India: Looming social and environmental disaster

March 6, 2009

While the US and European economies are in recession, the World Bank and International Monetary Fund inspired "export" oriented policies being followed by the government of India are about to create social and environmental catastrophe in the name of "special economic zones" (SEZs — geographical areas in which less regulations on labour rights, environmental practices and other areas are applied on companies).

Topping the list of states proposing SEZs is the Congress Party–ruled southern state of Andhra Pradesh.

To date, the state government has proposed 71 SEZs covering inland and coastal regions. The most ambitious proposal programme is to establish SEZs along 973 kilometres of the state's coastline.

This is to be coupled with a coastal corridor in over 1500km2, comprising airports, sea ports, roadways and related infrastructure.

A staggering 5 million acres stretching over 1575km2 is to be acquired for the proposed SEZ, and a coastal corridor that includes airports, sea ports, ship-breaking, pharmaceutical, petrochemical, information technology, apparel units and captive thermal power stations.


The projects will displace or severely affect the livelihoods of an estimated 20 million people — equalling the entire population of Australia.

The lands to be forcibly acquired include some of the most fertile farmlands and environmentally significant ecosystems of the "rice bowl" of India.

The crops raised here by hundreds of thousands of small and medium-sized farmers include rice, peanuts, lentils, fruits, vegetables, cashews, casuarinas and flowers in addition to toddy palms, sheep, goat and dairy cattle rearing.

Apart from agriculture, the region supports about 8 million members of traditional fishing communities, who catch fish both in the sea and in the mouths of rivers and streams.

The region is the breeding ground of the endangered Olive Ridley sea turtles.

It is also home to dolphins and thousands of species of tropical and sub-tropical fish that breed and feed in the nutrient-rich flows from rivers and streams in the network of mangroves. The mangroves act as a natural barrier against tidal waves and cyclones.

The lakes of the region are home to migratory birds from as far as Siberia. Fisherpeople have already reported 400 dead Olive Ridleys and two dead dolphins in the effluents of a thermal power station in the northern sector of the coast.

They estimate 36 tonnes of fish have already died due to the pollution.

While the government has been promising cash compensation of between Rs100,000 and Rs500,000, there is immense pressure on the farmers from politicians, their henchmen and the bureaucracy. What is left unsaid is that the government has not done a socio-economic survey of the region to identify the impact of the displacement.

The inconvenient truth is that formal title-holding farmers are only a small section of the cultivators here. A significant part of them are cultivators of lands assigned to landless farmers, temple and endowment lands, forest lands and lands of former zamindars (revenue collectors under British colonial rule).

While the cash compensation in itself is unjust to the farmers, who have little scope for finding alternative employment or buying land with the money, it ignores the plight of significant other sections dependent on the land. This includes agricultural labourers, animal herders, fruit growers, artisans, small traders and those providing services to the farming villages.

Fishing communities, and those working in salt pans and fish farms, will be thrown out of work.

Losing land for good

That farmers will not be able to buy alternative land with the compensation is clear to anyone familiar with the subsistence economies of most Third World farming. Most of the farmers are in debt and will have to repay their loans even once the security of land is gone.

Also, demand from thousands of displaced farmers and commercial activity will inflate land prices.

That such fears are not unfounded is borne out by the experience of those already displaced by SEZs. The most striking example being the SEZ at Pollepalli, 70km from the state capital of Hyderabad.

The once-independent farmers of the village have been reduced to begging and children have had to work as labourers. At least 40 farmers in the region have died of grief, with the situation in some hamlets so dire that they do not even have the communal spaces for burials.

Politicians have been holding out promises of significant employment opportunities to force farmers off the land. That this is a cheap fraud is evident from the regulations governing the SEZs; they are legally "foreign territory" and the government has been handing them on a platter to both foreign multinationals and Indian corporations.

Investors are given generous tax holidays, exemption from income tax, and the waiving of stamp duties, levies and registration fee. The loss of revenue to the government from these exemptions alone is expected to be in the region of Rs 174 billion (roughly A$5 billion).

Any trade generated in the SEZs — even within the same SEZ or between two SEZs — will be treated as "exports". Businesses will be provided with captive power plants, assured cheap water, plus dedicated infrastructure, including multi-lane highways, sea and air ports.

The SEZs can be granted exemption from any domestic laws, including environmental regulations and labour laws. To make intentions clear, the SEZ law even assures investors that exemptions from labour laws cannot be withdrawn once such exemptions are given.

The law defines "manufacturing" as not merely industrial production, but commercial activity and services including banking, insurance, shopping malls, resorts, hotels, warehouses and even agriculture, horticulture, animal husbandry and fisheries.

The activities proposed for the SEZs include pharmaceuticals, apparel industries, chemicals, petro-chemicals, petroleum, information technology and ship-building.

The destructive art of ship-breaking

One particular SEZ named VANPIC (Vodarevu Nizampatnam Ports Industrial Corridor) is suspected to include a ship-breaking project. Ship breaking projects have met with severe opposition from local communities because of the enormous amount of pollutants and hazardous material released in the process.

Given that even nominal enforcement of environmental laws will not be possible in the SEZs, there are fears that operators will use the streams, rivers and the sea as drains for the waste and effluents which will include cyanides, sulphides, nitrates and ammonia, heavy metals and dyes.

Farm land in the region, producing about 7 million tonnes of rice, will also be affected by the demand on water, ash and carbon from the industries. Ecologists fear that the feeding and breeding grounds of several species of marine life will be contaminated by pollutants.

Hussein Sagar, a huge fresh water lake in the heart of the state capital, has already been reduced to a sewer for industrial and domestic effluents.

The government has been trying to stem the tide of protest against this human and environmental vandalism by clamping down on protests and intimidation through the local political henchmen.

Prohibitory orders, banning the assembly of more than four people, have been imposed in villages facing the loss of land. Even the use of PA systems has been banned in the wake of protests.

When the Committee Against the Coastal Corridor announced a peaceful protest in front of the land acquisition office of VANPIC in October, police imposed a clampdown on the region, setting up roadblocks around the town, stopping vehicles and arresting protesters.

Leaders of the Communist Party of India, opposition groups and the convener of the committee were detained for an entire day at dispersed locations.

In spite of the threats and intimidation, SEZs have been opposed and even rolled back in some places.

The Industrial House of Tata had to pull out of an SEZ at Singur in the state of Bengal. In Andhra Pradesh the government has temporarily retreated from aspects of the infrastructure corridor.

There is urgent need, however, for international solidarity with the struggles for livelihood, recognition of community control over resources and sustainable development.

[For more information, visit <>. An Indian activist, Kavita Krishnan from the Communist Party of India-Marxist-Leninist, will be a featured guest at the World at a Crossroads conference in Sydney from April 10-12. For more information, or to book tickets, visit]

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