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World's biggest Free Trade Zone to be built!

Phil McLease | 29.08.2001 00:09

This sinister article appeared in the Business section of yesterday's Independent. I have added emphasis to important bits by putting them in CAPITAL LETTERS.

Western investors offered tax deals to build India's new city

By Saeed Shah
28 August 2001


India is seeking to attract western multinational companies to invest $15bn (£10.4bn) in a new manufacturing and logistics area planned for Bombay.

In one of South Asia's most ambitious economic projects, an area to be known as Navi Mumbai has been designated a SPECIAL ECONOMIC ZONE and granted FOREIGN TERRITORY STATUS by the Indian Government.

A whole new city will be built on a 44 sq km site south of Bombay, adjacent to the Jawaharlal Nehru Port. The zone will have its own airport, and ITS OWN LABOUR LAWS and TAX REGIME.
The Maharashtra state development corporation, Cidco, is behind the plan, which will be a PUBLIC-PRIVATE PARTNERSHIP.

Cidco said the scheme is the largest current new town development in the world and it aims to have a population of 2 million within the next few years.

The plan is modelled on other SPECIAL ECONOMIC ZONES which have powered economic growth in Asia and the Middle East, especially Dubai's Jebel Ali Free Zone and Shenzhen in China. Bombay will compete with these areas to attract foreign business.

Suhas Thakar, general manager of Cidco, said: "The idea is to target LARGE MULTINATIONALS to form a manufacturing hub as well as logistics base for the whole Asian, Gulf and East African region. The main requirement is that the industries should be high technology, HIGH-VALUE ADDED companies."

A large part of the necessary basic infrastructure has already been built. Arthur Andersen, the financial advisers to the scheme, are preparing a business plan, which should be ready in October.

A CORPORATE TAX HOLIDAY FOR 10 YEARS will be offered to attract companies to Navi Mumbai, which will be a DUTY-FREE ZONE. Although export-orientated industries are targeted, unrestricted access will be available to India's domestic market. IT IS HOPED THAT LOW LABOUR COSTS WILL PROVE ATTRACTIVE.


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End of article

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Now does that sound dodgy or what?!

Phil McLease

Comments

Hide the following 3 comments

Capitalist heaven

29.08.2001 15:34

That is any neo-liberal's dream city. The worst is that they are planning this kind of scheme worldwide. Pretty scary all of this capitalist nonsense.

Joe Blow


It's exploitation of the worst kind!

29.08.2001 21:31

It's pretty incredible that this sort of thing is going on. It's close to slavery.

guy


I wrote this letter to the Independent+others

29.08.2001 22:24


You (The Independent) featured this article in the business section yesterday.

I have to say that this is the most sinister, piece I have read in your paper for a long time.

The most ominous bit is of course the bit about the zone having "it's own labour laws".

If you have read Naomi Klein's book No Logo, or if you have watched John Pilger's recent documentary about globalisation and it's effects on the people of Indonesia, then you will know what I am talking about.

"Export Processing Zones" like these are springing up at an alarming rate all over the third world, in a return to Victorian (or worse) standards of capitalist exploitation of the poor.

"Low labour costs" means paying people barely enough to survive (or in some cases not even that). The special "labour laws" mean absolute or near absolute 'deregulation'. This means that there are no limits to the number of hours that may be worked, no employment rights, no benefits, no minimum wage, no health and safety regulations, no fire safety standards (sweatshops such as these regularly burn down, claiming the lives of unfortunate workers), no limit to the abuse and exploitation that may be suffered at the hands of management, and just generally no rights whatsoever. Oh and did I mention the armed guards to enforce that no one uninvited from outside gets a look in, no one goes to the toilet except during their one ten minute break (or whatever it may be), noone talks (in some factories even smiling is strictly forbidden) and that generally no one breaks the rules. Obviously it goes without saying that trade unions are out of the question.

Another rather frightening bit was the "corporate tax holiday of ten years". This means that for ten years, the "large multinationals" who are raping and pillaging the country and working India's people to death (literally in some cases) will not have to put anything back into Indian society at all for a whole ten years. And I don't think it's unrealistic to assume that after those ten years they'll either pack up and head somewhere else (as is made increasingly easy with the increasing mobility of capital) or they'll demand another ten years tax free or at least of low tax. It does make one wonder what the Indian government thinks it's going to get out of it.


I highlighted "public-private partnerships" just for good measure because even those who are not aware of the nastier aspects of capitalism are currently very sceptical about these, especially in the light of the recent developments with respect to the London Underground.

"High-value-added" means that the products being assembled will, like Nike Trainers, cost peanuts to make but will be flogged at grossly inflated rip-off prices to gullible western consumers such as ourselves in the European and American high street / mall. With such products, everyone's being conned apart from the capitalist. The consumer is ripped off while the poor sod who works appalling hours in appalling conditions is payed a pittance for his virtual slavery. Meanwhile, nearly 100% of the retail price is split between the retailers, the advertisers and Nike's shareholders, plus the odd middle man along the way.

That's what "Special Economic Zones" are all about. This kind of "free" trade, this kind of deregulated unrestrained free market neoliberal Thatcherite/Reaganite capitalism is the work of the devil.

Like all good aetheists, I am reasonably familiar with the bible. And it seems true enough to me that "the love of money" is indeed "the route of all evil". I wonder what the average church going conservative or republican would have to say about that.

Anyway, just in case you hadn't made the connection, the subject of Saeed Shah's article is exactly the sort of thing against which all those socialists and anarchists and human rights activists and hippies and general lunatics have been protesting, at the recent demonstrations in Seattle, Prague, Melbourne, Davos, Nice, Gothenburg and Genoa and all over the world.

Just in case you hadn't made that connection, I thought I'd point it out to you.

Next time one of your team produces a finance news story written entirely in clean abstract euphemistic economics technical terms, would it be to much to ask them to consider what these things mean for ordinary human beings - for the vast majority of humanity who are getting poorer, not richer, under these insane policies, whilst the investment bankers and management consultants continue to lap it up and generally roll in it?

Simon Bamford


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