[Jamshedpur]
1. Taking up an invitation from Tata Steel, I was flown in a small Beechcraft propeller aeroplane to visit the steel town of Jamshedpur in the Indian state of Jarkhand today. I had to study Jamshedpur years ago in Secondary Two Geography class. I never thought that I would one day see the furnaces and mills there for myself.



2. Established a hundred years ago by Jamshedji Tata (hence the name Jamshedpur, city of Jamshed), it was the first steel-making operation outside the UK in the British Empire. The Tatas are an enlightened Parsee business family who have always believed in treating employees well and contributing to society. Years before it became commonplace, Tata Steel had an 8-hour workday for its employees and provided free medical treatment. It even established a scheme similar to our CPF before the Second World War. All kinds of social and sports facilities are provided in the town. It is probably the only town in India where you can drink water directly from the tap. The workers are paid way above market. Union leaders participate in the making of all important decisions. Two years ago, Tata Steel celebrated 75 years of harmonious industrial relations with not a single strike.



3. For years after India became independent, steel production was under direct control by the Government in Delhi, both quantity and price. There was therefore no incentive to improve. It was only after the reforms in 1992 that the company was freed to innovate and expand. It is now one of the most efficient steel producers in the world. A major capacity expansion is underway. Tata Steel is also making a multi-billion dollar bid for Corus, one of the world's biggest steel companies operating in the UK and the Netherlands.

4. As India grows, it will become a major consumer of steel the way China has become. China today uses some 300 million tons a year. India will need at least 100 million. Manufacturing is gradually becoming more important in the Indian economy. As a lively democracy, India can't move as fast as China in many areas. But, for the same reason, there is a deeper stability in Indian society which protects individual and property rights. Each has the weakness of its strength.

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