Rural-urban, agrarian-industrial tensions in India

This story by Somini Sengupta from yesterday's New York Times reports on tensions in Singur, West Bengal, India -- tensions between a powerful industrial conglomerate and native peasants who once farmed rice and potatoes where a new automobile factory now sits.

This excerpt sums up the bigger conflict represented by recent events in Singur:

The standoff is just the most prominent example of a dark cloud looming over India’s economic transition: How to divert scarce fertile farmland to industry in a country where more than half the people still live off the land.

At the heart of the challenge, one of the most important facing the Indian government, is not only how to compensate peasants who make way for India’s industrial future, but also how to prepare them — in great numbers — for the new economy India wants to enter.

The story explains that last month, protesters laid siege to a new factory owned by Tata Motors. Some of the land on which the factory was built had been taken forcibly from farmers. Interestingly, Tata chose this locale in part because of the sorts of generous incentives that states and counties in the United States -- especially rural ones -- offer to industry. Tata got a generous land lease and tax breaks. That strategy in the U.S. has often resulted in a race to the bottom among nonmetro communities desperate for jobs. It has also resulted in adverse consequences over the long term, as factories brought to rural places on favorable terms have subsequently moved abroad -- indeed, to places like India -- in search of cheaper labor. That's a problem India likely won't be dealing with for a long time, if ever. Meanwhile, that nation is confronting a much different challenge, one that marks an earlier stage in the progression from a primarily rural nation to a primarily urban one.

See a related post here.