembly and Legislative Council was packed with imperialist and comprador reactionaries. Except for a handful of SM Krishna’s cabinet ministers, the rest of the MLAs and MLCs were not permitted to enter the Vidhana Soudha on 5 and 6 June. Even Agriculture Minister, TB Jayachandra could afford to get irritated by some of these developments. He said on 6 June, that the GIM had brought alive the days of the East India Company and the British Raj.

In a press conference on the eve of the GIM, RV Deshpande said that the government expected about Rs 10,000 crores of investment proposals to be signed. The government on its part made a list of state-run institutions it planned to auction. Noteworthy among these were water supply, power distribution and highways.

Day Two witnessed a windfall. A total of Rs 8,000 crores came up in the form of assurances. Of these, six memoranda of understanding (MOUs) that were signed promised an investment of Rs 7,000 crores between them.

The first two of the 22-day sale had alone crossed the expectations of the SM Krishna cabinet. He had begun to dream of the dollars he could amass. On 7 June, SM Krishna announced "all the projects will be personally monitored by me." And this crony agent proved his mettle by sitting through the rest of the GIM at the counter he called the Single Window Agency collecting his commission from the imperialists and big compradors.

Speaking on June 30 at the close of the grand discount sale, VP Baligar, Director of Industries and Commerce, said that the GIM netted 250 investment promises—big and small, amounting to a total commitment of Rs 27,700 crores or $ 6.10 billions!

Compradors like R Ganesh of Terra Firma Biotech chewed their fingernails in elation. He said the GIM "was a spectacular show in the country…."

SM Krishna could not wait to make his assessments till after the end of the jamboree. The busy crony who had participated in the signing of every single MOU took some time off for an on-line interview. Answering a question about the response from investors he said at length: "To say that it was overwhelming will be an understatement. The kind of enthusiasm and ‘feel good’ atmosphere it has created has to be seen to be believed. Though we have to wait till the month-end for the final outcome, the spontaneous response of the investors from overseas and domestic players is beyond our expectations…. The surprise announcement by News Corp of media mogul Rupert Murdoch to set up the broadband internet-cum-digital studio facility in Bangalore at an investment of Rs 1000 crores was the icing on the cake."

Krishna did not stop his jubilation with this. The few months as Chief Minister, his submissive confabulations with the sharks of Fortune 500 and the pirate captains of Indian industry led him to forecast: "This is only the beginning. We have a long way to go…. The impact of the meet will not only be far-reaching, but will also have a domino effect on the investors."

Echoing these precise words of Krishna, Manmohan Singh, former Union Finance Minister, handpicked by the World Bank and later crowned as the "architect" of the first generation of pro-imperialist reforms said during his valedictory address on 30 June: "It is only the beginning and the best of Karnataka is yet to come."

Since the commencement of the first generation of pro-imperialist reforms under the aegis of globalisation in 1991 till the eve of the GIM, Karnataka saw an assurance of Rs 91,000 crores in investments from all sources. Of this, actual implementation was Rs 40,000 crores. Hence the ratio of promises to actual realisation stands at 44%. If assurances made at the GIM translate into real investments at this rate, it would amount to a total real investment of about Rs 12,000 crores. In fact BS Patil, the Principal Secretary, said that Karnataka has been able to mobilise about one-thirds of all the investments it has managed in the nine long years of the first generation of reforms during as short a span of 22 days.

Measure it with any yardstick, the point that ultimately sediments in an evaluation of the GIM is that Karnataka has not seen the likes of such massive penetration of imperialist and comprador capital ever in its history.

But what is the employment that this massive flow of capital is slated to generate?

Figures provided by the Directorate of Industries and Commerce state that a total capital of Rs 25,242.27 crores is to generate employment for 34,770 people. (See table) This amounts to an average of Rs 72 lakhs investment per job. If the actual investment is taken as Rs 12,000 crores, the total number of jobs this is going to really create is 16,560.

Unemployment in Karnataka at the beginning of the millennium stood at 40 lakhs. The employment this windfall of investment is likely to generate only scratches the surface……… a mere 0.4% of the total. Going by government estimates, the total capital to be invested in Karnataka alone to eradicate unemployment stands at Rs 28,80,000 crores!

These figures clearly demonstrate that the GIM has got nothing to do with unemployment eradication. That story is absolute nonsense. It is a propaganda smokescreen to carry on with the job of imperialist plunder.

In fact government figures of employment generation due to GIM has an undisclosed and hidden aspect. A good chunk of investment that the GIM has invited will actually destroy more jobs than it can create. The privatisation of state owned institutions is done at the cost of the masses employed in them.

The GIM is no magic solution for the masses of Karnataka. Rather it is a grim reminder of growing imperialist greed and pillage.

In the course of the three week long GIM, SM Krishna, the new feather in the tattered comprador cap, already spoke of his future plans.

On 17 June he announced that he was invited by Goh Chok Tong to visit Singapore. Karnataka holds a special and let us not forget, personal relationship, with Singapore. The earlier Chief Minister, JH Patel was gifted a golden wrist watch worth three lakh rupees by Goh Chok which came to light when his cook was caught after stealing it. What gifts Goh has showered on Krishna remains unclear. Yet Krishna dutifully said: "I am going there for two days on their invitation. They have investible surplus of $ 80 billion. I will naturally be seeking to attract investments…."

He also bragged about his capacities as a comprador broker when he said: "…during the eight months of my tenure, I have been able to convince the World Bank to grant $ 3 billion during the next 2-3 years…."

Krishna is a hungry and voracious eater of the left overs. Evidently, one GIM was proving inadequate for his appetite.

These aspirations were given concrete shape when Arun Bharat Ram the CII President, flanked by SM Krishna and RV Deshpande, announced in Bangalore on 28 July that Karnataka’s second GIM would be organised on 11 and 12 March 2001. Karnataka’s second GIM will this time have three sponsors: The CII, the Government of Karnataka and the Asia Society of the USA. The last is a grouping of American transnationals and non-resident Asian-Americans who already have or seek to have investments in India.

Later, addressing CII members at their National Council Meeting on the same day, Krishna said at a thanksgiving that his "government will keep up interactions with the corporate sector." He also announced that reforms underway in power, water and roadways would be extended to encompass the privatisation of health and public education.

Comprador Ram’s announcement makes it appear that the GIM phenomenon is graduating into an annual event.

The BJP-Shiva Sena government of Maharashtra was the first state to organise a GIM in 1997. On June 24 the Congress coalition in Maharashtra announced that it would be organising its second GIM later this year to "highlight the state’s agriculture sector."

On 14 July BS Patil, Principal Secretary to the Karnataka government said at Bangalore: "The GIM held in June…had apparently caught the eye of several state governments—from Tamil Nadu and Andhra Pradesh to distant Haryana—who may be wanting to hold similar jamborees of their own."

The BJP Finance MinisterYeshwant Sinha pointed out in his inaugural speech that "the states will have a major role in the second generation of reforms." Again, praising Krishna in the course of his address he said that the GIM was "testimony to the fact that reforms have come to stay and all forward-looking state governments are full and equal partners in the reform movement."

One GIM, many GIMs. This is the view the compradors at the states and the centre have taken.

One immediate impact that has been on the cards is a kind of crass one-upmanship among the compradors of the states. Every state government is flaunting its prowess in attracting imperialist capital. If Gujarat is now in front, Maharashtra is now behind. If a Clinton will visit Hyderabad last, a Mori will visit Bangalore first. If Chandrababu issues a longsighted Vision 2020 for AP, Krishna publishes a shortsighted Vision 2010 for Karnataka. If CRISIL rates Gujarat A+ and Karnataka A, then ICRA rates Karnataka A+ and Gujarat A. Competition among the regional satraps is intensifying. Traditional conflicts among the major nationalities which have been stoked by the ruling classes, such as the Kaveri water dispute with Tamil Nadu and the Krishna water dispute with Maharashtra and Andhra Pradesh are being endowed with new meaning. Businessline reported on July 14 that after the success of the GIM "Karnataka was calling its southern siblings over to talk about a common approach to lure investments to the region as a whole." Karnataka had called a meeting of the Industry Secretaries of Tamil Nadu, Andhra Pradesh, Kerala, Goa and Pondicherry for July 24 to resolve some of these conflicts. According to BS Patil, in this meeting: "Primarily we will be discussing how we can project South India as an area of industrial opportunities, how to cooperate with each other to get good investments, and how to put in place the right kind of infrastructure network." The report goes on to add: "Ideally, the southern states could come together as a single economic platform instead of fighting among themselves over the same piece of cake…. There should be no oneupmanship among the states." A nice piece of advise for a report that chooses to call the other states of the south as "siblings".

A second immediate visible impact has been the absolute collusion between the Congress government of Krishna and the BJP-led NDA at the centre. During his ten month long tenure Krishna has not levelled a single major charge against the centre. Even the BJP party in power at Gujarat may take credit for having done better. What is more, the so-called anti-communal Congress government has colluded fully with the centre in implicating the Sufi sect based in Hubli, Deendar Anjuman, for the series of bomb blasts in churches across the state. At a time when the GIM was on, the dramatic arrests of these so-called ISI agents was stage-managed.

Again in August the Krishna government set up a Sindhi Sahitya Academy at Bangalore. This is the second immediate and visible impact. Only a few weeks earlier, the government announced that it was compelled to cut the expenditure of the Kannada Sahitya Academy for want of funds. Yet the grant of several lakhs for a Sindhi Sahitya Academy catering to just 12,000 people in the state has been made. Who can deny that the Sindhis are among the minuscule of national minorities in Karnataka. And, at the same time, who can deny that the Sindhis are a major component of the Indian comprador bureaucrat bourgeoisie and that the likes of the CII are happy with this step of the boot-licking Krishna government. GIMs will seek to further grind down the nationalities of India.

Imperialism is political reaction. And more imperialist loot is more political reaction. But does reaction not generate revolution in its wake?

In fact when scores of workers, peasants, women, students, intellectuals and adivasis were arrested on 5 June at Bangalore in a militant protest against the sale of Karnataka by the Krishna government, it marked "only the beginning." And what is more, "the best of" a smouldering "Karnataka was yet to come."

Real Patriots Wage a Militant Protest Against the GIM

It was the Anti-Imperialist Forum that protested against the Global Investors’ Meet.

It took up several propaganda programmes even one month before the GIM commenced. It undertook anti-imperialist propaganda from 21 May. It distributed thousands of pamphlets.

On 28 May a protest meeting was held at VV College, Bangalore. Prof Hargopal of the Central University, Hyderabad, made a speech explaining the disastrous impact of Chandrababu Naidu’s reforms under IMF-World Bank tutelage. Dr Shishir Jha, BG Krishnamurthy of Karnataka Vimochana Ranga, Jagadish of Dudiyora Horata spoke about the imperialist offensive and GIM. Street-corner meetings were held on 1 June at Yeshvanthapur and on 3 June at Vijayanagar. On 4 June an effigy of the GIM was burnt before the State Bank of Mysore on KG Road. In addition, at Kolar Gold Fields, Bhadravathi, Raichur, Shimoga and Shringeri, organisations such as the Karnataka Vimochana Ranga, Pragathipara Vidhyarthi Kendra and others distributed thousands of pamphlets and explained to the people about the auctioning of Karnataka.

On 5 June hundreds of activists from different parts of the state organised themselves under the banner of the Anti-Imperialist Forum, held a massive protest rally against the GIM and moved towards the Vidhana Soudha to disrupt the inauguration.

But the imperialist stooge government of SM Krishna arrested the protestors at the Maharani’s College Circle, more than a kilometre away from the Vidhana Soudha.

Fierce fisticuffs took place between the protestors and the police during the arrest. The demonstrators made a bold attempt to break the police cordon and head towards the Vidhana Soudha. But this was pre-empted by the police who were deployed in massive numbers. Yet their determination and the slogans that took the air were an inspiration to all patriots. They called for the launching of a struggle for real independence.

Courtesy, Jana Vimukthi, July 2000.