Invitation to Coke and privation to villagers



THE AGITATION by the indigenous people against the Coca-Cola plant in Plachimada, a village in Kerala, is important for three reasons. One, the agitation is organised by adivasis, one of the most vulnerable sections. Two, the agitation is against the Coca-Cola Company, a symbol of the strength of the corporate world. And three, the place of agitation is Kerala where, until recently, there was a near-consensus that the State has an adversarial relationship with capital.

The Coca-Cola Company established its bottling plant at Plachimada in the year 2000. Within two years of the company's operation, local inhabitants had started an agitation. Since April 22, 2002, a couple of thousands of villagers are organising blockades and picketing outside the plant. The agitators have at least four grievances. First, they assert that the factory has come up at an arable land violating the Kerala Land Utilisation Act. Secondly, they allege that the plant extracts more than one million litres of water daily. As a result, their wells have dried up. Thirdly, they have noticed deterioration in the quality of groundwater. Finally, they accuse the company of selling their waste to the farmers as fertilizers. The company, however, claims that it extracts only 600,000 litres of water daily. It argues that it has not violated any federal or State laws, but has instead installed an advanced rainfall harvesting technology. It says that the depletion of the aquifers is due to the 60 per cent fall in rainfall and that it complies with standards set by the Kerala State Pollution Control Board. The company also claims that local communities have welcomed their business as a "good corporate neighbour."

On April 7, 2003, the 15-member Perumatty Grama Panchayat Board decided not to renew the licence issued to the plant as the company was "causing shortage of drinking water in the area through over-exploitation of groundwater sources." The company, however, obtained relief from the court, which stayed the panchayat decision pending a final decision by the State government.

Panchayat as the sentinel


The panchayat's decision is a milestone because of three reasons. First, it was an outcome of a mass movement organised by the adivasis and supported by villagers and advocacy NGOs. In the absence of any strong support from political parties, the decision reflects the strength of mass struggle. Secondly, the decision symbolises the assertion of the authority and control of local community over corporate power. Finally, the decision questions the authority and legitimacy of decisions made by the State without involving the local government. Through this decision, the village panchayat has identified itself as part of village community.

However, a key issue is the fiscal autonomy of local government. One of the ways by which the State retains control over panchayats is through the control of fiscal powers and resources. Various studies of panchayat finances suggest that their ability to mobilise funds is constrained by factors such as low local revenue base, unwillingness to tax local voters, project-tied grants, lack of political will on the part of State governments to devolve revenue powers and a `resistant' bureaucracy. The share of its own revenue in total income of Gram Panchayat in Kerala declined continuously from 61 per cent in 1995-96 to 15 per cent in 1999-2000. This makes the local institution merely as an executive arm of the State to execute its programmes. Secondly, the presence of a very big corporate entity in a small village can at times make the village panchayat completely reliant on the company, as the company will be the highest single contributor to the panchayat finances. For example, a decision of revoking Coca-Cola plant's licence cost the Perumatty Panchayat a major portion of its annual income. In such cases, the ability of the local government to control the company is inhibited.

The institution of village panchayat, by virtue of its closeness to people and the vastness of its influence, appears to be an important political institution that can be used as a platform where the problems of the marginalised people can be discussed and negotiated vis-à-vis concessions to the industries. The village panchayat, however, can represent the interests of the poor only if the institution in itself is provided financial and executive autonomy from the influence of the higher levels of administration, and if the excluded section within the local community is sufficiently mobilised to influence the community decision-making process. There also needs a support from the global civil society for realising real participation of the excluded in the institutional framework. The events show that investment decisions are not merely economic decisions. They are political settlements, in which every actor represents an interest group. Hence, in the absence of institutional actors who can represent the interests of marginalised communities, no deliberation can safeguard the interests of vulnerable.