Workers and peasants have to always bear the burden of capitalist crisis
Shree Renuka Sugars, India’s largest sugar company by turnover, announced the stopping of production at its plant at Haldia in West Bengal, at the end of last month.
Workers and peasants have to always bear the burden of capitalist crisis
Shree Renuka Sugars, India’s largest sugar company by turnover, announced the stopping of production at its plant at Haldia in West Bengal, at the end of last month. It announced that the contracts of 200 contract workers would not be renewed, while the 157 permanent workers would be “relocated” to the company’s plants located in other parts of the country. In other words, while the contract workers have been fired, the “permanent” workers have been given the “option” to quit or take transfer to some far away place.
The Shree Renuka plant at Haldia came into operation in 2007, as a sugar refining plant, dependent on imported raw sugar. The imported – and brown – sugar is refined into white sugar and sold locally and in neighbouring countries such as Bangladesh and Nepal.
The sugar refinery was set up on land acquired from the farmers. The capitalist owners of the company, together with the then government of West Bengal promised that the factory would bring “development” and light into the dark lives of the villagers. The peasants sold their lands to the company in return for a job in the company and some monetary compensation.
Now, with the closure of the plant, the peasant turned worker is left with neither a job, nor land.
This is the direct consequence of the capitalist orientation of the economy that aims at ensuring maximum profits for the Indian and foreign capitalists through savage exploitation of labour, land and natural resources of our workers and peasants.
The Renuka Group set up the Haldia plant, with the aim of using the sugar import-export policy of the government to make maximum profits.
The import policy of the government on sugar is dictated by the interests of maximising the profits of the multinational trading companies involved in the sugar trade, as well as of the sugar mill cooperatives who process sugarcane bought from farmers and produce sugar for the market.
India is the world’s second largest producer of sugar after Brazil, and the largest consumer of sugar. The trading multinationals involved in sugar trade keep a keen eye on the sugar production in the major producing countries. They speculate on government policies as well as dictate these policies. The sugar mill cooperatives too do the same. However, to fool the people, the government makes out that its sugar policy is dictated by the interests of the consumer and of the sugarcane farmer.
There has been a bumper crop of sugar cane this season. The sugar mills in the country are expected to produce around 265 lakh tonnes in 2014-15 as against the domestic demand for around 248 lakh tonnes. Sugar prices are now the lowest in the past three years, falling by around Rs 300 per quintal over four months.
In the past year, the sugar mill cooperatives built up a huge stock of unsold sugar, as a result of which the market price of sugar has come down. Taking advantage of falling price of sugar in Brazil, because of a bumper cane harvest in that country, massive import of sugar was organized, adding to the bumper stock of sugar.
The sugar mill cooperatives are demanding that the government buy their sugar stocks assuring them profits. They are threatening otherwise to not pay the sugar cane farmers their dues of the past season. They are also threatening not to process the sugarcane.
As far as Renuka Mills is concerned, its Haldia unit is based on using the low import duties on sugar, which was 15% last year, to make profits by refining this sugar and exporting it. It is a capitalist company which is making maximum profits on the basis of the trading policy of the government. Now, not only has the import duty increased to 25%, there are reports that the government plans to increase it even further to 40% to prevent further imports. Therefore, in this year, when there is overproduction of cane and sugar in the Indian market, it makes “perfect sense” for this capitalist to shut down its Bengal operations, no matter what the terrible consequences for the workers of the plant.
Renuka sugar mills has sizeable operations in Brazil. Reports indicate that it is taking advantage of the bumper sugar crop in that country and the devaluation of its currency, to make maximum profits, even as it virtually closes down its operations in the Haldia plant, for now.
The tragic fate of the workers of Shree Renuka sugar refining plant at Haldia once again shows what may lie in store for the millions of peasants who are today being made attractive promises and offers, that if they give up their land for industrial projects, then they will get jobs, have more income and their families will have a better life.
The capitalist orientation of our economy, driven by the greed of the capitalists to make maximum profits, can never ensure a secure livelihood for the peasantry. The capitalist system has to be replaced by the rule of the workers and peasants, so that the economy can be reoriented towards fulfilling the needs of the people.