Is the age of ethical entrepreneurship over? This report in 'The Caravan' takes a hard look at the house of Tata.
The entire article can be read here:
At first sight, the quaint mining town of Noamundi, nestled against the Orissa border at the southern edge of Jharkhand, looks like it’s been sprinkled with fairy dust: particles of iron oxide tint the sky red, floating onto trees, roads, the rooftops of pastel-coloured huts and even the skin, hair, clothes, fields, food and water of those who live here. The iron mines in Noamundi were first discovered by Tata Steel in 1917, and are estimated to contain some 200 million tonnes of iron ore, all of it a convenient three-hour train ride from the company’s steel plant in Jamshedpur. Legend has it that Tata Steel’s prospectors stumbled on Noamundi’s iron deposits almost by accident. Amazed to come across people with iron pickaxes, they inquired where they found the metal and were pointed in the direction of “Neya Mundi”, meaning “that hill” in the local Ho tribal language.
Nizam Laghury, an ethnic Ho tribal and former president of Tata Steel’s Noamundi Worker’s Union, joined Tata in 1977 and recalls a time when it was “a better company”.Today the iron ore business is booming in Noamundi, where convoys of open trucks ferry iron from mines of varying legality. But for decades, the fate of Noamundi was linked solely and inextricably with Tata Steel, starting with the first consignment of iron ore dispatched to Jamshedpur in 1925. Until the late 1960s, local men and women, mostly Ho, manually mined ore with “chisels and hammers” for Tata Steel, as a company brochure puts it. In 1967, the mines were fully mechanised, and by the following year Noamundi was supplying more than 90 percent of the 2.7 million tonnes of iron ore used at Jamshedpur.
A certain sense of lawlessness is palpable in Noamundi as soon as you step outside the small provincial train station. On the drive into town, I passed what appeared to be an endless line of trucks, parked back-to-back at the side of the red and dusty road; it’s been estimated that some 5,000 ply the roads every night, loaded with iron. We soon ran into a massive traffic jam; earlier that day, I learned, a truck driver speeding through town in spite of daytime “no entry” rules had run over a young tribal boy at a market, and angry locals had blocked the road to demand action against the driver. The boy was in critical condition, I was told, but local authorities still hadn’t arrived at the scene several hours later.
According to local police records, two or three people are killed each month by vehicles on Noamundi’s main road. Crime has also spiked in recent years: in 2010 there were 15 cases of murder. In 2008, an officer in the district government testified in front of a state task force that almost 170 iron ore crusher units in the area were processing thousands of tonnes of iron ore from illegal mines every week. By 2010, with air pollution worsening and attention to illegal mining increasing, the state government temporarily shut down the crushers and announced it wouldn’t renew licences. “There was a breathing problem,” said Shailash Sharma, a local police inspector. “Life was getting affected. Some illegal ones still operate.”
A mountainside defaced by iron ore mining in Noamundi.It would be all too simple to lay the unflattering legacy of a century of mining in Noamundi at the feet of Tata Steel, given the explosive and largely unregulated (and in many cases, outright illegal) expansion of mining activity in the past few decades.
But the red-tinted town is an excellent place to consider the consequences of the shifting corporate culture at Tata Steel, and the company’s uneasy position as a private firm whose earlier status and reputation was as something far more than a private firm. The ethical precepts of Jamsetji and JRD Tata, as we have already seen, were not always perfect in practice. But their notions of “trusteeship” eased the tension between Tata Steel’s dual identities: the state gave the company land and rights, but it strived to do something in return for the affected populations.
The land allotted to Tata Steel in Noamundi and Jamshedpur under the British Raj consisted mostly of tribal villages; since many of the tribals did not have land titles, they were displaced when the goverment handed over the property to Tata Steel for mining. For decades, the tribals found employment with Tata: until the early 1990s, the company’s mining operations in Noamundi and nearby Joda employed approximately 30,000 people. But the permanent workforce has been reduced to under 1,000, with an additional 1,500 or so contract labourers. When the downsizing began, tribal people were often among the first to go, because of their low literacy and skill levels. “The company said they will only keep technical, not unskilled people,” said Nizam Laghury, a straight-talking former president of Tata Steel’s Noamundi Worker’s Union, in his raspy voice. “But if they don’t have capability and you have not invested in their training, how will they compete with people from the outside?”
“When TISCO first arrived in Noamundi, the local people didn’t want to work for them,” said Ambika Das, a chirpy 28-year-old girl whose grandparents spent their lives manually mining iron for Tata Steel. Originally from a scheduled caste family, intermarriage and coexistence with the Ho people have made her manners, habits and way of life almost indistinguishable from theirs. “There were a lot of Kusum trees at that time, which used to have a lot of lac,” said Das, who grew up listening to stories about Tata Steel passed down the generations in her family. “It would sell for good money and goods in the market. TISCO would go door to door and nobody would come. Then, they started cutting Kusum trees and people were forced to come out and work.”
A Ho tribal, Laghury joined Tata Steel in 1977 as a labourer, picking up iron for 195 per month. When we met one evening at his compact two-bedroom quarters in the “TISCO camp”, he walked in looking like he had stepped straight out of a furnace. Traces of red iron dust had settled on his receding, white hairline. Large, black-rimmed glasses framed his swarthy, beaten face. Tall and medium-framed, he sank into a low sofa, pulled out a white handkerchief from his trouser pocket and wiped the sweat off his face. Hanging on the wall across from him was a framed photo of JN Tata with a quote inscribed below, which read: “In a free enterprise, the community is not just another stakeholder, but is in fact the very purpose of its existence.”
“I remember a time when even if it was belt cleaning, people had a permanent job,” Laghury told me. “The general repairs of houses and drains of the workers, the company used to do all this. It was all outsourced in 1998. Maybe the company was thinking a hundred years ahead, but it should not have outsourced jobs of a permanent nature.”
“TISCO didn’t do right by the tribal people,” Laghury continued. “They gave us jobs at one time in exchange for our lands. But most of the next generation was left high and dry. But today, Tata Steel is still standing strong and taking production from the same plant made on our land.”
“It used to be a better company,” Laghury concluded. “But now it is working with carte blanche.”
Before leaving, I asked Laghury about the photo of Jamsetji Tata hanging on his wall. “I still believe in JN Tata,” he said. “And JRD never gave any direction to make the local community unhappy.”
As the story of cutting the Kusum trees illustrates, it would be naive to presume that the happiness of the local community was the absolute highest priority for Tata Steel in Noamundi. But in a series of interviews with former employees who served in the town, it became clear that there had been significant efforts in an earlier era to offset the impact of mining on the environment and local communities—and that these endeavours had been sharply curtailed in recent years.
-- This extract is from the article 'Moral Minefield' by Divya Gupta published in The Caravan, November 1 2011.