People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 22

May 29, 2011




A Sordid Picture of Ruling Class Betrayal


Ashok Dhawale


ON May 1, 2011, Maharashtra completed 51 years of its statehood. The state was formed on May 1, 1960 in the wake of the massive Samyukta Maharashtra movement that was led by the Samyukta Maharashtra Samiti which had the Communist Party, Praja Socialist Party, Peasants and Workers Party and the Republican Party as its main constituents.




Except for a two and a half year stint in 1978-80 when the state was ruled by the Progressive Democratic Front and a four and a half year period in 1995-99 when it was ruled by the Shiv Sena-BJP communal alliance, Maharashtra has been ruled for 44 of these 51 years by the Congress (from 1999 to date by the Congress-NCP alliance).


As a result of the anti-people, insensitive and corruption-ridden policies of successive state governments, and particularly the neo-liberal policies of the last two decades, Maharashtra has seen a steady decline in the socio-economic condition of its people. This is reflected in the Economic Survey of Maharashtra 2010-11 and in other documents.


The Economic Survey has stated that due to the good monsoon last year, agricultural growth in the state was expected to touch 12.5 per cent; and due to the reduced intensity of the recession, industrial growth was expected to touch 9 per cent and service sector growth 10.9 per cent.


However, the main beneficiaries of this growth have always been the urban and rural rich. It is their profits, wealth – and corruption – that have been constantly rising. On the other hand, the condition of the basic classes like the working class, the peasantry, agricultural labourers and artisans and the socially backward sections like dalits, adivasis, minorities, nomadic tribes and large sections among OBCs has shown a definite decline.




The most shocking figures in the Economic Survey relate to the incidence of poverty. 38.1 per cent of the people in the state, which amounts to a population of four and a half crore, is mired in poverty. The national average is 37.2 per cent; which means that in spite of being a comparatively rich state, the incidence of poverty in the state is 1 per cent more than the national average. In fact, among major states, Maharashtra ranks fourth in the incidence of poverty after Bihar, MP and UP.    


Poverty in Maharashtra has not declined, but grown, over the years, as per the figures given by the Economic Survey itself. The poverty in rural Maharashtra increased from 34.6 per cent in 1997, to 35.7 per cent in 2002, to 47.9 per cent in 2004-05, as per the revised estimates of the Suresh Tendulkar committee. This means that nearly half of rural Maharashtra is poor. Poverty in urban Maharashtra increased from 8.8 per cent in 1997, to 18.2 per cent in 2002, to 25.6 per cent in 2004-05.


The Arjun Sengupta committee, on the basis of the 2004-05 survey, had concluded that 77 per cent of Indians cannot spend even Rs 20 per day. If this is taken as the basis, then it is clear that even the above official poverty estimates do not correspond to reality. Lakhs of poor families are not included in the BPL lists, they have no BPL ration cards, and in a public distribution system that is mired in corruption they do not get cheap and regular foodgrains.


The massive price rise of the last one year has played havoc with the lives of the poor. In May 2010 the price rise in food grains was 21.4 per cent; in January 2011 it was still 15.7 per cent. The price rise of other essential items, which was 14.8 per cent in May 2010, rose sharply to 23.9 per cent in January 2011. During the last one year, the price index in rural areas rose by 11.2 per cent and in urban areas by 12 per cent.


During the last four years, while price rise was attacking the lives of the common people, the UPA central government and the Congress-NCP state government were pouring oil in the fire by their policies like the recurrent fuel price hikes, deregulation of petrol prices leading to the ninth price hike of petrol in nine months, encouragement to futures trading in food grains and other essential commodities and protection to hoarding and speculation.




However, no part of this steep price rise accrues to the peasantry. Recently, when the price of onions touched Rs 70 to 80 per kg, the onion-producing peasantry in Nashik district got just Rs 3 to 4 per kg! The vast difference was eaten up by middlemen and big traders. Similar is the case with regard to all other food crops and cash crops.


The National Crime Records Bureau (NCRB) under the Union Home ministry has estimated that in the 15 years from 1995 to 2009, over two lakh peasants committed suicide in the country. Of this the largest number of 41,000-odd peasant suicides were in Maharashtra, most of them in the Vidarbha region. The main reason was indebtedness.


Peasant indebtedness was in turn a result of three major factors: increased cost of production due to rise in prices of agricultural inputs, lack of remunerative prices for agricultural produce and paucity of institutional credit at cheap rates of interest. Banks are notorious for denying credit to poor farmers who are forced to go to usurious private moneylenders. Hence during the last one year, the number of registered private moneylenders has increased by 11.3 per cent. There is no count of unregistered moneylenders.


If such is the state of landowning peasants, the condition of landless agricultural workers can well be imagined. So far as the implementation of the NREGA is concerned, the state ranks amongst the worst in the country. In most places agricultural workers have no work, and the few who have work do not get the stipulated wage. Crores of rupees that have come from the centre for the NREGA have had to be returned simply because they were not spent. Last year, out of a total central and state amount of Rs 600 crore earmarked for the NREGA, only 48.45 per cent was spent and Rs 308 crore still remains. Homelessness amongst agricultural workers is also a major problem. Since dalits, adivasis and women form a preponderant part of agricultural workers, they have to constantly face social discrimination and atrocities.




The number of registered unemployed in the state in December 2010 was 26.82 lakh and of these the number of women was 6.61 lakh. The number of closed factories as on March 31, 2011 was 31,190 and the number of workers rendered unemployed in these was 1.61 lakh. The number of closed medium and big factories was 418 and the number of unemployed workers in these was 0.58 lakh. There is no social security whatsoever for these 2.20 lakh unemployed workers.


For the lakhs of unorganised, contract and temporary workers, minimum wage and social security is a far cry and all efforts are made by the employers and the government to prevent them from exercising their right to form their own unions. The condition of large sections of unorganised workers in the beedi, powerloom, construction and sugar industries, as also domestic workers, midday meal scheme workers, Gram Rozgar Sevaks and Anganwadi and ASHA workers is very serious and in urgent need of redressal.


The question of housing has also assumed grave proportions. According to a recent NSS report, the largest number of slum dwellers in the country stay in Maharashtra. Most of them are from the working class. The number of slum dwellers has increased from 1.43 crore in 2001 to 1.81 crore in 2011 in Maharashtra, and from 58 lakh to 70 lakh in Mumbai. In large cities like Mumbai, Thane, Pune, Nashik, Nagpur and Aurangabad it is the land mafia and the builder lobby that rules the roost and government policies are designed precisely for their benefit. On the other hand, owning a decent house in the city remains an unattainable dream for the common man, who is then consigned to the slums.


The sectors of education and health are in the doldrums, with privatisation and commercialisation adversely affecting lakhs of poor and even middle class families.




The situation of power in the state is critical, with rural Maharashtra having to face load-shedding for 12 to 16 hours daily for the last few years. Until the early 1990s Maharashtra was a surplus state so far as power was concerned, as a result of the sustained efforts over four decades put in by the large public sector concern called the Maharashtra State Electricity Board (MSEB). Now see this comparative picture of the last 10 years. In 2001-02, the peak demand for power was 10,119 MW, the supply was 9,103 MW and the deficit (load-shedding) was 1,016 MW. In 2010-11, the peak demand was 16,615 MW, the supply was 11,119 MW and the deficit (load-shedding) rose to 5,496 MW.


The main reason for this is that, while successive Congress and Shiv Sena-BJP state governments pursued the Dabhol power project with the American company Enron through corrupt means for over a decade, they refused permission to the MSEB to build even a single power plant which would have provided power at much less cost. What happened to the notorious Enron is now known to all. But it was this deal and its perpetrators that are responsible for the massive load-shedding and also for repeated hikes in power tariffs.


Two years ago the state government declared that MOUs worth Rs 32,000 crore had been signed for power projects that would yield 12,000 MW of power. But not a single one of these projects has got off the ground. Instead, the central and state government are now bent on pursuing the disastrous Jaitapur nuclear power plant to be built by the French company Areva, despite the Fukushima nuclear disaster in Japan. The Jaitapur nuclear power plant is five times bigger and at least fifteen times costlier than the Dabhol power plant! So its adverse effects across the board can well be imagined.   


Similar is the state of affairs as regards irrigation. In spite of literally thousands of crores of rupees being spent on irrigation in the last five decades, the irrigated area in the state has increased from 6.5 per cent in 1960-61 to only 17.7 per cent in 2009-10. The major part of this increase is limited to the sugar belt of Western Maharashtra. As against this, the proportion of irrigated area in the country as a whole is 45.3 per cent. The centralisation of irrigation resources is constantly increasing, and the rulers have stopped even mentioning the goal of equitable water distribution.


The most serious aspect of irrigation and power is that, as per World Bank dictates the state government has embarked on a spree of privatisation of both these sectors. This has led to several reactionary amendments in irrigation laws. In spite of the extremely poor state of irrigation, last month the state government hastily pushed through a bill after midnight in the state assembly to divert water from agriculture to industry. Due to the public uproar that followed, the bill later had to be amended but it was enough indication of the intentions of the ruling Congress-NCP alliance.            




The special economic zones (SEZs) are a new source of unlimited loot of peasants and workers given by the central government in the hands of the capitalists. In Maharashtra up to December 2010, there have come 233 SEZ proposals, of which 143 have been cleared by the Centre, and of these 63 have been notified. The total area of the 143 SEZs cleared is 39,966 hectares, and the area of the 63 SEZs notified is 9,868 hectares. Most of this land is under agriculture and efforts are being made to evict peasants from their land.


But some intense peasant struggles against the SEZs have also been waged. The most successful of these has been in Raigad district. Here there was a proposal by Mukesh Ambani to set up a 10,000 hectare MahaMumbai SEZ and the government was hand in glove with Ambani. But over 50,000 peasants led by the PWP, the CPI(M) and other groups conducted a massive five-year struggle to save their lands. Eventually, earlier this year, the government was forced to denotify the MahaMumbai SEZ. This was a big victory. Now the CPI(M) is leading a united struggle in the Sinnar tehsil of Nashik district against the Indiabulls SEZ in the teeth of repression.




The latest and most salient example of the anarchy in the cooperative sector is that of the Maharashtra State Cooperative Bank (MSCB), the apex institution itself. This bank has always been under the control of the Congress, and for the last one dozen years, the NCP.


Today this apex bank is in deep crisis. In an unprecedented step last week, the RBI dissolved the 44-member Board of Directors of the MSCB and appointed two senior administrators. The powerful Board of Directors comprised several state Cabinet ministers, current and former MPs and MLAs – most of them of the NCP, but also some from the Congress, BJP and Shiv Sena. This step has led to tremendous tension between the Congress and the NCP, with the latter accusing the former of having used the RBI to serve its own political interests.


But a few instances will show the depths to which this apex bank had sunk. Firstly, the MSCB gave loans of Rs 2,810 crore, mainly to cooperative sugar factories, most of which are again controlled by NCP stalwarts. The state government gave a counter guarantee for these loans. Of this amount, the sugar factories never paid back Rs 1,831 crore. Now the MSCB was insisting that the state government shell out this amount. Recently, the government agreed to pay Rs 270 crore but dithered over the remaining amount. Secondly, in spite of the MSCB making a loss last year of 1,043 crore, it falsely declared a profit of Rs 2.87 crore. Thirdly, the non-performing assets (NPA) of the MSCB are in excess of 30 per cent. Fourthly, as many as 10 district cooperative banks – almost all of them in the backward Vidarbha, Marathwada and Khandesh regions – are in crisis. And lastly, this entire state of affairs is riddled with corruption, nepotism and mismanagement on a monumental scale at all levels.


Many urban and rural district cooperative banks have ended up in bankruptcy over the last few years as a result of the corruption and mismanagement of their own directors. This has resulted in the vanishing of the lifetime savings of lakhs of common people.




Regional imbalance has been a chronic and burning issue in Maharashtra. Due to capitalist development, this imbalance has constantly aggravated. Look at this picture for the year 2009-10. The per capita income (PCI) of India is Rs 46,492; for Maharashtra it is Rs 74,027. But if we exclude the three districts of Mumbai, Pune and Thane, the PCI for the rest of Maharashtra plunges to Rs 56,241. The PCI of as many as 29 of the 35 districts is below the state average, while that of 11 of these districts is even below the national average.


Now see the district-wise disparity. The three districts with the highest PCI are Mumbai (Rs 1.25 lakh), Pune (Rs 1.11 lakh) and Thane (Rs 1.05 lakh), while the three districts with the lowest PCI are Washim (Rs 36,087), Nandurbar (Rs 36,203) and Gadchiroli (Rs 36,286). This shows that there is more than a 300 per cent gap between these two groups of districts.


The same unequal picture of PCI is seen division-wise as follows: Konkan division (Rs 1,09,824) – but here too the two districts of Ratnagiri and Sindhudurg are poor cousins when compared to Mumbai and Thane in the same division, and even in Thane the Adivasi belt still remains very backward; Pune division (Rs 79,788); Nagpur division (Rs 63,179); Nashik division (Rs 58,464); Aurangabad division (Rs 46,535) and Amravati division (Rs 46,340). It is the Amravati division that has had the maximum number of peasant suicides. No serious efforts have ever been made by any state government since 1960 to clear the backlog of the backward regions and address their developmental concerns.




The debt burden on Maharashtra has sharply risen over the last two decades of liberalisation and this has endangered the entire economy of the state. In 1990-91, the state debt was Rs 12,878 crore. In 1994-95, when the Shiv Sena-BJP regime came to power, it was Rs 16,000 crore. In 1999-2000, when the SS-BJP regime was dislodged and when the Congress-NCP regime came to power, it was Rs 44,000 crore. And in 2011-12 it has risen massively to Rs 2,31,926 crore.


Maharashtra is the second most indebted state in the country after Uttar Pradesh. 17 per cent of the annual state revenue, i.e. around Rs 17,000 crore, is spent on paying the interest on this debt. Most of the state revenue comes from indirect taxes like sales tax and excise duties. Thus the main burden of this debt falls on the working people. This massive debt severely limits the scope of social welfare schemes and developmental programmes.




The state of the social sector is dismal. In the 11 years from 1998 to 2008, there were 1,192 communal clashes in Maharashtra and this was the highest number among all states in the country. This has been admitted in the government report titled The Socio-Economic and Educational Status of Muslims in Maharashtra released last month. The Sachar Committee report has also highlighted the grim situation of the Muslim community in Maharashtra.


Unspeakable atrocities on Dalits like those at Khairlanji and Sategaon have occurred in Maharashtra in recent years and they have dealt a blow to the progressive Phule-Ambedkar social reform tradition in the state. In 2009, the incidence of conviction for atrocities on Dalits in Maharashtra was only 2.9 per cent, which is among the lowest in the country.


In the 15 districts in Maharashtra with a substantial Adivasi population, last year there were 1,585 child deaths due to malnutrition; 36,117 children were severely malnourished; and 46,586 children were moderately malnourished. So far as the implementation of the Tribal Forest Rights Act (FRA) is concerned, only 1.05 lakh out of a total of 3.40 lakh claims for land made in the state were found valid, but even so far as the valid claimants were concerned, they were given much less land than what they were actually in possession of. A big struggle on this issue is continuing, and it has yielded some concrete results.


In 2009, there were 15,048 cases of atrocities on women in Maharashtra, placing the state sixth in the country. In the same year, there were 2,894 cases of atrocities on children, placing the state third in the country. As per the provisional figures of the 2011 census, although the number of women per 1000 men has slightly risen from 922 to 925 over the last ten years, there has been a sharp fall in the proportion of girls of the age group 0-6 per 1000 boys from 913 to 883 in the same period. This is an extremely serious matter.


However, it is in the dubious field of the production of liquor that Maharashtra leads the country! It is reported that 36 of the 38 wineries of the country are in Maharashtra, and the state produces 87 per cent of India’s wine! In the novel business of manufacturing liquor from food grain also, Maharashtra is perhaps the pioneer!




This bird’s eye-view of ‘Maharashtra at 51’ will remain incomplete without a clear mention that Maharashtra is also among the leading states in the country so far as stinking corruption scandals are concerned. In all the major corruption scams that have recently shamed the UPA II regime – 2-G Spectrum, Commonwealth Games, IPL cricket, Adarsh Society, Lavasa City, Hasan Ali Khan, assorted land deals and now the Maharashtra State Cooperative Bank – politicians and bureaucrats from Maharashtra find a prominent place. However, space does not permit any elaboration of this murky aspect.



It is clear that it is the ruling classes, their political parties and their elitist policies that are at the root of the situation in which Maharashtra and its people find themselves after 51 years. The popular worker-peasant slogan in the Samyukta Maharashtra movement of building a ‘Socialist Maharashtra in a Socialist India’ has been negated by these same forces. With the imperialist-oriented neo-liberal policies of the last two decades, the mass of working people are being sidelined, economic and social disparity has widened and corruption has reached unprecedented levels. Communal, casteist and chauvinist forces are raising their heads.


But the fighting people of Maharashtra have the strength and the capacity to roll back these challenges. They will have to build their unity through massive struggles, lead sustained campaigns for alternative policies, create political awareness among the people against the ruling classes and build a widespread and powerful organisation. It is only a Left, democratic and secular alternative emerging from this struggle that will be able to save – and change – Maharashtra and our country for the better and lead the people on to the road to progress.