Fractured/Earth

Reportage on a planet without equitable or sustainable development.

In Surat’s textile hub, small businesses are afraid of GST – but big companies are not

Rajesh Mehra is desolate.

A big-boned man in his mid-fifties, he is a trader in women’s blouses.

Until ten years ago, Mehra used to take orders from garment wholesalers in big cities like Mumbai, Kolkata and Bengaluru, buy the cloth and thread he needed from garment clusters like Silvassa, and get the blouses stitched in Amritsar.

But this business model ran into trouble when blouse-making units came up in Surat, one of India’s biggest synthetic fabric and sari-making clusters. Enjoying advantages like proximity to cloth- and thread-makers, these units made cheaper blouses than their counterparts in Amritsar.

In response, Mehra made a hard call. He left his family behind in Amritsar and moved to Surat, working on the assumption that having a perch in that city would help him sell better.

Now, as India readies to overhaul its tax regime for businesses, replacing a welter of sales and income taxes with a single tax called the Goods and Services Tax, Mehra has run out of ideas. “Kya hoga?” he asked. “Kaise chalega yeh sab?” What will happen? How can this business continue?

Anxieties about how GST will impact their businesses have prompted textile traders to go on a nationwide strike over three days this week. But not everyone in Surat’s textile hub is worried.

No more than 20 minutes away from Mehra’s shop in the basement of a building opposite Surat’s old Ratan Cinema, in the heart of the town’s textile market, lies the soot-blackened industrial estate of Pandesara. This is where Sanjay Saraogi works.

Saraogi, who looks far younger than his 46 years, is the managing director of Rs 450 crore Laxmipati Saris.

Described by his peers as one of the sharpest minds in the Surat textile industry, he entered the family business at 14 when his father fell very ill – he would go to school in the morning and spend the rest of the day in the shop. Over the last ten years, he has steered Laxmipati beyond trading into sari manufacturing.

When it comes to GST, he is relatively unconcerned. It will be good for businesses like ours, he said.

The contrasting responses of Mehra and Saraogi offer a picture of how GST will affect people and companies in India’s manufacturing economy.

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m rajshekhar

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I am an Indian journalist with interests in energy, environment, climate and India’s ongoing slide into right-wing authoritarianism. My book, Despite the State, an examination of pervasive state failure and democratic decay in India, was published by Westland Publications, India, in January 2021. My work has won the Bala Kailasam Memorial Award; the Ramnath Goenka Excellence in Journalism Award; and five Shriram Awards for Excellence in Financial Journalism. Write to me at despitethestate@protonmail.com.

Reviews

“…une plongée dans les failles béantes de la démocratie indienne, un compte rendu implacable du dysfonctionnement des Etats fédérés, minés par la corruption, le clientélisme, le culte de la personnalité des élus et le capitalisme de connivence. (…a dive into the gaping holes in Indian democracy, a relentless account of the dysfunction of the federated states, undermined by corruption, clientelism, the cult of the personality of elected officials and crony capitalism).” Le Monde

“…a critical enquiry into why representative government in India is flagging.” Biblio

“…strives for an understanding of the factors that enable governments and political parties to function in a way that is seemingly hostile to the interests of the very public they have been elected to serve, a gross anomaly in an electoral democracy.” Scroll.in

“M. Rajshekhar’s deeply researched book… holds a mirror to Indian democracy, and finds several cracks.” The Hindu

“…excels at connecting the local to the national.” Open

“…refreshingly new writing on the play between India’s dysfunctional democracy and its development challenges…” Seminar

“A patient mapping and thorough analysis of the Indian system’s horrific flaws…” Business Standard (Image here)

“33 മാസം, 6 സംസ്ഥാനങ്ങൾ, 120 റിപ്പോർട്ടുകൾ: ജനാധിപത്യം തേടി മഹത്തായ ഇന്ത്യൻ യാത്ര… (33 months, 6 states, 120 reports: Great Indian journey in search of democracy…)” Malayala Manorama

“Hindustan ki maujooda siyasi wa maaashi soorat e hal.” QindeelOnline

“What emerges is the image of a state that is extractive, dominant, casteist and clientelist.” Tribune

“…reporting at its best. The picture that emerges is of a democracy that has been hijacked by vested interests, interested only in power and pelf.” Moneycontrol.com

Book lists

“Ten best non-fiction books of the year“, The Hindu.

“Twenty-One Notable Books From 2021“, The Wire.

“What has South Asia been reading: 2021 edition“, Himal Southasian

Interviews

“Journalism is a social enterprise…,” Booksfirst.in.

“Democratic decay at state level: Journalist M Rajshekhar on book ‘Despite the State’,” The News Minute.

“Covid-19 en Inde : “des décès de masse” dont un “État obscurantiste est responsable,” Asialyst.

Allusions/Mentions

“JP to BJP: The Unanswered Questions“.
Mahtab Alam’s review of “JP to BJP: Bihar After Lalu and Nitish”.

“Urban History of Atmospheric Modernity in Colonial India“. Mohammad Sajjad’s review of “Dust and Smoke: Air Pollution and Colonial Urbanism, India, c1860-c1940”.

“Westland closure: Titles that are selling fast and a few personal recommendations,” by Chetana Divya Vasudev, Moneycontrol. (Because this happened too. In February, a year after DtS was released, Amazon decided to shutter Westland, which published the book. The announcement saw folks rushing to buy copies of Westland books before stocks run out.)

“Time to change tack on counterinsurgency” by TK Arun, The Federal.

“All Things Policy: The Challenges of Governing States” by Suman Joshi and Sarthak Pradhan, Takshashila Institute (podcast).

“The Future of Entertainment“, Kaveree Bamzai in Open.

“On What India’s Watching“, Prathyush Parasuraman on Substack.

“The puppeteers around us“, Karthik Venkatesh in Deccan Herald.

“Will TN election manifestos continue ‘populist’ welfare schemes?“, Anna Isaac for The News Minute.

“Why wages-for-housework won’t help women“, V Geetha in Indian Express.

“The poor state of the Indian state“, Arun Maira in The Hindu.

Book discussions

26 December, 2021: Rangashankara, Bangalore, a discussion with Dhanya Rajendran.

16 November: Rachna Books, Gangtok, a discussion with Pema Wangchuk.

29 August: Books In The Time of Chaos, with Ujwal Kumar.

21 May: Hyderabad Lit Fest with Kaveree Bamzai and Aniruddha Bahal.

28 March: Paalam Books, Salem, Tamil Nadu.

19 March: The News Minute, “Citizens, the State, and the idea of India“

6 March: Pen@Prithvi, with Suhit Kelkar

20 February: A discussion between scholars Usha Ramanathan, Tridip Suhrud, MS Sriram and me to formally launch Despite the State.

6 February: DogEars Bookshop, Margoa.

5 February: The Polis Project, Dispatches with Suchitra Vijayan.

30 January: Founding Fuel, “Systems Thinking, State Capacity and Grassroots Development“.

25 January: Miranda House Literary Society