Appendix

208

Appendix A.1 Institutions Visited and/or Contacted for Data Collection

Institution Place, Country Year

All India Trade Union Congress New Delhi, India 1992Allied Motors Ltd. New Delhi, India 1991Am Forge Mumbai, India 1991Asahi Glass New Delhi, India 1996Ashok-Leyland Chennai, India 1991Associated Chambers of Commerce New Delhi, India 1994and Industry of IndiaAssociation of Indian Automobile Mumbai, India 1991ManufacturersAutomotive Components New Delhi, India 1991, 1992, 1994, Manufacturers Association 1995, 1996Bharat Gears Mumbai, India 1991Bharat Seats Ltd. New Delhi, India 1991Bharat Seats Ltd. Gurgaon, India 1996Bharatiya Mazdoor Sangh New Delhi, India 1992Business India New Delhi, India 1994Centre for Indian Trade Unions New Delhi, India 1992Centre for Indian Trade Unions Uttarpara, Kolkata, 1995

IndiaCenter for Studies in Social Sciences Kolkata, India 1994, 2002C.K. Daikin Mumbai, India 1991Communist Party of India (Marxist) Kolkata, India 1994Communist Party of India (Marxist) Uttarpara, Kolkata, 1995

IndiaConfederation of Indian Industry New Delhi, India 1991, 1992, 2001Dalmia Engineering Kolkata, India 1991DCM-Toyota Surajpur, Uttar Pradesh, 1991, 1992, 1994

IndiaEicher Tractors New Delhi, India 1991Eicher-Mitsubishi Pithampur, 1992

Madhya Pradesh, IndiaEmbassy of Japan New Delhi, India 1991Embassy of the Republic of Korea New Delhi, India 1994Federation of Indian Chambers of New Delhi, India 1991Commerce and IndustryGeneral Motors India Halol, Gujarat, India 2001Gleitlager India Mumbai, India 1991Government of India, Department New Delhi, India 1991of Electronics

Appendix 209

Government of India, Directorate New Delhi, India 1991General of Technology and DevelopmentGovernment of India, Ministry New Delhi, India 1992of FinanceGovernment of India, Ministry New Delhi, India 1991of IndustryGovernment of India, New Delhi, India 1991Planning CommissionGovernment of West Bengal, Kolkata, India 1995Cottage & Small Scale IndustriesHaryana State Industrial Development New Delhi, India 1994CorporationHind Mazdoor Sabha New Delhi, India 1992Hindustan Motors Kolkata, India 1991, 1995Honda Motors Tokyo, Japan 1991Honda Motors Saitama Plant, Tokyo, 1991

JapanIndia Investment Centre New Delhi, India 1991, 1992, 1994India Today New Delhi, India 1991Indian Council for Research on New Delhi, India 1991, 1992International Economic RelationsIndian Machine Tool Manufacturers New Delhi, India 1991AssociationIndian National Trade Union Congress New Delhi, India 1992Indo-Japanese Association Tokyo, Japan 1991Isuzu Motors Tokyo, Japan 1991Jamna Auto Industries New Delhi, India 1991Japan Automobile Manufacturers Tokyo, Japan 1991AssociationJapan External Trade Organization New Delhi, India 1991Japan International Cooperation New Delhi, India 1991AgencyJawaharlal Nehru University New Delhi, India 1991, 1992Korea Trade Center New Delhi, India 1994Lucas-TVS Padi, Chennai, India 1991Machino Plastics Gurgaon, India 1996Mahindra and Mahindra Mumbai, India 1991, 1996Mark Auto Gurgaon, India 1996Maruti Udyog Limited New Delhi, India 1991, 1992,

1994, 1995, 1996, 1999, 2002

Maruti Udyog Limited Gurgaon, India 1987, 1991, 1992, 1994, 1996

Appendix A.1 Institutions Visited and/or Contacted for Data Collection –continued

Institution Place, Country Year

210 Appendix

Mazda Motor Corporation Hiroshima, Japan 1991MICO-Bosch New Delhi, India 1991Mitsubishi Motors Tokyo, Japan 1991National Council of Applied New Delhi, India 1991, 1992Economics ResearchNational Institute of Public Finance New Delhi, India 1991and PolicyNational Union of General Workers Tokyo, Japan 1991(South District)Nippon Denso Industry Co. Tokyo, Japan 1991Nissan Motor Company Tokyo, Japan 1991Nissan Motor Company Yokohama Plant, 1991

Yokohama, JapanPremier Automobiles Ltd. Kurla, Mumbai, India 1991Rane (Madras) Ltd. Chennai, India 1991Research and Information System New Delhi, India 2001for the Non-Aligned and Other Developing CountriesRICO Auto Industries Ltd. New Delhi, India 1991Society of Indian Automobile New Delhi, India 2002ManufacturersSona Steering New Delhi, India 1991, 1994Sona Steering Gurgaon, India 1991Sona Components Gurgaon, India 1996Standard Motors Chennai, India 1991Suzuki Motors Hammamatsu, Japan 1991Tata Engineering and Locomotive Mumbai, India 1991CompanyToshiba (International Operations) Tokyo, Japan 1991Toyota-Kirloskar Bedadi, Bangalore, India 2003UCAL Fuel Systems Chennai, India 1991West Bengal Industrial Development Kolkata, India 2002CorporationWorld Bank Washington, D.C., USA 2002World Bank New Delhi, India 1998XLO India Mumbai, India 1991

Appendix A.1 Institutions Visited and/or Contacted for Data Collection –continued

Institution Place, Country Year

211

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Chapter 1

1. This approach, long-established and widely used by historically-groundedmarxian scholars, has only recently caught the attention of other scholars (seePierson 2004).

2. The growth of the middle class, income polarization, and transnationalization ofthe industry are features common to both.

3. Robert Boyer warns of mechanistic application of western institutions of capitalistdevelopment to non-western, semi-industrialized economies (Boyer 1990: 99). Heclassifies India as a “mixed” economy in which intensive accumulation (a featureof advance capitalism) coexists with the absence and presence of mass productionand traditional agriculture respectively (Boyer 1990: Table 3). This of course doesnot adequately capture the institutions of Indian capitalism.

Chapter 2

1. For example, in two cities deeply integrated with the contemporary globaleconomy, Singapore and Penang (Malaysia), the high degree of business col-laboration is actually based on primordial ethnic ties rather than impersonalarms-length, market transactions (Wong 2001, Rasiah 2001).

2. The literature on the Regulation school is voluminous and hence it is beyondthe scope of this chapter to disentangle the subtleties of the various positionswithin the Regulation school (see Robles, Jr. 1994 for a survey). A critique ofthe Regulation framework can be found in Brenner and Glick (1991) andMavroudeas (1999).

3. This is similar to the “social structure of accumulation” framework, wherebyeach phase corresponds to a social structure of accumulation (SSA) comprisingsets of institutions favorable to capital accumulation (Kotz 2001).

4. Boyer does not even include Japan in his classification scheme (1990: Table 3).See Williams (1994) for an alternative Japanese approach to regulating markets.

5. Whitley (1999), however, also examines the East European case, which can beargued to fall broadly under the “transitional” group–from state socialism tomarket capitalism. Within this group there is considerable diversity, with Russiaand the East European economies (closer to the more “liberal” Western Europe)and China and Vietnam (closer to more “socially” embedded Asian systems).However, the common link between the two groups is the significance of exoge-nous capitalist forces in altering their institutional foundations for economictransformation.

6. As per the regulation approach, there are two types of regimes–extensive andintensive regimes of accumulation. For the purposes of this study no distinctionis made, although the market-driven strategy intuitively reflects a more intensiveregime of accumulation.

7. The regulation approach in its stylized historicization of advanced capitalismoffers two kinds of modes, namely, competitive (mid-19th century to World War

213

Notes

I) and monopoly (post-World War II until the 1970s) forms. These parallel theextensive and intensive regime of accumulation respectively.

8. Neoliberal ideology could be imposed by exogenous forces. For example, eco-nomic failings, as in the Japanese and Korean financial systems, are often ex-plained by the non-adoption of neoliberal banking practices. Thus these statesare forced to accept practices that they have historically avoided, to theirbenefit, in creating an industrial foundation unprecedented in capitalist devel-opment. Today they reluctantly accept neoliberal foundations for economicorganization to extricate themselves from stagnation and stave off further crisis.

9. This interpretation of the transformation of states is consistent with Pedersen’ssociety-centered explanation of economic liberalization in India (Pedersen2000). However, his attempt to link the 1991 reforms to the emergence of a newcrop of entrepreneurs (the “quiet revolution”), underplays the larger context ofstate-sponsored embourgeoisment, which was in process much earlier.

10. This is in sharp contrast to the distinctiveness of Japanese business systems,which seem to remain “nationally” intact despite the considerable interna-tionalization of the Japanese economy and significant outward foreign directinvestment (Whitley 1999: 128–129).

11. There are various definitions of excess capacity, depending on how productioncapacity is defined (European Commission 1997: 3). In general, excess capacityis the “amount of extra volume that a firm could produce if all its existingplant and equipment were fully used for 24 hours a day” (European Com-mission 1997: 3). Excess capacity in the Indian auto industry is equivalent tothe difference between installed capacity and actual production. For a givenfirm, this difference could arise not only in the way installed capacity isdefined (and sometimes “stretched” incrementally) but due to actual produc-tion falling short of such capacity (see D’Costa 1999: 21–27). However, excesscapacity as discussed here is integral to capitalism and is hence interpreted assystemic.

Chapter 3

1. There are many structural and historical reasons for India’s low level of entrepre-neurship. Suffice it to say the British contribution to landlordism (zamindars),support of local traders, managing agencies involving commissions, and highcaste disdain for manual work contributed to a rent-seeking, risk-averse businessorientation.

2. Other factors include the structural constraints of the import substitution model.This includes bias against exports, misallocation of resources, regulation of production through licensing of industrial capacity, and restrictions on foreigncapital to eliminate competition. The results have been induced competition for state largesse in the form of industrial licenses and the encouragement ofhigh-cost, inefficient industry.

3. Rural class differentiation can be gauged by the fact that in 1971 about 17,000tractors were produced compared to nearly 83,000 in 1981. This is a five-foldincrease (Automotive Components Manufacturers Association (ACMA) 1999: 10).

4. Since 1951 India’s population increased by 2.76 times but grain output increasedby 4.21 times.

5. The irony of this politicization should not be lost on scholars of social change,whereby communities consciously devalorize their primordially-derived social

214 Notes

standing or construct an inferior one in order to gain secular economic benefits.It is of course entirely possible that new-found secular gains can cumulativelyreinforce non-secular attributes.

6. In 1997 138,450 and 186,155 students were admitted to engineering degree anddiploma programs respectively (Institute of Applied Manpower Research 1998).There is a high attrition rate among lower ranked institutions, which results fromboth under-preparation of students as well as poor quality facilities.

7. In Africa, local support for state-led import substitution arose from vested inter-ests (Lofchie 1997).

Chapter 4

1. The government in the 1970s had established Scooters India Ltd. to capture thelucrative two-wheeler market. However, it failed miserably because of industrialstrife and managerial and technological incompetence (Nayar 1992).

2. Discussions held with relevant officials in New Delhi, Bombay, Madras, Calcutta,Tokyo, Hammamatsu, Hiroshima, and Toyota-shi (August-December 1991).

3. In 1986 about 33 million persondays were lost due to industrial disputes(Confederation of Engineering Industries 1991: 131). In a highly politicizedsociety such magnitudes were not uncommon in the past.

4. One component manufacturer confided that dies worth about $4 million for theTELCO-Honda project were already made and were lying idle in Japan (Interviewwith RICO, New Delhi, Sept. 1991). This could not be confirmed with Hondaofficials in Tokyo.

5. Although exporting the Indian-made Hondas was not explicitly stated in theapplication, one TELCO official stated exports could have been made if neces-sary. But he added that since the Hondas would be extremely popular in Indiathere would not have been a need for exports (Interview with TELCO officials,Bombay, Oct. 1991). This argument, however, is not persuasive if the govern-ment was concerned with foreign exchange outflows since not exporting wouldhave entailed outflows under the assumption imported components had to beused for production.

6. I am grateful to Makoto Kojima for this information.7. Based on interviews conducted during September-November 1991.8. See Chapter 6 on the continuing controversy over the firm’s restructuring.9. Nayar (1992) illustrates the difficulty in privatizing state-run firms such as Scooters

India Ltd. as part of the overall liberalization package. Even for private firms laborretrenchment is fraught with difficulty, as in the case of Standard Motors.

10. Manor (1988) sees this principally as a result of the breakdown of the rulingCongress Party’s discipline.

11. The feasibility studies of many Japanese LCV projects were done at 260 yen tothe US dollar. The yen subsequently rose to about a 100 per dollar.

Chapter 5

1. Cooperation between partners need not be symmetrical. A survey carried outfifteen years ago indicates the vulnerabilities of small parts suppliers (Category C),each of whom sold nearly two-thirds of their output to a single buyer, whereassome of the larger suppliers (Category A) were quite independent of assemblers(Narayana 1989: 57–58).

Notes 215

2. Economy of scale in microeconomics is seen as declining long-run average costwith output increases. It is expressed as the cost-output elasticity and written asE = (ΔC/C)/(ΔQ/Q). The numerator is the percentage change in cost and thedenominator the percentage change in output. An E value less than one indi-cates an economy of scale (Pindyck and Rubinfeld 1995: 213). Economy of scopeis said to exist if the cost of joint output by a firm is less than the combined costof output under two firms. However, this economistic view of scale and scopeoverlooks the importance of risks in low-trust environments.

3. This interpretation differs from Kohli’s analysis of liberalization of the 1980swhere he does not even mention the CII (1992: 315–330).

4. After relinquishing his position as the Managing Director of majority state-owned MUL in the late 1990s, R. C. Bhargava was recalled in 2003 to serveunder the majority Suzuki-owned MUL.

5. Proximity to the assembler is not a new development in India. Several “job-works”-oriented firms are found in the vicinity of vehicle manufacturers. In Narayana’s survey (1989), these firms were small, dedicated, and heavilydependent on the vehicle manufacturer. In the current discussion mutual vulnerability would also imply the buyer’s dependence on suppliers.

6. An important exception is TELCO, which over the years cultivated a highlydiversified network of suppliers. However, TELCO, as with other Indian firms inexistence prior to MUL, was vertically integrated (see Narayana 1989: Table 2.2:17). This turned out to be an asset in the changing market.

7. This was echoed by virtually all the representatives of automotive firms I spoketo during my fieldwork in Delhi, Bombay, and Madras in 1991, Pithampur in1992, Halol in 2001, and Bedadi in 2003.

8. It is therefore not surprising that DCM-Toyota in its initial years was plagued byvarious labor disputes. While lay-offs have been rare in the assembly industry,DCM-Toyota in the late 1980s resorted to firing workers as it continued to facelimited demand for its product. This was a quintessential feature of contemporarycapitalist regulation with deleterious effect on industrial relations.

9. This section is based on extensive interviews conducted in Delhi in 1992 withcentral trade union leaders from the All India Trade Union Conference,Conference of Indian Trade Unions, Hind Mazdoor Sangh, and BharatiyaMazdoor Sangh.

10. One renowned trade union leader chastised the workers and national politiciansfor the strange mix of “political sophistication and social backwardness” whencommenting on workers wanting to build temples on factory premises andofficials breaking coconuts to inaugurate high science-based projects (Interviewwith Centre of Indian Trade Unions (CITU) official, Delhi 1992).

11. Cellularization is defined as a production process in which a number ofmachines are programmed to produce outputs, which become inputs for othermachines. The machines are synchronized in a way such that there is a strictadherence to “takt” time. It is a central principle of lean processes, which dictates that a specific number of finished parts must come off the lines within aset time – less than a few minutes. This is accomplished by simplifying andbreaking down operations according to takt time, grouping machines tightlytogether in cellular fashion and limiting operator involvement (Thomas NetIndustrial Newsroom 2003).

12. At its Saitama plant, Honda took 8 minutes in all to change the die – 5 minutesand 40 seconds for the actual transfer plus 2 minutes and 20 seconds for manualtesting (Saitama Plant Visit, Japan, December 1991).

216 Notes

13. There are dedicated but programmable welding robots for passenger car pro-duction. Most welding has been manual because of low labor costs. In Indiathere is no definitive trade-off between workers and robots. When outputincreases rapidly other manual welders are generally deployed. Workers aresufficiently trained to undertake relatively complex but routine tasks on thewelding line.

14. Other cost-reducing, output-enhancing changes included reductions in weldingand transfer time, lengthening the conveyor line, and adding another workstation. Models with low demand were easily replaced with high demand items,making a new line available for high demand units. Even the paint shop (an expensive bottleneck) was reconfigured to accommodate production ofadditional units.

15. Mathur (1991: 119) notes that there were 400 QCs in MUL in the 1980s, most of which have become inactive due to power struggles between workers, management, and unions. I suspect this high figure was due to the overzealous-ness of the management to embrace the QC system in every facet of the organi-zation, resulting in natural redundancy. The fact that MUL’s productivity was26.38 vehicles per person per year compared to 3–4 in other (non-Japanese) car producing units does indicate, at least partly, the utility of Japanese-typepractices, including QCs.

16. In the late 1980s, the lump sum payment at MUL was Rs. 6,900 for monthly production exceeding 400 vehicles per day and an additional Rs. 5.20 for everyvehicle over 400 per day (Mathur 1991: 119).

17. All the QCs compete and the winning team is sent to Suzuki Motors in Japan.The trip in itself is a significant perk for Indian workers, while Suzuki uses thevisit as a learning opportunity.

18. Although the number of suggestions per employee of MUL is comparable toToyota, the implementation rate is significantly lower in India than in Japan.For example, in 1983, Toyota in Japan had an average of 31.8 suggestions peremployee, of which 96% were implemented (Hoffman and Kaplinsky 1988).

19. Commensal rules outside of the modern managerial hierarchical system aresignificantly conditioned by caste, jati, and, increasingly, class positions. Forexample, social and religious rules have been based on the notion of ritualpurity and pollution, which dictate rules of association with others in India,including rules pertaining to eating. Hence, common canteens represent asignificant deviation from the typical Indian experience.

20. The feasibility studies of many Japanese LCV projects were done at 260 yen tothe US dollar. The yen subsequently rose to about a 100 per dollar.

21. Several representatives from the Indian auto industry felt that Japanese LCVjoint-ventures made their money before the appreciation of the Japanese yen,suggesting rent-seeking behavior.

22. See Baranson (1969) for the relationship between local content and cost ofoutput. Eicher-Mitsubishi earlier had four months lead time for the import of knocked-down units from Japan for assembly. Not surprisingly, as predictedby Baranson, supply problems increased with Eicher-Mitsubishi’s increase inlocal content.

23. DCM-Toyota saved Rs. 6,005 per vehicle, 60% of which was material, throughthe breakdown of vendors’ costs, while Eicher-Mitsubishi reported it was able tosave Rs. 212 per vehicle simply by eliminating excess parts available withdealers. Though the amount saved by Eicher is a mere $6 per vehicle, such incre-mental savings cumulatively become crucial for the viability of the firm with

Notes 217

low capacity utilization. These cost reduction approaches are unilateral but suppliers recognize the benefits as well.

24. Generally the labor content of vendor-supplied parts is not negotiated. Buyerscould negotiate over prices and material content in parts and components,should changes in part specifications warrant a reduction.

25. Eicher-Mitsubishi experienced long distance delivery problems, promptingdevelopment of local vendors in a limited way. Of the 1500 parts used by EicherMitsubishi in the early 1990s, 112 were supplied from Pithampur itself on palletswhich are placed directly on the production line. Eicher’s inventory level in1992 averaged 23 days.

26. Rotation of workers in MUL was not across shops. There was negligible rotationin DCM-Toyota and Eicher-Mitsubishi. In these enterprises rotation was motivated not because of the wider implication for flexible production andincreasing product variety but rather to reduce vulnerability associated withabsenteeism. Absenteeism in MUL and the two JLCV producers have been lowby Indian standards, roughly 12–15%.

27. At DCM-Toyota, there was an average of nearly 150 line stops per month duringApril–July of 1992. These stops are indicative of intractable supply problems.Line stops were more frequent at Eicher-Mitsubishi, 15–20 per day, lastingseveral minutes. Again, this was due to supply problems. This is inconsistentwith Eicher-Mitsubishi’s zero defect policy on the production line, which placedsignificant responsibility on its suppliers.

28. Eicher had no industrial engineering department because of low volume produc-tion. Instead it encouraged its workers to adopt self-directed learning. But lowvolume of production and imported kits constrained local “learning by doing”opportunities. Quality control was often confined to fairly mundane tasks suchas physical counting of weld spots.

29. There appears to be statistical artifact, whereby the small-scale sector has a con-stant share of 23.1% of the total components market for each of the financialyears between 1995–96 and 2000–01 (Calculated from ACMA 2001: 27, 38).

30. In the past even large producers like Mahindra and Mahindra confronted arbitrary price increases by its suppliers (Personal Interview, M&M Staff, BombayOctober 1991).

Chapter 6

1. In this connection, the restructuring of the global steel industry is a goodexample of the changing fortunes of older and newer industrial regions (D’Costa1999).

2. Mallick (1993) disputes that West Bengal faced any discrimination. He finds nopattern in the statewise distribution of industrial licenses granted by the centralgovernment during the 1974–84 period (pp. 183–184). West Bengal’s experienceparalleled the decline in the total number of licenses issued nationwide.

3. Such a response is typical in capitalist economies and is not unfamiliar in post-independent India when capital, opposed to the state’s disciplined form ofregulation, refused to make industrial investments (Chibber 2003: 23–39).

4. Banerjee et al. (2002) dispute the significance of labor militancy to West Bengal’srelative industrial decline. They see a drastic drop in strikes during the 1980–97period as a good reason for investment to pick up. However, industrial relationsas a whole remained problematic with a massive rise in industrial lockouts and

218 Notes

capital flight out of the state. There is indeed a relationship between earlier labormilitancy and later investment slow-down in the state.

5. This interpretation is somewhat different from but not inconsistent with themicro institutional view of Banerjee et al. (2002).

6. This was also evident in Karnataka but investments continued to pour in, suggesting labor instability or high wage costs are two of several factors thatinfluence investment decisions.

7. This was also witnessed in the case of the US steel industry where investors shiedaway from modernization of plant and equipment and instead diversified intomore profitable non-steel activities (Markusen 1985, D’Costa 1999).

8. A similar argument has been made by Banerjee et al. (2002) to explain the state’sindustrial decline.

9. See Chapter 4.10. A copy of the request must be provided to the workers and a judgment passed by

the government. If the resolution is disputed then the matter is transferred to atribunal for adjudication.

11. Like most older manufacturing plants in India, the HM plant at Uttarpara alsohas several labor unions. Class conflict at the shop-floor level is further compli-cated by inter-union rivalry. However, in this instance as workers’ jobs are atstake we can reasonably assume that the major battle lines are drawn betweenworkers and employer (management) rather than among workers. Similarly,there are various arms of the government that impinge on the process of arbitra-tion of labor disputes. Involved are the judicial system, the ruling political party,the bureaucratic arm under the Department of Labor of the state, an IndustrialTribunal that specifically aims to resolve the problem, and others.

12. I am grateful to Debdas Banerjee for pointing out HM’s captive market.13. West Bengal has wooed Japanese investments and consequently it has received

India’s largest Japanese investment in a petrochemical complex.14. In an unrelated way but consistent with the notion of productivity and

efficiency, the Kolkata High Court banned rallies and processions in the city onweekdays (Hindu 2003b).

15. The historic rise of the Workers Party in Brazil and the subsequent election of its leader Lula as the country’s president displays similar dilution of “leftist”political and economic agendas under a rapacious capitalist setting.

Chapter 7

1. These characteristics have been captured by India’s low GINI coefficients, whichintuitively suggests them to be high rather than low.

2. Strictly speaking, the data in Table 7.5 are not comparable as the incomes arebased on different base years. However, since the NCAER’s Market InformationSurvey of Households (MISH) consistently has five income groups, it probablymakes little difference in the distribution of households by such income groups(see Natarajan 1998 and NCAER 2002). The discussion in this section is largelybased on NCAER’s MISH Reports of 1998 (same as Natarajan 1998) and 2002.

3. Absolutely, coal remains India’s principal fuel, followed by imported petroleum,oil, and lubricants. In more recent years natural gas consumption has been on therise but it is a fraction of imported energy and electricity consumption.

4. Other modes of transportation such as railways and airlines also contribute to oil dependency, as the data for consumption of oil by the transportation sector

Notes 219

illustrates. For example, in 1975 consumption by this sector was 8.8 billiontonnes of oil equivalent, which rose to 29 billion tonnes in 1994 (Srivastava andSengupta 2000: 67–92, also Government of India, Ministry of Heavy Industries &Public Enterprises 2002: 88–89). A decade later this consumption is expected to bemuch higher, given the rapid expansion of the automobile industry.

5. Of the 72 entries obtained for “MC Mehta v Union of India” under the Envi-ronmental Law Alliance Worldwide, over 50% of the entries dealt directly withlitigation pursued by Mehta (http://www.elaw.org/5/24/2004 11:41 AM). Mehtanot only dealt with environmental issues such as automobile emissions and haz-ardous industries but also worker abuses that resulted from unregulated industriessuch as mining and quarrying and subsequent layoffs from court-ordered closuresof polluting enterprises around the Yamuna river and the Taj Mahal in Agra. In1996 he received the Goldman Prize (the “green Nobel”) and he is credited in thedecision to make Delhi’s buses use CNG.

Chapter 8

1. This was evident from MUL’s refusal to update some of the information, whichthey enthusiastically shared with me in the 1990s (Personal Interview with MULStaff, August 2002).

220 Notes

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238 References

Agrarian society 54–56Agriculture, commercialization of

54–55Air pollution 40, 42, 170, 191–195, 197Air Prevention and Control of Pollution

Act 192Allwyn-Nissan 88, 91Alternative analytical framework 13,

17, 23, 27–45Andhra Pradesh 145, 156Asahi Glass 111, 116, 121Ashok-Leyland 87, 88, 93–94, 120,

121, 131, 132, 160, 176Association of Indian Automobile

Manufacturers (AIAM) 90, 111see also SIAM

Automotive Components ManufacturersAssociation (ACMA) 111, 113,137, 139

Backward integration 11, 13, 119, 122,135, 138–139, 141

Bajaj Auto 87, 137, 176, 184Bajaj Tempo 131, 158, 160Balance of payment (BOP) problems

70, 76–77, 79–81, 89Best industry practices 11–12, 38, 67,

70, 95, 104, 110, 114see also Flexible practices

Bharat I and II pollution standards192–194

Bharat Seats 111, 115, 116Bharatiya Janata Party (BJP) 1Bhargava, R. C. 110, 113, 139Bhargava, Subodh 113Birla Group 82, 91, 94, 150, 157Black money 180BMW 75, 158, 159, 160Board for Industrial and Financial

Reconstruction (BIFR) 156Bombay Plan of 1944 48Brakes India 119, 120Brazil, automobile industry 2, 72, 96,

97, 98, 140, 201 Broadbanding 83

Business associations 30, 41see also Industry associations

Business systems 12, 16, 20–21, 23–27,31, 32, 34, 37, 39

C. K. Daikin 90Capacity utilization 92, 177

see also Excess capacityCaparo Industries 94, 116, 117Capital flight 151, 156, 158–159Capitalism

alternative framework of 13, 17, 23,27–45

heterogeneity of 3, 6, 15–18, 21, 23,26, 27, 199

models of 16, 18, 21, 23peripheral 18, 40

Capitalist competition 3, 8, 12, 14, 19,36, 91–93, 96–101, 129, 143, 156,160, 162, 171, 173–176, 185, 191

Capitalist contradictions 10, 14, 27,38–43, 169–171, 173, 196

Capitalist development, turning point2–5, 7, 8, 14, 22, 26–27, 29, 37, 41,105, 199–200

Capitalist regulation 5, 8–11, 28–29, 39,70, 81, 106, 108–110, 112, 129, 135,138, 169–170, 173, 186, 195, 199

see also French regulation approach Caste and class dynamics 51, 52,

56–57see also Dalits, Jatis, Other backward

castesCaste-based affirmative action 9, 51,

57–58Cellular manufacturing 35, 109,

119–120, 122, 125–127, 200Centre of Indian Trade Unions (CITU)

152, 166Chennai (formerly Madras) 113, 114,

119, 158, 164, 165China 7, 23, 24–25, 28, 59, 81,

189–190, 200, 203, 205–207Chinese networks 24

see also Business systems

239

Index

Citroen 90Class conflict 143, 156, 161–165, 168Climate Systems 115Communist Party of India (Marxist)

(CPM) 1, 151–152, 155, 161–162,165–166, 204, 207

Completely knocked down (CKD) kits85, 89, 92, 133

Components industry 95, 98, 104–105,110, 115, 117–119, 122, 135–140

Computer numerically controlled(CNC) machines 107, 108, 122

Confederation of Indian Industry (CII)111, 112, 113, 165

Conspicuous consumption 62–63, 78,177

Consumer class 1, 4–5, 9, 17, 177Consumer durables 2, 22, 28, 31, 38,

48, 63, 89, 183Consumption 59, 142, 144, 182–188,

197, 205–206Continuous improvements

see KaizenConvergence 6, 24Cooperative arrangements 5–6, 19–21,

23, 34, 44–45, 73, 105–110, 115,117–119, 122, 130, 133–134, 138,148, 200, 203

see also Economic coordination

Daewoo 75, 86, 87, 88, 92, 94–97,100–101, 119, 131, 134, 140, 174,176, 187, 200

Daimler-Benz 75, 94, 99, 100, 174,176, 187, 205

Dalits 56, 57, 58DCM Group 94, 96, 139DCM-Daewoo 88, 95, 134DCM-Toyota 88, 91, 92, 93, 96, 123,

125, 132, 134, 135Delhi 110, 119, 134, 146–148, 155,

159, 192, 194, 195Diversified output 99, 100, 101, 108

see also Flexible practices

East Asia 7, 16–17, 23, 26, 70Economic coordination 5, 16, 19,

28–29, 34–35, 40–41, 43Economies of scale 20–21, 35, 37, 42,

82–83, 91, 93, 99, 106, 108–109,112, 114, 129–130, 137, 139, 177,185, 206

Economies of scope 21, 35, 37, 42, 83,93, 99, 108–109, 132, 174, 206

Education 31, 53, 58–61caste reservations 51, 57–58higher education 41–43, 59–62and social inequality 58–61

Eicher Group 87, 94, 131Eicher Tractors 90, 125, 128Eicher-Mitsubishi 88, 91, 92, 94, 123,

125, 128, 132, 133, 134, 135, 158,160

Emission standards 192–195Energy dependence 42, 188–192, 201Enterprise unions 34, 107, 109, 111,

122–124, 128, 200Environment Protection Act 192Environmental challenges 10, 11, 41,

43Euro pollution standards 193–194Excess capacity 11–14, 33, 36–37, 41,

43, 71–73, 96, 170–177, 201Exclusionary development

see InequalityExport of vehicles and components

98, 137

Foreign Exchange Regulation Act (FERA)49, 82, 83

Fiat 75, 86, 90, 93, 94, 96, 97, 100,130, 137, 174, 187

Fiat-Premier Automobiles Ltd. (PAL) 95Flexible practices 4, 9, 16, 17, 28,

37–39, 43–44, 70, 81, 105–110, 122,124–125, 128–130, 132–135,138–141–142, 173, 203, 206

Food grain production 54Ford 75, 82, 94, 95, 99, 100, 103, 113,

116, 119, 140, 160, 174, 176, 187Ford India 94, 96, 97, 158, 159, 160,

177Fordism 8, 20, 22, 35–36, 94–95

see also Mass production systemForeign exchange reserves 76–77Fossil fuel imports 10, 14, 40, 76, 170,

188–191, 201French regulation approach 7–9,

12–13, 20–24, 28, 29, 34Fuel efficiency 91, 191, 194–195

Gandhi, Indira 85, 91, 110Gandhi, Rajiv 66–67, 91, 113Gandhi, Sanjay 85, 110

240 Index

General Motors 75, 82, 86, 93–100,103, 125, 130, 137, 140, 158–160,174, 176–177, 187, 201, 204

German capitalist model 18, 21Germany 24, 25, 47Gujarat 125, 130, 144–148,

152–153, 156, 159–160, 165, 204Gurgaon, Haryana 113, 125

Halol, Gujarat 96, 158–159Haryana 113, 114, 125, 145, 147, 152,

165Hero Honda 176, 184Hindustan Mazdoor Sangh 123Hindustan Motors (HM) 82, 85–88,

91, 93–100, 103, 125, 128–131, 143,149, 157–169, 174–176, 187,200–201

Honda Motors 75, 90, 94, 100, 140Honda-Siel 94, 174, 176, 187Hosur, Tamil Nadu 158, 160Household incomes 98, 179–182, 184,

186, 187, 197, 206, 211, 212Hyundai 75, 85, 86, 95, 99, 100, 101,

113, 137, 140, 141, 160, 174, 176,187, 206

Import substitution industrialization2, 5, 8, 30, 31, 39, 42, 46–49, 50, 72,81, 149, 200

Inclusionary consumption 15, 182,184–185

Income distribution among households98, 178, 179, 184, 186, 187, 197,206, 211, 212

Income polarization 38, 168, 170, 178,197, 199

Incremental innovations 35, 125–127,135

Indian National Trade Union Congress123

Industrial clusters 113–114, 119, 130,134, 139, 140, 141, 158, 160

Industrial decline in West Bengal144–165

Industrial Disputes Act 161–162Industrial licenses 110–112, 114, 144,

165, 188Industrial Policy Statements 83Industrial relations 20, 35, 89,

122–126, 150–165Industrial Training Institutes 124

Industries Development and RegulationAct 49, 81, 83

Industry associations 5, 8, 107, 112, 113see also Business associations

Inequality 7, 11, 12, 15, 26, 29, 32, 36,38, 43, 55, 56, 59, 98, 142, 149,170–171, 178, 184–186, 188

Information technology industry 61,66, 77–78

ISO 9000 121, 137Isuzu 75, 93, 94, 96, 97, 100, 158, 159Italy 20, 24, 85, 96

Japan 12, 24–25, 33, 70, 72–73, 85,95–96, 102, 103, 139, 190

Japanese capitalism 18–21Jatis 52, 56, 57, 58Jay Bharat 111, 115, 116Just in time (JIT) 115, 117, 119, 130, 134

Kaizen 35, 135Karnataka 145, 147, 159, 160Keynesian policies 8, 17, 20, 36, 46,

69, 71, 106Kirloskar 94, 96Kolkata (formerly Calcutta) 114, 125,

129, 146, 148–149Koyo Seiko 115, 116, 119Krishnamurthy, V. 110

Labor 107, 123–126, 128, 143,151–152, 161–163, 166, 170

Labor relations in West Bengal152–165

Light commercial vehicles (LCV) 14,84, 88, 96, 103, 106, 128–130,132–134, 138–139

Local content 92, 93, 101, 110, 134,164, 203

Lockouts 151–156Long-term subcontracting arrangements

20, 34, 44–45, 73Luxury car segment 98, 100

Machino Plastics 111, 115, 116, 117Macroeconomic stability 17–18Madhya Pradesh 159, 160Maharashtra 144, 145, 146, 147, 148,

152, 153, 156, 165Mahindra & Mahindra 85–88, 94, 95,

114, 126–127, 130, 131, 174, 176,187

Index 241

Mark Auto 111, 116Maruti Udyog Ltd. (MUL) 75, 83–86,

88, 90–95, 97–100, 101, 103, 105,110–130, 134, 138–139, 157,159–160, 162, 173, 176–177, 187,195, 200, 206

Marwaris 149–150Mass consumption 22, 106

see also FordismMass customization 35, 132Mass production system 9, 20, 21, 35,

106, 81, 105, 107Mazda 75, 87, 88, 91, 94, 130Mehta, M. C. 193Mercedes Benz 86, 94, 100, 121, 140MG Rover 75, 133Middle class 3–5, 13, 31, 41, 52, 68,

80, 89, 177–180, 184–187, 193, 194,200–201, 211, 212

Middle class, size of 62–64Minimum efficient scale 37, 172Mitsubishi 75, 87–94, 96, 97, 99, 100,

130, 158, 159, 160, 163, 174, 187Mode of capitalist regulation

see Capitalist regulationModels of capitalism 17–18, 21, 27, 103Monopolies and Restrictive Trade

Practices Act (MRTP) 49, 82, 83Motor Vehicles Act 192Multinational firms 1, 5, 12, 14, 29,

72, 84, 103Mumbai (formerly Bombay) 129, 146,

148Mumbai-Pune region 114

National Ambient Air Quality Standards192

National Capital Region (NCR) 113,148, 201

National Council of Applied EconomicResearch (NCAER) 178, 182, 196

Natural gas 191, 193–195Negative externalities 40–41Neoliberalism 2, 5, 12, 13, 15–16, 28,

32–33, 38–39, 66, 71, 95, 135,164–165, 195

Nissan 75, 87, 88, 91, 93, 94, 99, 100,111, 112, 129, 130, 131

NOIDA, Uttar Pradesh 113, 125see also Industrial clusters

Non-resident Indians (NRIs) 67, 68,78, 80, 102

Oil dependency 41, 43, 76, 188, 189Opel 96, 97Other backward castes (OBCs) 58Outsourcing 34, 37, 95, 96, 107, 141,

164Overproduction 33, 72

see also Excess capacity

Path-dependent development 31–32Peugeot 93, 94, 100, 130Phased Manufacturing Program (PMP)

90, 93see also Local content

Pithampur, Madhya Pradesh 125, 134,158, 159, 160, 165, 204

Political economy approach 10, 12,25, 46

Pollutionsee Air pollution

Pollution Control Boards 193Poverty 11, 27, 51, 56, 62, 150, 199Premier Automobiles Ltd. (PAL) 82,

85–88, 91, 93, 94, 95, 98, 100, 128,129, 130, 200

Premier Automobiles Ltd. (PAL)-Peugeot86, 94

Pricescars 186–187two-wheelers 184–185

Punjab 114, 145, 147

Quality circles 25, 35, 107, 109, 122,127, 133, 135, 200

Regime of accumulation 9–11, 13, 25,28–29, 34, 36, 39, 81, 102, 141–143,164, 169–171, 199, 201

Regulation approachsee French regulation approach

Rural embourgeoisment 53–55, 68Rural-urban income distribution 59,

180–185, 211–212Russia 21, 23

Scheduled castes 58Scheduled tribes 58SEAT 111, 112

242 Index

Shopfloor organization 105, 114, 122,125–128, 135, 200, 203

Skoda 174, 187Social regulation 41, 193, 196, 205, 206Society for Indian Automobile

Manufacturers (SIAM) 113, 174, 194Sona Steering 111, 115, 116, 118, 119,

126, 139South Korea 10, 24, 33, 72, 85, 95,

115, 139, 177, 190, 200Soviet Union 6, 69, 77Standard Motors Private Ltd. (SMP)

85–88, 93, 95, 160Statement of Government’s Industrial

Policy 49, 81Sundaram Fasteners 96, 97, 120, 205Suzuki Motors Corp. (SMC) 43, 68, 73,

83–85, 94, 96–97, 100, 110–111,115–117, 125, 137, 174

Swaraj-Mazda 87–88, 91, 94, 131Swedish capitalist model 18, 21

Taiwan 24–25Tata Group 75, 90TELCO 86–88, 90, 91, 93, 94, 99–101,

103, 120, 122, 129–133, 139, 163,174, 176, 187, 200

Three-wheelers 175–177Tiruvallur, Tamil Nadu 130, 144–147,

152–153, 156, 158–160, 165

Toyota 86–93, 96, 130, 134, 140, 141,158, 174, 187

Toyota Kirloskar 94, 123, 160, 203Trade unions 122–125, 129, 152, 161,

164, 166see also Enterprise unions

TVS Group 137, 139, 158, 176Two-wheelers 63–66, 82, 137,

175–177, 182–187, 197

UCAL Fuel Systems 115, 117, 120Uneven capitalist development 8–9,

26–27, 98, 104, 143–144, 148–149,151, 155, 157, 167, 169

Uneven regional development 11, 14, 40–42, 141–142, 144, 165, 200

Untouchablessee Dalits

Uttar Pradesh 145, 147Uttarpara, West Bengal 143, 149,

158–169

Vertical integration 20, 34

Walchand Group 82West Bengal 1, 14, 129, 143–168, 169,

194, 20West Bengal Industrial Development

Corporation 166

Index 243