“FDI in retail, land acquisition
bill, cut in subsidies” an industrialist friend was pointing out, “the
government is finally warming up to the reform process. I am sure that the much
needed impetus to the economy will now be administered and we will be back on
the path of growth.” While there are certain reasons to cheer, the pall of
gloom may not lift as early as certain over enthusiastic corners are now making
out to be.
The one reason that scares me the
most is the backlog that has accumulated over the last year or so because of
the bad weather. As a recent study has pointed out, projects worth INR 2
trillion have been shelved, some of them permanently. And this may emerge as a
major concern for the economy in general and the policymakers in particular.
Talk to any industry house worth
its balance sheet and you will hear exasperated complaints and helplessness at
their inability to push through with proposed projects.
Environmental clearances, land
acquisition and the scarcity of capital at affordable rates are the three bones
of contention, though not in the same order across categories. Local unrest,
which is increasingly becoming militant, is another problem that is pushing
projects into the backburners. Add to this the scarcity of both coal and iron
ore and the tip of the iceberg emerge.
What no industrialist will tell
you however is that the industry used to “managing” the environmental clearances,
coal and iron ore linkages and accessing both coal and iron ore of the
illegally mined variety at a cost substantially lower than the prevailing
market rates are now finding their operations cost prohibitive.
An entire chain of sponge iron
units of West Bengal, hitherto fueled by “disco” coal, pilfered from the CIL
mines of Ranigunj and thereabouts is now on the throes of closure as by they
are not sustainable at market rates. The entire parallel economy fed and fueled
by pilferage of both coal and iron ore are at stake and people who have minted
(mined) moneys by being parts of this complex web of deceit are now forcing
many to grasp for breath.
It is not about an allocation of
a bloc here or there. It is not about Coalgate either. The rot (loot?) was much
more pervasive. I recall as one prominent member of the dreaded Coal Mafia had
famously quipped, “Governments come and Governments go, we are here forever.
Governments are peopled by politicians who have the popular mandate. And
political parties need money. Money, that can buy everything.”
And this is where the problem is.
Everything is still available at a price. But compelling factors have jacked up
the price to such a high that it is just not viable for many an industry. This argument
is also refurbished by the fact that huge capacities that have come up in the
near past are lying unutilized. Capacity utilization has hit the nadir as for
many, the cost of production is just not within control. Realisation is not
enough to meet the cost that had underhand payment for the purchase of undue
favours built in. And forget about being remunerative, production is not even
guaranteeing a break even.
It is a curious case of the knave calling the
rascals black. If politicians have taken bribes, my friends, it is you the
industrialists who have paid them and have looted the nation by piling your
coffers with tainted cash. Not only have you guys abrogated your right to
protest, now that you have been caught on the wrong foot, you do not have the
moral right to sermonize.
Read my lips, we are yet to see
the end of the coal and iron ore conundrum.
- Chawm Ganguly
No comments:
Post a Comment