Category Archives: South Asia

by | 28 September 2008 · 11:53 am

India’s Infrastructure: Bad News, Good News

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), pp. 157-160:

Next to airports, India’s seaports require thoroughgoing modernization. The biggest and most famous of them all, Mumbai, has a notorious reputation for terrible delays and incompetent handling of goods. A few years ago, turnaround time was about eight days, regardless of the size of the vessel; this has improved somewhat but even now about four days are required to load or unload a ship. This is due to deliberate negligence as the port earns more by collecting demurrage charges than by any other means. The trick of this trade is the stranglehold which Port Authority labour has on the loading and unloading of goods. In most other ports around the world, the port authority is merely a landlord, providing berths and cranes, etc. but no labour, with loading and unloading done by labour hired by the shipowner or his agent. The port authority with ‘dedicated’ labour is a British legacy. In British ports it may have made sense to retain a labour force specialized in loading and unloading ships, particularly in the past when most of this work was not mechanized. Nobody would have thought that delay rather than speed would be the result of retaining specialized labour. Making money on demurrage charges is, of course, a flagrant example of being penny-wise and pound-foolish. No shipowner in his right mind would enter a port such as Mumbai unless he absolutely has to because it is his destination. Bulk breaking is taking place elsewhere in efficient ports like Singapore or Colombo. Many a ship with only part of its load to be delivered to India would rather call at those ports than enter an Indian port. Jawaharlal Nehru Port across the bay from the old port of Mumbai is supposed to be somewhat more efficient than the old one, but it is first and foremost a container port under the management of the Indian railways and is thus not a direct competitor of the old port. Although Jawaharlal Nehru Port is India’s largest container port, it handles only about 10 per cent of the freight handled by Hong Kong, the world’s largest port of this kind. The inefficiency of Indian ports is not only delaying imports, it is also harming the export trade. In the old days of ‘export pessimism’ this was ignored, but now when producers in India wish to export some of their production to achieve economies of scale, they may give up such plans as their goods get stuck in the port….

The story of Sunil Bharti Mittal, who is now the biggest private operator in this field, is a good example of the rise of the new type of Indian telecom entrepreneur. He is not related to the famous steel tycoon Lakshmi Niwas Mittal, and his rather unusual family name Bharti is made up. His father, who belonged to a caste of traders, married a woman of a higher caste. This inter-caste marriage was frowned upon at that time and the couple adopted the name Bharti. Sunil started making cycle parts in Ludhiana. In 1983 when many imports were still banned, he hit upon the idea of manufacturing push-button telephones and then launched his Airtel brand of mobile phones in 1995. From making phones it was only one further step to acquiring two mobile phone licences and one fixed net licence. Subsequently Mittal expanded his operations and now provides his services in all 23 mobile telephone circles of India in which field he has overtaken the public sector firm BSNL. In order to raise the capital for this relentless expansion he linked up with foreign investors. In 2001 the American firm Warburg Pincus acquired about 6 per cent of Bharti Televentures; later the Singapore firm SingTel and the British firm Vodafone also acquired shares in Mittal’s company, but they are all minority shareholders. Meanwhile Sunil Mittal dominates the Indian telecom scene and continues to win prizes both in his personal capacity as an exemplary entrepreneur and for his company as the best in its field. He has also pioneered broadband connectivity in various fields and is always a step ahead in adopting new technologies. Mittal had started from scratch as an innovative entrepreneur. As he has stated, he was inspired by Mahatma Gandhi’s words: ‘First they ignore you, then they laugh at you, then they fight you, and then they lose.’

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by | 27 September 2008 · 9:58 am

Policing the Pirates of Puntland

The India-oriented blog, The Acorn, recently noted that the Indian navy is proposing to join the multinational effort to police the pirate-infested waters off the Horn of Africa, many of them operating out of Somalia’s “self-governing” region known as Puntland.

Among the tasks assigned to the Combined Task Force 150 (CTF-150)—an international naval task force comprising, among others, of US, British, French, Pakistani and Bahraini ships—are maritime security operations in the Gulf of Aden, Gulf of Oman, the Arabian Sea, Red Sea and the Indian Ocean. While its purpose is to deny the use of the seas to smugglers and terrorists the main problem in the area under its watch is piracy.

CTF-150 doesn’t have enough ships to secure one of the world’s busiest shipping lanes. So it advises large, slower vessels to travel in convoys so that it can better watch over them. But since this is not always possible, around one in 500 ships fall victim to pirates. Since the monthly traffic is around 1500, pirates succeed in raiding three or four ships each month.

Now the Russian navy is sending a warship to the area after one group of the pirates may have bitten off more than they can chew.

SOMALI PIRATES who seized a Ukrainian ship carrying 33 T72 battle tanks – apparently bound for the autonomous government of South Sudan – yesterday warned against any attempt by Western navies to rescue the vessel’s weapons cargo or its crew.

Januna Ali Jama, a spokesman for the pirates in the breakaway north statelet of Puntland said the pirates would soon begin the routine Somali pirate tactic of negotiating the return of the cargo ship Faina to its Ukraine state owners in exchange for a ransom.

Jama told the BBC Somali Service that the pirates demand is £18 million from the Kiev government because apart from the Russian made tanks the Faina is carrying “weapons of all kinds”, including rocket-propelled grenades, anti-aircraft guns and many hundreds of thousands of ammunition….

The pirate syndicates – of which there at least five, each about 1000-strong – operate out of Puntland, far to the north, wrapped around the Horn of Africa where the Gulf of Aden meets the Indian Ocean, which declared itself separate from the Republic of Somalia 10 years ago. Puntland is to Mogadishu what Kurdistan, semi-autonomous and far off in the northern mountains of Iraq, is to Baghdad.

Unrecognised internationally – although the British Embassy in neighbouring Ethiopia maintains close contact with the Puntland government, which is allowing oil exploration by three Western companies – little diplomatic pressure can be put on Puntland, which says piracy grew after international “sea robber” fishing fleets plundered and wrecked its rich fishing grounds. The United Nations estimates that fish worth at least £50 million a year are plundered illegally from Somali waters by Spanish and other foreign boats.

The pirates are unlikely to be unable to unload the tanks because of a lack of specialist heavy-lifting gear in the tiny ports and innumerable coves of Puntland, a barren land three times the area of Scotland which historically depended on fishing and camel and goat-herding.

But that will hardly discourage the pirates. What they want is booty, in the form of on-board cash, cargo and, most importantly, ransom money, which owners are increasingly willing to pay, given the huge values of ships and their cargoes and the daily costs of maintaining them at sea. On the same day as the Faina was captured, another Puntland pirate syndicate released a Japanese ship and its 21-member crew after a £1 million ransom was paid. The 53,000-tonne bulk carrier Stella Maris had a valuable cargo of zinc and lead ingots. And as the Stella Maris was being freed, Somali pirates were hijacking a Greek chemical tanker with 19 crew on board as it sailed through the Gulf of Aden from Europe to the Middle East.

The Faina is believed to be heading to the pirate port of Eyl, the main destination of hijacked ships where Puntland entrepreneurs run special restaurants for the hundreds of seized crewmen and where the pirates’ accountants make calculations on laptops and drive state-of-the-art land cruisers….

Worldwide, pirates attacked a known 263 large vessels in 2007, up from a reported 239 in 2006, according to Choong’s piracy reporting centre. Southeast Asia, especially the shipping lanes of the Malacca Straits between Malaysia and the huge Indonesian Island of Sumatra, used to be the world’s busiest place for pirate attacks. Better co-operation between southeast Asian nations and the consequences of the 2004 tsunami have greatly reduced the number of attacks. Many pirates operated out of Aceh, the northern province of Sumatra, but the tsunami destroyed their ports, wrecked their boats and killed many of the pirates.

Somali piracy easily tops the world table, both in terms of the number of attacks and the money made. It is the Somali financiers sitting mainly in Dubai, Britain, Canada, Denmark and Kenya who make the big money by keeping the bulk of the ransom payments. Pirates based in Nigeria and Peru are also climbing the league table.

France is now circulating a draft resolution in the UN Security Council urging nations to contribute more warships and aircraft to the fight against piracy off Somalia. While the Foreign office has ordered the Royal Navy, to the incredulity of the nation’s maritime industry, not to detain Somali pirates from fear of human rights complications, the French are being pro-active.

UPDATE: On The Atlantic magazine’s blog The Current, Robert Kaplan describes a bit of the lifestyle of these pirates.

I spoke recently with several U.S. Navy officers who had been involved in anti-piracy operations off Somalia, and who had interviewed captured pirates. The officers told me that Somali pirate confederations consist of cells of ten men, with each cell distributed among three skiffs. The skiffs are usually old, ratty, and roach-infested, and made of unpainted, decaying wood or fiberglass. A typical pirate cell goes into the open ocean for three weeks at a time, navigating by the stars. The pirates come equipped with drinking water, gasoline for their single-engine outboards, grappling hooks, short ladders, knives, AK-47 assault rifles, and rocket-propelled grenades. They bring millet and qat (the local narcotic of choice), and they use lines and nets to catch fish, which they eat raw. One captured pirate skiff held a hunk of shark meat so tough it had teeth marks all over it. With no shade and only a limited amount of water, their existence on the high seas is painfully rugged.

The classic tactic of Somali pirates is to take over a slightly larger dhow, often a fishing boat manned by Indians, Taiwanese, or South Koreans, and then live on it, with the skiff attached. Once in possession of a dhow, they can seize an even bigger ship. As they leapfrog to yet bigger ships, they let the smaller ships go free. Because the sea is vast, only when a large ship issues a distress call do foreign navies even know where to look for pirates. If Somali pirates hunted only small boats, no warship in the international coalition would know about the piracy.

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Filed under Africa, Asia, Australia, Europe, Middle East, piracy, Russia, Somalia, South Asia, Southeast Asia, U.S., Ukraine

by | 20 September 2008 · 12:31 pm

India’s Sweatshop Diamonds

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), pp. 96-97:

When India had shielded its economy behind tariff walls, its share in world trade had dwindled into insignificance. As mentioned earlier, ‘export pessimism’ was the prevailing mood at that time. It was not easy to change this mood so only new branches of export production could escape it. Nowadays three new types of commodity account for more than half of India’s total exports. Diamond processing was the first and the most unexpected success story of them all. Of course, India had been known as a source of beautiful diamonds in ancient times, but in modern times South Africa has been the leading producer of raw diamonds and the processing is done in Western Europe in places such as Antwerp. Only a few decades ago Jewish merchants controlled almost the entire diamond trade and Jewish artisans participated in the processing of these precious stones. Suddenly a community of Gujarati merchants from Palanpur cut into this trade and made use of cheap and skilled labour available to them in places such as Surat and other towns of Gujarat as well as on the outskirts of Mumbai.

India has to import the raw diamonds; the contribution of its export industry is the value added by expert processing. A breakthrough was provided to this new industry by the creative use of industrial diamonds. Only about a quarter of all diamonds mined are normally fit for jewellery; the rest are passed on to the makers of machine tools for cutting and grinding. Most industrial diamonds are small. Gujarati entrepreneurs knew how to get these tiny stones processed and adopted novel designs of jewellery which sparkled due to the collective effect of many small stones rather than the individual radiance of larger and very expensive diamonds. This created a new market of middle-class consumers who could not afford expensive jewellery. But the Gujarati entrepreneurs also ventured into the market for very precious stones. They even created new brands such as the Nakshatra diamonds endorsed by the Indian actress Aishwarya Rai, a former Miss World.

The buying of diamonds in places like Antwerp is done by the so-called ‘sightholders’, experts entitled to inspect raw diamonds and select them for their respective companies. Earlier these sightholders were a charmed circle of insiders, but the Gujarati merchants gained access to the circle and now almost dominate it. Eleven of twelve diamonds processed in the world are now processed in India. This, of course, means that the fast growth which this Indian industry registered in recent years is bound to level off. The value of Indian exports of precious stones – mostly processed diamonds – has expanded by leaps and bounds. In 1966 the value of these exports was a mere US$ 25 million; by 2004 it amounted to US$ 14 billion.

India’s greatest advantage is the low wage paid for the rather demanding job of diamond processing. The fixture in which the diamond is held during processing is called a dop. With a semi-automatic dop a worker can polish 800 to 1,000 diamonds per day. The wages of Indian workers in this line are about 10 per cent of those earned by their colleagues in Antwerp. This is why more than 800,000 workers are employed in the various workshops in Surat whereas in Antwerp there are only about 30,000 still active in this field. Surat is just one of the Indian centres of diamond processing, though perhaps the largest. The conditions of the workers are generally quite miserable and children are also recruited for this work. Large profits are reaped only by the entrepreneurs, who have now extended the scope of their work to other Asian countries and even to Russia.

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by | 20 September 2008 · 7:05 am

India’s ‘Fraternal Capital’ and Contractor Networks

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), pp. 100-101:

Tiruppur, a town near Coimbatore in Tamil Nadu, has emerged as a major centre of knitwear production and Sharad Chari has made a fascinating study of the mode of production in this town. He has described the emergence of ‘fraternal capital’ as a typical form of cooperation among small-scale entrepreneurs in this field. Most of the owners of the small workshops and even a large number of their employees belong to the Gounder caste of peasants who have made a successful transition to industrial production. The Gounder peasants are used to hard work in intensive agriculture where the landholder and his labourers are working together and this style of operations has been transferred to the shop floor where the owner is always present, usually controlling the stitching table where the cloth is converted into garments. Gounders who want to emphasise the special features of their work often make it appear as a kind of ‘work ethic’. Actually it helps them to justify the control of labour in their small-scale industry. They do not strive for economies of scale as these would be diseconomies under the official rules favouring small-scale enterprises. Accordingly, successful entrepreneurs do not invest their capital in expanding their production, but in setting up ‘fraternal’ enterprises run by other members of the Gounder caste, albeit these people are not necessarily related to them in terms of family ties. Total production has thus grown very quickly and whereas earlier only men worked in this industry, more and more women have been recruited in recent years. Most workers are paid by piece rate or they work under various types of contracts rather than receiving regular wages.

When production for export increased, a new elite of export merchants arose from the ranks of these small entrepreneurs. Smart young men in business suits, wearing sunglasses, can be seen chatting with their relatives on the shop floor who provide them with the material which they market in New York or elsewhere. Many of these exporters are assemblers rather than producers. The links of fraternal capital connect all these people and make it difficult for outsiders to penetrate this business. In this way fraternal capital provides horizontal and vertical linkages which are otherwise only found in big corporations. Decentralized supervision – and exploitation – of labour is an asset in this type of business organization. Contracting in and out enables the small entrepreneurs to respond to changing demand. Such an organization helps to defend the class of entrepreneurs against labour unions, which have a strong tradition in this area.

Another interesting example of the control of labour in this region is the putting-out system practised by a producer of rag carpets in the adjacent Erode District. He uses rags from the hosiery industry and gets carpets woven for the big Swedish firm IKEA. Initially it was traditional weavers who got involved in this business, but soon the putting-out system was extended to villages whose supply of labour was of a very different kind. In a Gounder village affected by water scarcity, the peasants took up carpet weaving in order to survive. In another village inhabited by migrant construction workers, the women who had also participated in this work shifted to carpet weaving, which they could do at home. Tapping labour resources of different kinds for export production is a characteristic feature of the informal sector of India’s economy.

Similar features of decentralized production and exploitation of labour can be observed in the garment industry of Ahmadabad, a city once famous for its large composite textile mills, most of which have long since closed down or are ‘sick‘. But in the 1990s hundreds of small workshops producing ready-made garments sprang up. Their production is supplemented by home-based women who stitch garments for entrepreneurs who operate a putting-out system. These women had been used to stitching petticoats and children’s wear; they own very simple sewing machines. When they were required to stitch more complicated garments for export their skills and their machines often proved insufficient for the new tasks. They usually earn piece rates which amount to about 2 to 5 per cent of the value of the articles they produce. With such low wages they can hardly afford to invest in add-ons to their sewing machine for new lines of production. Nevertheless, they somehow managed to get on with their work. This area of Gujarat is also famous for its embroidery, which has been successfully adapted to the requirements of export production, a line of production in which India is ahead of China.

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by | 6 September 2008 · 1:59 pm

What China Taught India, 1962

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), pp. 46-48:

The big blow to [Afro-Asian] solidarity came in 1962 when China invaded India in order to settle a border dispute. Nehru had assumed that China was an anti-imperialist power just like India and that such powers would live in peace with each other. Moreover, he had supported China’s control over Tibet, which was supposed to be an autonomous region. Unfortunately, he had failed to get from China a definitive statement concerning the India-China border in return for this support. The treaty which Nehru concluded with China in 1954 only mentioned some passes through which the trade between the two countries might flow. It also contained the five principles (panchshila) relating to mutual benefit and non-interference in each other’s internal affairs which Nehru henceforth regarded as the cornerstone of his foreign policy. However, none of this could prevent a clash with China. In 1959, the Dalai Lama, Tibet’s priestly ruler, fled to India and Nehru granted asylum to him but did not permit him to establish a Tibetan government in exile. In the following months border clashes increased and notes were exchanged which Nehru did not publish until he was forced to do so by the Indian parliament. In 1961, the Chinese Prime Minister Chou En-lai visited India for border negotiations. Nehru had collected all relevant maps and was surprised that Chou En-lai did not wish to look at them but immediately proposed a deal: China would recognize India’s eastern border as delineated by the McMahon Line of 1914 if India would leave the Karakoram Pass and Aksai Chin (northeast Kashmir) to China. China had secretly occupied most of Aksai Chin in the 1950s, so India would simply have to acquiesce in this loss. The access to the Karakoram highway was of great strategic importance to China for the control of its western provinces. However, Nehru as head of a democratic government could not deal with national territory as easily as Chou En-lai had expected. The deal was not accepted and border clashes continued. Finally, China forced the deal on an unwilling India by means of a well-planned military offensive. When the USA and the Soviet Union were busy with the Cuban Missile Crisis in October 1962, a division of Chinese troops crossed the McMahon Line in the east and soon reached the Assamese plains. But this was a diversionary move. These troops withdrew before their supply lines could be cut. In the meantime the Chinese also launched a massive offensive in the west to capture the Karakorum highway – and they did not withdraw as this was the area which really interested them. Subsequently, there was a conspiracy of silence between India and China as to what had happened there. India was not willing to admit its losses and China would not reveal its illegitimate gains. China has adopted an attitude of superiority ever since and sometimes this has even been expressed quite openly. When China invaded Vietnam in 1979, Deng Xiao-ping compared this to what China had done to India in 1962. Atal Bihari Vajpayee, who visited China at that time as India’s Minister of External Affairs in order to ‘normalize’ relations with China, got this message and immediately returned home. ‘Normalization’ had to wait for a long time.

The clash between India and China had sounded the death knell of Afro-Asian Solidarity even before 1962, but anti-colonial solidarity still motivated Nehru, who was sensitive to appeals from leaders of countries which were involved in their freedom struggle. In September 1961, Kenneth Kaunda, the future President of Zambia who had attended the Belgrade Conference of the Nonaligned Nations, visited New Delhi and gave a lecture in which he blamed Nehru for tolerating Portuguese colonial rule in Goa. He argued that rather than setting an encouraging example which the Africans could follow Nehru obviously wanted to wait until the Africans had overcome Portuguese colonial rule, whereupon Goa would then fall into his lap like a ripe fruit. Kaunda was clearly quite right in assessing Nehru’s motives and his speech stung him into action. Goa was liberated by the Indian army in December 1961; it proved to be a walkover but this could not have been predicted. As a member of NATO, Portugal was well armed and had a strong garrison in Goa. It could also rely on support from Pakistan. If the Portuguese Governor-General had decided to defend Goa seriously, the liberation could have ended in a bloodbath. Fortunately, he only blew up a few bridges and surrendered gracefully as he was aware of the far superior power of the Indian army. This was Nehru’s last great triumph, but he experienced it with mixed feelings. He lost his reputation as an apostle of peace and was berated by every Western power. This he could live with, but the humiliating defeat he suffered at the hands of the Chinese in 1962 broke his heart. He must have felt very deeply that he had failed as architect of India’s foreign policy.

Nehru’s successors adopted a more realistic approach: India’s regional position was more important to them than its role in world affairs. The twin challenges of China and Pakistan converted India with a vengeance into a self-conscious territorial state concerned with its defence. A retired Indian general had once said that the colonial legacy of a huge army embarrassed India’s political leaders as much as inheriting a brewery would embarrass a teetotaller. Nehru did not invest much money in armaments; however, this changed after India’s defeat by the Chinese in 1962. Defence expenditure was stepped up, which alarmed Pakistan. The Chinese had shown that India could be beaten and had thus set Pakistan an example, but due to India’s rapid armament, the window of opportunity for Pakistan seemed to be closing fast. Pakistan’s military dictator Ayub Khan was pushed by his young Foreign Minister, Zulfiqar Ali Bhutto, to attack India in Kashmir. Bhutto had forged a military alliance with China in 1963 and Pakistan had yielded a large part of territory to the west of the Karakoram Pass to China at that time. Nehru’s successor, Lal Bahadur Shastri, was considered weak and inexperienced. Pakistan tested his reaction to a border intrusion in the Rann of Katch in the summer of 1965. Shastri requested the then British Prime Minister Harold Wilson to arbitrate in this matter, which only served to encourage Ayub Khan to launch his Operation Grand Slam in September 1965 and he sent his tanks to cut the only connection between India and Kashmir. If Shastri had again called for arbitration, Ayub Khan could have finished his business in Kashmir and then negotiated from a position of strength. But this time Shastri ordered his troops to launch a counter-attack on Lahore. He also refused to listen to a Chinese ultimatum which referred to their threat to cross the border of Sikkim. Pakistan had hoped that China would open a second front in the east, but the Chinese did not follow up their ultimatum and bitterly disappointed their Pakistani allies. China had encouraged Pakistan in the hope that it would do some damage to India, but it was not interested in investing anything in this war as it had reached its aims in 1962. The same Chinese stratagem was repeated in 1971 when Pakistan lost its eastern half and the Chinese supported Pakistan, but did not give the Pakistanis help when they needed it.

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by | 31 August 2008 · 10:40 am

Wordcatcher Tales: girmitya, kala pani

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), p. 1:

India is a state encompassing a civilization. It includes a multitude of ethnic and linguistic groups which share a common cultural background. Its historical continuity is amazing…. In the recent past India has also become a territorial nation state with defined borders and institutions guarding its territorial integrity. The idea of a clearly delineated territoriality was not prevalent in India in earlier times. The Himalayas in the north and the ocean encircling the country appeared to those living inside it as ‘natural’ boundaries. In fact the mountain people never conceived of the Himalayas as a boundary and they ‘transgressed’ it in many ways. Many of the coastal people, on the other hand, participated throughout the ages in maritime trade. The orthodox prejudice against crossing the kala pani (black water) was not shared by them. This aversion to seafaring was a relatively late phenomenon in an era when people in India became more introverted and defensive.

The awareness of the ‘natural’ boundaries of India did not imply a feeling of national identity in territorial terms. Nationalism first found expression among educated people and did not affect the common people for along time. The poor people from northern India who were transported to Fiji as indentured servants to work on the sugar plantations did not refer to themselves as ‘Indians’ but as girmityas. The word girmit was a Hindi neologism derived from ‘agreement’, the document which bound them to their servitude. Their identity was derived from this common fate. It was only later when emissaries of Mahatma Gandhi reached Fiji that these girmityas became Indians.

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by | 23 August 2008 · 2:09 am

India’s Rise: Sick Mills vs. Powermills

From India: The Rise of an Asian Giant, by Dietmar Rothermund (Yale U. Press, 2008), pp. 88-89:

In the years of the Great Depression, the Indian textile industry was partially protected under the regime of imperial preference, Production for the home market expanded, but there was hardly any investment in new machinery. Moreover, India had no textile machine industry of its own. During the Second World War, no machinery could be imported, but the mills worked around the clock under the regime of government procurement. By the end of the war, spindles and looms were worn out and mill-owners would have liked to have invested in new machinery. However, foreign exchange was scarce as India had no immediate access to its reserves accumulated in the Bank of England. At this stage something happened which had terrible consequences for the future of the Indian textile industry. Mahatma Gandhi had compelled the Indian government to abolish the food-grain controls introduced during the war. Prices fell after the controls had been abolished – as Gandhi had predicted. His followers then tried to apply the same rule to cotton texiles, which had also been subjected to controls. The mill-owners warned the government that they would not be able to cope with the rising demand with their decrepit looms. Nevertheless, the controls were abolished and prices rose. Controls were then re-imposed in August 1948. At the same time positive discrimination in favour of the products of handloom weavers was introduced. These weavers were dear to Gandhi as he regarded them as the paragon of the type of cottage industry which he preferred to the mills. The well-meaning protectors of the handloom weavers did not notice that these weavers had to a large extent been replaced by powerloom weavers, whose rise will be described below. The mills were now prevented from modernizing their equipment and expanding their production. They were turned into living fossils. The mill-owners continued production half-heartedly. There seemed no longer to be any future for this industry. Some mills were closed down as early as the 1950s and 1960s. To make matters worse, a prolonged strike of textile labour in Mumbai in the 1980s sounded the death knell for the industry in this metropolis.

It was quite natural that textile labour should be frustrated under these conditions, but resorting to a strike in an industry which was already doomed proved to be counterproductive. The workers turned to Dr Datta Samant, an independent labour leader who had organized a very succesful strike for the workers of the Premier automobile factory in Mumbai. This strike ended with a substantial increase in wages, which were tied to a productivity index. Samant was a medical doctor who knew nothing about economics and thought that his recipe would work in the textile industry just as it had done in the automobile industry. He was a charismatic leader and inspired the workers to continue their strike, which started in 1982, for eighteen months. (His life ended tragically when he was openly gunned down by gangsters in 1997.) The result of the strike which he had led was perverse: the workers shifted to the powerlooms in order to earn a living and the mill-owners procured cloth from these power looms and marketed it. By the time the strike ended the powerlooms had taken over most of the production and the mills were ‘sick’.

The phenomenon of a ‘sick mill’ can only be understood in the Indian context. Elsewhere a sick mill would go bankrupt and close down. In India, however, where there are no unemployment benefits, laid-off workers are politically dangerous and therefore the government will nurse sick mills to keep them alive even if they cease to produce anything. The mill-owners soon learned to make a profit out of being sick. The Reserve Bank of India sanctioned favourable loans for such sick mills. Clever manipulators could siphon off enough money from such loans and use it for other purposes. The production of mill-made cloth declined steeply under such conditions, from about 3.4 to 2 billion metres in the decade of the 1980s. In the same period the production of powerlooms increased from 5 to 11.4 billion metres.

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by | 7 August 2008 · 8:41 pm

Armenian Merchant Information Networks, 1600s-1800s

The latest issue of the Journal of World History (vol. 19, no. 2) leads off with an article that somehow caught my fancy. Whitman College professor Sebouh Aslanian writes on “The Salt in a Merchant’s Letter”: The Culture of Julfan Correspondence in the Indian Ocean and the Mediterranean (Project MUSE subscription required). Here’s a bit of the introduction (omitting footnotes and page numbers).

The crucial role of information flows was particularly important for Armenian merchants from New Julfa, a suburb of the Safavid capital of Isfahan founded in 1605 by Armenian silk merchants forcibly displaced by Shah Abbas I from the town of Old Julfa on the Ottoman-Persian frontier [in the Nakhchivan Autonomous Republic in Azerbaijan]. These merchants managed a remarkable achievement by coming to preside, within a short time of their forced displacement, over one of the greatest trade networks of the early modern era. By the eighteenth century, the Armenian merchants of New Julfa had branched out from their small mercantile suburb to form a global trading network stretching from Amsterdam in the west to Canton (China) and Manila (Philippines) on the rim of the Pacific Ocean in the east. Their mercantile settlements in the Indian Ocean, Mediterranean, and northwest Europe and Russia spanned several empires, including the three most significant Islamic empires of Eurasia—that is, the Ottomans, the Safavids, and the Mughals—as well as several European seaborne empires, including the British, Dutch, French, Portuguese, and Spanish.

In the case of Julfan society, information sharing was important not only for merchants for their daily commercial affairs, but also for maintaining the integrity of the Julfan network as a whole. Letter writing connected far away commenda agents to their masters in New Julfa and also unified the trade settlements in the periphery to the nodal center of the entire network in New Julfa….

The sources for this study derive from a remarkable archive of eighteenth-century documents I discovered while doing research at the Public Records Office (PRO) in London. This archive consists of approximately 1,700 Julfan mercantile letters seized in the Indian Ocean in 1748 on board an Armenian-freighted ship called the Santa Catharina. The majority of these letters were carried by Armenian overland couriers across the Mediterranean littoral and Asia Minor to the Persian Gulf port city of Basra, where they were relayed to other merchant-couriers traveling by ship to Bengal with the purpose of being delivered to recipients there and farther east in China. What makes these letters valuable for the present investigation is that their journey was unexpectedly cut short when the ship on which they were traveling was captured as a war time “prize” by a British naval squadron patrolling the waters off the southern coast of India. The letters were confiscated along with the Santa Catharina’s other cargo and shipped to England to be presented as “exhibits” in a high-stakes trial in London. Luckily for us, this event not only ensured their survival, but also transformed them into a kind of Julfan geniza. In addition to relying on this vast trove of documents, I shall also use two other collections of business and family correspondence stored in the Archivio di Stato di Venezia (henceforth ASV) and the All Savior’s Monastery Archive (ASMA) in Julfa/Isfahan. Both collections are valuable because they contain thousands of commercial letters sent from Europe and India, many of which are examined here for the first time….

This is the kind of bottom-up, data-rich spadework that I really respect in historians, and many of the observations give one a vivid sense of what life was like as a farflung member of the Armenian (silk) trade network, such as how long it took to get a letter from Isfahan to Venice (often 6 months or so, if it got there at all). Even some of the footnotes are interesting, although the sources cited in Armenian orthography are completely opaque to me. I’ll cite just one example that relates to the language used in the letters.

In general, most correspondents maintained high levels of penmanship, a skill most likely taught to them in a commercial school operating in Julfa in the 1680s. In addition to a solid reputation and competence in the arts of mathematics and commercial accounting, literacy and good penmanship were also attributes merchants sought in a factor. Nonetheless, there are occasional letters that exhibit rather poor levels of penmanship, but, fortunately for the historian, these are rare exceptions. The language of Julfan correspondence is the defunct peculiar dialect of Julfan Armenian that flourished between the seventeenth and nineteenth centuries throughout the commercial settlements where Julfans resided, especially in India and the Far East. This dialect is so distinct from other dialects of Armenian and from modern standard Armenian that it was and still is nearly incomprehensible to most Armenians. It was, therefore, an ideal medium for confidential communication in an age when information sharing was regarded as the lifeline of merchant communities and when a merchant could never be certain that his letters would not be intercepted and read by rivals in commerce or politics. Julfan letters, like most writing before the nineteenth century, do not have standard punctuation or spelling and no paragraph breaks except those indicated by the word dardzeal (again). Some letters also had important bills of exchange or notarized powers of attorney enclosed in them.

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Filed under Central Asia, economics, Europe, Iran, language, migration, South Asia

by | 20 November 2007 · 6:52 am

Overview of Southern Immigration

The latest issue of Southern Culture (vol. 13, no. 4, pp. 24-44; Project Muse subscription required) contains an article by Carl L. Bankston entitled New People in the New South: An Overview of Southern Immigration (voluntary immigrants only; not slaves). Here are a few excerpts that caught my eye.

Old South

In 1850 Louisiana had the largest concentration of immigrants in the South, about 75,000 people and approximately one-quarter of Louisiana’s free population. New Orleans, the largest port in the South and the second largest in the nation after New York, was a natural point of entry for people from other countries. Between 1820 and 1860, over half a million immigrants arrived in Louisiana. Given Louisiana’s French history and the large French-speaking population in the state during the nineteenth century, it is easy to assume that France would be the place of origin for most of the state’s foreign-born residents. Many immigrants to Louisiana were, in fact, from France. About 15,000 people in Louisiana in 1850, or one out of five immigrants in the state, gave France as their birthplace. The largest immigrant group in Louisiana, though, came from Ireland. An estimated 26,580 Louisianans, or nearly 38 percent of the state’s immigrants, were born in Ireland in 1850. The Irish are generally described as having arrived in Louisiana in two waves. Those known as the “Old Irish” came primarily from the northern part of Ireland between 1803 and 1830. These earlier immigrants became part of the middle classes of New Orleans. The “New Irish,” consisting mainly of peasants, left their homes because of poverty and famine, particularly after the potato blight, which hit Ireland about 1845 and lasted into the following decade, leaving Ireland devastated. They settled in the area known as the City of Lafayette, which was later incorporated into New Orleans and is still identified as the Irish Channel. The New Irish provided much of New Orleans’s low-paying manual labor.

Germans made up the second largest immigrant nationality in antebellum Louisiana. Over 20,000 people in the state in 1850, or 28 percent of all immigrants, had been born in Germany. Germans first arrived at the port of New Orleans when Louisiana was a French colony. Many settled just north of New Orleans in the Parishes of St. John and St. Charles, in an area known as the Côte des Allemands, or German Coast. A second wave of peasant German workers followed the first wave of German settlers between 1820 and 1850.

New South

As a consequence of geographic access, Texas’s main immigrant population is Hispanic or Latino, yet Texas also has a substantial Asian minority (see Table 1), attributable to some extent to the general rise in Asian migration around the United States and to the booming economy in Texas cities such as Houston. In 2000 the Vietnamese were Texas’s single largest Asian immigrant group, accounting for one out of every four foreign-born Asian Texans, and the state had the second largest Vietnamese population in the United States, after California, with 12 percent of all Vietnamese in the United States.

The case of the Vietnamese illustrates the importance of Texas as a point of access even for members of these more distant national-origin groups. Initial U.S. government resettlement efforts in 1975 had planted Vietnamese communities in the cities of Dallas and Houston. Additional Vietnamese Americans were drawn to Texas by the existing ethnic communities, combined with the availability of jobs in that state. Shrimping became something of an ethnic specialty for Vietnamese Americans along the Gulf Coast of Texas and other states….

As a world center, Atlanta has attracted a diverse Asian population. The largest grouping of Atlanta’s Asians in 2000 consisted of people from the South Asian subcontinent, with just under 36,000 Asian Indians, over 1,000 Bangladeshis, and well over 3,000 Pakistanis. At that time, Atlanta was also home to nearly 25,000 Vietnamese, close to 22,000 Koreans, and just under 21,500 Chinese. Largely members of an educated work force, the South Asian migrants were drawn to this international-airport-hub city by its professional, white-collar opportunities in professional, scientific, and technical industries, which in 2000 employed one in five of the Asian Indians in the metropolis.

As in Texas, the Vietnamese first came to Atlanta as part of government resettlement efforts, and the initial Vietnamese communities provided bases for secondary migration from other parts of the country while Vietnamese job seekers looked for work. They found it in the blue-collar sector, with nearly one-third of Atlanta Vietnamese occupied in the city’s manufacturing industry in 2000. Koreans, as in New York and Los Angeles, became the small shopkeepers of Greater Atlanta, with about 22 percent of Koreans in retail trade. Chinese, like the South Asians, had often come with educational credentials to seek jobs in professional, scientific, and technical fields, which held 17 percent of the area’s Chinese workers. Other Chinese migrants tended to go in to restaurant and related work, as accommodations and food services held 16 percent of the city’s Chinese workers. A diversified metropolitan economy with global connections had pulled in workers from all over the world into a mosaic of national-origin specializations.

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Filed under Asia, France, Germany, Ireland, migration, South Asia, U.S., Vietnam

by | 15 November 2007 · 6:22 pm

A Grim Backgrounder on Waziristan

In the forthcoming issue of the Claremont Review of Books, Stanley Kurtz reviews three books by Akbar S. Ahmed, a social anthropologist who once served as Pakistan’s appointed “king” of Waziristan. Here are some excerpts about its grim political culture.

The British solution in Waziristan was to rule indirectly, through sympathetic tribal maliks (elders), who received preferred treatment and financial support. By treaty and tradition, the laws of what was then British India governed only 100 yards on either side of Waziristan’s main roads. Beyond that, the maliks and tribal custom ruled. Yet Britain did post a representative in Waziristan, a “political agent” or “P.A.,” whose headquarters was protected by an elite military force, and who enjoyed extraordinary powers to reward cooperative maliks and to punish offenders. The political agent was authorized to arrest and jail the male kin of miscreants on the run (particularly important given the organization of Waziristan’s tribes around male descent groups). And in special cases, the political agent could blockade and even destroy entire settlements. After achieving independence in 1947, Pakistan followed this British scheme, indirectly governing its many tribal “agencies” and posting P.A.s who enjoyed the same extraordinary powers as under the British.

Akbar Ahmed, a British-trained social anthropologist, served as Pakistan’s P.A. in South Waziristan from 1978 through 1980. Drawing on his academic background and political experience, he has written a fascinating book about his days as “king” (as the tribesmen used to call the political agent). First published in 1983 under the title Religion and Politics in Muslim Society, the book was reissued in 1991, and revised and released again in 2004, each time under the title Resistance and Control in Pakistan. Its obscure title and conventional academic introductory chapters explain why it has been neglected….

The first thing that strikes the reader of Resistance and Control in Pakistan is the pervasive nature of political violence in South Waziristan. And here, in contrast to his later work, Ahmed himself is at pains to emphasize the point. A popular novelist of the British Raj called Waziristan tribesmen “physically the hardest people on earth.” British officers considered them among the finest fighters in the world. During the 1930’s Waziristan’s troublesome tribesmen forced the British to station more troops in that agency than in the remainder of the Indian subcontinent. In more settled agricultural areas of Pakistan’s tribal Northwest Frontier Province, Ahmed says, adults, children, and soldiers mill about comfortably in the open, while women help their men in the fields. No guns are visible. But arid Waziristan is a collection of silent, fortress-like settlements. Women are invisible, men carry guns, and desolation rules the countryside.

Even in ordinary times, from the British era through the present, the political agent’s headquarters at Wana in South Waziristan wears the air of a fortress under perpetual siege. Five British political agents died in Waziristan. Ahmed reports that during a visit to Wana by Zulfikar Ali Bhutto in 1976, the entourage of Pakistan’s Prime Minister was kept nervously awake most of the night by machine gun and rifle fire from the surrounding hills. In short, the Wana encampment in South Waziristan seems like nothing so much as a century-old version of Baghdad’s Green Zone.

Politics in Waziristan is inseparable from violence. A British official once called firing on government officers the local “equivalent for presenting a petition.” Sniping, explosions on government property, and kidnappings are common enough to necessitate continuous military protection for political officials. And the forms of routinized political violence extend well beyond direct attacks on government personnel.

Because government allowances are directed to tribal elders who control violent trouble-makers in their own ranks, ambitious maliks have reason to insure that such outlaws do in fact emerge. Waziristan’s many “Robin Hoods,” who make careers out of kidnapping even non-government officials and holding them for ransom, are simultaneously encouraged and controlled by local maliks. This double game allows the clans to profit from their own capacity for causing trouble, while also establishing a violence valve, so to speak, through which they can periodically convey displeasure with the administration. “To create a problem, control it, and terminate it is an acknowledged and highly regarded yardstick of political skill,” writes Ahmed. For the most part, income in Waziristan is derived from “political activity such as raiding settled districts” and “allowances from the administration for good behavior.” Unfortunately, a people who petitions by sniper fire seems poorly suited to democratic citizenship….

South Waziristan is populated by two major tribes, the Wazirs and the Mahsuds. (A century ago the Mahsuds were part of the Wazirs, but have since split off and gained their own identity.) The Mahsuds traditionally outnumbered the Wazirs and were at least relatively more integrated into modern society. After Pakistan gained independence in 1947, a few Mahsuds moved to “settled areas” and entered school. Many of these made their way into government service, thus connecting the Mahsuds to influential bureaucratic networks. Others started businesses, which brought a modern source of wealth to the tribe….

Following the oil boom of the 1970s, Wazirs and Mahsuds alike migrated to the Persian Gulf to work the oil fields and send their remittances back home. Maliks from the most prestigious tribal lineages initially resisted the call of migration. So the oil boom created an opening that “depressed lineages” happily filled. By the time the maliks began to send their sons to the Gulf, intra-tribal disparities of wealth and influence were disappearing.

So while the Mahsuds had outpaced the Wazirs, the power of maliks was waning among the Wazirs themselves. Now the Wazirs could afford to throw off those pliant elders who had taken and distributed British and later the Pakistan government’s pelf; and by supporting a radical mullah, the restive tribe could feed its resentment of both the government and the Mahsuds.

As Ahmed notes, and in pointed contrast to the “poverty theory” of Islamism, modern education and wealth seem to have sparked this early Islamist rebellion. Instead of spurring further development, economic opportunities have fed the traditionalist reaction. Waziristan’s tribesmen understand full well that their rulers mean to transform their way of life, thereby “taming” them through the seductions of education and modern forms of wealth. While some have accepted the trade, the majority consciously reject it. During the colonial period, education was despised as an infidel plot. In the 1970s conservative tribesmen systematically destroyed electrical poles, which were seen as a threat to Waziristan’s isolation and therefore to the survival of traditional Pushtun culture. Economic development might well “tame” these tribesmen, yet poverty is less the cause of their warlike ways than the result of a deliberate decision to preserve their traditional way of life—their Pushtun honor—even at material cost.

If only the Mahsuds and Wazirs could achieve the lasting peace with each other and the modern world that the Hatfields and McCoys of Pike County, Kentucky, have achieved.

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Filed under Afghanistan, Pakistan