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This is an archive article published on June 3, 1997

Spinning into steep decline

Creepers twine along the shed of the 130-year-old Elgin mills, once the pride of Kanpur and Uttar Pradesh. The three chimneys no longer smo...

Creepers twine along the shed of the 130-year-old Elgin mills, once the pride of Kanpur and Uttar Pradesh. The three chimneys no longer smoke; instead grass grows on them. There was a time when Kanpur was christened the Manchester of the East because of this mill, but now it stands as a monument to the decaying industrial culture in Uttar Pradesh.

short article insert This most populated State is perhaps the most backward on the industrial front with entrepreneurs unwilling to set up their units and those that exist are planning to shift because of the fluid political situation and the lack of amenities necessary for the healthy development of an industrial unit.

Factories are closing down, which is a direct indictment of the callous governments, both at the Centre and in the State. The Textile Ministry too has decided to close down all the four mills managed by the Kanpur-based British India Corporation (BIC) group, thus rendering nearly 11,000 employees jobless.

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The Ministry has also negated a Rs 2,005-crore package for the revival of nearly 120 mills run by the National Textile Corporation (NTC), out of which 13 are situated in Uttar Pradesh. While on the one hand, closure of the NTC and BIC mills will further push up the unemployment rate. On the other, it will also obliterate Uttar Pradesh, especially Kanpur, from the industrial map of the country.

Into a volcano of labour unrest

According to sources, a special package has been prepared to run only a few of the NTC units, of which seven are in Uttar Pradesh. All these seven units have been placed in B or C categories under the special package, which means that these units would be self-reliant after 10 years.

Though the industrial climate in the entire State is dismal, the closure of nearly nine units managed by the nationalised NTC and BIC groups, all in Kanpur, are bound to push the industrial capital of Uttar Pradesh in to a volcano of labour unrest. A strong force of more than 10,000 labourers are silently but menacingly preparing for a showdown with the Government on the issue.

“Where will these workers, thrown in to unemployment by the wrong policies of the Central and State Governments over the years, go? This autocratic decision of the Textile Ministry should be negated,” says Gyanendra Mishra, a trade union leader.

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The human aspect of the industrial decay in Kanpur is depressing. As thousands of workers join the ranks of the unemployed, poverty and squalor are bound to grow. Some of them will go back to their villages but most will stay back because they no longer have roots there. “This category will either take to petty trade or to petty crime,” Mishra observes.What went wrong with this industrial hub of Uttar Pradesh where the Communist Party of India was founded in 1925 because it was a labour-oriented city and where trade union leaders like Muzzafar Ahmed, Sripad Amritrai Dange and S.M. Bannerji, elected Lok Sabha MP for five successive terms, have sweated for the cause of the white collar force?

Politics plays havoc with Kanpur’s future

“Uttar Pradesh in general and Kanpur in particular stand as an epitome of how fluid political situations and rudderless leaders can play havoc with the fate of a State as big as Uttar Pradesh. The closure of BIC and NTC, which has woven woollen and other clothes for more than 100 years, will be an apt epitaph on the industrial graveyard that Kanpur has become,” laments K.N. Sharma, a social scientist.

Since 1989, there have been four short-lived governments and prolonged spells of President’s rule. Even the life of the current Mayawati Government is unsure, which means that major decisions for industrial uplift remain undone.

The Chief Ministers have remained preoccupied with identifying ways to ensure longevity to their respective Governments, finding little time to ponder over the murky industrial scenario. The BJP Government led by Kalyan Singh had taken some steps to ensure some improvements and signed MOUs with industrial giants but all that was negated by Mulayam Singh Yadav in 1993 as he was not ready to implement any decision that would result in political benefit to the BJP.

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Mulayam, in his second innings as Chief Minister, showed some alacrity in the industrial development of the State and toured the metropolitan cities and even went abroad to persuade big industrial houses to invest in Uttar Pradesh. He got a favorable response. A number of MOUs were signed but none saw the light of day, barring a few minor ones.

His successor Mayawati did not like that MOUs signed during the tenure of her bete noire, Mulayam Singh, should come into being. As a result, four ambitious power projects steered by Sanjay Dalmia, a mega thermal power plant of the Birla group at Roja near Shahajanpur, and a car project of a Korean company, Hyundai, were not given a go-ahead. While Hyundai shifted to Tamil Nadu, the Birlas scuttled the project.

“While minority governments in the State could not find time to take decisions for the betterment of the industrial scenario, frequent spells of President’s rule could not effect major policy decisions for lack of mandate,” observes a senior IAS officer, who is head of a government-owned loan agency.

Idle units bleed the exchequer

There is, however, the other side of the coin too. Closure of the NTC and BIC mills, which is on the cards, will not be the outcome of an instant decision. Over the years, these units have bled the exchequer as the workers are getting idle wages while production is either nil or not up to the mark. NTC was formed in 1968 under the Textiles Ministry to take over ownership of bankrupt private sector mills.

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They had already been dried up financially by their private promoters and should have been closed down then but the Government took an initiative, obviously with a political motive, of not going against the strong white collar force.

By 1990, the NTC management decided that without massive retrenchment, the mills could not be put back on the rails. Four of the five NTC mills in Kanpur had registered zero production for several years and the Government thought it fit to minimise workers’ strength and introduced the Voluntary Retirement Scheme (VRS).

Between 1992 and 1994, 38,650 textile mill employees availed of a VRS package.

But many remained with the hope that the Government would never order closure of these mills for political reasons. “NTC and BIC mills have worn-out machines, out-dated technology and a large staff and hence can never be restructured,” says Kailash Agarwal, a BIC employee.

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“This is no solution,” counters Sharma, adding that a strong political will is needed for the resurrection of these units. Claims and counter-claims notwithstanding, Kanpur, the Manchester of the East, with its history of many labour movements, is bound to be part of a fierce labour struggle when these mills close down finally.

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