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Latest News inf. By Ashok Hindocha

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Wednesday, September 30, 2009

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BSNL to outsource towers, cable networks
Indian operator's outsourcing deal could be worth $1 billion-plus over five years.
Bharat Sanchar Nigam Ltd. is planning to outsource the management and maintenance of its towers and cable networks, in a deal that could be worth more than $1 billion over five years, the Economic Times reported on its Web site Tuesday, citing two unnamed company executives.

BSNL is finalizing the conditions for a tender for the contract, the executives said, the Web site reported.

The company plans to outsource more than 50,000 towers and more than 100,000 kilometers of fiber optic cable, the Web site reported the executives as saying.
for more click here
http://www.totaltele.com/view.aspx?ID=449345


BSNL may launch IPO next year
State-owned telecom major Bharat Sanchar Nigam Limited (BSNL) may launch its initial public offer (IPO) by next year, its Chairman Kuldeep Goyal told CNBC-TV18 in an interview. “The company may launch an initial public offer (IPO) next year and is awaiting government approval,” he said.
Here is a verbatim transcript of an exclusive interview with Kuldeep Goyal on CNBC-TV18.

for more click here


http://www.totaltele.com/view.aspx?ID=449345

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--------------------------------------------------------------------------------
Mukesh G. Vaghela
Circle President
SNATTA GUJARAT
Jr. Er. STM16 RAJKOT
Mob.:- 9428346111
http://snattaguj.org
http://snattaguj.blogspot.com
--------------------------------------------------------------------------------
papVII.doc
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BSNL may go for listing, to shelve divestment plan
Press Trust Of India / New Delhi September 07, 2009, 1:53 IST

Fearing opposition by employee unions, the government is considering listing telecom major BSNL on bourses by issuing nominal fresh shares and may shelve plans of directly divesting its equity for the time being.

Repeated attempts by the government and also management of the PSU have failed to bring the different associations to consensus on divesting government stake, even as they (employees) have been lured with employee stock options at an attractive terms.

“We may first list BSNL on stock exchanges and then go for disinvestment,” a senior government official told PTI.

BSNL’s valuation has been pegged at about $100 billion and the PSU has a paid up capital of about Rs 5,000 crore.

The PSU has reported a lower net profit of a little over Rs 574 crore, with total revenues of about Rs 36,000 crore during 2008-09.

Its revenue and net profit in the previous financial year were Rs 38,000 crore and Rs 3,000 crore, respectively. The sharp erosion in both revenue and profits is mainly due to lower average revenue per user (ARPU) vis-à-vis the private operators and if the trend continues for a few years, the company’s long-term plans may suffer badly.

Asked when the decision may be taken to raise fresh equity, the official said the timing and quantity of fresh equity to be raised for the purpose of listing is yet to be decided.

BSNL has a subscriber base of a little over 50 million, whereas private operators like Bharti Airtel and Vodafone Essar have moved ahead much faster in recent months. In fact, Airtel announced the 100-million mark more than two months ago.

The PSU has been adding 0.50 million users on an average for the last three to four months, BSNL officials had said, adding the company was making efforts to increase the incremental subscriber base to at least one million every month.

The company is in the process of adding its GSM capacity by massive 93 million lines, for which the financial bids have already opened and BSNL may place orders soon with the equipment suppliers.

Telecom Minister A Raja could not be contacted for comments on what would be the impact of this decision on the overall disinvestment policy of the government.

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
outsource management and maintenance of its towers
www.bsnlnewsbyashokBSNL to hindocha.blogspot.com M-9426201999
Bharat Sanchar Nigam (BSNL) plans to outsource the management and maintenance of its towers and cable networks as the state-owned telecom operator looks to compete more effectively with private rivals such as Bharti Airtel and Reliace Communications that dominate the booming industry, and unlock the value of its assets.

BSNL plans to outsource more than 50,000 towers and over 100,000 km of optic fibre cable, two executives with the telco told ET. The deal could be worth more than Rs 5,000 crore ($1 billion) over five years.

The move is expected to face stiff resistance from about three lakh employees of the telco as it will impact close to 30,000 jobs.

The company plans to train and redeploy a significant section of these employees to marketing roles, said the executives requesting anonymity.

Most employees are expected to resist transfer to the rolls of the IT firms that win the outsourcing deal.

BSNL is in the process of finalising tender conditions for inviting bids for the contract, the executives said.

The move will help BSNL unlock the value from its towers and passive infrastructure as the once-monopoly tries to play catch-up with private rivals, said B K Syngal, senior principal of consulting firm Dua Consulting.

“Successful bidders for this contract can share the telco’s networks with private players for a fee and this could result in a revenue boost for BSNL,” added Mr Syngal who is a former chairman of VSNL (now Tata Communications).

While the officials refused to put a value to the contract, it could be worth more than $1 billion going by recent similar deals in the industry.

Last year, Reliance Communications had formed joint venture with Franco American networks major Alcatel-Lucent and outsourced the management of its GSM and CDMA networks and its passive infrastructure such as optic fibre cable in a deal worth more than $500 million over a five-year period. In July 2009, the companies announced that the deal size had crossed $750 million.

Similarly, in April 2009, Bharti Airtel entered into a $500-million joint venture with Alcatel-Lucent to manage its landline and broadband business.

About 4,000 employees from Bharti Airtel were transferred to this new venture, which is also the front-runner to bag another $500-million contract from the telco to manage and maintain its 80,000 km-plus inter-city optic fibre cable network.

BSNL had recently shelved its plans to hive off its towers and other related infrastructure into a separate company as it felt it will be difficult to unlock value by merely hiving off its infrastructure and listing it due to falling valuations for the tower sector, said the executives.

The state-run firm started outsourcing its operations recently to compete with the likes of the country’s largest telco Bharti Airtel, which has made outsourcing the cornerstone of its strategy and signed multi-billion dollar contracts with network vendors such as Ericsson, Nokia and Siemens to build and run its mobile network.

BSNL recently invited bids from private players to offer wireless broadband services and Internet television, and set up Internet data services.
www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

BSNLlatestNewsByAIBSNLEACHQND

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
25.09.2009 : GS, President, AGS (Fin) and FS met Secy (T) and discussed regarding IDA pension revision and ITS absorption issue. Secy (T) informed that Cabinet Note on both the issues is ready for circulation to Nodal Ministries but the same will be sent to the Nodal Ministries for comments by the new Secy (T) since he is retiring on 30.09.2009.

25.09.2009 : GS, President, AGS (Fin) and FS met Member (Technology) Shri Chandra Prakash, Ex CGM Maharashtra Circle and congratulated him on assuming the high office of Member (Tech) DOT. Shri Chandra Prakash, Member (Tech) while discussing regarding viability of BSNL advised all the BSNL employees to provide quality service and to devote for the growth of BSNL. We requested him to extend his support to BSNL.
25.09.2009 : GS, President and AGS (Fin) met CMD BSNL and discussed ?

(a) Payment of 60% arrears ? CMD BSNL mentioned that the matter is under consideration with the BSNL Management Board but in the last meeting of BSNL Board it was decided to explore the possibilities to reduce the 30% fitment benefit given to the Executives on revision of pay scale. He informed that shortly Executive Associations will be called to discuss the matter, thereafter the decision in this regard will be taken. We strongly protested against such move and requested for early payment of 60% arrears.

(b) Implementation of DPE OM dated 02.04.2009 regarding 78.2% IDA fitment ? We requested for early implementation of 78.2% IDA fitment as per DPE OM dated 02.04.2009. CMD mentioned that this issue will also be decided along with 60% arrears payment. We expressed our serious concern against delay in implementation.

(c) Viability of BSNL ? CMD appealed to strengthen the Marketing and Sales units of BSNL so that BSNL services are sold through retailers to customers. He also impressed upon to improve the quality of service.

(d) Regularisation of adhoc STS level officers ? CMD assured to look into the matter.

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

BSNLRURALBROADBANDHCLDeal

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
BSNL- HCL Deal For Better Penetration Of Rural Broadband Services
Last Updated: 2009-09-17T12:17:33+05:30

Government telecom operator, Bharat Sanchar Nigam Ltd, and HCL Infosystems, a major IT player, have joined hands for working on National Broadband Penetration Progrmme. This is an initiative taken by the government for ensuring a faster penetration of information technology in rural India.

The Universal Service Obligation Fund, which was initiated by Department of Telecommunications, will be controlled by BSNL for the implementation of this project. USOF was set up to enable BSNL to provide broadband to rural areas at a subsidized rate.

USOF will provide a subsidy of Rs.4,500 per broadband connection that BSNL will roll out through its 27,789 rural and remote telephone exchanges.

The customers of the rural regions can avail this service at Rs.2,250 after which they have to make a monthly payment of Rs.300 for computing device and Rs. 90 or Rs. 150 for the broadband services.

Personal computers will be available at HCL's Touch outlets that have a network across more than 4,000 towns.

"This is indeed one of the major initiatives to bridge the digital divide by offering personal computers plus broadband at subsidised rates to our customers," said BSNL chairman and managing director Kuldeep Goyal. HCL will also be putting up call centres for technical assistance.

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

BSNLpensionForRetiermentEmployees

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BSNL EMPLOYEES UNION
Recognised Union in BSNL
(Regiisttered Under Indiian Trade Uniion Act 1926.. Regn..No..4896))
CHQ::Dada Ghosh Bhawan,, Opp.. Shadiipur Bus Depott..,, New Dellhii – 110008
Emaiill:: chqbsnlleu@siiffy..com,, websiitte:: bsnlleuchq..com
Phone:: ((O)) 011--25705385
V..A..N.. Namboodiirii ((R)) 011-- 23342848
Generall Secrettary Fax:: 011-- 25894862
BSNLEU//413 ((Pensiion) 29..09..2009
To
Shrii Siidharttha Behura,,
Secrettary,, DoT,,
Sanchar Bhawan
New Dellhii – 110 001
Sub:: Reviisiion off pensiion for BSNL rettiirees ((DoT emplloyees absorbed iin BSNL)) –
reg..
Siirr,,
IIt iis underrsttood tthatt tthe prroposall fforr merrger off 50% IDA ffor BSNL pensiioners rrettirred befforre
01..01..2007 iis drropped by DoT on tthe grround tthatt ttherre iis no autthorriizattiion tto DoT ffrrom tthe
Goverrnmentt fforr doiing so and iinsttead,, a cabiinett memo iis underr prreparrattiion fforr rreviisiing ttheiirr
pension,, on the basiis of Deparrttmentt off Pensiion’s orrder no.. 4//14//2001-P&PW((D)) datted
19..09..2003.. IIn tthiis connecttiion,, tthe ffollllowiing iis submiitttted fforr yourr kiind consiiderrattiion::
1.. The above orrderr off tthe Pensiion Deparrttmentt was iissued tto settttlle tthe prrobllem off rreviisiion
off pensiion w..e..ff.. 01..01..1996 iin case off tthe PSU rrettiirrees who had been absorrbed iin PSU
as a rresulltt off converrsiion and had optted fforr pensiionarry beneffiitts off combiined serrviice iin
tthe Centtrrall Goverrnmentt and tthe PSU as perr Centtrrall Goverrnmentt Rulles on ttheiirr
absorrpttiion.. But iit was nott iissued keepiing tthe siituattiion off BSNL emplloyees allso in viiew,,
siince tthe questtiion off rreviisiing ttheiirr pensiion ffrrom 01..01..1996 woulld nott arriise as ttherre was
no BSNL unttiill 01..10..2000.. Therrefforre tthiis orrderr need nott be mechaniicalllly applliied fforr
BSNL emplloyees siince BSNL emplloyees arre diifffferrenttlly pllaced..
2.. As perr Rulle--37A off CCS ((Pensiion Rulles)),, tthe BSNL rrettiirrees arre beiing paiid pensiion
diirrecttlly by tthe Goverrnmentt,, tthrrough CCAs.. No ottherr PSU emplloyee iis haviing tthiis
prroviisiion.. Forr ffaciilliittatting tthiis paymentt off pension by Governmentt,, tthe BSNL iis paying
pensiion conttrriibuttiion tto tthe Goverrnmentt fforr tthe serrviice off tthe BSNL absorrbed emplloyees..
Thus tthe burrden off bearriing tthe pensiion expendiitturre ffiinalllly rrestts wiitth BSNL onlly,, alltthough
there iis guarranttee ffrrom the Goverrnment fforr pensiion paymentt..
3.. The Pensiion Deparrttmentt’’s orrderr datted 19..09..2003 prrescrriibes brriingiing allll absorrbed
emplloyees nottiionalllly tto equiivallentt CDA scalle and ffiix pensiion ttherreafftterr on tthatt basiis iin
the CDA scalle.. Butt thiis prrescrriipttiion wiilll briing crriisiis iin the matttterr off paymentt off pension
fforr BSNL rrettiirrees,, siince ttheiirr pensiion iis allrready beiing paiid on tthe basiis off IIDA pay
scalles,, siince tthe fforrmattiion off BSNL.. As perr tthe orrderrs iissued by DoT earrlliierr and as perr
Rulle-37A off CCS ((Pensiion)) Rules,, tthe absorrbed emplloyees are assurred off pensiion on
tthe basiis off IIDA scalles.. The Rulle--37A was amended viide Pensiion Deparrttmentt’’s orrderr
datted 25..10..2007 allllowiing tthe same metthod fforr callcullattiing pensiion fforr BSNL rrettiirree on
parr wiitth a Centtrrall Goverrnmentt Emplloyee rrettiirred on tthe same datte.. Therrefforre,, fforr any
BSNL emplloyee absorrbed ffrrom DoT and rrettiirriing afftterr 01..01..2007 ((Datte off wage rreviisiion
iin IIDA scalles)),, pensiion iis tto be callcullatted on tthe basiis off IIDA pay scalle,, wiitth callcullattiion
prrocedurre beiing tthe same as prrescrriibed fforr Centtrrall Goverrnmentt emplloyee.. Forr allll
absorrbed BSNL emplloyees rrettiirred afftterr 01..10..2000 tto ttiillll now,, pensiion iis paiid on IIDA
scalle and nott on CDA scalle..
4.. IIff iitt iis tto be assurred tthatt,, pensiion rreviisiion wiillll be done on tthe basiis off equiivallentt CDA
scalle,, iitt wiillll be grross diiscrriimiinattiion off one sett off rrettiirrees agaiinstt anottherr sett off rrettiirrees
and againstt tthe llaw establiished by tthe Suprreme Courrtt of IIndiia iin D..S.. Nakarra case wherre
iitt cllearrlly ttolld tthatt allll pensiionerrs shoulld be off tthe same cllass wiitthoutt any diiscrriimiinattiion..
As perr tthe Goverrnmentt’’s orrderrs,, pensiion fforr absorrbed BSNL emplloyees has tto be paiid
on IIDA scalle and nott on CDA scalle.. Therrefforre sendiing prroposall fforr rreviisiion off pensiion
forr BSNL retiirees on tthe basiis off CDA scalle basiing on 19..09..2003 orrderr iis iirregullarr and
iillllegall and ttottalllly unjjusttiiffiied..
Hence,, II rrequest you tto kiindlly cause tto iissue necessarry orrderr, tto ensure revisiion off pensiion forr
BSNL rrettiirrees on IIDA pay scalles..
We shallll be tthankffull fforr consiiderriing ourr rrequestt..
Yourrs ffaiitthffulllly,,
[[V..A.N.Namboodiirii]
Generall Secrettary
Copy tto:: The CMD,, BSNL,, Bharrat Sanchar Bhawan,, New Dellhii – 110001..
www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

BSNLpensionNews


www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
BSNL EMPLOYEES UNION
Recognised Union in BSNL
(Regiisttered Under Indiian Trade Uniion Act 1926.. Regn..No..4896))
CHQ::Dada Ghosh Bhawan,, Opp.. Shadiipur Bus Depott..,, New Dellhii – 110008
Emaiill:: chqbsnlleu@siiffy..com,, websiitte:: bsnlleuchq..com
Phone:: ((O)) 011--25705385
V..A..N.. Namboodiirii ((R)) 011-- 23342848
Generall Secrettary Fax:: 011-- 25894862
BSNLEU//413 ((Pensiion) 29..09..2009
To
Shrii Siidharttha Behura,,
Secrettary,, DoT,,
Sanchar Bhawan
New Dellhii – 110 001
Sub:: Reviisiion off pensiion for BSNL rettiirees ((DoT emplloyees absorbed iin BSNL)) –
reg..
Siirr,,
IIt iis underrsttood tthatt tthe prroposall fforr merrger off 50% IDA ffor BSNL pensiioners rrettirred befforre
01..01..2007 iis drropped by DoT on tthe grround tthatt ttherre iis no autthorriizattiion tto DoT ffrrom tthe
Goverrnmentt fforr doiing so and iinsttead,, a cabiinett memo iis underr prreparrattiion fforr rreviisiing ttheiirr
pension,, on the basiis of Deparrttmentt off Pensiion’s orrder no.. 4//14//2001-P&PW((D)) datted
19..09..2003.. IIn tthiis connecttiion,, tthe ffollllowiing iis submiitttted fforr yourr kiind consiiderrattiion::
1.. The above orrderr off tthe Pensiion Deparrttmentt was iissued tto settttlle tthe prrobllem off rreviisiion
off pensiion w..e..ff.. 01..01..1996 iin case off tthe PSU rrettiirrees who had been absorrbed iin PSU
as a rresulltt off converrsiion and had optted fforr pensiionarry beneffiitts off combiined serrviice iin
tthe Centtrrall Goverrnmentt and tthe PSU as perr Centtrrall Goverrnmentt Rulles on ttheiirr
absorrpttiion.. But iit was nott iissued keepiing tthe siituattiion off BSNL emplloyees allso in viiew,,
siince tthe questtiion off rreviisiing ttheiirr pensiion ffrrom 01..01..1996 woulld nott arriise as ttherre was
no BSNL unttiill 01..10..2000.. Therrefforre tthiis orrderr need nott be mechaniicalllly applliied fforr
BSNL emplloyees siince BSNL emplloyees arre diifffferrenttlly pllaced..
2.. As perr Rulle--37A off CCS ((Pensiion Rulles)),, tthe BSNL rrettiirrees arre beiing paiid pensiion
diirrecttlly by tthe Goverrnmentt,, tthrrough CCAs.. No ottherr PSU emplloyee iis haviing tthiis
prroviisiion.. Forr ffaciilliittatting tthiis paymentt off pension by Governmentt,, tthe BSNL iis paying
pensiion conttrriibuttiion tto tthe Goverrnmentt fforr tthe serrviice off tthe BSNL absorrbed emplloyees..
Thus tthe burrden off bearriing tthe pensiion expendiitturre ffiinalllly rrestts wiitth BSNL onlly,, alltthough
there iis guarranttee ffrrom the Goverrnment fforr pensiion paymentt..
3.. The Pensiion Deparrttmentt’’s orrderr datted 19..09..2003 prrescrriibes brriingiing allll absorrbed
emplloyees nottiionalllly tto equiivallentt CDA scalle and ffiix pensiion ttherreafftterr on tthatt basiis iin
the CDA scalle.. Butt thiis prrescrriipttiion wiilll briing crriisiis iin the matttterr off paymentt off pension
fforr BSNL rrettiirrees,, siince ttheiirr pensiion iis allrready beiing paiid on tthe basiis off IIDA pay
scalles,, siince tthe fforrmattiion off BSNL.. As perr tthe orrderrs iissued by DoT earrlliierr and as perr
Rulle-37A off CCS ((Pensiion)) Rules,, tthe absorrbed emplloyees are assurred off pensiion on
tthe basiis off IIDA scalles.. The Rulle--37A was amended viide Pensiion Deparrttmentt’’s orrderr
datted 25..10..2007 allllowiing tthe same metthod fforr callcullattiing pensiion fforr BSNL rrettiirree on
parr wiitth a Centtrrall Goverrnmentt Emplloyee rrettiirred on tthe same datte.. Therrefforre,, fforr any
BSNL emplloyee absorrbed ffrrom DoT and rrettiirriing afftterr 01..01..2007 ((Datte off wage rreviisiion
iin IIDA scalles)),, pensiion iis tto be callcullatted on tthe basiis off IIDA pay scalle,, wiitth callcullattiion
prrocedurre beiing tthe same as prrescrriibed fforr Centtrrall Goverrnmentt emplloyee.. Forr allll
absorrbed BSNL emplloyees rrettiirred afftterr 01..10..2000 tto ttiillll now,, pensiion iis paiid on IIDA
scalle and nott on CDA scalle..
4.. IIff iitt iis tto be assurred tthatt,, pensiion rreviisiion wiillll be done on tthe basiis off equiivallentt CDA
scalle,, iitt wiillll be grross diiscrriimiinattiion off one sett off rrettiirrees agaiinstt anottherr sett off rrettiirrees
and againstt tthe llaw establiished by tthe Suprreme Courrtt of IIndiia iin D..S.. Nakarra case wherre
iitt cllearrlly ttolld tthatt allll pensiionerrs shoulld be off tthe same cllass wiitthoutt any diiscrriimiinattiion..
As perr tthe Goverrnmentt’’s orrderrs,, pensiion fforr absorrbed BSNL emplloyees has tto be paiid
on IIDA scalle and nott on CDA scalle.. Therrefforre sendiing prroposall fforr rreviisiion off pensiion
forr BSNL retiirees on tthe basiis off CDA scalle basiing on 19..09..2003 orrderr iis iirregullarr and
iillllegall and ttottalllly unjjusttiiffiied..
Hence,, II rrequest you tto kiindlly cause tto iissue necessarry orrderr, tto ensure revisiion off pensiion forr
BSNL rrettiirrees on IIDA pay scalles..
We shallll be tthankffull fforr consiiderriing ourr rrequestt..
Yourrs ffaiitthffulllly,,
[[V..A.N.Namboodiirii]
Generall Secrettary
Copy tto:: The CMD,, BSNL,, Bharrat Sanchar Bhawan,, New Dellhii – 110001..
www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

Tuesday, September 29, 2009

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999

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BONUSTOBSNLEMPLOYEESUNJUSTICE

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
BSNL EMPLOYEES UNION
Recognised Union in BSNL
(Regiisttered Under Indiian Trade Uniion Act 1926.. Regn..No..4896))
CHQ::Dada Ghosh Bhawan,, Opp.. Shadiipur Bus Depott..,, New Dellhii – 110008
Emaiill:: chqbsnlleu@siiffy..com,, websiitte:: bsnlleuchq..com
Phone:: ((O)) 011--25705385
V..A..N.. Namboodiirii ((R)) 011-- 23342848
Generall Secrettary Fax:: 011-- 25894862
BSNLEU//404((Bonus)) 29--09--2009
To
Shrii Kulldeep Goyall,,
CMD BSNL,,
Bharatt Sanchar Bhawan,,
New Dellhii – 110001
Sub:: -- PLII ffor 2008--2009 –reg..
Reff:: -- Lr..No.. 12--2//2009 – PAT((BSNL)) datted 18--09--2009..
Siir,,
The BSNL managementt has iissued orrderrs,, grranttiing Rs.. 3500//-- as PLII fforr Non--executtiives.. Thiis arrbiittrrarry
deciisiion off tthe managementt tto rreduce PLII fforr 2008--2009 iis ffulllly unjjusttiiffiied tto say tthe lleastt.. The arrgumentt off
tthe management tto rreduce the PLII iis tthatt ttherre is rreducttiion iin tthe prroffiitt ffor tthe yearr and hence tthe ffulll PLII
cannott be giiven.. IItt allso says tthatt tthe diisttrriibuttablle prroffiitt fforr grrantt off PLII does nott allllow tto pay morre amountt..
These arrgumentts have no basiis iiff we check tthe ffactts..
The PLII ((Prroducttiiviitty Liinked Bonus)) fforrmulla fforr BSNL and MTNL was announced by DOT viide No..11--
18//2003-SU.. III((Pt..)) dated 19th Septtemberr 2006 on tthe basis off DPE guiidelliines iin tthe matttterr conveyed vide
DOT lletttterr off even No.. Datted 5th Octtoberr 2005.. Whiille tthe PLII amountt iis callcullatted on tthe basiis off MOU
grradiing,, iitt was speciiffiicalllly menttiioned tthatt tthe miiniimum and maxiimum ceiilliing off tthe PLII shallll be Rs.. 7,,000//-- &
Rs.. 10,,000//-- fforr non--executtiives and Rs.. 10,,000//-- & Rs..12,,500//-- fforr executtiives.. IItt was allso menttiioned tthatt tthe
PLII tto casuall llabourrerrs wiillll be Rs..3,,000//-- ffiixed..
As ffarr as tthe non--executtiives arre concerrned,, ttherre iis no rresttrriicttiion based on tthe lliimiitt off 5% off tthe diisttrriibuttablle
prroffiitt.. Thiis iis onlly applliicablle fforr tthe executtiives as perr DPE guiidelliines.. The managementt has now iinvoked tthiis
prroviisiion fforr tthe non--executtiives wiitthoutt any jjusttiiffiicattiion..
The prroffiitt tthiis yearr has been rreduced nott because off any llack off perrfforrmance on tthe parrtt off tthe executtiives,,
butt due tto tthe llack //crrunch off mobiille lliines fforr whiich tthe managementt was ffulllly rresponsiiblle,, who have rreduced
tthe ttenderr orrderr ffrrom 45..5 miilllliion tto hallff.. Furrttherr tthe iincrreased expendiitturre fforr paymentt off arrrrearrs off wage
rreviisiion cannott be a rreason fforr rreduciing PLII..
When lleaderrs off tthe Uniitted Forrum mett tthe CMD,, BSNL and Diirrecttorr ((HR)),, BSNL,, on Septtemberr 15,, 2009,, we
prressed fforr paymentt off miiniimum PLII off Rs.. 7000//-- tto tthe Non--Executtiives.. Siince we diid nott gett posiittiive
rresponse,, tthe Uniitted Forrum conductted nattiion wiide dharrna//demonsttrrattiions,, on Septtemberr 17,, 2009,, tto prress
ourr demand off paymentt off Rs.. 7000//-- as miiniimum PLII.. Once agaiin,, afftterr tthe iissuiing off tthe PLII orrderr,, tthe
Uniitted Forrum conductted nattiion wiide demonsttrrattiions on Septtemberr 22,, 2009 exprressiing ourr opposiittiion tto tthe
rreducttiion iin tthe quanttum off PLII..
IIn viiew off tthe fforregoiing,, II rrequestt you tto kiindlly iissue orrderr iimmediiattelly fforr paymentt off tthe ballance amountt off
PLII ii..e..,, Rs.. 3500//-- tto tthe Non--Executtiives and Rs.. 1500//-- tto tthe casuall llabourrerrs..
Yourrs Siincerrelly
((V..A..N.. NAMBOODIIRII)
Generall Secrettary
Copy tto :: 1.. The Chiieff Labourr Commiissiionerr,, Shrram Shaktthii Bhawan,, New Dellhii – 110001..
2.. The Diirecttorr (HR)),, BSNL,, New Dellhii – 110001..
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OrganisationNtask

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ORGANISATION & TASKS
BSNL Employees Union
V.A.N Namboodiri, GS, BSNLEU
Published By:
BSNL EMPLOYEES UNION
CHQ, Dada Ghosh Bhawan, 2151/1, New Patel Nagar,
Opp. Shadipur Bus Depot, New Delhi- 110 008
Email: chqbsnleu@sify.com. Website: www.bsnleuchq.com
Organization & Tasks
BSNL Employees Union
Background
Bharat Sanchar Nigam Limited (BSNL) was an unwanted child born at the wrong time.
There was no necessity, requirement or justification to convert the Department of Telecom
Services / Department of Telecom Operations / Department of Telecom in to a Public
Sector i.e. BSNL. It was done as part of the ongoing process of liberalization, globalization
and privatization policy of the Central government initiated in the 1990s.
The government proposal was to convert the government department in to a PSU by April
2001. This was advanced to 1st October, 2000, i.e. 6 months earlier, due to the
collaborationist policy of the then recognized Staff Federations viz. National Federation of
Telecom Employees (NFTE), Federation of National Telecom Organizations (FNTO) and
Bharatheeya Telecom Employees Federation (BTEF). After going on strike for a day against
corporatization, they compromised with the government for an additional amount of Rs.1,
000 p.m. and some' vague assurances on government pension continued to the absorbed
employees in BSNL.
The National Action Committee (NAC) of Telecom Organizations which comprised of the All
India Unions which merged later in to BSNL Employees Union went on strike on 9th
September, 2000 and also organized Non-co-operation agitation on 26th & 27th September,
continued by walk out strikes on 29th September 2000 against corporatization. But the
compromising attitude of the three recognized federations enabled the govt. to corporatize
DTS/DTO/DOT in to BSNL w.e.f. 01.10.2000.
Com. V.A.N. Namboodiri, Convener, NAC, at the time of inauguration of BSNL pointed out
that the workers and the unions have a threefold task at the moment i.e. to ensure that
corporation is sustained defeating government's plan to privatize it, planning and
developmental activities on a fast pace and hard work & determination on the part of
workers for giving a better service to the people.
BSNL Employees Union formed
BSNL Employees Union was formed on 22nd March, 2001 in the National Convention of
Telecom Workers held at Visakhapatnam by merging the following All India Unions:
1. All India Telecom Employees Union Class-Ill (N)
2. All India Telegraph Traffic Employees Union Class-Ill
3. All India P&T Industrial Workers Union
4. All India Telecom Civil Wing Employees Union Gr. 'C; & 'D1
5. Indian Telecom Employees Union Line staff & Gr. 'D'
6. All India Telecom Administrative Offices Employees Union
7. All India Telecom Employees Union Line Staff & Gr. 'D'
8. All India Telegraph Traffic Employees Union Gr. 'D'
Corns. Sisir Bhattacharjee and Moni Bose, veteran leaders of P&T trade union movement,
were elected as Chief Patrons. Corns. J.N. Mishra and V.A.N. Namboodiri were elected as
President and General Secretary respectively. Thus a new vibrant union of Telecom
Workers was born. It is noteworthy that the Union was formed on the death anniversary of
Com. A.K.Gopalan, one of the all time loved working class leader and the first opposition
leader in the Parliament.
The Organizational Resolution adopted in the Conference gave call to forge unity among
the entire telecom workers and to fight against privatization of this crucial industry and for
the cause of the entire telecom workers.
The Growth of BSNLEU
The formation of BSNLEU was welcomed by the workers not only of BSNL, but by the entire
country. The recognized and well established Federations in BSNL as also BSNL
management tried to create hurdles in its activities; but countering all these difficulties and
attacks, BSNLEU started its forward march.
The growth of the organization -Foundation Conference at
Visakhapatnam
The formation conference of BSNLEU was held on 21 - 22 Match, 2001 at Visakhapatnam
(Andhra Pradesh). The union constitution and flag were approved in this conference. A
unanimous panel of office-bearers with Com. J.N. Mishra as President and Com. V.A.N.
Namboodiri as General Secretary was elected. The conference also passed a policy and
programme resolution on the basis of which the union started functioning. The BSNL
Employees Union was registered with the Registrar of Trade Unions Delhi on 15.06.2001 with
Registration No.4896.
6 Central Executive Committee / Office-bearers meeting was held at Delhi (26.05.2001) Kolkata
(13-15 September, 2001) Delhi (28.02.2002) Mandya (08-10 April, 2002)Aurangabad (3-5
August 2002) and Kolkata (26-27 October, 2002).
The first wage agreement on conversion from CDA to IDA was finalized and signed on
26.04.2002 after hard bargaining. Since no union was recognised, all the applicant unions
participated.
A lot of agitations were organized against victimization, on our demands as also on the call of
Sponsoring Committee of Trade Unions etc. There were two one day strikes successfully
organized on 16.04.2002 and 21.05.2003 as per the call of Central Trade Unions.
// AIC at Lucknow
The II All India Conference of BSNLEU was held at Lucknow on 2-5 June, 2003. A large number
of delegates attended despite the terrible heat and later very heavy rains. The conference called
upon the workers to intensify the struggle against privatization as also on the demands of the
workers. The conference re-elected Corns. J.N. Mishra as President and V.A.N. Namboodiri as
General Secretary. 7 Central Executive Committee meetings were held at Delhi (25-26 August,
2003) Hyderabad (20-21st January, 2004) Pondicherry (17th -19th July, 2003) Delhi (9-10
December, 2004) Ludhiana (7-9 March, 2005) Pune (15-17 June, 2005) and Kanyakumari
(21-22 October, 2005). Many important issues were discussed and sustained struggles
organized during the period.
In the II Membership Verification held, BSNLEU got No. 1 position and recognition. The
United Forum was formed with 4 other unions to defeat pro-management NFTE.
A large number of long pending issues were discussed and settled including BSNL GSLI
Scheme, refund of CGEGIS, gift to retiring employees, Perks, New PLI etc.
Many struggles were organized on workers' issues. Strikes were organized on 24th
February, 2004 for TU rights and 29th September, 2005 strike as per call of Sponsoring
Committee of Trade Unions. The strike on 5th January, 2006 called by Joint Forum was
deferred after Secretary DoT assured in writing that BSNL will not be disinvested /
privatized.
/// AlC at Guwahati
Guwahati All India Conference held on 26th to 29th January, 2006 was a milestone in the
history of the BSNL Employees Union. It was held in the backdrop of the historic victory in
the II membership verification for BSNLEU and United Forum.
A women's convention was organized as part of the AIC which was largely participated. The
policy & programme adopted gave a clear line to the organization to move forward.
This conference saw a good number of senior leaders, especially retired comrades, giving
way to comparatively younger generation.
Central Executive Committee meetings were held at Calicut (21st to 23rd August, 2006),
Bijapur (6th to 8th February, 2007) and Bhubaneswar (21st to 23rd August, 2007). Important
decisions were taken with regard to issues as also organizational matters. A lot of important
demands could be settled. Promotion Policy, Transfer Policy etc. were got approved.
Two important strikes were successfully organized on 14.12.2006 called by Sponsoring
Committee of Trade Unions and another on 11.07.2007 by BSNL Unions to defend BSNL
and for getting sufficient mobile lines to provide to the people. The strike on 11.07.2007 was
complete with both executives and non-executives fully participating. It is worth noting that
there was no economic demand in this strike. Only the firm stand taken by BSNLEU
ensured strike and that too a 100% strike. Many other agitational programmes were also
organized.
BSNL Casual & Contract Workers Federation
Another important development was that as per decision of the Guwahati Conference,
BSNL Casual & Contract Workers Federation was formed at the All India Convention held
at Koikata on 14th & 15th March, 2008. Com. V.A.N. Namboodiri and Com Tapas Ghosh
were unanimously elected as President & Secretary General of the Federation. About 14
circle unions have been formed by this time. BSNLEU and BSNL C&CWF together are
trying to improve the conditions of Casual / Contract Workers.
IV AIC at Mumbai
The IV All India Conference was held at Mumbai from 13th to 16th February, 2008. Despite
restrictions on the number of delegates, more than 4,000 workers participated as also many
visitors. The high level discussion was a pointer to the growth of the organization. For the
first time, a Communications Minister (ThiruA. Raja) attended BSNLEU conference.
Leaders of almost all Non-Executive and Executive Unions addressed the conference.
Foreign delegates from Sri Lanka and Nepal also participated.
The conference adopted a resolution for Indefinite Strike to start from 26th February, 2008
against disinvestment, VRS etc. It also adopted another resolution on organization to
strengthen the same. The issues of Casual & Contract Workers also were given focus.
Certain amendments to the constitution were adopted.
More than 120 delegates participated in the discussion. Corns. J.N. Mishra and V.A.N.
Namboodiri were unanimously elected as President and the General Secretary for the IV
consecutive term.
Central Executive Committee meetings were held at New Delhi (21-22 July, 2008) Kolkata
(03-05 November, 2008) and New Delhi (05-06 March, 2009). The next Central Executive
Committee meeting is going to be held at Mysore from 27-29 August, 2009. One more
Central Executive Committee meeting can be held before the AIC to be held at
Thiruvananthapuram.
Many agitations and struggles were organized during this period including for settlement of
wage revision and other demands. The 7th May, 2008 strike called by CPSTU was deferred
after the Prime Minister gave assurance on the 5 year periodicity for wage revision. The
indefinite strike call by Joint Forum on common demands from 26th February, 2008 was also
deferred on the basis of assurance from management. Massive Dharnas were organized on
28th & 29th May, 2008 and was withdrawn after 50% IDA merger was ordered at the
instance of Communication Minister.
The 20th August 2008 strike was one of the biggest strikes of Indian Working Class. The call
for strike given by Sponsoring Committee of Trade Unions was well responded with crores
of workers' participation. Another strike called on 11-12 December, 2008 was deferred on
assurance to start the negotiation from 15lh December, 2008. BSNLEU also participated in
the Parliament March on 18th February, 2009 called by the Sponsoring Committee of Trade
Unions. The 2 days strike called for 19-20 May, 2009 was deferred after management
agreed to pay 6 months pay advance and new HRA retrospectively from February, 2009.
First Membership Verification
Four membership verifications have been conducted so far, in 2002, 2004, 2006 & 2009 to
select the majority union for grant of recognition. While NFTE wanted check off system,
BSNLEU & other unions insisted upon Secret Ballot and the latter was accepted by Chief
Labour Commissioner and management. In the first verification in 2002, NFTE got
approximately 35% and BSNLEU 30%. As per the then existing rules on recognition in
Government, both NFTE and BSNLEU, which got more than 15% should have been
recognized. (No other union, including FNTO, did not reach 15%). But to deny due
recognition to BSNLEU, the management and NFTE conspired and on the plea of
provisions of 'Code of Discipline', NFTE alone was recognized, denying rightful recognition
to BSNLEU.
Brutal Repression
Neither the management nor the Federations expected that BSNLEU will get 30%, only 5%
less than NFTE. In order to curtail the growth of BSNLEU, it was targeted and series of
attacks were made on BSNLEU by management in connivance with the recognized union.
Many Circles, Districts and Branch Secretaries along with hundreds of active workers of
BSNLEU were transferred in a move to destabilize the union and discourage workers
joining it. Many charge sheets were issued on active workers and punishments imposed on
flimsy charges. BSNLEU organized sustained struggles continuously including a Parliament
March and fought against the harassment and victimization.
// Membership Verification
During the two years of its tenure of recognition, NFTE concluded certain agreements which
were completely against the interests of workers. It agreed to the Management proposal of
retrenching 50,000 workers through VRS/CRS. Very low perks were agreed upon. It
declared that it will not oppose government policies like disinvestment / privatization etc.
While crying hoarse about uncertainty of pension, it did not make any effort to ensure it by
government. In all these, FNTO was a party as they allied with NFTE at that time.
Continuing such a grave situation would have resulted in quick disinvestment / privatization
as happened in the case with corporatisation. The workers were very unhappy and wanted
a change'. BSNLEU took the initiative to form the United Forum of BSNL Unions with the
support of certain unions including FNTO and fought the II membership verification which was
held in 2004. The 'invincible' NFTE was decisively defeated and BSNLEU got recognition as the
majority union, it was a big victory of BSNL workers. BSNLEU got 39,601 votes more than
NFTE.
The main task after grant of recognition was to restore the confidence of workers. United Forum
under the leadership of BSNLEU took long pending issues one after another for settlement. An
agreement was got signed between management and L!C for group insurance, which is the
biggest group insurance scheme in the world. A new Perk agreement was made with more
benefits than agreed to by the earlier recognized union. Acommittee was formed to finalise
promotion policy on the demand of BSNLEU. The workers understood the difference between
the earlier & present recognized unions.
/// Membership Verification
The many settlements made after getting recognition in 2004 resulted in increase in
membership of BSNLEU to a large extent. The support base amongst the workers also
increased. The result was another landslide victory. NFTE felt utterly isolated. The difference
between BSNLEU and NFTE increased to 64,207-votes.
Our continuous and sustained struggle against Disinvestment / IPO, VRS, for improvement of
services and on workers demands, while increasing our support base, also created a peculiar
situation where in the management wished for a compromising recognized union. Gradually it
started supporting NFTE and also managed to create division within United Forum.
FNTO was not happy that BSNLEU has become very strong with more than 50% membership
of total non-executives. If not to become king, FNTO wanted to become kingmaker. By granting
facility of deduction of subscription and certain TU rights to the non-recognised unions, the
management was successful in ensuring that FNTO and certain other unions desert United
Forum.
The Dark Conspiracy
It is in this situation that FNTO and Rashtriya Union left United Forum, joined NFTE and
formed BSNL Workers Alliance to face the IV membership verification in the banner of
NFTE. President of SEWA BSNL, who was with us from the 1st verification joined with NFTE
alliance. BSNLEU was left with only AIBCTES and TEPU in the United Forum. The massive
hateful and slanderous propaganda unleashed by NFTE-FNTO alliance had to be
countered. BSNLEU had a paid membership of more than 1, 35,000 out of 2,47,000 total
non-executive workers, coming to 55%. But the fact that there was a shift of about 10,000
memberships from BSNLEU to other unions earlier when deduction of membership was
given to non-recognised union was a warning bell.
The Central Executive Committee held at Delhi considered all these aspects and gave clear
direction to CHQ that a strengthened United Forum is necessary not only to win the
verification with more than 50%, but also to continue and strengthen our fight against
disinvestment, privatization etc.
United Forum - 7 Unions Alliance
As per the directives of the CEC, hectic efforts were made and CHQ could form a strong
alliance of 7 unions (including BSNLEU) even breaking away some of the constituents of
NFTE alliance, like BSNLMS and BTU. SEWA BSNL and SNATTA also joined. It was not
an easy matter and we had to go extra mile for reaching that target. Though the alliance
was completed very late, it gave a strong message and confidence to the workers.
The IV Membership Verification witnessed a very low standard and malicious propaganda
by NFTE-FNTO alliance. Management overtly and covertly supported NFTE. We countered
it with explaining our achievements with facts and figures. The intensive propaganda during
the last few days entirely changed the situation in favor of BSNLEU. Once again, BSNLEU
won with a thumbing majority defeating NFTE by more than 28,000 votes.
The shattered and desperate NFTE & FNTO have now left the Joint Forum, the umbrella
organization of executives and non-executives, on flimsy grounds. The real reason is
entirely different. In fact, they do not want to oppose the anti-worker policies of govt. and
management in order to get certain concessions and support from management. Of course,
this game plan will be defeated by workers. But for that to succeed, sustained and
concentrated effort on our part is necessary.
Wage Negotiation
Without going in to details, certain important points on this issue are given below.
The periodicity of wage agreements in PSUs was 5 years till the Mohan Committee Report
(I Pay Revision Committee -1997) which recommended a ten year period. So this time,
except in Coal Industry, where the workers, through continuous struggles compelled the
management for 5 years agreement both in 2002 and 2007, all other PSUs are having an
agreement for 10 years. Committee of Public Sector Trade Unions (CPSTU) called for one
day strike on 7th May, 2008 on the demand for restoring 5 years periodicity and other
demands on wage revision. The Prime Minister called the union leaders, heard them and
assured that the wage revision can go from 10 years to 5 years. DPE also issued guidelines
for the same. As such, Rao Committee (II Pay Revision Committee for executives- 2007)
did not specify any periodicity. The workers will get.two wage revisions in 10 years, if 5
years periodicity is agreed. Pension also will be revised.
The propaganda by management and NFTE-FNTO alliance is that in the 5 years periodicity,
workers will not get full fitment benefit. We are not going to make any agreement with less
than full fitment benefit, considering the special situation of BSNL. Our task is to convince
the workers about the benefits of 5 years agreement and expose the pro-management
unions.
Joint Forum
BSNLEU took the initiative in forming the Joint Forum of BSNL Associations / Unions &
Executives and Non-Executives and organized many struggles for improvement of BSNL
and its services. It also organized struggles on the common demands of BSNL Workers like
Pension and IDA merger. Com. V.A.N Namboodiri, General Secretary, BSNLEU .continues
to be the Convener of Joint Forum.
BSNL Employees Union always stood for a Better Service to the Nation. It regularly
discusses the issue with the management. Works Committees were formed at SSA levels at
the insistence of BSNLEU for joint discussion on the development, expansion and service.
Organizational Tasks
BSNL Employees Union is the biggest union in BSNL with about 1,35,000 members. From
60,000 in 2001 it has grown to this position despite the fact that more than 10,000
employees are retiring every year and there is almost no recruitment. This growth of
membership itself is a great success, which no other union could achieve so far. In the first
verification we were in majority in only 13 circles but now except in eight circles BSNLEU is
in majority. Our target to be number one in all circles could not succeed due to various
reasons. However, we have advanced in almost all circles.
As already stated, in the formation conference at Visakhapatnam in 2001, the resolution on
organization stated that "BSNL Employees Union stands for the workers cause, democratic
functioning and will be part of the main stream of working class".
In the report adopted in the All India Conference of BSNLEU at Lucknow in June 2003, we
underlined the need for democratic functioning and streamlining the organization to enable
it to fulfill the expected tasks.
With regard to democratic functioning it stated:
"13.10 The democratic functioning of the organization is a must for its growth and strength.
In many places the decision making is being done by a few leaders. This is not fair.
Collective decision making should be done after discussion at the appropriate body.
13.11 The members should be given the right to place their views on the functioning of the
leaders and that of the organization. Hence, conducting of branch general body
meetings is a must. At present except in some areas, conducting of general body
meetings is not taking place at all. Position cannot remain like this. Regular general
body meetings should take place and District and Circle Secretaries should ensure
this. Similarly, Districts and Circle Executive Committees should meet periodically,
for ensuring effective functioning. CHQ also wishes to point out that this is not
happening at present and the position should improve."
With regard to streamlining the organization the report stated:
13.12 The functioning of the organization has got to be toned up. The days to come are
going to be very difficult and the organization should be strong and vibrant enough to
face any situation. All calls given by the All India Union should be diligently carried
out by the Circle, District and Branch levels. It is the duty of the Circle Secretaries to
ensure that the All India calls are successfully implemented in their respective
circles. Written reports should also be sent to the CHQ in time, about the
implementation of the calls. In the case of strike calls, it is imperative on the part of
the Circle unions to hold the Circle Executive Committee Meetings well in advance
and meticulously plan the implementation of the call.
13.13 Grievances of the members should be represented to the management in time. If
required, our Branch, District and Circle unions should resort to local agitations such
as demonstrations, dharna, fast etc. to ensure timely settlement of the issues. The
guidance of the higher bodies shall also be sought in such cases. The CHQ is
always willing to help for the settlement of Circle level issues. At the same time, the
tendency of making over the cases to CHQ, without seriously trying for it's settlement
at the lower levels, is not correct.
13.14 Now everyone writes to the CHQ seeking its help to settle problems. This is also a
wrong tendency. It will be better if the cases are referred to the CHQ, through the
Circle union. This will avoid duplication and complications.
13.15 The Circle, District and Branch unions should relentlessly propagate the policies and
achievements of our union. Top priority should be given for the matters connected
with our fight against disinvestment and privatization. Posters and leaflets should be
printed and taken to the masses whenever necessary. Our branch unions should
utilize our notice boards effectively. Daily information connected with our union
activities, general information connected with working class movement etc. should
be displayed on the notice boards."
These stipulations are fully relevant today.
In the Policy & Programme Resolution adopted in Guwahati conference, January, 2006, we
stated:
"This conference decides to broaden the strength of the Joint Committee of the
Unions in the Public Sector Units which is unavoidable to protect the interest of the
employees of the PSUs as a whole and at the same time fighting out the faulty anti
people, anti nation policies pursued by the government, BSNLEU pledges to play a
pivotal role in organizing the Joint Trade Union ' Actions of the CPSTU. Better
service to the nation, satisfactory service to the people and settlement of
issues of workers. This must be the motto of the BSNL Employees."
In all the conferences and programmes, maximum focus is given for our fight against
disinvestment, privatization, FDI increase etc.
The Guwahati Conference adopted another resolution on the need to organize the
increasing number of Casual and Contract Workers, in order to improve their
working conditions and wages.
"This 3rd All India Conference of BSNL Employees Union notes with grave concern
that all over India in different Telecom Circles, thousands and thousands of contract
labours are working for years together and number of such workers are increasing
day by day. These labourers are most unorganized and as such highly exploited
section of workers though they are engaged in an organized, strategically and
technically important industry like telecom. This Conference feels that such a huge
work force cannot be allowed to remain unorganized and BSNL Employees Union,
will have to take lead to organize them as it is in a better position to understand their
problems and to take suitable measure to redress those."
The conference therefore decided helping in formation of an "All India Federation of
BSNL Casual & Contract Workers."
During the last 8 years of its existence, BSNL Employees Union had tried to advance
in the right direction. In this context, what are our immediate and long term tasks?
Some of the .important tasks on which maximum attention have to be given are
given below:
1. The union has to arouse the consciousness of the workers, including that of the
backward sections so that it will become a mighty force not only to settle their own
economic demands but also to be part of the main working class movement fighting
against the anti-worker policies of the government especially in this era when the
neo-liberalization programmes are forcibly being implemented.
2. The policies of liberalization and structural adjustment programmes are imposing the
following burdens on the common people and workers especially in the developing
countries like India.
o Disinvestment, Privatisation of PSUs and public assets
o Drastic reduction in workforce and retrenchment through VRS etc.,
o Closure of sick units including sick PSUs.
o Free entry of MNCs through FDI etc.
o Curtailment of Social Security benefits and existing amenities.
o Attack on TU and democratic rights.
o Amendment to labour laws giving free hand to employers
etc.
The Trade union movement has to unite the entire working class to fight against
these attacks and onslaughts. The programmes organized by the Platform of Mass
Organisations, Sponsoring Committee of Trade Unions, CPSTU etc. against the
above attacks should not only be supported but should also be implemented
effectively and with massive participation of maximum number of workers.
3. The struggle cannot be limited in one sector alone. It requires concerted and joint
movements of the working class as a whole. The information regarding struggle in
one sector or in one PSD should be given wide publicity and supported.
4. The working class has also to fight against reactionary and communal forces which
divide the workers and disrupt the working class movement. The conspiracy of these
forces should be thoroughly exposed and defeated with the full participation of
workers.
5. The union work should extend to the social life of workers outside office / factory like
cultural activities, education, health, accommodation and other social activities. This
is very important. The connection should not be limited to the worker alone, but
should reach to each and every member of the family.
6. Intensify ideological work to improve consciousness of workers to develop the
activities and preparing them for bigger struggles. Due to the influence of the
reactionary and revisionist leaderships and their continued propaganda, a negative
trade union look out is being gradually developed making the workers slaves to
economic demands. This should be changed in to trade union consciousness with
sustained propaganda and trade union classes.
7. The experience of the past struggles, failures & achievements should be studied and
explained in order to plan our future work. Both the Central Government employees
as also the public sector trade union movement have gone through historic struggles
which will inspire the workers.
8. The vacillations among the workers, resulting out of the massive vile propaganda
unleashed by the employers, media and govt. should be removed through
continuous effective propaganda and personal contact. Interaction, pamphlets,
notices, journals, meetings etc. can be successfully utilized for this purpose.
9. Even while working in united and joint movements, our independent activities should
continue. To keep up your identity as also develop your cadres this is necessary.
10. Organising Casual & Contract Workers is a very important task the union has to
undertake. These workers are maximum exploited by the management and the
contractors. They do implement neither the social security measures nor the relevant
labour laws. It is the responsibility of our union functionaries to help the casual
contract workers in organizing their union and achieving their rights.
11. Organising women workers and their participation at leadership level are being
neglected. Women workers constitute about more than 25% of our workforce as also
membership. The problems of women employees must be given due importance. It
is utmost necessary for the health of the organization itself that the women workers
are well organized and they are in the leadership at all levels. It is only with
conscious effort that this can be achieved.
12. The number of pensioners is increasing. In BSNL, more than 10,000 to 12,000
workers are retiring every year. BSNL Pensioners have their special problems, in
addition to that of Central Govt. pensioners. A separate organization for them is
necessary. We should take initiative for the same and help in organizing pensioners
and their struggles.
13. Democratic functioning is most important. The point has already been elaborated
earlier.
Some of the main tasks before us are mentioned above. These should be discussed,
enriched, complemented and implemented effectively, so that BSNL Employees Union can
advance and while settling the issues of workers can take its correct position in the TU
movement and society.
************
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GLOBLEeconomicCrisis

www.bsnlnewsbyashokhindocha.blogspot.com M-9426201999
GLOBAL ECONOMIC CRISIS
AND ITS IMPACT ON THE
PEOPLE OF INDIA
M.K. Pandhe, President, CITU
Published by:
BSNL EMPLOYEES UNION
CHQ, Dada Ghosh Bhawan, 2151/1, New Patel Nagar,
Opp. ShadipurBus Depot, New Delhi-110 008 Email:
chqbsnleu@sify.com, Website: www.bsnleuchq.com
GLOBAL ECONOMIC CRISISAND ITS
IMPACT ON THE PEOPLE OF INDIA
(Presented in BSNL Trade Union class at
Thiruvananthapuram on 6th July, 2009)
Crisis in the Capitalist System
The whole capitalist system all over the world is in the grip of severe economic
crisis, the bottom of which is yet to be seen by the people. It commenced in the
middle of September, 2008 in the richest capitalist country - USA! The entire
world was shocked to hear the news that one of the topmost U.S. investment bank
in U.S.A. Lehman Brothers declared bankruptcy and openly pleaded inability to
pay money to the depositors. The bank had accumulated huge doubtful assets
which could not be recovered. It indulged in reckless housing mortgages without
assessing the capability of the debtors to repay the loans. The Bush administration
had to pump, huge amount to save the bank. The crisis created by irresponsible
behaviour of the bankers was to be resolved by using the poor and middle level tax
payers' money.
This was only the beginning. Big names in the financial circles in the world such
as Merrill Lynch, Morgan Stanley and Goldman Sacks had also followed suit and
Government of U.S.A. could save them by merging them and taking over their
doubtful assets. These banks had to give up their character as investment banks and
function as ordinary commercial banks. Another investment bank Bear Streams
reached the verge of bankruptcy and had to be saved by its merger with JP Morgan
Chase Bank. Before people could realize the gravity of the situation, the crisis
spread like wild fire affecting several banking and financial institutions. Many
found it difficult to believe when the largest insurance company in the world,
American Investment Group (AIG), faced bankruptcy and could be saved only
when U.S. Government had to shell out $150 billion to save it from liquidation.
Fannie Mac and Freddie Mac, leading investment companies faced total collapse
which could be saved only by nationalisation by the U.S. Government. Washington
Mutual and Wanchovia had to be taken over by the U.S. Government without
which they could not have been saved.
These sudden developments naturally resulted in panic all over U.S.A. and U.S.
Presidential candidate Barrack Obama had to say that crisis in Wall street had
become a crisis in all the streets. The champions of globalisation and free market
economy had no explanation to the people why such a crisis occurred in U.S.
economy. When Socialist system in Soviet Union and Eastern European countries
was dismantled, the capitalist economists started singing virtues of capitalist
system as the highest stage of human development. One economist had the
temerity to give title for his book "The End of History" to explain how Socialism
has failed which proved the superiority of the free market economy. Some
economists tried to explain that it was greed of some individual businessmen
which brought the collapse of the economic framework.
To understand the background of the crisis we must see the reckless policies
pursued by Bush administration. Public debt of U.S.A. doubled during the Bush
rule reaching a figure of $10.3 trillion. His reckless and unjust war in Iraq cost U.S.
over one trillion dollars to public exchequer. At the end of his eight year tenure the
bubble of U.S. economy busted. The most powerful capitalist economy which
advocated reduction in budget deficit for the developing countries itself was
indulging in budgetary deficit. The U.S. budget deficit which was $140 billion in
1997 rose to $800 billion in 2006 and exceeded $ one trillion in 2008.
The U.S. citizens were living on borrowed money. The average expenditure of a
U.S. citizen was estimated to be 60 per cent
more than the average income.
Utter Failure of Market Economy
The global financial crisis exposed the utter failure of the market economy
advocated by the World Bank, IMF and the WTO. The concept that the
Government should not play any role in economic matters indicated privatisation
of all economic undertakings at throw away prices. Moreover it visualised that the
market should be left to decide all matters relating to economy without any
regulation of the Government. It resulted in reckless business practices to make
quick money, high salaries and bonuses to Chief Executives of undertakings
without any restrictions from the Government and creation oMhe phenomenon of
subprime loan without ensuring that the indebted persons can repay the loans.
U.S.A. witnessed huge crisis of housing mortgages wherein the persons failed the
repay the loan creating toxic assets for the financial institutions.
The phenomenon of concentration of capital gave rise to the growth of monopolies
to control the global market. The cut throat competition among the leading Multi
National Corporations to increase the market share gave rise to several
malpractices among the big capitalists with tacit support from the capitalist
Governments. Several bureaucrats of the Government were also involved in the
process of quick money making. A bubble economy was created, and as several
economists warned earlier, the bubble was bound to burst one day and it actually
took place in September, 2008.
Paul Krugman, the Nobel Prize winning economist of U.S., who warned about the
crisis earlier stated, "Now the housing bubble has burst in turn leaving the financial
landscape strewn with wreckage. Even if the ongoing efforts to rescue the banking
system and unfreeze the credit markets work - and while it is, early days. Yet, the
initial results have been disappointing - it is hard to see housing making a
comeback any time soon. And if there is another buddle waiting to happen, it is not
obvious (New York Times News Service).
Similar statements have been made by several economists in U.S.A. There is
complete unanimity now among all the economists that the crisis is going to be a
long drawn one. However few realised that the crisis is shaking the very
foundation of capitalism itself.
Impact on the Capitalist World
The globalisation has strengthened the trend of internationalisation of finance
capital. For instance, several mining companies in U.S. are in control of foreign
financial companies while U.S. financial agencies are controlling several industrial
units in foreign countries. The finance capital showed a trend of going from one
country to another depending on a higher profit margin. Finance capitalist
increasingly gave emphasis on speculative share market transactions.
The economy in European countries were already facing acute recession during
2008. The second, third and fourth quarters of 2008 showed a decline in growth of
gross domestic product. The projected fall of GDP in European countries is
estimated at 0.4 per cent.
The decline in production also was seen in Japan in the year 2008 while the
projections for the year 2009 show further decline. The trend in other advanced
capitalist countries also showed the same picture.
The volatile prices of oil in the world showed clearly how by creating artificial
scarcity the oil cartels have been minting money. The oil price per barrel shot up
more than twice during 2008 but then drastically came down to $40 per barrel in
2009, when the global meltdown became a reality. However, the retail oil price
was still high in the market. In India for example, the price was brought down only
by Rs. two per liter.
The bailout packages prepared by several advanced countries included partial or
full nationalisation of banks or other financial institutions, taking over toxic assets
of financial institutions. Those who were advocating privatisation of banks and
financial institutions had to advocate taking over these institutions by the
Government as a means to save those companies. The total bailout packages all
over the world are estimated to be above $2 trillion.
To overcome the effect to economic meltdown most of the capitalist countries have
imposed job cuts on the working class. Over and above, the imposition of
deteriorating working conditions on the workers and even wage cuts have been
resorted to by the Governments of capitalist countries.
Several restrictions and even ban on migrant workers in advanced capitalist
countries were resorted to in a big way. The Obama administration imposed
restrictive taxes on companies who outsourced their jobs outside the country or
engage foreign labourers. Drastic action is being planned against illegal migrant
labour with a view to throw them out of the country.
In the name of taking protectionist measures, U.S. and other countries are
advocating purchase of their domestic products to reduce dependence on imports.
These measures will adversely affect the developing countries whose exports-will
be drastically cut!
The G-20 meeting of major heads of the State in London on 1st and 2nd April, 2009
could not come to definite conclusion to meet the global crisis. France and German
Governments opposed U.S. proposals while developing countries representatives
criticised the protectionist trends in advanced capitalist countries. The bailout
package of over $ one trillion visualised helped the capitalists to help their liquidity
problem. The financial assistance planned for developing countries is not likely to
materialise. The bailout packages do not give any relief to the workers who lost
their jobs due to economic melt down. It did not even accept the proposals given
by Prof. Joseph Stiglitz Commission to face the economic crisis and to come out of
it. Though the G-20 countries were representing overwhelming majority of the
world population, it failed to tackle the problems of the developing counters. D ue
to controversies among different countries, a patch up declaration was drafted.
Only some of speeches in the meeting indicated that the crisis is likely to be a long
drawn one whose bottom had not get been reached.
The massive demonstrations organised prior to the G-20 meeting and during the
meeting reflected the anger prevailing among the people all over the world. The
WFTU also gave a call to organise demonstrations in all the countries to oppose
the policies of globalization and capitalist meltdown. These demonstrations reflect
the growing discontent prevailing among the people in the world against the
policies of globalisation and neo-liberalisation.
Pointing out the drawbacks of measures taken by leading capitalist countries to
overcome the crisis, Fidel Castro noted, "these measures will bring more inflation,
more devaluation of the national currencies, more unequal exchange". He further
observed that the crisis would bring more knowledge of the truth of the capitalist
system, more consciousness among the workers, more rebellions and more
revolutions (Gramma'-JournalofCuba).
No worthnoting Impact in Socialist Countries
While the entire capitalist world was engulfed in a deep crisis, the impact on the
socialist countries was minimal.
The economy of China was affected to the extent it had exports to advanced
capitalist countries. As is known, China has surplus balance of trade in major
capitalist countries including U.S.A. Due to fall in exports to these countries due
the capitalist global downturn Chinese economy had to find a way to increase
domestic consumption and avert the crisis.
Chinese Government prepared a package of 4 trillion Yuan ($586 billion)
providing creation of new jobs, improving wage level of low paid workers. The
basic thrust of the Chinese policy makers was to improve the living standard of the
people which would absorb the additional production generated due to expansion
of industrial and agricultural output. Though in some quarter the rate of growth of
Chinese economy declined during 2008 the overall growth target of 8 per cent was
fulfilled by the Chinese economy. Even the Western economists have admitted this
achievement by the Chinese socialist society.
The Vietnam faced certain problem due to decline in exports but the Govt. took the
step of increasing domestic consumption and maintains the growth rate.
The economy of Cuba and North Korea had not many relations with advanced
capitalist countries and therefore did not face the impact of the global slowdown.
Setback to Unipolar World
The present global financial crisis has hit the influence of U.S. in the world and it
has shattered the dream of U.S. imperialists to dominate the world economy. The
hegemonistic policies adopted by the U.S. Government with a view to create a
unipolar world received a big jolt and possibilities of emerging a multipolar world
have become powerful. The aggressive position taken by U.S. imperialists to
expand NATO and establish U.S. missile defence system in Europe is being
resolutely opposed by Russia. Latin American countries have opposed U.S.
dominating designs and expressed solidarity with Cuba. The emergence of
Shanghai Club for developing strategic alliance between Russia, Central Asian
Republics, China and others have resulted in emergence of a new power centre.
The growing opposition to U.S. policies all over the world including West Asia
have undermined U.S. role in the world.
The global financial crisis has further aggravated the world situation against U.S.
imperialism and U.S. model of capitalism is no more acceptable to many capitalist
countries. The opposition to U.S. policies in G-20 meeting in London by French
and German Governments has highlighted this phenomenon.
The set back received by the concept of unipolar world has no doubt strengthened
the anti-imperialist forces all over the world. The emergence of multipolar world
with collapse of U.S's hegemonistic role is a welcome development which has been
buttressed by the global capitalist meltdown.
Bail out package for whom?
The UFA Government first claimed that the fundamentals of Indian economy were
strong and the global financial crisis would not adversely affect it. Former Finance
Minister P. Chidambaram had repeatedly assured the Indian people that Indian
economy is insulated from the global financial crisis. However, the impact soon
began to be felt by the Indian economy when export started falling and Indian units
were forced to cut their production.
The Reserve Bank of India was first to announce the bailout package by reducing
restriction on banks to give loans to needy corporate sector. Pressure was brought
on Indian banks to reduce rate of interest so that more credit was available to the
corporate sector. More concessions were given to housing loans which actually
helped the builders lobby.
Despite these concessions the production did not increase since these measures
failed to increase the purchasing power of the people. Many Corporate houses
utilised the cheaper credits to repay their costlier loans.
The UPA Government announced tax cuts and reduction in excise duty on some
items. However, the employers did not pass on the concession to the consumers
which failed to boost the market. Despite giving liberal concessions to export
industries, the exports did not pick up but export houses tried to misutilise the
concessions.
The UPA Government did not take any measures to restore the import restrictions
which were withdrawn due to WTO conditionalities. Foreign goods continue to
enter Indian market freely adversely affecting the Indian commodities.
The stimulus package offered by the Government of India failed to overcome the
crisis but only added to the coffers of the Super rich. The 2008-09 budget of UPA
Government only added to the sops for the capitalists to enable them to garner
higher profits. The UPAGovernment miserably failed to protect the large number
of workers who lost jobs as a result of meltdown of the economy. The survey
conducted by the Union Labour Ministry found that five lakh workers lost their
jobs due to global financial crisis but no relief was given to the workers. Only ESI
Corporation announced some allowance fora period of one year which did not give
any benefits to most of the workers because their units were not covered by the ESI
Act.
The net result of the UPA Government's policy was that the capitalist class was
trying to put on the burden of the crisis on the shoulders of the working class and
the toiling people. The budgetary losses due to liberal concessions given to the
capitalist class were recovered by imposing tax burden on the common people.
The capitalist class which was responsible for the crisis was given relief to come
out of the crisis while the working class and the toiling people who were not at all
responsible for the crisis had to pay the cost for overcoming the crisis.
To maintain profitability of the capitalists, hours of work for the workers were
increased. A large number of units were working for 12 hours a day without paying
any overtime wages to the workers. Several units illegally announced wage cut for
the workers while some declared lay-off without taking statutory permission from
the Government of India and without paying wages to the workers. Illegal closure
of units became the order of the day. Despite labour laws were being violated
openly by the employers, the Union Labour Ministry connived at the steps taken
by the management in the name effacing the economic meltdown. In the Indian
Labour Conference held in February, 2009 all the central trade unions criticized the
policy of the UPA Government and demanded full implementation of the Labour
Laws and introduction of the employment insurance scheme but these appeals fell
on deaf years.
Role of Left and Trade Unions
The role played by the Left parties and the trade union movement in opposing the
UPA Government's policies of neo-liberalisation and privatization compelled the
Govt. to go slow on their programme of economic reforms. The Left parties
prevented UPA Govt. from disinvesting profit making public sector undertakings.
They did not allow Bill to privatize the Pension Scheme to be passed, they
prevented putting PF money of workers in share market, they prevented increasing
FDI in banking and insurance companies they prevented entry of FDI in retail trade
they did not allow UPA Govt. to handover Indian banks to MNCS etc.
These measures of the left parties prevented the global crisis from having wider
effect on the Indian economy. The. former Governor of Reserve Bank of India had
to admit that the global crisis did not affect the Indian banking industry since they
were in the public sector. Despite collapse of AIG, the largest insurance company
in the world became bankrupt, but LIC and GIG remained unaffected since they
were in public sector. The PF money and Pension funds of workers remained safe
since they were not privatized and not entered the share market in a big way as
visualized by the UPA Government.
Trade Union movement organized 3 nationwide strikes during UPA regime to
oppose the policies of globalization. It compelled the UPA Govt. to slowdown
their reform agenda which saved the country to some extent. The working class
and the people of India should note the positive role played by the left parties in
not allowing UPA Government to pursue neo-liberal policies recklessly.
Scandalous Participatory Notes
Despite the demand by the left parties to ban the operation of participatory notes in
the share market operations, the Ministry of Finance continue their role in the share
market manipulations. With the global financial crisis looming large the Govt. of
India did not take steps against the depredations of participatory notes but
withdrew certain restrictions imposed on these notes earlier by the Government of
India itself.
Participatory notes are defined as "Financial instruments used by investors or
hedge funds are not registered with the Securities and Exchange Board of India to
invest in Indian Securities".
Many persons do not know what is hedge fund. According to its definition it is "an
investment company that is organized as a limited partnership and uses high-risk
techniques in the hope of making large profit". It thus indulges in speculative
activity and plays an important role in manipulations in the share market
operations.
The participatory notes have become a device to make black money white or to
permit Havala money freely in share market. The Foreign institutional investors
who operate in Indian share market are also utilizingjhese notes for making quick
money and indulging in clandestine deals. According to an article published in
Hindu Business Line estimated that outstanding participatory notes account for
over 51 per cent of foreign money in India. It further states that Foreign
Institutional Investors control most of the floating stocks in the Indian share
market. According to an estimate the participatory notes increased from 2004 to
2007 by 11 times which shows the seriousness of their problem.
Business Line reports, "There have been estimates that show FIIS including
participatory notes holders, owning around 15-20 per cent of stock of the top 1000
companies in the bourses.
Now consider the promoters; they own over 50 per cent but those shares rarely
ever come to the market. The means that the FIIS have had a near ruling of the
market. In effect, they control the market because they not only own a chunk of
floating shares, they are also the most active".
Women - The Worst Sufferers
The global economic meltdown has affected the women most severely. The recent
ILO publication "Economic Meltdown Has a Woman's Face" has noted that 14
crore mothers in the Asian Pacific region's developing countries would be forced
into extreme poverty.
The ILO Report further points out, "For policy makers, failure to take into account
this gender dimension, especially at the lower end of the socio-economic scale
could be a critical miscalculation, worsening the working and living conditions of
millions, deepening economic and social inequalities and wiping out of a
generation of hard-won gains in pay inequality and workplace inequality. The
report continues "Shrinking global demand for clothes, textile and electronics as
well as for related business services use hotels, and restaurants means that women
will be the first to lose their jobs".
The capitalist society is trying to use women as a cheap source of labour. In a
period of global meltdown the capitalist class had been increasing their hours of
work and lowering their earning and thus making them cheaper. The conditions of
Anganwadi, ASHA and mid-day meal workers is a clear example of this. The
conditions of women workers in Bidi and Plantation industry had further been
deteriorated invoking them to adopt a path of struggle.
Satyam Swindle
The harrowing swindle by the management of Satyam Computer Services, the
fourth largest IT sector company of India has highlighted how the corporate
undertakings are minting money by resorting several illegal practices at the
connivance of the state administration. The Raju family having close contacts with
Chief Minister of Andhra Pradesh have been blatantly making a mockery of
corporate governance.
The amount of swindle is estimated by some researchers works out to Rs.8000
crores. The dubious $1.6 billion deal to take over Matyas firm owned by one of the
promoters came to the forefront which exposed the greedy promoters who
accumulate ill-gotten wealth at the cost of vital interests of the company. The
shocking news had come that the company had over 13,000 fictitious employees
whose salary was paid by cheques. This involves the co-operation of the banks in
siphoning of the funds to Raju regularly by manipulating banking accounts. In this
case one of the auditors Price water Coopers role in helping the company to
prepare fictitious balance sheet and hide the misdeeds of Raju family has been of
crucial importance. The manipulations in the share market operation by the
company has also shocked the country.
Though the Government of India intervened and the company was taken over by
Mahindra, the bungling that is going on in the corporate sector is yet to be fully
brought to light. It is a clear' case of a capitalist management taking full advantage
of a deregulated free market economy with full patronage of the state
administration. The CBI has opposed release of Raju brothers on the ground that
they were influential persons and may destroy the evidence!
There are several such Satyams who are yet to be exposed. The length to which the
degenerated capitalism can go is exposed in this case but defenders of capitalist
system are trying to cover up such instances at the cost of genuine development of
national economy.
Swiss Bank Fraud
When India is suffering from the impact of global meltdown, reports had been
published of Indian Super rich depositing billions of dollars in secret Swiss Bank
accounts. Press reports estimate vary from Rs.40 lakh to 70 lakh crores of rupees
of such deposits!
This illegal money is the outcome of tax evasion, kickbacks received secretly while
signing collaboration agreements with foreign companies, havala transactions or
garnering of black money, commission demanded by Ministers, bureaucrats or
intermediaries of foreign companies have also been responsible for such secret
accounts. Before gun scam highlighted how the money goes to Swiss Banks as a
result of secret deal which is yet to be fully revealed to the Indian public.
Recently, UBS the largest Swiss Bank agreed to provide information to the U.S.
Government about secret accounts of American citizens. The U.K. Government
has also followed suit. However, despite demand of the left parties, the UPA
Government has not demanded such details about Indian citizens holding such
secret accounts in Swiss Bank. The lack of keenness by the Government of India
has been noted by Swiss newspapers.
The money deposited in such secret accounts is actually Indian assets illegally
flushed in Swiss Banks for money laundering or using it for wrong purposes. The
Government must confiscate these huge resources and use them for improving the
standard of living of the Indian people. Several Ministers and bureaucrats as well
as Industrial houses may be holding such secret accounts but the UPAGovt. is
protecting these elements for their ulterior objective.
The policy of over reliance on foreign capital by the NDA and UPA Governments
has increased the inflow of foreign in India since the commencement of the present
century. In the year 2001-02 the total inflow stood at $8.2 billion which increased
to $15.7 billion in 2003-04. It rose further to $21.4 billion in 2005-06 while in
2006-07 it jumped to $29.8 billion and further to $63.8 billion in 2007-08. A
sizable portion of this inflow was in the share market and speculative activities.
However, after the global financial crisis foreign capital started withdrawing from
India which drastically brought down the share market index. It also brought down
retail credit flow in the country. As pointed out by a well known economist Prof.
C.P. Chandrashekhar, "..the credit stringency generated by the exodus of capital
from the country and the uncertainties generated by the threat of default of retail
loans that now constitute a high proportion of total advances could freeze up retail
credit and curtail demand as in happening in the developed industrial countries!!"
Adverse Impact on Informal Sector
The National Commission for Enterprises in the Unorganized Sector in their
memorandum to the Govt. of India on the Global Economic Crisis and the informal
Economy in India on 26th November 2008 has noted, "It is critical for our country
to pay focused attention to protect, at the least, the livelihood security, employment
and income of the vast majority of the people who are either poor or vulnerable
and so doing stimulate overall economic growth". The size of such people is
estimated by the Commission at 88 crore! The Commission earlier estimated that
77 per cent of Indian population in the unorganized sector live with an average per
capita daily consumption below Rs.20 per day. It now observes, "However, during
the current slow down, it is precisely these people, the poor and vulnerable
engaged in informal sector enterprises or formally employed by the formal sector,
who will be affected the most adversely."
The Commission studied at length the impact of the crisis in the following manner.
1. Forty five per cent of the employment in the organized sector is without any
job security. In a period of crisis this strata is the first to lose jobs.
2. Thirty percent of Indian exports are contributed by small producers with
declining exports due to melt down sectors as handlooms, textiles, wearing
apparel, leather products, gems and jewellary, meal products, carpets, spices
and marine products are adversely affected. In March 2009 alone 70
diamond cutting workers in Gujarat committed suicide. The total loss of
jobs in the last six months is estimated at 15 lakhs.
3. Due to so called credit crunch the banks and financial institutions are
refusing to give credit to the small industry which is facing closure and
sickness.
4. Due to slow down in the organized sector the ancillary units who supply
components to the larger units are starving for orders. The competition from
big manufacturers also is adding to the critical conditions of such small and
traditional units.
5. With steep price rise of essential commodities and absence of rise in their
income levels the vendors, workers in small units and marginal farmers are
experiencing drastic curtailment in their living standards leading to
starvation.
6. Due to fall in international prices cheaper imports of several commodities
such as cotton, oilseeds are putting strain on Indian producers. The failure of
the Govt. to protect such sectors from cheaper imports is making them more
vulnerable. The withdrawal of quantitative restrictions on import of several
commodities have opened floodgates of imports of several commodities
which are produced in India in sufficient quantity.
As the Commission noted, "The combined impact of all the above effects on the
informal economy would be an increase in livelihood insecurity, decline in income
and an intensification in the conditions of poverty and vulnerability. The worst
affected segment of India's poor and vulnerable would be the casual laborers of
whom the poorest segment is constituted by the agricultural workers."
The commission has not dwelt with the plight of the migrant workers due to this
meltdown, who are among the worst sufferers in a period of crisis.
The left parties and the trade union movement demanded several measures to help
the worst affected persons so that they can face the crisis and maintain their
standard of living. The following are some of the urgent measures.
The Government of India must take steps to generate demand in the economy. For
this purpose through public expenditure infra-structural projects can be undertaken
which would generate jobs and create more demand in the economy.
The National Common Minimum Programme visualized employment guarantee
scheme for urban, rural and poor middle class sections of the society. Every family
was to be guaranteed 100 days job for one person in every family. However, the
programme was implemented only for rural areas and only a small segment was
covered. It was controlled by bureaucrats who indulged in corrupt practices
preventing genuine benefit to the needy people. The central trade unions demanded
that the scheme should coverall urban areas and a minimum of 180 days job as
proposed by ILO should be provided. Action should be taken against corrupt
officials and the scheme should be implemented in its true spirit.
The minimum wages of all informal sector workers should be increased at least by
20 per cent to increase their purchasing power so that they would be able to
consume more to maintain a proper standard of living. This would also boost the
demand for goods in the society and would result in reducing the extent of
economic meltdown.
Several lakhs of people are forced to do the work of Hawking and Vendoring to
make both ends meet. They do not get adequate earning to meet the essential
requirements of their families and are living an existence below the poverty line.
They do not get adequate facilitates of micro-finance from the financial
institutions. If the Govt. arranges financial assistance to them their conditions will
improve and this process will lead to increase in the domestic demand. Though
these persons are grouped as self-employed they are forced to adopt this
occupation due to non-availability of work as a wage labourer.
The marginal and small farmers are also facing the brunt of the crisis since they are
unable to get a proper price for their products. The procurement price fixed by the
Govt. is low and uneconomic for them. Moreover, the forward trading permitted by
the Government to purchase their products in advance at low prices by the
unscrupulous traders. The demand by the left parties and central trade unions to
ban the forward trading in essential commodities has not been accepted by the
Government of India with the result that this exploitative practice continues
unabated.
The small and tiny sector of our industry gets less than 2 per cent of the total credit
available to the industrial sector as most of the credit is appropriated by the big
capitalists in the country. The democratic movement in the country must prevail
upon the Govt. to give credit to the small and tiny sector at concessional rate and
the share of credit to them must increase sizably. They require facilities of
marketing their product which the Govt. must give through a net work of sales
organization.
The Government of India has not investing much in granting social security to a
large section of our vulnerable population. The Human development of India is
extremely poor while the gains of economic development have been pocketed by
the affluent section of the society. Forty eight rich persons in India have income of
over Rs.5000 crores per annum who control one fourth of the total national income
of India while three fourth of our population are unable to get two square meals a
day. In Human Development, India ranks 128 among the 177 countries studied by
UNDP in 2007. Three years earlier India ranked 123 which shows that in human
development there is severe deterioration. Under these circumstances, the
Government of India must invest substantially in granting social security benefits
to the vast deprived sections of the society. This improvement in their living
conditions will increase the demand in the economy and which act as a real
stimulus to the industry in the country.
Struggle for Revolutionary Social Transformation
The global crisis of capitalism has raised to the forefront the basic issue that
capitalism cannot solve a single issue faced by humanity in the world. The bail out
package is only an attempt to save capitalism and profits of capitalists.
However, ideologically the working class all over the world does not fully
understand the real game of global capitalism. A large section of the working class
is still having illusion about the capitalist system who think that they would get
justice within the capitalist framework. The class collaborating leaders by the trade
union movement are hoodwinking the workers that the capitalist system can be
reformed and working class interests can be duly protected within the framework
of capitalist system. Though the working class is realizing the true nature of
capitalism the process needs to be made faster.
One must note that growing interest is taken all over the world to understand what
Karl Marx said about the capitalist system. The leading book stores all over the
world are displaying Marxist classics prominently and the number of readers
buying these books is swelling day by day.
Karl Marx and V. Lenin are no more absolute today. What they predicted about
capitalist system has proved to be correct.
This is an occasion for us to educate the working class about the real nature of
capitalist system and stress the need for transformation of the exploitative system.
Establishment of a Socialist system is the only alternative to capitalist system.
Those who criticized Karl Marx for calling profit as theft by the capitalists are now
compelled to speak about "greed for profit of some CEO's was the cause of the
present global financial crisis."
Ninety two years ago in 1916 while analyzing the role of Finance capital, Lenin
pointed out. "Financial Capital concentrated in a few hands and exercising a virtual
monopoly, extracts enormous and ever increasing profits from floating of
companies, issue of stock, state loans etc, strengthens the domination of Financial
oligarchy and levy tribute upon the whole society for the benefits of monopolists"
(Imperialism: The Highest stage of Capitalism).
Without ideological preparations of the working class, it is not possible to launch
powerful struggles against capitalist system. We must tell the workers that it is not
sufficient to fight against the effects of exploitation. We must ultimately prepare
ourselves to fight against the cause of exploitation itself.
It is, therefore, the duty of people of India to fight against every attempt of the
capitalist class to pass on the burden of the crises on the shoulders of the working
class. At the same time we should also call on the working class to be prepared to
fight against the moribund capitalist system itself which alone ensure
establishment of a world without crisis and exploitation. History has given the
responsibility on the working class of the world to be the "grave diggers" of
capitalism.
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