As in other industries , foreign private capital was not satisfied with having control only in the private sector . They insist on entering the public sector itself , as in the oil industry . The Government had to give in . Therefore , even in this field , the so-called joint sector companies were established . For example , Madras Fertilizer “ will be in the public sector with equity participation by American International Oil Company ”. The Government of India will hold 51 per cent of the equity and the American firm the remaining 49 per cent . The Chairman of the Board of Directors will be a nominee of the Government . The Managing Director will be the nominee of the American Company . He will act on the advice of the Board on which there will be equal representation both for the Government and the American company . But the most important part of the agreement is that , “ the arrangements regarding management will last only for 10 years from the date of the commercial operation or until foreign exchange loans have been fully repaid whichever is earlier ” (‘ Hindu Survey of Industries ’, 1966 , Page 75 ). The foreign exchange bill will be about $ 35 million .
Thus the management of the public sector companies has been handed over to foreign monopolies , for another 10 years from the date of a commercial operation or until foreign exchange loans have been fully repaid . This is only one of the examples of increasing collaboration between the Government of India and foreign companies in the establishment of the fertilizer industry in this country . Another example is Kanpur Fertilisers , another ‘ mixed ’ company in which the Government of India has invested in the share capital and Rs . 16 crores have been given as loans to this industry from the Indian banks and financial institutions . One can very well see that the feeding of such joint sector company , in which foreign hold is strong , with loans either from the Government of India or from Indian 14 finance institutions is nothing but supplying them with scarce Indian capital for the exploitation of the country by foreign monopolies .
As early as in 1963 ( on December 27 ), the Eastern Economists in an article ‘ The Battle for Industrial Production ’ had ironically declared that “ the public sector in the fertilizer industry seems to have bitten off more than it can chew ”. On behalf of the foreign monopolies , this Birla dominated economic journal had demanded of the Government that it should revise its “ policy of relying almost wholly on the public sector ” and pleaded that “ proper economic , climate which is particularly important as the foreign finance and technical collaboration have to be enlisted ” should be created . The Government of India readily gave into their demands and gave up control over fertilizer prices and trade .
We had previously noted that the foreign concerns were interested mainly to use the raw material of their choice - either naphtha from their refineries or liquid ammonia to be imported - so that they , as producers of naphtha , could dictate prices , or as importers of ammonia , earn profits , not only on the sale of fertilizers but also on the supply of raw materials to the industry .
Thus the fertilizer industry even in the public sector was made dependent on foreign finance , foreign technology , foreign management , and foreign raw materials - in addition to completely controlling prices and marketing . Can anyone in these circumstances say that the public sector industries and the credit from the socialist countries “ have undermined the former monopoly position of the imperialist powers ”, as Uliyanovsky has so consistently argued in his book , “ Asia and the Dollar ”?
Mineral Revolution and Foreign Role
To achieve a ‘ mineral revolution ’ through air-borne mineral surveys under-taken by foreigners on a turnkey basis with loans from foreign finance capital , is the latest fad of the Government of India . This only helps to mortgage every part and every sector of India to foreign monopolies .
Prof . K . V . Subramaniam , a well known and eminent scientist in this field , a member of the Committee on Science and Technology was aghast at the shameless manner in which “ the nation has been reduced to bankruptcy and its economy has been thrown open to foreign enterprise in every conceivable form ”. He gives a resume of the steps taken by the Government of India in ‘ this regard to the detriment of India ’ s interest . In an article in ‘ Economic Times ’, he says : “ There are several remarkable features about these contracts for air-borne mineral surveys . The Government of India approaches the US AID for a loan to meet the foreign exchange cost of the Khetri copper project and receives a loan for Operation Hard Rock , which it accepts with alacrity ”.
“ The Government of India then approaches the French Government for a loan for Khetri and receives along with it another loan for another air-borne mineral survey , the knowhow for which is the same as the one for Operation Hard Rock ”.
When such interesting research is taking place in the name of a mineral survey , how can the Soviet Union one of the biggest powers be left out ? How can the Soviet Union allow itself to be left out ? Therefore , “ not to be outdone by the others , USSR comes up with its offer of an aeromagnetic survey which is well within our own resources in knowhow equipment and personnel ”.
Mr . Subramaniam continues that the latter two aerial survey contracts were committed to foreign powers at a huge cost to the exchequer , “ despite the clear recommendation of the committee headed by late Dr . D . N . Wadia , which included as members leading geophysicists in the country with experience of similar aerial surveys conducted for the Oil & Natural Gas Commission , that no further commitments for aerial surveys should be made with foreign agencies
Class Struggle