Strike against reforms casts pall over India’s coalition

Schools, businesses and government offices were shut in many parts of India yesterday as protesters blocked roads and trains as part of a one-day
nationwide strike against economic reforms announced by the government last week.

The opposition Bharatiya Janata Party (BJP) and smaller parties from both the political left and right called the strike to protest against a 14 per cent increase in heavily subsidised diesel prices, and a government decision that opens the door to foreign supermarket chains
investing in India.

The measures, part of a package of economic reforms aimed at boosting a sharply slowing economy, have triggered a political firestorm. Prime minister Manmohan Singh’s biggest ally, the Trinamool Congress party, said it would pull out of the coalition today unless the reforms were reversed, raising the risk of an early election.

The Confederation of Indian Industry (CII) urged Mr Singh not to yield to the pressure, saying the reforms, long demanded by Indian business leaders, were crucial for economic growth.

The CII said the one-day strike had cost the economy $2.3 billion in lost production and trade.

It did not say how it had
arrived at the figure, but hundreds of thousands of owners of small kirana stores, who fear the retail reform will drive them out of business, were reported to have shut for the day in protest. Bigger companies gave staff the day off or allowed them to work from home.

Across the country, morning commuters were left stranded at train stations and bus stops as protesters squatted on railway tracks and laid siege to bus depots. Supporters of the BJP and other opposition parties also burned effigies of Mr Singh and blocked roads with burning tyres.

“If we don’t protest now, the central government will eliminate the poor and middle-class families,” said Santi Barik as she protested in Bhubaneswar, capital of the eastern state of Odisha.

On the outskirts of Kolkata, capital of West Bengal, protesters smashed car windows and damaged buses as panic-stricken commuters fled their vehicles, police said. In Bihar state, protesters marched through the streets of the capital, Patna,
sitting on buffalo.

“We will be left with nothing but bullock carts and buffalo to move around in towns due to frequent hikes in fuel,” said protester Punam Devi.

The Congress party-ruled coalition, which has a record
of buckling under pressure, partially rolled backed a petrol price increase this year after facing a similar strike.

However, the party has held firm against calls for the retail reform to be scrapped, despite the threat by Trinamool Congress to withdraw its ministers – which would leave Mr Singh with a minority government.

The prime minister is counting on support from two regional parties to prop up his shaky coalition in parliament. But the leader of one of the parties, Mulayam Singh, was among protesters marching in New Delhi yesterday, underscoring the difficulties Mr Singh will face in pushing forward with his economic reforms.

The BJP is seeking to exploit anger against the diesel increase and retail reforms ahead of state elections later this year and
national elections due by 2014.

Grocery shop owners are an important constituency for the BJP. Tiny family-owned kiranas are ubiquitous, dotting densely packed neighbourhoods across India. Some of them are walk-in stores, but many owners operate out of garages or hole-in-the-wall stalls.