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by Neil Gray, Mute Magazine, 24 September 2008

In the second of a two-part analysis of neoliberalism in the subcontinent, Neil Gray looks at the material economic impact of the policies which ideologies of Indianness legitimate and discusses some of the forces of resistance these have provoked

Just when the extreme right is also rising again, and just when its dynamics have taken new forms […] the analysis of it, and its connection with the wider politics and political economy of our time, has been radically impoverished.
– Radhika Desai

Culture really only has one parent – and that is labour.
– Terry Eagleton

In Marx and Engels’ famous inversion of German idealist thought, the Young Hegelians were lambasted for considering that ‘… conceptions, thoughts, ideas, in fact all forms of consciousness’ produced ‘the real chains of men’.iii Marx and Engels, in contrast, set about showing how the social structure and the state are continually evolving out of the life process of individuals:

… but of individuals, not as they may appear in their own or other people’s imagination, but as they really are; i.e, as they operate, produce materially, and hence as they work under definite material limits, presuppositions and conditions independent of their will.iv

The German idealists, moving in the realm of ‘pure spirit’, had made religious illusion the driving force of history. Marx and Engels sought a new conception to challenge this ‘hegemony of the spirit in history’, one that did not attempt to explain practice from ideas but explained: ‘…the formation of ideas from material practice’.v With Hindu nationalism’s regressive efforts to return to idealist forms of thought, an immanent critique of capitalism is once again disavowed, and mystical thought can once again flatter itself that it is independent of material reality. It is in this sense that Hindutva and neo-Ghandianism operate as neoliberal alibis, turning philosophy into ideology, and resolving conflicts occurring at the material productive level, on an imaginary spiritual level.

India’s ‘growth story’, its superficially impressive growth rates and the surface visibility of the real estate building boom in urban areas, mask an intensifying extraction of surplus value from a hyper-exploited urban workforce, and a concerted attack on Asian peasants and agricultural workers through displacement, debt and starvation wages. A report produced in August 2007 by The National Commission for Enterprises in the Unorganised Sector (NCEUS) acknowledged that the Indian economy had seen ‘growth’ for the middle class and the rich, but that this growth coexisted with an unprecedented rise in poverty. At the end of 2004-05, a staggering 836 million people (77 percent of the population) were categorised as financially ‘vulnerable’, on less than 20 rupees a day (under 25 pence a day). Between 1993 and 2006, the percentage of this ‘vulnerable’ population grew from 32 to 36 percent. There was an increase of workers employed in the economy from 397 million in 1999-2000, to 457 million in 2004-05, but the growth in the formal economy was negative. The 17 percent increase was entirely in the unorganised sector (93 percent of the workforce), which is characterised by an almost complete lack of social

The sectoral composition of Indian workers has shifted considerably since IMF reform at the beginning of the ’90s. Despite 7 to 8 percent GDP growth rates annually, the material and productive sectors – agricultural and industry – have seen serious decline, agriculture especially so. The share of agriculture in GDP has fallen from about 36 percent in the early ’90s to below 25 percent by 2003-4. Meanwhile, the share of GDP in the service sector has risen from around two-fifths to over one-half of India’s GDP, the largest rise being in trade, hotels, transport and communications, followed by finance, real estate and business services. This certainly posits a trend towards immaterial labour as a hegemonic force. However, the occupational distribution of the Indian workforce shows that the share of agriculture in the male rural workforce only declined by 3 percent from 1987-88 to 1999-2000, leaving 71.4 percent of the Indian population (one-tenth of the world population) still dependent on agriculture for their livelihood.vii While the figures need updating, it should still be clear that economic relations have not yet dislodged an enormous Indian population from the immiseration of exploitative rural wage relations (if, that is, work can be found at all).

For Patnaik, the figures suggest that the real output per head in rural areas has fallen dramatically since IMF reform and trade liberalisation, and that the extraction of absolute surplus value (the lengthening of the working day and the lowering of wages) has taken precedence over relative surplus value (the increase of productivity through the application of technology). In other words, a tenth of the world’s population is working more for less. Chris Wright’s recent analysis of David Harvey’s conception of neoliberalism argues that this is precisely what distinguishes the neoliberal mode of accumulation:

capital’s avoidance of reinvestment in the means of production provides the necessary connection between reliance on absolute surplus-value and the speculation characteristic of neo-liberalism.viii

The ramifications of IMF-dictated reductions in development expenditures, caps on wages, limits on credit expansion, and reductions in the ratio of budget deficit relative to GDP, has been brutally clear. An ‘unprecedented decline’ in purchasing power has led to an unprecedented food security crisis: almost one half of India’s 1.1 billion children are now underweight and malnourished. Meanwhile, data from the National Sample Survey (2004-05) shows that a record high of 87 percent of the rural population could not access the basic requirement of 2400 calories – a climb of 12 percent from 1993-94. The corresponding figure for urban India is 64.5 percent, an increase of 7.5percent since 1993-94. As Patnaik argues, contra India’s ‘growth story’:

Never before in the independent history of our country have we seen the kind of wholesale denial of a negative trend, and of its packaging and presentation as a positive development, as we are seeing at present.ix

The recent talk of a financial ‘crisis’ – characterised as a recent and temporary phenomenon by many – is something of a red herring in India. Utsa Patnaik argues that the scale of India’s agrarian crisis has for long been known, yet the ‘growth story’ persists. Patnaik equates India’s recent position in the global media with that of Russia in the early ’90s, when IMF ‘shock therapy’ ushered in a collapse of Russian GDP to half the levels of the previous decade. In the correspnding period, the average life expectancy declined by an astonishing six years, and Patnaik estimates that a ‘reasonable figure’ of ‘excess deaths’ related directly to IMF-led Russian economic reform might amount to 4 million people. The Russian famine was effectively ‘hidden’ because the Russian economy was making a transition to global capitalism, not socialism. Patnaik argues that a crisis of much the same order stalks the narrative of ‘Shining India’.x

Dangerous Classes and ‘Weight of Numbers’

Utsa Patnaik sees new, and ‘increasingly clear’ patterns of class realignments emerging from the agrarian crisis precipitated by neoliberal reform. For Patnaik, the principal contradiction is now between:

all the peasant classes in rural areas on the one hand, and imperialism with its local landed collaborators on the other hand [italics present in quote].xi

Cautioning against the proponents of narrow identity politics, and the self-appointed ‘leaders’ who have stepped into the fray to ‘represent’ lower-caste groups with inverted forms of exclusionary caste-based politics in parliament, Patnaik instead sees potential in the unified mobilisation of the dalits (formerly known as ‘untouchables’) alongside other exploited mass worker and peasant groups, whose ‘sheer weight of numbers’ offer the combined potential ‘to act as a revolutionary force where the working class alone cannot’.xii The potential of the poor to act in ‘common’ is dependent for Patnaik, on an awareness of the ‘urgency of the present conjuncture’ alongside a clear theoretical understanding of the nature of the contradictions between an impoverished multitude and the owners and managers of capital.

The profusion of ‘Special Economic Zones’ (SEZs) in India sharply illustrates these contemporary contradictions. An SEZ is a specially demarcated area of land – ‘an integrated township’ – owned and operated by a private company. The zone is deemed ‘foreign territory’ for the purpose of trade, duties and tariffs. SEZs enjoy extraordinary exemptions from customs duties, income tax, sales tax and service tax: a fifteen-year ‘income tax holiday’ consists of total exemption for the first five years, 50 percent for the next five years and 50 percent on reinvested export profits for the following five years (zone developers, meanwhile, get a ten-year, 100 percent tax exemption). An incredible 404 SEZs have been formally approved by the India SEZ act, exacerbating already intense regional state competition for foreign direct investment.

With chief ministers essentially acting as ‘property dealers’, SEZs have become bywords for forcible acquisition, displacement and the privatisation of space – a clause in the SEZ land act allows upwards of 75 percent of the area under large SEZs (over 1000 hectares) to be used for non-industrial purposes, a likely loophole for the accumulation of land banks by private developers and property dealers. Meanwhile, labour laws in SEZs are viciously skewed towards the immiseration of workers: a no strike policy, since companies are considered public utility services; use of contract labour with no health, occupational or social protection; exemption from publication of working time, wage rates and shift working; no meaningful safety and health inspections; and a five-year waiver from providing social security.xiii

But with new enclosures comes new resistance. Last year’s National Convention on Displacement in Bhubaneshwar on 26-27 June, coalesced a countrywide ‘upsurge of mass movements’ against displacement, ‘land-grabbing’ SEZs, and ‘pro-imperialist’ policies. The convention gathered a diverse array of proletarian and peasant struggles organised around the issue of displacement, including, but not exclusive to; the Kashipur Movement, fighting against the Bauxite mining and Aluminum plant of the Birlas; the Kalinganagar Movement against forcible displacement for steel plants by the Tata’s; the Movement in Earasama against the proposed steel plant of the South Korean MNC, Posco; the Singur Movement against the Tata’s car plant; the Nandigram Movement against land acquisition by the Salim group of Indonesia (SEZ); the Haripur (West Bengal) struggle against a proposed Nuclear Power plant; the Raigad Movement in Maharastra against the proposed SEZ by Reliance Industries; the ‘People’ of Uttar Pradesh against Reliance’s 2500 acre power plant; the fight in Punjab against the forcible acquisition of farmland by the Trident group for the international airport near Ludhiana, and the thermal power plant at Nabha…

The list goes on. Displacement from SEZs, dams, mining, and large-scale steel and industrial plants – all in the name of ‘development’ – is being challenged in a movement from below whose membership base continues to increase in opposition to the Indian state’s SEZ policies: ‘New movements against displacement [and] SEZs are shaping up almost on a daily basis.’ These struggles are not confined to the rural areas. The Bhubaneshwar draft declaration affirmed its solidarity with those urban slum dwellers in Mumbai, Visakhapatnam, Bhubaneshwar and Chennai, who are fighting forcible eviction, ‘… to make way for city beautification’. Moreover, lessons have been learned from previous experience (some of the struggles have lasted more than a decade): the declaration calls for ‘the exposure and isolation’ of the NGO ‘forces of compromise’ who ‘play a divisive role in the movements’. Meanwhile, the movement resolved to carry forward the previous work of the assembled groups through an ‘intensive and countrywide struggle against displacement and SEZs’.xiv The coalescence of peasants, agricultural workers, tribals, industrial workers, and recalcitrant slum dwellers around common grievances is promising. Whether these struggles, ‘biopolitical’ or otherwise, set about ‘transforming social life in its entirety’,xv however, is a question that will be worked out in praxis.xvi

Meanwhile, The Communist Party of India (Marxist) has been ‘caught out’ on the SEZ front. Arguing that SEZs are central to ‘development’ in the Communist-run state of West Bengal, the CPI (M) sanctioned the Nandigram SEZ under the SEZ act. This acquisition process saw fierce peasant and village resistance; a resistance violently crushed by the state and CPI (M) cadres, resulting in the death of 14 villagers. Under pressure from all fronts, the Communist Party have now stated that the Nandigram SEZ will no longer go ahead, but have merely shifted the proposed SEZ to a less populated area, and have no plans to shelve SEZs per se. The theoretical rigour and class solidarity of the CPI (M) – always suspect – is now being judged on the basis of its class treachery and ideologically flexible submission to neo-colonial accumulation strategies. As Utsa Patnaik has pointed out in regard to the agrarian situation, there can be no ‘soft’ stance on liberalisation:

To support any aspect of liberalisation even for pragmatic reasons is equivalent to political liquidationism.xvii

The capitulation of the CPI (M), and the erosion of Congress hegemony, has created political space for the Naxalite movement in the north-east of India. The ‘red corridor’ of Maoist influence stretches from Nepal down to Andhra Pradesh, including Bihar, Jharkhand, West Bengal, Orissa, Chattisgarh and Madhya Pradesh. The full gamut of administrative negligence and corporate hostility has led to the most savage levels of poverty in India. The Maoists cadres have gained popularity by raising the concerns of the poorest and the most exploited in the absence of viable competing ideologies – Hindutva, for instance, has little presence in the north-east (which has a large Muslim population), being primarily based in the central ‘cow belt’ and the north-west of India. The CPIU (Maoist) are active in 160 of the country’s 604 administrative districts, maintain upwards of 15 thousand troops and control an estimated ‘one fifth of India’s forests’.xviii

While the remnants of Leninism search for signs of workers autonomy or a leftist tendency within the top-down military apparatus of the Maoist cadres, the potential direction of the Indian Maoist parties might better be gauged by briefly examining their Maoist neighbours in Nepal. Since winning the April 2008 elections, the Nepalese Communist Party CPN (M) has been eager to assuage the local and international business class about their intentions. Dr. Bhattarai, a senior member of the CPN (Maoist) politburo, sought to reassure both potential and current investors:

Our other agenda is economic development and for this we want to mobilise domestic resources and capital, and also welcome private foreign direct investment […] We want to fully assure international investors already in Nepal that we welcome them here, and we will work to make the investment climate even better than it is now. Just watch, the labour-management climate will improve in our time in office.

Comrade Prachanda, the Party leader, clarified Dr. Bhattarai’s message: ‘Rest assured, we are in favor of the capitalist economy’.xix

The ‘success’ of the CPN (M) in the Nepalese elections, and the continuing mistreatment of vast swathes of the Indian population in the north-east of India, means that the Maoist cadres will continue to play an important role in Indian politics. Yet, what was already not socialist is now no longer even ideological. ‘Himalmag’ reports that the middle and lower middle class students, who used to form the backbone of the Maoist intelligentsia, are now seeing opportunities elsewhere, and this has created a vacuum of the politically committed, ideologically trained activist. Interviewed by Himalmag, a local cadre admitted:

The politicisation of the cadre is weak. The top leadership has a set of principles, and we have no desire to kill innocents. But the command structure is not in place, which gives the local units a lot of autonomy. And in the absence of politicisation, corruption seeps in.xx

The Maoists have gained popularity by raising the concerns of the poorest and most exploited, but they have also evolved into a dictatorial power structure with a culture of corruption, brutality and entrenched vested interests. This corruption is reflected in the blurred lines between mainstream and ‘revolutionary’ parties. Party politicians need the support of Maoists to win polls in areas where the rebels have a strong influence: in return, the Maoists have been happy to receive money and protection from local politicians and parts of the establishment.

Yet it is also undeniable that the Maoist cadres have succeeded in creating space for dissent. While the government continues to discriminate against lower castes and tribals, opportunities will continue to present themselves to the Maoists for exploitation. These opportunities for new compositions of class resistance are also available for other groups with a libertarian commitment to social transformation. India, however, is a different proposition than Nepal; the Maoists in India are mainly confined to deep forest areas where there is little state presence. Yet, Manmohan Singh, the Indian prime minister, has recently ominously described the Maoist rebels as ‘the single biggest internal security challenge ever faced by our country’.xxi Given the punitive anti-terrorism environment globally, and India’s clientist position in the US-led ‘axis of democracy’, the paramilitary activities of the cadres, and other dissenting groups, are likely to face deepening state repression in the north-east.

The independent Gurgaon Workers News, more promisingly, see ‘explosive potential for a completely different kind of working class movement in India’. The project aims to document – and intervene – in the development of workers’ struggles in and around the Gurgaon area south of Delhi, which lies in the state of Haryana, one of the alleged ‘boom regions’ of global capital. The industrial areas in the south of Delhi are of major importance for the whole ‘national’ economy. Gurgaon is the major production hub for India’s textile and automobile industries and the biggest call centre hub in India, ‘therefore the world’. Biotech, and the agro and pharmaceutical industries make up the mix. Thousands of migrant workers from all over India come to Gurgaon seeking jobs as contract workers, or as agents for call centres. For Gurgaon Workers News, the ‘explosive potential’ in Gurgaon lies in a highly volatile, flexible, diversified workforce where the ‘traditional values and limitations’ of the old labour movement ‘do not apply’. They see promise for new forms of communication and radical activity in the mixture of proletarianised middle classes, and the mass of ‘unskilled’ mass workers cooperating side by side (workers often live together, share resources and information, and deal with the same problems both inside and outside the ‘factory’).xxii

The group argue that the global market for raw material, for production and products, has markedly contracted – an important difference to the situation in Italy in the 1960s (the Italian autonomist tradition is an important theoretical reference point for the Gurgaon group). They argue that the textile and electronic goods market are overflowing and that capital now has no other low wage regions left where it can relocate to. In this context capital ‘will have to confront the workers directly’. The potential power and influence of the Gurgaon workers, while facing severe pressure, is in this sense considerable. Further, they see the possibility for ‘parallel struggles’ linking the ‘north’ and ‘south’ through the global division of labour, with workers in quite different circumstances fighting the same companies over downsizing and closures on the one hand (the north), and low wages and extreme work loads on the other (the south).

Some of the diverse struggles that Gurgaon Workers News have documented so far include: factory occupations and wildcat strikes by contract workers at Hero Honda in Summer 2006, at Honda HMSI in September 2006, and at Delphi, the world’s biggest car part supplier, in January 2007 (each time more than a thousand workers were involved); a wildcat strike of 3 thousand casual workers employed by Eastern Medikit, a global medical supplier, in December 2007; a police attack on striking casual workers at Automax (an auto parts manufacturing company); BPO workers protesting against summary dismissal from Voicekraft Infosole; a factory occupation and union conflict at Gurgaon based Fashion Express (in late autumn 2007, ‘tens of thousands’ of garment workers in Gurgaon were sacked, including the entire staff of Fashion Express); a road picket against water shortages in the villages; the movement to enforce the minimum wage in Haryana; and the exposure of a private clinic in Gurgaon that has removed about 500 kidneys from migrant workers for the global organ trade over the last eight to nine years. The website also includes analysis of the various productive sectors in Gurgaon, and interviews and ‘true-life stories’ from workers exploited by and resisting capital in a myriad of different ways.

While this summary has been necessarily tentative, the project of the Gurgaon Workers News goes some way towards answering Mike Davis’ question in his ‘Planet of Slums’: ‘To what extent does an informal proletariat possess that most potent of Marxist talismans: “historical agency”?’ Yet, as Davis says, these are complex questions, which will require continued radical activity and detailed study before they yield concrete answers. However, the continued resistance of peasants and workers to capital, does, at least in part, challenge another gloomy Davis prognosis: that Marx has been superceded by Muhammad and the Holy Ghost (…here, we can also add Rama). The recalcitrant activity documented by the Gurgaon Workers News project is rooted in the productive process, and directly challenges the neoliberal hegemony of the communalised Sangh Parivar and the Congress party, in turn revealing the poverty of their ideology. In reality, there is little to choose between them on economic terms. While even in secular terms, the Congress Party have been increasingly willing to forsake their upper-caste ‘vocation’ as the traditional party of the poor – Muslims and lower-caste groups – for fear of losing vital Hindu vote banks. The Congress climb-down over the Ram Sethu affair last year perfectly illustrated this regression.xxiii

Since winning the elections in 2004, the Congress-led United Progressive Alliance (UPA) has merely continued the neoliberal policy of the BJP-led National Democratic Alliance (NDA). Both parties have subjected Indian workers to neoliberal austerity under global conditions of extreme competitive nationalism. The power balance could swing either way in the next elections. The UPA still hold the national majority, but the BJP’s third successive victory in Gujarat, despite state complicity in the Gujarat massacre, and its recent victory in the state of Karnataka, its first major advance in the south, mean that Hindutva remains a potent and mainstream political threat.

Hindutva supplements and obscures the murderous edges of neoliberal economic policy by providing culturalist discourses as a ‘counterfeit answer’ to the accelerating penetration of capitalism and the insecurity it wreaks. Meanwhile, the Maoists continue to ply a jaded and corrupt Marxist-Leninist ideology, which – if the results of Nepal’s ‘revolution’ are anything to go by – will merely result in a new set of managers for capital. The project for secularism and the left in India, on the other hand, will have to question the roots of communalism in the social relations of capital that Hindu nationalism obfuscates. The reality is daunting. The successive rounds of primitive accumulation that have divorced producers from their means of production, and the concomitant increase of a hyper-exploited ‘precariat’ mean, of course, that this will be no easy task. The lower castes and classes in India have rarely been offered anything other than spectacular, populist and opportunistic forms of political mobilisation by Congress and its allies. The ‘revolutionary image’ of Maoist ideology, capital’s ‘pseudo-negation and real support’ is not a viable alternative.xxiv If history is to become something other than: ‘… an imagined activity of imagined subjects’,xxv the products of ‘political trade’ on Hindu consciousness will not be dissolved by mental criticism alone, but require most forcefully

… the practical overthrow of the actual social relations which first give rise to this idealistic humbug.xxvi

As the Gurgaon Workers News Group argue, it may be that capital, after continually taking flight from organised workforces across the globe, will finally have to face its nemesis. A new Indian working class, still in the making, may yet provide a potent adversary to a neoliberal order running out of new frontiers to exploit. Whether Indian workers will emerge as an antagonistic frontrunner in a truly global proletariat remains to be seen. The myopia of Eurocentric ‘post-industrial’ pessimism shouldn’t blind us to the changing structures of industrial world capitalism and the new kinds of resistance that have emerged to confront them.

This is the second part of a text on neoliberalism in India, ‘Orientalism Inverted: The Rise of “Hindu Nation’’’:

Neil Gray <neilgray00 AT> is a writer and film-maker based in Glasgow


i Ibid., p.9.

ii Terry Eagleton, Marx, Phoenix Paperback, 1999, p.8.

iii Karl Marx and Friedrich Engels, The German Ideology, Lawrence and Wishart, 1982, p.41.

iv Ibid., p.42.

v Ibid., p.58.

vi Frontline,Volume 24, Number 19, 5 October, 2007,

vii Utsa Patnaik, The Republic of Hunger: and other essays, The Merlin Press, 2007, p.213-16.

ix Utsa Patnaik, op. cit., p.116.

x Ibid., p.121.

xi Ibid., p.226.

xii Ibid., p.230.

xv Michael Hardt and Antonio Negri, Multitude, Penguin Books, 2006, p.124.

xvi See the Bhubaneshwar draft declaration for a full list of the ‘demands’, Note 74. Hardt and Negri’s concept of representation as a disjunctive synthesis, which links the ‘multitude’ to government ‘and at the same time separates it’ is a useful rejoinder to false hopes of democratic representation, Multitude, p.241.

xvii Utsa Patnaik, op. cit., p.212.

xxiii See, Frontline, op. cit.,

xxiv Guy Debord, ‘The Explosion Point of Ideology’, A Sick Planet, Seagull Books, 2008, p.37.

xxv Karl Marx and Friedrich Engels, op. cit., p.48.

xxvi Ibid., p.58.

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