1642 and all that

By M.J. Akbar

No one can quite recall why Haidergarh is called Haidergarh. Who was this Haider who gave his name to a place that echoes through a myriad layers of India's history and collective memory. This was one place where the Pandavas found refuge during their 14-year-exile, and where King Kulu sprinkled the water from a famous yagna into the wells blessing them thereby with a spiritual power: unmarried women still carry water from its wells to the Mahadev temple at Barabanki to offer it to Lord Shiva on Shivratri. The spirit of miracles travelled through the centuries. When Raja Bhalchandra Singh Chalhari, then ruler of Haidergarh, died in the war of independence against the British in 1858, his body, it is said , kept fighting even after it had been beheaded until the last drop of blood had oozed out. That vision of freedom made it a hub of the nationalist movement: Rafi Ahmed Kidwal, whose relative Mohsina is now a senior leader of the Congress, emerged from Haidergarh to become a close friend and member of Jawaharlal Nehru's Cabinet. The Congress won the Assembly seat consistently till the debacle of 1989, and such was the historic strength of the party that it won the seat back in the debacle of 1991. Since then the seat has travelled back and forth between the Congress and the BJP, and went tricolour again in 1996.

In 1996, under the variable leadership of Sitaram Kesri, the Congress got 46,993 votes. In 2001, under the able leadership of Sonia Gandhi, the congress has got 1,649 votes.

Losing an election is no longer news in Congress circles, or among Congress squares. But getting 1,649 votes out of the 131,676 votes given to the candidates of the recognised parties still is, or should be. This is a little more than one per cent of the votes cast for the knows parties and therefore even less as a percentage of the total votes cast. If Haidergarh has been the only criteria by which the Election Commission recognised or derecognised parties, the Congress would lose its symbol: you have to get four per cent of the vote to retain your symbol.

Mrs Sonia Gandhi may have other reasons for worry as well. The constituency is a neighbour of Amethi, about halfway between Lucknow and Amethi and a whisper away from Rae Bareli. Contagion could exact a heavy price.

One has noted before that the Congress over the last few election has become what might be called a "calendar" party: that is, its votes are now within four number, as in the years of a calendar. That is bad enough. But unlike normal calendars which measure the advance of time, howsoever slowly, this one is regressive. From a vote puddle (you can hardly call it a bank) ranging between 2000 and seven or eight thousand, the vote seems to have slipped to less than 2000. All it has to do now to enter the Dark Ages is to become a three-figure vote.

Congress spin doctors (frankly, they talk like compounders and vets rather than doctors) are trying their best to offer some sort of explanation for this performance.. The sitting Congress MLA, for instance, unusually, resigned to vocate his seat for an incumbent BJP chief minister, Mr Rajnath Singh. That is not an explanation, that is an excuse. No candidate carries more than a small percentage of the party vote when he defects; the bulk vote belongs to the party, not to the candidate, except in the most unusual circumstances. The voting pattern reflects that. Ram Pal Verma of Mulayam Singh's Samajwadi Party got 29,059 votes and Mata Prasad Chowdhary of Mayawati Bahujan Samaj Party received 28,650 votes SP and BSP supporters also knew that the BJP chief minister was going of win; there is sufficient general and specific patronage available to ensure that . But their support base is intact; it is the floating vote that has wafted towards the winner. In different circumstances, the floating vote will come their way as well. What the Haidergarh election prove is that the Congress has lost its core vote. An independent, R.D. Sharma, got some four hundred votes more than the Congress. To get some idea of how appalling a figure like 1,649 votes is, do remember that the Congress brand name, even in its pathetic states, tends to get some votes by a sort of historic inertia: In other words, about a thousand of those 1,649 voters have probably forgotten not to vote for the Congress. The Yadavs did not forget to vote for Mulayam Singh Yadav and the Dalits did not forget to vote for Mayawati; that is why they received those respectable numbers.

The Congress candidate was a Brahmin, Sarvesh Bajpal, son of a former Congress MLA, Shyam Lal Bajpai. Brahmins constitute the largest single cast block in the Assembly segment, commanding roughly 38,000 votes (Thakurs, Raj Nath Singh's caste, are second with about 32,000 votes) There was no other serious Brahmin candidate. And yet the Congress could not get a single Brahmin vote. I can say with some assurance that it is unlikely that Sarvesh Bajpai's family voted for him. Certainly Rafi Ahmed Kidwai's family did not. Haidergarh is more evidence that the Muslim of Uttar Pradesh have turned decisively away from the Congress. There are some 23,000 Muslim votes, and the turnout would have been low in the absence of any meaningful campaigning since the results were never in any doubt to. Analysis of the votes polled in Subeha could provide an indication of the trends in the Muslim vote, but the larger share has almost certainly gone to Mulayam Singh Yadav with perhaps a slice to Mayawati. The Congress does not exist in the Muslim mind scape of Uttar Pradesh or Bihar. I assume that every Congress leader knows why. If not, do please refer to Mr Lal Krishna Advani's submission to the Liberhan Commission last week. Whatever the merits of any other claim or contention there is great validity in his view that a temple has already been constructed at the site of the disputed Babri mosque. This happened on the day Congress president and Prime Minister P.V. Narasimha Rao, with the able assistance of a heap of Congress leaders like Ghulam Nabi Azad permitted the mosque to be destroyed and a temple to be built on the razed site. The temples was small, but it was a Ram temple, it still exists in fact the dispute over whether a temple should be built here or not is in effect over. The only question is whether a huge temple should be constructed by the VHP over there or not. The Congress enabled this , as it enabled so much else. Sonia Gandhi could have begun the process of reversal of Muslim hostility. But her chief advisers are either those who advocate a toe-dip during Kumbha, nor out of faith in Hinduism or even out of respect for the central faith of our country, but because they think that such gestures can help manipulate the Hindu vote in favour of Sonia Gandhi. She should check with the Brahmins of Haidergarh how deeply they have been moved by her toe-dip at Allahabad. She could of course also use the opportunity to check with Ghulam Nabi Azad what he was doing on 6 December 1992, although of course Mr Azad's memory might have become in the difficult decade since then.

The dilemma of the Congress is very clear: it belongs to no one. No community, or combination of communities, has any emotional bond with the Congress any more. Its strength once lay in the weakness of its support base: the poor, the minorities, the Dalits, the dispossessed. It was these Indian who gathered under this historic tricolour and gave the party strength through their unity. Alone, they were weak: together, they ruled. The Congress was intelligent enough to include strong sections of the upper castes in its demographic and democratic combination because it needed their Involvement to exercise power. The Brahmin vote was the most loyal, at least partly because the Nehru-Gandhi family was Brahmin. Was. Today that identity has weakened to the point of dilution and no toe dipping in the Ganga is going to restore the respect the a Panditji commanded and the adoration the Indira Gandhi got from the Barhmins. The Muslims find nothing in either the idiom or the ideology of Sonia Gandhi to enthuse them; even when they want top consolidate behind the Congress as an alternative to the BJP, they find that motivation to missing The Congress has done nothing to revive its appeal among the Muslims or the Dalits.

The Congress exists only in those regions where there are only two political parties, as in Gujarat and Rajasthan and Madhya Pardesh. There the backlash effect helps it retain a seesaw existence. But the absence of sustained ideological commitment or a programme that can define a government makes it ineffective in victory and irrelevant in defeat. The Congress now exists merely because it was. It does not live for the future.

That is the message of Haidergarh. Membership of a coalition that might win in Kerala, or some success in Assam, or even a psephologists victory as a humiliated junior partner in Bengal will not change this fact.

We have a popular saying that even a dead elephant is worth something. The Congress is now feeding off the remains of a rich history.

Feel good factor absent among SSIs

By Ramesh Kanitkar

We are , with increasing fre-quency and tempo, being bamboozled and bombarded with words like 'maha', jumbo, bumper, super and the like. Gone are the days when small used to be beautiful and useful. Successive governments, even till last year, used to go out of their way to encourage small scale players, be it investors or entrepreneurs. This attitude is slowly but surely witnessing a seachange, witness the Central budget 2001-02. One connotation of the world 'small' is 'of little importance' as it seems that the powers that be have taken this meaning to heart, while dealing with the small scale sector (SSS) or small scale industries (SSI).

It is now well-known that this fundamental change, that is, to leave SSIs to their own devices, was caused by the WTO compulsions and/or hectic lobbying by major players in the field. It is difficult to comprehend what made the Government to cave in, when even as late as September 2000, it announced a reduction in basic customs duty on certain items used by SSIs. The Economic Survey for 1999-2000 had this to say. "Our SSIs have contributed greatly to the growth of our economy, employment and exports. But to meet the challenges of the future, some of the existing policies need to be reframed to emphasise positive promotional programmes of credit supply, technological improvement and marketing assistance, while phasing out inefficient protectionist policies". Alas, the budget belies these protestations!

Coming to the proposals in the budget, 14 items relating to leather goods, shoes and toys have been dereserved. This step has been denounced as 'a retrograde step' by the SSIs and bailed as overdue by the major players. That dereservation was on the cards was well-known for some months now. In fact, a proposal was being bandied about for a policy prescription for complete dreservation with April 1, 2001 as deadline, in the context of lifting of quantitative restrictions on the remaining 715 items that would result in free flow of imports, seriously eroding the domestic competitive edge, unless the items reserved for SSIs were permitted to be produced by others. It was recommended that it would be better to dreserve the SSI sector instead of allowing it to be squashed in which case Indian presence in the production of these items would disappear. In this context, it is difficult to understand why the Government developed cold feet and did not dereserve the entire sector in one go. Is it that the Government wants to feel its way slowly, study the consequences and reactions and then come out with more drastic announcements at a more congenial time? More woes for SSIs!

It is a sad fact that many small units (an estimate puts it at 1.5 million), are closed. The reasons attributed are many-lack of orders, shortage of funds, estimates going awry, managerial incompetence, labour intransigence and the like. Dumping of cheaper goods, especially from China, seems to have added to their trouble. And gradual dereservation coupled with complete integration of the Indian market with the world's will further aggravate and already unhealthy situation. There is, however, a glimmer of hope in some quarters. That the budget is positive towards both automobile/ auto components and food processing sectors, which are closely linked to SSIs and this augurs well for small entrepreneurs.

A second proposal in the budget that has agitated SSIs is the withdrawal of excise exemption for some items. To quote the Finance Minister, "Products of SSI units are exempt from excise duty up to Rs. 1 crore. This exemption is intended to provide fiscal support to the genuinely small producers. I propose to withdraw this exemption in respect of the following items, in which misuse of the exemption is more then likely-cotton yarn, ball or roller bearings, arms and ammunition for private use".

The powerful associations of mill owners had lobbied hard to get this exemption withdrawn. They had argued that "small scale units have sprung up with absolutely no inherent techno-economic advantage after excise relief was given to them". The modus operandi is either by fragmenting existing mills or creating new entities with old second hand machinery or under-invoiced reasonably old machinery, as it is impossible to create a viable spinning mill in small scale". They also confessed that "pressed against the wall due to unequal competition and huge benefits given to an unviable sector of the textile industry, many large scale mills have started evading excise duty either by.."

As expected the big players have warmly welcomed the budget proposal - "happy that the long pending plea for withdrawing excise exemption for small scale units has been conceded thereby removing the distortion in fiscal structure", "a major factor for tilting the playing field in favour of duty evaders had at last been withdrawn", "a very positive indication of a new realism in government policies overriding ideological considerations". On the other hand, vehement protests have been made by the affected units which have stated that this "would seriously hurt the high employment opportunities for rural people, especially women". It is relevant to note here that about 35 million workers are employed in SSIs. The question arises: "Is the Government not strong enough to take action against the offending units? Is it not armed with enough authority and men to weed out the black sheep? Should the entire segment be penalised for the aberrations of a few? Or is it the government's view that all the units were evaders of duty?

It is also the right time for the bigger units in the organised sector which have evaded excise duty, to own up and pay the dues inclusive of penalties.

Finally it is hoped that the budget proposal to bring the Small Industries Development Bank of India (SIDBI) under the tax net would not affect the flow of funds to SSIs. It may be recalled that the Government's policy statement on SSIs is July 1990 had highlighted the important role assigned to SIDBI to ensure "adequate and timely flow of credit to SSIs". The Government cannot be faulted for its proposal to withdraw the tax shield as SIDBI's earning have leapfrogged. According to SIDBI's own estimates, the impact could be around Rs.100 crores based on current profit figures. With SIDBI enjoying good health, it should be in a position to continue with its "series of schemes providing soft assistance".

The 'feel good' factor is definitely absent among SSI units.INAV