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BW Businessworld

Community Capitalism Vs Maoism

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Is corporate India burying its head in the sand in face of rising aggression from Maoists? Once again business leaders have stayed away from reacting to the Maoist attack on Congress leaders in Chhatisgarh.

Some business leaders perhaps feel that this is a political and social issue that does not directly concern them. Many others feel that reacting now would land them in the middle of a political crossfire.

Most though should be terribly worried about the attack. Whether they speak up and condemn the attack or not is a smaller issue. What is important though is the implication it has for business and growth.

About a third of india is under the influence of Maoist and Naxalite rebels. A painful fact is that much of these regions are also rich in natural resources. State governments and industrial groups have been experimenting with various models to harness these resources.

Most of these attempts have been driven by opaque policies that benefit crony capitalism at the cost of local communities. Political and business leaders are still to realise the impact of this dangerous game.

Resource-oriented scams are now routinely cropping up in states. Many go unnoticed and unreported. These allow Maoists to justify their terrorist activities. Maoists convince their cadres and local communities that their wealth is being usurped by political and business leaders.

While there is some truth to this allegation, it does not justify violence in any way.

Even as the government and security agencies are stepping up their war against Maoists, corporate India must act too. Business is an equal stakeholder in social peace. Ensuring it is the responsibility mostly of the government, but also of industry and community leaders.

Corporates that operate in regions under Maoist influence should step up their community engagement programmes. Many companies objected when a law was being discussed that would force them to share profits with local communities whose land had been acquired or mined. This exposes a mindset that focusses on short-term gains.

Giving  up a higher share of profits should be seen as an investment in regional community, social peace and local development.

More importantly, these businesses should be supported by the local government to raise the level of communication of these activities in the region. Often good work is ignored while scam are highlighted. Maoists influence will be undermined by high profile acts of social welfare.

There are various reports that suggest the Maoist empire has annual revenues of Rs 1,500-2,000 crore or about $500 million. Much of this money comes from ransom and extortion.

Organisations working in these areas have to pay monthly extortion fees or risk kidnapping, arson and attacks.

This threat will have to be met with police action. Local governments must be reinforced and strengthened to counter extortion.

This is critical to plug the funding of terror activities. Central, state and local governments must place strengthening of security forces on top priority to ensure that Maoists are choked of funds.

For the sake of long-term peace and development, industry leaders will have to sink business rivalry to support local government in a open forceful manner.

Countering the growing menace of Maoist terrorism will require corporate India to change the way it does business. It will have to discard crony capitalism to being more benign, transparent and collaborative. It is time for community capitalism.

(Pranjal Sharma is a senior business writer. He can be contacted at [email protected])