US embassy cable - 05NEWDELHI1854

C O N F I D E N T I A L SECTION 01 OF 06 NEW DELHI 001854 
 
SIPDIS 
 
E.O. 12958: DECL: 03/10/2015 
TAGS: PGOV, ELAB, PREL, PINR, IN, Indian Domestic Politics 
SUBJECT: INDIA'S COMMUNISTS - CONTENT TO SUPPORT THE 
GOVERNMENT FOR NOW - BUT NOT OVER THE LONG-TERM 
 
REF: A. NEW DELHI 1710 
     B. NEW DELHI 1519 
     C. NEW DELHI 1274 
     D. CALCUTTA 97 
     E. CALCUTTA 68 
 
Classified By: DCM Robert O. Blake, Jr. for Reasons 1.4 (B, D) 
 
1.  (C) Summary: The strong performance of the BJP following 
recent State Assembly elections has convinced India's 
mainstream Communists to downplay their differences with the 
ruling United Progressive Alliance (UPA) and cooperate for 
the time being to meet the "rightist" threat.  The Communists 
view Congress as "enemy number two," however, and their 
long-term strategy is to form a "third front" government that 
excludes Congress.  As long as the Left Front (LF) parties 
remain with the UPA they will scale down their economic 
demands to "welfare capitalism" based on poverty alleviation 
and social programs.  Over the long term, however, the LF 
would like to destroy the Naxalite and Maoist parties and 
absorb their followers into a "united front" committed to 
parliamentary democracy and opposed to "neo-liberal" 
development policies propounded by the US, World Bank and 
IMF.  India's Communist parties are committed, cadre-based, 
and have never been stronger in Parliament, in the states 
they rule, and in popularity.  Long confined to West Bengal, 
Kerala, and Tripura, they could begin to "break out" in the 
years ahead, and expand into other states such as Bihar, and 
Jharkhand, where they could provide an alternative to corrupt 
caste-based parties.  Indian Communists increasingly see the 
electoral success of Communist/Socialist parties in Latin 
America as the trend for the future, rather than the violent 
Naxalites.  End Summary. 
 
The Left in a Nutshell 
---------------------- 
 
2.  (U) The Indian Communist movement spans an ideological 
spectrum from the far-left Naxalites to the relatively 
moderate Communist Party of India (CPI).  The Naxalites are a 
group of disparate Maoist parties which advocate violent 
revolution (Ref C).  The largest Naxalite party is the 
Communist Party of India (Maoist).  Slightly to their right 
is a group of small Maoist parties which advocate the same 
radical goals but have eschewed violence in favor of 
parliamentary democracy.  One of these, the Communist Party 
of India (Marxist-Leninist) won seven seats in Bihar's recent 
Assembly Election.  The Communist Party of India (Marxist) or 
CPI(M) is India's largest and most powerful Communist group. 
It advocated a pro-China policy during the Sino-Soviet split, 
but now rejects the Chinese model.  Having ruled West Bengal 
for 17 years, it has revised its Marxist tenets and become 
more pragmatic.  The CPI, founded in 1925, is India's first 
Communist Party and all other Communist groups trace their 
origin to it.  Slavishly devoted to the Soviet Union, the CPI 
has lost considerable power and popularity to the CPI(M) 
since the end of the Cold War.  In February, the CPI(M) 
rebuffed a CPI merger proposal. 
 
3.  (U) The CPI and CPI(M) and two non-Communist parties, the 
Forward Bloc (FB) and the Revolutionary Socialist Party (RSP) 
constitute the Left Front (LF), which supports the United 
Progressive Alliance (UPA) government from outside.  Although 
largely confined to their "red forts" of West Bengal, Kerala, 
and Tripura, these four parties had their best electoral 
performance ever in the 2004 Parliamentary Elections.  The LF 
currently has 59 MPs, (CPI(M) 43, CPI 10, FB 3, RSP 3).  The 
LF relies on several prominent spokesmen in New Delhi to 
articulate its positions and handle day to day negotiations 
with the UPA.  These include:  CPM(M) General Secretary 
Harkishen Singh Surjeet, CPI(M) Politburo members Prakash 
Karat and Sitaram Yechuri, CPI Secretariat Member D. Raja, 
and CPI General Secretary A.B. Bardhan. 
 
Basic Ideology 
-------------- 
 
4.  (U) Like Communist Parties worldwide, the Indian 
Communist Parties engage in constant ideological wrangling, 
but agree on some basic points. 
--There is no role for violence; Communist parties should 
participate in parliamentary democracy. 
 
--The Naxalites are "adventurists," who should renounce 
violence and rejoin the fold of mainstream Communist parties. 
 
 
--Globalization is for the present inevitable and cannot be 
avoided or stopped, and Foreign Direct Investment (FDI) is 
essential for India's economic development, but should be 
restricted and closely monitored. 
 
--Government intervention in the economy is necessary to 
prevent exploitation of the poor, carry out redistribution of 
resources, and achieve a measure of poverty alleviation. 
 
--Countries like India should maintain a mixed economy with a 
vibrant "profit-making" public sector. 
 
--Asset redistribution should be achieved through taxation of 
the wealthy and government-sponsored social welfare programs 
for the poor, especially in rural areas. 
 
--The United States, and multilateral financial institutions 
such as the World Bank and International Monetary Fund cannot 
dictate India's economic and foreign policies. 
 
--India should renounce nuclear weapons, reduce military 
spending, accept no military alliances, especially with the 
US, and normalize relations with Pakistan. 
 
--While India's Communists should maintain cordial relations 
with other Communist Parties, none should serve as a model 
for India, which will have to devise a country specific 
socialist system that reflects its own cultural values. 
 
Relations with Congress 
----------------------- 
 
5.  (U) Of the four parties in the LF, only the CPI has had 
cordial relations with Congress.  After the 2004 elections, 
the CPI wanted the LF to join the government, but was 
rebuffed by its three partners and acquiesced in the 
interests of "Left Unity."  Within the CPI(M) several senior 
leaders, including Jyoti Basu, were also in favor of joining 
the UPA.  After being overruled in internal party conclaves, 
Basu and other leaders went along with the majority view as 
required by "party discipline." Congen Calcutta reports that 
the LF has repeatedly stated that as a "bourgeois party," 
Congress does not share the Communists' ideology and values. 
The LF's long-term goal is to establish a "third front" of 
secular, socialist parties, that does not include Congress. 
However, the LF claims to support the UPA to prevent 
"communalist forces" (the BJP) from returning to power, and 
to ensure that India's economic policies address the needs of 
the poor.  As a condition for its support of the UPA, the LF 
insisted on a "Common Minimum Program" (CMP), which is aimed 
at providing "development with a human face," the political 
slogan of the UPA government. 
 
6.  (U) Since the UPA has been in power, the LF has 
repeatedly accused Congress of failing to implement the CMP 
and not properly consulting with the LF.  Although the LF has 
a coordination committee which meets regularly with the 
Congress leadership, it accuses Congress of making important 
economic decisions without consultation.  Since the UPA has 
been in power the LF and Congress have clashed over a number 
of issues including: 
 
--privatization of the pension fund for government employees: 
 
--allowing 74 per cent FDI in private sector banks; 
 
--FDI liberalization in civil aviation; 
--removal of subsidies on fuel; 
--enhanced military ties between India and the US and India 
and Israel; and 
 
--allowing 74 per cent FDI in the telecom sector. 
 
7.  (U) When the UPA was formed in May 2004, the LF committed 
to support the GOI "from the outside," noting that while it 
would criticize individual policies, it would not bring down 
the government.  Despite this commitment, there have been 
several instances when it appeared that the tension between 
the LF and Congress had reached the boiling point, with 
Communist leaders stating that they had reached the end of 
their patience and were putting the UPA on notice that it 
should not take LF support for granted.  Many LF party 
conferences are scheduled for this spring as follows: 
 
--The Revolutionary Socialist Party National Conference, 
February 17-20; 
 
--The Communist Party of India National Conference - March 
29-April 3; 
 
--The Forward Bloc International Conference - April 4-5; and 
 
--The Communist Party of India (Marxist) Conference - April 
6-12. 
 
Party spokesmen have reiterated that they would address the 
LF/UPA relationship at the conferences and discuss other 
options, to include withdrawing support from the UPA and the 
formation of a "third front." 
 
One Tune Before the Elections 
----------------------------- 
 
8.  (C) The state Assembly Elections (Refs A and B) and the 
announcement of the budget in Parliament have played a key 
role in the evolution of LF attitudes towards Congress and 
the UPA.  Poloff met with Communist leaders before and after 
these events and noticed a distinct change in their political 
line.  The pre-election views were fiery and anti-Congress, 
while post-election statements were decidedly less so. 
 
9.  (C) In a February 17 meeting with Poloff, G. Devarajan, 
the Secretary of the All-India Forward Bloc (FB) maintained 
that his party's rank-and-file were unhappy with the UPA 
government and would press for a shift to the left. 
Devarajan predicted that "bad days are ahead," as the tension 
between the Left and Congress could grow unmanageable, 
opening up the possibility of a "third front."  He confirmed 
that since a third front government is the ultimate goal of 
the LF, a split with the UPA was inevitable, and the only 
issue is of timing.  Devarajan maintained that the LF would 
not "take the initiative" until the BJP is sufficiently 
weakened as to no longer pose a threat.  The breaking point 
could be the 2006 elections in West Bengal or even before. 
He confirmed that the Common Minimum Program (CMP) was the 
"bare minimum" for Left support of the UPA.  Reluctant to 
accept the presence in India of non-unionized American retail 
chains, Devarajan confirmed that the LF would confer with 
Communist Party of the USA (CPUSA) representatives at their 
conferences, regarding whether chains such as Walmart would 
be acceptable. 
 
10.  (C) Devarajan argued that Congress won "only" 142 seats 
in the 2004 election, far less than the Congress high point 
of 1984, when it won 415 seats in a house of 545.  In 
Devarajan's view, this electoral performance was not a 
mandate for Congress and its "Neo-liberal" policies.  Rather, 
the people of India voted for Congress as the best way to get 
the communal BJP out of power.  Devarajan maintained that 
what Indians really want is a shift in focus from the urban 
middle class to the rural masses, and the UPA must provide 
for the common people or face their wrath at the ballot box. 
Devarajan conceded that while the LF is opposed to much of 
neo-liberalism, it has only one MP from the entire Hindi 
belt, is confined to its "red forts," and does not have the 
power to stop it.  According to Devarajan, the LF can work 
with PM Manmohan Singh, but is not happy with FinMin 
Chidambaram, and is pressing for his replacement in the next 
Cabinet reshuffle. 
 
11.  (C) Abani Roy, the Secretary of the Revolutionary 
Socialist Party (RSP), echoed Devarajan in a February 24 
meeting with Poloff.  Emphasizing that the LF is "finding it 
difficult to support this government," even for the sake of 
Left unity, but did not think that a good opportunity to 
break with the UPA would emerge until the 2006 elections in 
West Bengal, where the LF would campaign against Congress. 
Roy argued that India needed a "third front," that would 
accurately reflect political opinion and would be good for 
India, providing the poor with their own voice in the 
democratic system.  Roy dismissed any possibility that 
"non-Left regional parties" such as the Samajwadi Party (SP) 
of UP and the Rashtriya Janata Dal (RJD) of Bihar would be 
asked to join the third front, as "we are only interested in 
anti-Capitalist forces."  According to Roy, the LF is not 
happy with the UPA, which is not doing enough to alleviate 
India's pervasive poverty, and provide basic necessities to 
the poorest of the poor.  He argued that since India is an 
undeveloped country, the GOI must play a strong role in the 
economy.  Roy complained that India's "bad government 
machinery" soaked up money dedicated to poverty alleviation, 
while the UPA was curtailed anti-poverty programs. 
 
Another Tune Afterwards 
----------------------- 
 
12.  (C) In a March 2 meeting with Poloff, CPI Secretary and 
principal spokesman D. Raja made it clear that circumstances 
had changed, and the LF was now more amenable to working with 
Congress.  Raja expressed some satisfaction with FinMin 
Chidambaram's budget presentation to Parliament.  While the 
LF had presented the UPA with a demand for a 50,000 crore 
rupee (USD 1.15 billion) social spending program, he seemed 
pleased that 25,000 crore (USD 575 million) had been 
allocated.  He also noted that government subsidies on food, 
petroleum and fertilizers would continue at the behest of the 
LF.  Raja was adamant that these social programs would never 
be implemented were it not for the LF. 
 
13.  (C) Raja was also pleased with the tax revenue 
initiatives contained in the budget, which he characterized 
as "serious efforts to mobilize resources."  He emphasized 
that the LF believed that India should mobilize its own 
resources to address poverty and not rely on FDI.  For 
example, he stated, corporate taxation of Indian industrial 
houses should be increased rather than reduced.  He praised 
the budget provision imposing a 10 rupee (USD .30) tax on 
withdrawals of rupees 10,000 (USD 230) or more. 
 
14.  (C) Characterizing those who supported neo-liberalism as 
"little more than animals," who don't have a "basic community 
spirit," Raja maintained that the LF would ensure that this 
"failed system based on human greed," would not take root in 
India.  Raja maintained that the current UPA government was 
just an intermediate step for the LF, which wanted to see a 
third front government take power in India.  According to 
Raja, the UPA would never unify India's "secular democratic 
parties," and the LF had gained stature from its marriage of 
convenience with the UPA and felt encouraged. 
 
15.  (C) The LF was quick to distance itself from the 
Congress power grab in Jharkhand and Goa (Refs A and B), with 
the CPI(M) Politburo dismissing "the hasty manner" with which 
the Jharkhand governor swore in the Shibu Soren government in 
Jharkhand as "controversial."  In private, however, Raja told 
Poloff that the LF's first priority was to ensure that the 
BJP "communalists" do not return to power.  According to 
Raja, the Communists have determined that the Congress 
missteps have revived the BJP and its NDA alliance, which 
would now take the offensive.  Raja confirmed that the LF 
would stand with Congress to prevent a BJP return to power 
and put aside talk of a third front or open confrontation 
with the UPA until the BJP threat is nullified. 
 
Swing to the Left 
----------------- 
 
16.  (U) On January 22, Poloff attended a panel discussion 
that provided some insight into what direction India's 
Communist/Left parties are headed.  The panel, on the 
"anti-Imperialist Struggle of the Venezuelan People," was 
sponsored by the Third World Studies Center, a Delhi group 
that represents the left wings of India's Communist parties. 
It included Prakash Karat, the CPI(M) ideologue, marked to 
assume a leadership role in India's Communist movement in the 
next several months.  The panelists emphasized that the Left 
has been too accommodating to Congress and should expand its 
opposition to neo-liberalism beyond rhetoric to organizing. 
 
17.  (U) The panelists argued that if India's Communist 
parties continue to placate Congress, over the long term it 
will exacerbate India's rich/poor divide and encourage 
Naxalites to greater violence, resulting in needless 
bloodshed.  They emphasized that mainstream Communists must 
demonstrate to Naxalites that they are serious about 
addressing the needs of India's poor.  This was endorsed on 
February 8, by the Karnataka State Committee of the CPI(M), 
which urged Naxalites to forego violence in favor of peaceful 
methods to combat social injustice and exploitation.  G.C. 
Bayyareddy, the Secretary of the Committee, said that the 
best way to combat Naxalism was to distribute land to the 
landless, give title deeds to tribals, provide fair 
compensation to families affected by development projects, 
and protect tribals' social and cultural rights. 
 
18.  (U) The panelists contended that rather than the 
Nepalese Maoists, the Indian Left should adopt as a its model 
the democratic, non-violent movement of President Hugo Chavez 
of Venezuela, and other Left parties of Latin America which 
are scoring electoral gains.  They contended that the Left 
should use some of the same tactics developed by Chavez and 
other Latin American leaders to prevent the US, the IMF and 
World Bank from "dominating India."  Karat noted that the 
Left Front pressured the UPA to extend an invitation to 
Chavez to make a state visit to India in March and would 
mobilize to give him a "warm welcome," and pressure the GOI 
to defend Venezuela from "another US-orchestrated coup 
attempt (Ref E)." 
 
Comment 
------- 
 
19.  (C) India's Communists have modified their Marxist views 
since taking power in West Bengal and other states.  When 
governing, they tend to take a pragmatic approach at the 
regional level that is often belied by some of their rhetoric 
at public events.  As Communists, however, they take a 
historic view of their role, with tactical and strategic 
objectives and short-term and long-term strategies.  Over the 
short-term, the LF wants to keep the BJP out of power long 
enough for the Sangh Parivar's political appeal to fade.  If 
this means that they must work with Congress, they are 
willing to make the sacrifice.  While supporting the UPA, 
however, the LF wants to keep its distance from Congress 
economic policies and maintain its credibility by stressing a 
"welfare capitalism" approach based on poverty alleviation 
and social programs. 
 
20.  (C) The Communists' willingness to cooperate with 
Congress depends on large measure on how the Congress 
leadership packages and presents economic reforms.  We expect 
the LF to support a greater role for the private sector in 
the food processing, retailing, real estate, and 
manufacturing sectors if the GOI provides benefits for 
farmers and low-income consumers.  The LF will also likely 
tolerate partial privatization of public sector units if a 
significant portion of the proceeds are used to fund social 
programs, as Congress has promised.  The Communists will 
likely resist Congress' efforts to expand private investment 
in banking and increase labor market flexibility. 
 
21.  (C) When the BJP challenge has been addressed and the 
"rightist enemies" have faded away, the LF would turn its 
attention to Congress, "the second enemy."  Communist 
ideologues argue that the BJP is a short-term threat, as 
"communal politics" has no future in India.  Increasingly, 
they are coming to agree that "neo-liberal" development 
policies propounded by Congress are a long-term threat that 
poses a greater danger.  To address that threat, the 
mainstream Communists hope to destroy the Maoist and Naxalite 
parties (Refs C and D), which they dismiss as violent 
"adventurists," and convince their less radical followers to 
join a common "anti-imperialist" front that will be united, 
democratic, non-violent, and plugged into an international 
network of friendly parties and governments. 
 
22.  (C) Media profiles of India, including those in the US, 
have stressed that rapid economic growth is lifting many 
boats, and downplayed popular opposition to economic 
liberalization.  However, the growing power, popularity and 
political influence of the India's Communists indicate that 
all will not be smooth sailing.  The Indian Left envisions 
that the "internal contradictions of neo-liberalism" will 
soon become apparent in India, as they have in Latin America, 
and the country will then be ready to accept a third front 
government that does not include Congress.  States like 
Jharkhand and Bihar, where class divisions are acute and 
growing, provide an opportunity for Communist expansion in 
the coming years, and the Left's political power is likely to 
increase along with its seats in Parliament. 
MULFORD