Shall We Leave It to the Experts?
by Arundhati Roy
The Nation magazine, February 18, 2002
India lives in several centuries at the same time. Somehow
we manage to progress and regress simultaneously.
As a nation we age by pushing outward from the middle-adding
a few centuries on either end of the extraordinary CV. We greaten
like the maturing head of a hammerhead shark with eyes looking
in diametrically opposite directions.
I don't mean to put a simplistic value judgment on this peculiar
form of "progress" by suggesting that Modern is Good
and Traditional is Bad-or vice versa. What's hard to reconcile
oneself to, both personally and politically, is the schizophrenic
nature of it. That applies not just to the ancient/modern conundrum
but to the utter illogic of what appears to be the current national
enterprise. In the lane behind my house, every night I walk past
road gangs of emaciated laborers digging a trench to lay fiber-optic
cables to speed up our digital revolution. In the bitter winter
cold, they work by the light of a few candles.
It's as though the people of India have been rounded up and
loaded onto two convoys of trucks (a huge big one and a tiny little
one) that have set off resolutely in opposite directions. The
tiny convoy is on its way to a glittering destination somewhere
near the top of the world. The other convoy just melts into the
darkness and disappears. A cursory survey that tallies the caste,
class and religion of who gets to be on which convoy would make
a good Lazy Person's concise Guide to the History of lndia. For
some of us, life in India is like being suspended between two
of the trucks, one leg in each convoy, and being neatly dismembered
as they move apart, not bodily, but emotionally and intellectually.
Fifty years after independence, India is still struggling
with the legacy of colonialism, still flinching from the "cultural
insult." As citizens we're still caught up in the business
of "disproving" the white world's definition of us.
Intellectually and emotionally, we have just begun to grapple
with communal and caste politics that threaten to tear our society
apart. But meanwhile, something new looms on our horizon. On the
face of it, it's just ordinary, day-to-day business. It lacks
the drama, the large-format, epic magnificence of war or genocide
or famine. It's dull in comparison. It makes bad TV It has to
do with boring things like jobs, money, water supply, electricity,
irrigation. But it also has to do with a process of barbaric dispossession
on a scale that has few parallels in history. You may have guessed
by now that I'm talking about the modern version of globalization.
What is globalization? Who is it for? What is it going to
do to a country like India, in which social inequality has been
institutionalized in the caste system for centuries? A country
in which 700 million people live in rural areas. In which 80 percent
of the landholdings are small farms. In which 300 million people
are illiterate. Is the corporatization and globalization of agriculture,
water supply, electricity and essential commodities going to pull
India out of the stagnant morass of poverty, illiteracy and religious
O and auctioning off of elaborate public sector infrastructure,
developed with public money over the past fifty years, really
the way forward? Is globalization going to close the gap between
the privileged and the underprivileged, between the upper castes
and the lower castes, between the educated and the illiterate?
Or is it going to give those who already have a centuries-old
head start a friendly helping hand?
Is globalization about "eradication of world poverty,"
or is it a mutant variety of colonialism, remote-controlled and
digitally operated? These are huge, contentious questions. The
answers vary depending on whether they come from the villages
and fields of rural India, from the slums and shantytowns of urban
India, from the living rooms of the burgeoning middle class or
from the boardrooms of the big business houses. Today India produces
more milk, more sugar and more food grain than ever before. And
yet, in March 2000, just before President Clinton's visit to India,
the Indian government lifted import restrictions on 1,400 commodities,
including milk, grain, sugar, cotton, tea, coffee and palm oil.
This despite the fact that there was a glut of these products
on the market.
As of April 1-April Fool's Day-2001, according to the terms
of its agreement with the World Trade Organization, the Indian
government had to drop its quantitative import restrictions. The
Indian market is already flooded with cheap imports. Though India
is technically free to export its agricultural produce, in practice
most of it cannot be exported because it doesn't meet the First
World's "environmental standards." (You don't eat bruised
mangoes or bananas with mosquito bites or rice with a few weevils
in it, whereas we don't mind the odd mosquito and the occasional
Developed countries like the United States, whose hugely subsidized
farm industry engages only 2 to 3 percent of its total population,
are using the WTO to pressure countries like India to drop agricultural
subsidies in order to make the market "competitive."
Huge, mechanized corporate enterprises working thousands of acres
of farmland want to compete with impoverished subsistence farmers
who own a couple of acres.
In effect, India's rural economy, which supports 700 million
people, is being garroted. Farmers who produce too much are in
distress, farmers who produce too little are in distress and landless
agricultural laborers are out of work as big estates and farms
lay off their workers. They're all flocking to the cities in search
"Trade Not Aid" is the rallying cry of the head
men of the new Global Village, headquartered in the shining offices
of the WTO. Our British colonizers stepped onto our shores a few
centuries ago disguised as traders. We all remember the East India
Company. This time around, the colonizer doesn't even need a token
white presence in the colonies. The CEOs and their men don't need
to go to the trouble of tramping through the tropics, risking
malaria, diarrhea, sunstroke and an early death. They don't have
to maintain an army or a police force, or worry about insurrections
and mutinies. They can have their colonies and an easy conscience.
"Creating a good investment climate" is the new euphemism
for Third World repression. Besides, the responsibility for implementation
rests with the local administration.
Enron in India
The fishbowl of the drive to privatize power, its truly star
turn, is the story of Enron, the Houston-based natural gas company.
The Enron project was the first private power project in India.
The Power Purchase Agreement between Enron and the Congress Party-ruled
state government of Maharashtra for a 740 megawatt power plant
was signed in 1993. The opposition parties, the Hindu nationalist
Bharatiya Janata Party (BJP) and the Shiv Sena, set up a howl
of swadeshi (nationalist) protest and filed legal proceedings
against Enron and the state government. They alleged malfeasance
and corruption at the highest level. A year later, when state
elections were announced, it was the only campaign issue of the
BJP-Shiv Sena alliance.
In February 1995 this combine won the elections. True to their
word, they "scrapped" the project. In a savage, fiery
statement, the opposition leader L.K. Advani attacked the phenomenon
he called "loot through liberalization." He more or
less directly accused the Congress Party government of having
taken a $13 million bribe from Enron. Enron had made no secret
of the fact that in order to secure the deal, it paid out millions
of dollars to "educate" the politicians and bureaucrats
involved in the deal.
Following annulment of the contract, the US government began
to pressure the Maharashtra government. US Ambassador Frank Wisner
made several statements deploring the cancellation. (Soon after
he completed his term as ambassador, he joined Enron as a director.)
In November 1995 the BJP-Shiv Sena government in Maharashtra announced
a "renegotiation" committee. In May 1996 a minority
federal government headed by the BJP was sworn in at New Delhi.
It lasted for exactly thirteen days and then resigned before facing
a no-confidence vote in Parliament. On its last day in office,
even as the motion of no confidence was in progress, the Cabinet
met for a hurried "lunch" and reratified the national
government's counter-guarantee (which had become void because
of the earlier "canceled" contract with Enron). In August
1996 the government of Maharashtra signed a fresh contract with
Enron on terms that would astound the most hard-boiled cynic.
The impugned contract had involved annual payments to Enron
of $430 million for Phase I of the project (740 megawatts), with
Phase II (1,624 megawatts) being optional. The "renegotiated"
power purchase agreement makes Phase II of the project mandatory
and legally binds the Maharashtra State Electricity Board (MSEB)
to pay Enron the sum of $30 billion! It constitutes the largest
contract ever signed in the history of India.
Indian experts who have studied the project have called it
the most massive fraud in the country's history. The project's
gross profits work out to between $12 billion and $14 billion.
The official return on equity is more than 30 percent. That's
almost double what Indian law and statutes permit in power projects.
In effect, for an 18 percent increase in installed capacity, the
MSEB has to set aside 70 percent of its revenue to pay Enron.
There is, of course, no record of what mathematical formula was
used to "re-educate" the new government. Nor any trace
of how much trickled up or down or sideways or to whom.
But there's more: In one of the most extraordinary decisions
in its not entirely pristine history, in May 1997 the Supreme
Court of India refused to entertain an appeal against Enron.
Today, everything that critics of the project predicted has
come true with an eerie vengeance. The power mat the Enron plant
produces is twice as expensive as its nearest competitor and seven
times as expensive as the cheapest electricity available in Maharashtra.
ln May 2000 the Maharashtra Electricity Regulatory Committee (MERC)
ruled that temporarily, until as long as was absolutely necessary,
no power should be bought from Enron. This was based on a calculation
that it would be cheaper to just pay Enron the mandatory fixed
charges for the maintenance and administration of the plant that
it is contractually obliged to pay than to actually buy any of
its exorbitant power. The fixed charges alone work out to around
$220 million a year for Phase I of the project. Phase II will
be nearly twice the amount.
Two hundred and twenty million dollars a year for the next
twenty years. Meanwhile, industrialists in Maharashtra have begun
to generate their own power at a much cheaper rate, with private
generators. The demand for power from the industrial sector has
begun to decline rapidly. The MSEB, strapped for cash, with Enron
hanging like an albatross around its neck, will now have no choice
but to make private generators illegal. That's the only way that
industrialists can be coerced into buying Enron's exorbitantly
In January 2001 the Maharashtra government (the Congress Party
is back in power with a new chief minister) announced that it
did not have the money to pay Enron's bills. On January 31, only
five days after an earthquake in the neighboring state of Gujarat,
at a time when the country was still reeling from the disaster,
the newspapers announced that Enron had decided to invoke the
counter-guarantee and that if the government did not come up with
the cash, it would have to auction the government properties named
as collateral security in the contract.
But Enron had friends in high places. It was one of the biggest
corporate contributors to President George W. Bush's election
campaign. US government officials warned India about vitiating
the "investment climate" and running the risk of frightening
away future investors. In other words: Allow us to rob you blind,
or else we'll go away.
Last June the MSEB announced that it was ending its agreement
with the Dabhol Power Corporation, a joint venture of Enron-which
has the largest stake-General Electric and Bechtel. DPC ceased
operations soon afterward, and is pressuring the government to
cover its debts. Royal Dutch/Shell, the AngloDutch petroleum group,
TotalFinaElf and Gaz de France are currently bidding to take over
Enron, Bechtel and GE's collective stake in the plant in a "distress
Recently, globalization has come in for some criticism. The
protests in Seattle and Prague will go down in history. Each time
the WTO or the World Economic Forum wants to have a meeting, ministers
have to barricade themselves with thousands of heavily armed police.
Still, all its admirers, from Bill Clinton, Kofi Annan and A.B.
Vajpayee (the Indian Prime Minister) to the cheering brokers in
the stalls, continue to say the same lofty things: If we have
the right institutions of governance in place-effective courts,
good laws, honest politicians, participatory democracy, a transparent
administration that respects human rights and gives people a say
in decisions that affect their lives-then the globalization project
will work for the poor as well. They call this "globalization
with a human face."
The point is, if all this were in place, almost anything would
succeed: socialism, capitalism, you name it. Everything works
in Paradise, a Communist State as well as a Military Dictatorship.
But in an imperfect world, is it globalization that's going to
bring us all this bounty? Is that what's happening in India now
that it's on the fast track to the free market? Does any one thing
on that lofty list apply to life in India today? Are state institutions
transparent? Have people had a say-have they even been informed,
let alone consulted-about decisions that vitally affect their
lives? And are Clinton (or now Bush) and Prime Minister Vajpayee
doing everything in their power to see that the "right institutions
of governance" are in place? Or are they involved in exactly
the opposite enterprise? Do they mean something else altogether
when they talk of the "right institutions of governance"?
The fact is that what's happening in India today is not a
'problem," and the issues that some of us are raising are
not "causes." They are huge political and social upheavals
that are convulsing the nation. One is not involved by virtue
of being a writer or activist. One is involved because one is
a human being.
If you're one of the lucky people with a berth booked on the
small convoy, then Leaving It to the Experts is, or can be, a
mutually beneficial proposition for both the expert and yourself.
It's a convenient way of shrugging off your own role in the circuitry.
And it creates a huge professional market for all kinds of "expertise."
There's a whole ugly universe waiting to be explored there. This
is not at all to suggest that all consultants are racketeers or
that expertise is unnecessary, but you've heard the saying: There's
a lot of money in poverty. There are plenty of ethical questions
to be asked of those who make a professional living off their
expertise in poverty and despair.
For instance, at what point does a scholar stop being a scholar
and become a parasite who feeds off despair and dispossession?
Does the source of your funding compromise your scholarship? We
know, after all, that World Bank studies are among the most quoted
studies in the world. Is the World Bank a dispassionate observer
of the global situation? Are the studies it funds entirely devoid
Take, for example, the international dam industry. It's worth
$32-$46 billion a year. It's bursting with experts and consultants.
Given the number of studies, reports, books, PhDs, grants, loans,
consultancies, environmental impact assessments-it's odd, wouldn't
you say, that there is no really reliable estimate of how many
people have been displaced by big dams in India? That there is
no estimate for exactly what the contribution of big dams has
been to overall food production in India? That there hasn't been
an official audit, a comprehensive, honest, thoughtful, post-project
evaluation, of a single big dam to see whether or not it has achieved
what it set out to achieve? Whether or not the costs were justified,
or even what the costs actually were?
Cynics say that real life is a choice between the failed revolution
and the shabby deal. I don't know...maybe they're right. But even
they should know that there's no limit to just how shabby that
shabby deal can be. What we need to search for and find, what
we need to hone and perfect into a magnificent, shining thing,
is a new kind of politics. Not the politics of governance, but
the politics of resistance. The politics of opposition. The politics
of forcing accountability. The politics of slowing things down.
The politics of joining hands across the world and preventing
certain destruction. In the present circumstances, I'd say that
the only thing worth globalizing is dissent. It's India's best
Arundhati Roy, a novelist who lives in New Delhi, is the author
of Power Politics, from which this article is adapted. A second
and expanded edition will be available in February from South