Sending out a strong, pro-Dalit signal to India Inc, the Mayawati government in Uttar Pradesh has decided not to release funds meant as subsidy for Tata Motors because it did not adhere to the state government’s affirmative action policy.
However, a senior official of Tata Motors’ Lucknow plant said the company believes it already employs more than the stipulated requirement of the three specified categories among its workforce but refuses to be drawn into a formal reservation per se.
“We are an equal-opportunity employer and we do not make any distinction among our employees on any basis whatsoever. However, for all new recruitments being done by us, we are giving our employees the option to declare their caste. But with the government not releasing funds meant as subsidy on this ground, we have been rendered uncompetitive in the market and put at a disadvantage as our goods are costlier than that of the other states that are giving many incentives to the industry. As a result, the second phase of our expansion plans has also been put on hold. The management is reviewing the viability of the expansion in the light of the government not releasing funds for us,” the official said on condition of anonymity, adding that the company stands to lose almost R150 crore on capital and infrastructure subsidies itself. “The tax and transport subsidy, however can take that figure to a whopping figure,” the official said.
The state government support flows in the form of infrastructure and capital subsidy, interest-free loans and transport subsidy for those investing R100 crore or more, and was introduced by the Mulayam Singh government in 2006 to attract industrial projects to the state. But soon after coming to power in 2007, the Mayawati government tagged the disbursement of the benefits to the private sector to her wider vision of social equality and justice. In doing so, industry was expected to reserve 10% jobs for SCs, 10% for OBCs (including religious minorities) and 10% for weaker sections of upper castes for all government-supported projects.
With this move, perhaps the first such, the Mayawati government has very firmly put its affirmative action initiative, envisaging job reservation for scheduled castes, other backward castes and the weaker sections among the upper castes for all government-supported projects, above economics.
The Tata Motors plant in Lucknow, which had expansion plans of R550 crore in the pipeline, was one 12 projects that were found eligible for the sops. But, with the company refusing to give an in-principle nod to the affirmative action agenda, the state government last week decided not to release funds for the company despite having the budgetary provisions and has, instead, surrendered the money. “The attitude of the private sector on the issue of ‘positive’ reservation so far has been ambivalent to say the least,” said an official closely involved with the state’s social schemes, “and they try to take umbrage under the argument that they are equal-opportunity, merit-based and caste-neutral companies and that the dreaded C-word, with all its dubious distinctions, should not be allowed to enter into the hallowed portals of corporate India.” However, according to the state government, the old, passive approaches to uplift the disadvantaged sections of society have failed and the new approach is to incentivise the corporate sector in doing so. “The government policy has been issued after a lot of deliberation and it aims at striking a harmonious balance between social equity and economic growth. The corporate sector should not have any difficulty in implementing this policy,” said VN Garg, principal secretary (industry). “It is perhaps time the industry rose and acknowledge the fact that in our country caste prejudices and inequalities not only exist but run very deep and cannot be wished away. Concrete steps and a diversified pattern must be followed to set the wrong right. And industry has the power to do so more than anyone else can,” said political scientist Ramesh Dixit, adding that if industry does not volunteer to do so, a legislation to that effect will certainly make things smoother.
Interestingly, a January CII study found UP was among the top 10 states when it came to the proportion of SC/ST staff in industry. Built on 300 acre in 1986, the Lucknow unit began in 1992. It makes MCVs, HCVs and a few LCVs too, apart from buses.
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