[lbo-talk] India: Marx invoked to break Lefts FDI barrier

[Chris Doss]

Marx invoked to break Left’s FDI barrier

SAMBIT SAHA
Calcutta, July 30: Nothing sells more in Bengal than
Karl Marx. And Marx it was that Union finance minister
P. Chidambaram used to push for foreign investment in
sectors where he faces opposition from Left parties.

Chidambaram, a Harvard-educated lawyer turned
politician, quoted a piece by Marx in the New York
Daily Tribune of 1853 to make a case for the free flow
of foreign capital to India in all areas, especially
the financial sector.

“It is notorious that the productive powers of India
are paralysed by the utter want of means for conveying
and exchanging its various produce. Nowhere, more than
in India, do we meet with social destitution in the
midst of natural plenty for want of the means of
exchange,” the minister quoted from The Future Results
of British Rule in India, at the inauguration of the
Calcutta Leather Complex.

Had Marx been writing today, Chidambaram said, he
would have talked about lack of insurance, banking and
foreign exchange, among other things. The minister
said the financial sector is critical for the
development of the country and said capital must flow
in to build infrastructure.

The minister’s statements came in the backdrop of Left
parties’ opposition to opening up FDI floodgates in
the banking, insurance and pension sectors.

The Left also opposed the government’s move to offload
10 per cent of its equity in Bharat Heavy Electricals
Limited, prompting an assurance from Congress chief
Sonia Gandhi that the Centre will not sell off
navratna companies.

He lauded work done with foreign investment in
transport, water supply, sanitation, and health
sectors and said this should be expanded to other
areas.

“There is no need to fear capital. Those who have
capital need not be capitalist. We have to see that
capital is utilised for raising output, drive growth
and raise resource to invest in the social sector.”

Chidambaram noted that saving is one of the most
important instruments for investment and said the
country must tap savings of other countries if it does
not have enough. “Wise man saves, wiser borrows,” he
quipped.

In a meeting with a chamber of commerce in the city,
the minister said Bengal could regain pre-eminence in
industry only by welcoming more capital. “Bengal has
done well in agriculture, land reform, panchayat raj.
It is time to do that in industry,” he said.

Royalty demand

Chief minister Buddhadeb Bhattacharjee today placed
the state’s demands for royalty on coal before
Chidambaram, who said he would look into the matter
and consult his colleague of the department concerned,
says a staff reporter.

“The demands relate to the discrimination regarding
non-payment of coal royalty
we are not getting royalty
on the pretext that the state is collecting cess on
coal,” state finance minister Asim Dasgupta said. A
recent Supreme Court judgement on this had gone in
favour of the Bengal government, he said.

Dasgupta said Bengal had claimed Rs 250 crore per year
on this head and the retrospective amount since 1991.
The total would be Rs 3,000 crore.

Bhattacharjee and Dasgupta also discussed debt relief
with Chidambaram. “Our state has a heavy burden on
central loan related debt
,” Dasgupta said.

The main issue raised was to offer relief in small
savings, which might bring the state government around
Rs 1,000 crore every year.

The Bengal government also placed before Chidambaram
its needs for improving infrastructure like the cargo
handling facility at the city port and a demand for
the development of the Sunderbans.

Chidambaram said the Centre would offer to help Bengal

improve its infrastructure.

The union minister added that the impact of value
added tax had been satisfactory.
  
http://www.telegraphindia.com/1050731/asp/bengal/story_5056327.asp


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