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Union government looking to create industrial corridors to facilitate trade

Tuesday, 12 August 2014 - 6:00am IST | Place: Mumbai | Agency: dna

The Union finance minister in his budget speech on July 10 proposed several industrial corridors. He announced a Chennai-Bangalore industrial corridor, a Bangalore-Mumbai eco-corridor, a biotechnology cluster, and industrial smart cities to be developed in the proposed Chennai-Bangalore Economic Corridor region. He also declared that the perspective plan for the Bangalore-Mumbai Economic Corridor would be completed in this fiscal year.

The biotechnology cluster would get a boost at par with international standards. It would include global partnerships in accessing model-organism resources for disease biology, stem cell biology, and high-end electron microscopy.

He also confirmed the long pending project of establishing an industrial corridor between Visakhapatnam and Chennai. Other related proposals included 20 new industrial clusters, Amritsar-Kolkata Link Industrial Master Planning, industrial smart cities, Export Promotion Mission and, most importantly, the establishment of a National Industrial Corridor Authority at Pune. Smart cities would be linked to transport connectivity. The Amritsar Kolkata Industrial Master Planning will be expedited for the establishment of industrial smart cities in seven states in this corridor. Besides, some cities with emphasis on hardware manufacture would be developed as key drivers of economic growth in their respective regions.

The most well known of such plans is, of course, is the Delhi-Mumbai Industrial Corridor (DMIC), connecting a distance of over 1,483km, and sanctioned in 2007. It is a mega infrastructure project with a sanctioned outlay of US$90 billion and supported by technical aid from Japan. A stretch of 150km by 200km on either side of the freight corridor has been chosen. Five states — Haryana, Gujarat, Rajasthan, Madhya Pradesh and Uttar Pradesh — are also parts of the corridor. They are among the stakeholders. For the purpose of the corridor land acquisition, plans are under way.

Clearly, corridor as a particular spatial organisation for economic development has caught the imagination of planners. Till the other day it was zoning: industrial zones, technology parks, export processing zones, small scale industries zones etc, the most prominent being the controversial special economic zones (SEZs). There is as yet no confirmed evidence that SEZs have been responsible for India's accelerated economic development. Some SEZs have closed down, some are languishing, some are plainly land loot projects, and some remain evidence of reaping windfall from a regime of labour deregulation. Zones have to be linked now. But not only that, they must be linked to the great nodal points of circulation — ports, railway terminals, container hubs, and financial and other data processing centres. Zones and corridors sum up the logistical strategy today in this age of neo-liberal economy.

But what about the other corridors in the country? Corridors are being thought of not for the first time. Think of the Mumbai-Pune corridor, Delhi-Chandigarh corridor, Hyderabad-Vijaywada corridor, or the Kolkata-Burdwan corridor. Metropolitan regions gave birth to these corridors, which now mostly lie unplanned, unregulated, uncared for. In some cases the industrial and manufacturing units along these corridors have closed down; the small towns lie in dusty and unkempt shape. The big cities have grown fatter — a case of the co-existence of apoplexy and anaemia.

And what about other zones: disaster zones, flood-prone zones, starvation zones, and zones of death? States involved in the Delhi-Mumbai corridor are in the death zone marked by the suicides of about two hundred thousand farmers in the past one and half decade. If the zoning and corridor strategy were to be by itself a guarantee of success, the government's eyes should have been careful. The logic of zoning and corridor strategy, if not dubious, at least demands caution. If the society in these neo-liberal times produces reconfigured spaces of zones and corridors, then the government has to have its eyes wide open to zones of various kinds and accordingly devise its corridor strategy.

A good general knows, zones will be trapped without corridors of supply. Yet, a corridor is meaningless without the zones to provision these supply routes. Yet, what I am saying is not exceptional. With a modicum of common sense any planner would have understood what I am hinting at. Are we then witnessing a new frontier of capital? Is it the case that after reaping profit from existing resources capital now moves to areas of circulation, while production languishes? Is it one more case of forward trading, a new calculation based on what can be called a corridor-economy?

See what happened in Gurgaon, a so-called visionary space, from where the DMIC begins. Manesar-Gurgaon is under Phase I of the implementation of the DMIC. The Haryana government wants to have at Manesar a model industrial town with a polytechnic, eco-city, and a logistic data bank characterised by harmonious labour relations. Yet workers' woes, labour unrest, and repeated doses of labour retrenchment fly in the face of such claims. Manesar-Gurgaon is a chaotic city — a haven for Japanese firms and investors, a dusty bowl, land sharks roaming around, with cars and other products waiting for the corridor to materialise to reach the port of Mumbai.

With acute labour trouble in the Manesar Maruti plant and horror stories of controlling labour's physical movement inside factories and plants, media hype over DMIC has gone down. But government seems to have learnt little. The important point is that unrest at Gurgaon is a direct result of the logistical mentality of the State. All other factors and considerations are thrown out of the window — as if the new frontiers of capital wait to be breached.

The plain fact is that the space of corridor is at once a space of land dispossession, fancy dreams, brutal labour regime, and unbridled entry of foreign interests — all these facilitated by the government in the name of public-private partnership.

Therefore, even the shareholding pattern of the corridor project is significant. The Government of India, represented through the Department of Industrial Policy and Promotion and the Ministry of Commerce and Industry holds 49 per cent; Japan Bank for International Cooperation (JBIC) holds 26 per cent; the Housing and Urban Development Corporation Limited (HUDCO) holds 19.9 per cent; the India Infrastructure Finance Company Limited (IIFCL) holds 4.1 per cent; and the Life Insurance Corporation of India (LIC) holds the last 1.0 per cent.

Who bears then the burden of these corridors, who pays the bills, and who gains? What are our lessons towards making visionary spaces of production and circulation?

The writer is Director, Kolkata Research Group

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