United struggle needed for a new policy and a good life

Nearly three years have passed since the CITU conference held in Calcutta in May 1970. This period has been eventful, with major advances made by the forces of socialism and democracy on the international and national scene. China's entry into the United Nations and the failure of the American policy of encircling China are proof of this.

The American policy of isolating and encircling China has ended in failure. The People's Republic of China has taken its rightful place in the United Nations, and the lie that the Chiang Kai-shek clique represents China has collapsed.

Above all, Nixon had to rush to China and then agree that the two countries would begin de facto diplomatic recognition.

The victory of the Vietnamese people

The most important development of this period is the end of the American war of aggression in Vietnam. Even the attacks of the American air force, which came close to nuclear bombing, could not subdue the heroic Vietnamese people. Isolated before world public opinion and the public opinion growing in America itself, Nixon had to stop the war.

The Vietnamese people received massive help, in arms and otherwise, from the socialist countries, above all from the Soviet Union and China. Yet whatever their differences, had the two great socialist countries taken a bold, united stand against the American imperialists when a member of the socialist camp was attacked, much indescribable suffering and misery could have been avoided.

The terms of the agreement ending the war are the withdrawal of the forces of America and other foreign powers from South Vietnam and the dismantling of their military bases. The Provisional Revolutionary Government of South Vietnam has been recognised, and its authority maintained in the areas it controls. The dividing line between North and South Vietnam has been accepted as a provisional line; the country will be reunified according to the wishes of the people. A unanimous decision of the National Council of National Reconciliation, made up of the Provisional Revolutionary Government, the Saigon government and neutral forces, will prepare the ground for democratic elections in South Vietnam. No troops, arms or war materials are to be brought into South Vietnam from abroad. Civilian prisoners and prisoners of war will be released, and there will be an international supervisory commission. These are the terms of the agreement.

There is no doubt that this is a tremendous victory won by the Vietnamese people, who have written a glorious chapter in the struggle for freedom. If the terms are honestly observed, a democratic government will be established in South Vietnam, with socialist Vietnam showing the way.

American imperialism is still conspiring

The American imperialists, who tore the 1954 Geneva agreement to pieces and unleashed the most brutal war against Vietnam, cannot be expected to respect the terms of the agreement. Already, through their puppet Thieu, they have begun violating the ceasefire terms.

These treacherous moves of the American imperialists must be defeated in time through the constant vigilance of the socialist countries and world democratic opinion.

The CITU congratulates the heroic Vietnamese people on this great victory over the most brutal imperialism. The CITU calls on the Indian working class to remain constantly vigilant and to raise its voice in protest against every attempt by the American imperialists to wriggle out of their own commitments and unleash a long civil war in South Vietnam. The CITU calls on the two socialist countries, China and Russia, to resolve their differences and act together against American conspiracies.

The birth of Bangladesh

Another major development is the emergence of Bangladesh as a sovereign, independent country, freed from the yoke of Pakistan's military dictatorship. This has led to the fall of military rule in Pakistan itself and to the rise of democratic forces in both Pakistan and Bangladesh.

Yet the American imperialists, who backed the unheard-of savagery of the Yahya Khan regime in Bangladesh and its attempts to drown the freedom struggle in blood, have lost no opportunity to make up with Bangladesh. In the guise of aid to rebuild the shattered economy and for development, America has already established considerable influence in Bangladesh. We know what American aid means. The democratic forces must remain extremely vigilant to defeat the American conspiracy.

The democratic forces in Bangladesh and Pakistan are working in extremely difficult conditions, facing constant attacks from reactionary forces. The Indian working class cannot stand by as a mere spectator to these attacks. We stand with the democratic forces of Pakistan and Bangladesh.

Release of prisoners of war

One of the things the reactionary forces in Pakistan use as a weapon against the democratic forces is the question of the 80,000 Pakistani prisoners of war held in India. The CITU asks the Government of India to resolve this question quickly. Except for war criminals who need to be tried, the prisoners must be released at once so that they can rejoin their relatives and families. The CITU also demands that the Bangladeshi refugees wandering in Pakistan be handed over to Bangladesh immediately.

There is the question of whether Pakistan's recognition of Bangladesh should come before or after a meeting between Bhutto and Mujib. Such matters must not be allowed to delay the resolution of these issues.

The dollar crisis

The past period has witnessed the deepening of the world capitalist crisis, whose concrete form was the currency crisis. The dollar, which emerged as master of the world at the end of the world war, no longer stands where it did. The system the imperialist powers set up at Bretton Woods at the end of the last war has completely collapsed. Despite America's reluctance, the dollar has had to be devalued by 10 per cent within the last 19 months, and still no solution to the currency crisis is in sight.

There is no need to go into an analysis of this crisis here. It is enough to understand that it is the creation of the imperialist countries Japan and West Germany, which are rising as powerful rivals of America in the world.

With Britain's entry, the European Common Market has been transformed into a large economic bloc capable of effectively holding America in check. In 1971 its imports amounted to 171 billion dollars, more than twice the combined imports of America (46 billion) and Japan (20 billion). It exported 312 billion dollars' worth, four times the combined exports of America (43 billion) and Japan (24 billion). This shows the strength of this economic alliance.

Trade relations among the imperialist powers

The European Common Market, formed with American encouragement to counter the growing influence of the Soviet Union and the socialist world, has today become the most important obstacle to America's growth in trade and investment. The contradictions between the Common Market and Japan, between America and Japan, and between America and the Common Market are becoming sharper. A trade war is going on.

America wants to solve its crisis at the expense of the Common Market and Japan. It threatens that unless Japan raises the value of the yen, it will impose tariff restrictions on Japanese goods imported into America. It threatens to withdraw its troops from the Common Market countries unless they come to its aid. Other countries can accept America's demands only by ruining their own economies.

None of these countries is able to take any joint action. On the contrary, any step a country takes to protect its own economy can only upset the American economy.

Working-class struggles grow

The depth of this crisis can be seen from the increase in strike struggles in the developed capitalist countries.

Number of workers on strike in the developed capitalist countries:

1967: 30 million
1968: 45 million
1969: 44 million
1970: 45 million
1971: 48 million

Every country has seen the hardest and longest strike struggles. The most memorable was the strike by shipyard workers on the Clyde in Britain against an attempt to close a shipbuilding company. The strike lasted nearly eight months, and the government had to agree that the company could continue working. In Britain the number of working days lost up to August 1972 was 15 million, against only 13 million in 1971.

Referring to the condition of the workers and their struggles, a bourgeois paper wrote: unemployment is rising, prices are soaring, and class contradictions grow sharper with each passing day.

It was as a result of this that the Communist and Socialist parties in France came together to form a united front. In the recent elections the ruling party lost about a hundred seats; but for the defects of the electoral system, the Gaullist party could not have returned to power.

These are only some indications of the growth of the struggles the working class, facing the exploitation of the monopolies as the capitalist crisis deepens, is waging against capitalism. I did not wish to load this report with accounts of the struggles taking place in each country.

The economic situation in India

Comrades,

In the report I presented at the founding conference of the CITU in May 1970, I pointed out that the capitalist path of development our rulers are trying to follow, without breaking feudal relations in agriculture and with imperialist aid and collaboration agreements with foreign monopoly capitalists, has led the country into a whirlpool of economic crisis. Instead of becoming a prosperous industrialised country, our dependence on foreign aid has grown year after year. The foreign exchange shortage is increasing every year. Even for imports, our country has to rely more and more on foreign aid, especially American aid.

I also pointed out that the budget and the Fourth Plan showed that the burdens on the working class and the people would be increased through inflation, rising prices and higher ….. on consumer goods.

Events from then until now have clearly proved that view right. Successive budgets have imposed huge burdens through indirect taxes, and the budget deficit grows every year.

Rising prices

As a result of all this, inflation is growing rapidly, and the prices of consumer goods have risen in a way never seen before.

The official figures saying that food grain prices rose by 15 per cent and wholesale prices by 12 per cent in 1972 are deliberate attempts to hide the real extent of the price rise. In the last year the retail price of a kilo of wheat rose from 80 paise to one and a half rupees. The price of rice rose from two rupees to three rupees. The price of oil rose from five rupees a kilo to seven. A kilo of sugar went from two rupees twenty paise to four rupees. In many places kerosene cannot be had even at two rupees fifty paise a litre, while the price fixed by the government is seventy paise. The prices of pulses have soared too. Yet the government claims prices have risen by only 12 per cent.

After dragging the people through all this suffering in the name of development, what has our economy gained? Neither industry nor agriculture has developed. Only poverty and unemployment have grown.

The finance minister has admitted that all the hopes of growth expected in the economy in 1970-71 were an illusion. His forecast that 1970-72 would be a good year has also proved wrong. The rate of growth was barely 3 to 3½ per cent.

1972-73: the year of the gravest crisis

1972-73 witnessed the gravest crisis. When America stopped all aid after the short war with Pakistan over Bangladesh, the results of excessive ….. on American pressure became visible. Many industries had to close for lack of spare parts, which could not be imported from America for want of foreign exchange.

This led to lay-offs for lakhs of workers in the organised sector and in small industries, threw millions of handloom workers out of work, and seriously affected tens of thousands of farmers who depended on electric irrigation and the agricultural workers on their land. The nationwide power shortage exposes the severity of this crisis and the bankruptcy of planning based on collaboration with foreign monopoly capitalists and on foreign aid.

The target over four plans was to generate 22.71 million kilowatts of electricity, but only 14.71 million kilowatts were actually achieved, 35 per cent short of the target.

The price of aid and collaboration

The failure to reach the target is due to dependence on foreign countries for importing generators, boilers and other equipment.

The 1969 report of Parliament's Committee on Public Undertakings pointed out that after Heavy Electricals in Bhopal and Bharat Heavy Boilers in Trichy were built at huge cost, only 15 per cent of their production capacity has been used. Eighty-five per cent of their capacity lies unused. No development work has been done on these products. No research has been done there to build 110-megawatt generators, while the new power projects need generators of 130 and 260 megawatts.

How can such policies free us from foreign dependence?

In the report I presented at the General Council in Coimbatore in May 1971, I described the widespread corruption in the public sector in collusion with contractors, the criminal negligence in maintaining machinery, and the use of poor-quality coal. All these have brought the country to such a state of chaos. The power crisis is only one example of the price we have to pay for our country's dependence on foreign aid and foreign monopoly capitalists.

As the disastrous results of depending on foreign collaboration, we have had to face sabotage of production, the use of outdated machinery and needless delays. This happened in many projects such as Durgapur Steel, Durgapur Alloy Steel, the Cochin Refinery and the Durgapur fertiliser plant. I dealt with them in detail in my report to the Coimbatore General Council.

On top of all this, the plunder by foreign companies through profits, fees for technical assistance and royalties is enormous. For example, the foreign oil companies alone made profits of Rs 31 crore in 1971 and Rs 42 crore in 1972. A rubber factory with a negligible capital investment was able to send crores of rupees in profit abroad.

The growth of the monopolies

Even as industrial progress stagnates and the people's suffering grows, the profiteering of the big monopoly capitalists keeps growing. Writing about a Reserve Bank study of the savings and investment of 1,019 companies that owned 75 per cent of the total capital invested in 1970-71, the Economic Times of June 13, 1972 said:

The study reveals that the scarcity of raw materials, machinery and the like has had no effect on economic concentration. Total savings were Rs 529 crore in 1969-70 and rose to Rs 622 crore in 1970-71. There was a considerable increase in net profits, from Rs 174 crore to Rs 237 crore. 1970-71 was not a very favourable year for industry; it is regarded as a year in which industrial development was held back for various reasons. Considering these facts, it is a pleasant surprise that big private companies recorded an 18 per cent rise in gross profits and a doubling of net profits that year.

Is there any reason for surprise that the monopoly capitalists grew fat in this period? Is it any surprise that with such policies the economy grew by only 3½ per cent, that average per capita income stayed almost stagnant, and that the percentage of people below the poverty line rose enormously?

The budget exposes the bankruptcy of government policy

The budget the finance minister presented in February this year for 1973-74 clearly reveals the government's complete inability to free the country from the crisis it faces and to speed up industrialisation. It sets aside only Rs 1,674 crore for the central plan, against Rs 1,787 crore in the last budget, a cut of Rs 103 crore, or 7 per cent. Taking into account the official estimate that prices have risen by 15 per cent, the real cut will be 15 per cent, a further shortfall of Rs 160 crore. The investment the government proposes for public sector undertakings in heavy industry, petrochemicals and iron ore mines, which are vital to industrial development, is only Rs 488 crore, against Rs 602 crore last year, a further cut of 20 per cent.

In the name of social justice, Rs 125 crore has been set aside for a child nutrition programme, rural water supply, a social security programme for industrial workers and so on. This is mere lip service: the same amount was set aside last year. Considering the price rise of 1972-73, the allocation this year is in reality 15 per cent less than last year.

Rs 100 crore has been set aside for new programmes to create jobs for about 5 lakh educated unemployed in various sectors while helping to produce permanent assets. Which sectors is not specified. Chavan has come on the scene declaring that, at one job for every Rs 2,000 of investment, he can give jobs to 5 lakh people. Only God knows in which industry these jobs will be! Planning has been degraded into mere arithmetic. Such is the bankruptcy of the rulers.

A deficit of Rs 250 crore was set aside for 1972-73. Now the finance minister says the actual deficit was Rs 550 crore. The real deficit is hidden by juggling the figures.

A paradise for tax evaders

Industrial production is thought to have risen by about 7 per cent, and the government admits that commodity prices have risen by at least 6 per cent. Yet there has been a shortfall even in excise taxes. Clearly this was a harvest season for tax evaders.

When prices rise and unemployment grows, it is obvious that more income piles up in the hands of the wealthy sections liable to pay income tax. Yet the finance minister estimates an increase of only Rs 49 crore in income tax. The government expects more excise duty to be evaded.

So this budget offers loopholes to create more black money.

To calm the anger of the people, the finance minister boasted that there would be a deficit of only Rs 85 crore this year. But he later had to admit that once the Central Pay Commission's report came, the deficit would rise to Rs 250 crore.

Can anyone who has the experience of 22 years of planning, and especially of the last year, and of prices rising even after the budget, believe this? The real growth that can be achieved is far below the target. This means a fresh attack on the living standards of ordinary people and more unemployment.

Indira Gandhi's words and deeds

Comrades,

What do the developments of the last two years show? Less than six months after our last conference, Indira Gandhi suddenly dissolved the Lok Sabha. She faced the election with the slogans 'abolish poverty' and 'end beggary'. She burst out against the Marwari and Gujarati monopolies as those who had brought ruin to the country and the common man. She pointed to bank nationalisation as a symbol of her determination to fight these monopoly capitalist houses. She declared that she had got rid of Morarji, Atulya Ghosh, S K Patil and Nijalingappa, and that she had removed every obstacle to pursuing progressive policies.

Attracted by her slogan, the poor gave her a huge victory in the election…