Investment Climate Takes a Beating

Indian executive killed by workers’ mob

By James Lamont in New Delhi

Published: September 23 2008 16:35 | Last updated: September 23 2008 16:35

The brutal killing of a multinational company chief in an industrial dispute has sent shockwaves through India’s business community.

Lalit Kishore Chaudhury, the chief executive of Graziano Trasmissioni India, an Italian car parts company, was beaten to death at his company offices in one of the country’s largest industrial zones on the outskirts of Delhi on Monday in a violent industrial protest.

A meeting with former employees to resolve a long-running dispute dissolved into a riot in which protesters overpowered security guards and turned on Mr Chaudhury and his staff. About 20 people were injured.

The attack at Graziano’s Greater Noida plant was sparked by the company’s dismissal of 200 workers in a pay dispute and has raised alarm among foreign companies operating in India. Many have already taken measures to give their personnel greater protection, following the wave of bomb attacks in Delhi this month.

The Italian government said on Tuesday it was “deeply shocked” by the violence that led to Mr Chaudhury’s death.

“The incident is all the more worrying as the Italian Company Graziano Trasmissioni, after many successful years, had been facing for several months violent forms of protest by self­proclaimed workers’ representatives. The situation had been repeatedly brought to the attention of the competent Indian authorities,” it said.

The company, a fully-owned subsidiary of Graziano Italy, makes gears and transmission systems for vehicles. Mr Chaudhury had worked at the company for the past decade.

Niccolo Tassoni, commercial counsellor at the Italian embassy in New Delhi, said attackers armed with metal bars and hammers had broken up the plant.

“It’s the first time I’ve heard of this kind of problem for an Italian company in India. It’s quite shocking.”

The Confederation of Indian Industry described Mr Chaudhury’s death as an “unwanted and gory act of violence”. It urged workers not to use violence to settle disputes with employers.

“Dialogue is always the way to find a solution. We can’t have unruly people taking the law into their own hand. We’ve had industrial violence in the past. We had it in Calcutta in the 1960s. But it was never of this kind,” said Jayant Bhuyam, deputy director general of the CII.

“The investment climate and image takes a beating [from an incident like this]. To assuage feelings, it takes time. One incident tarnishes the whole image,” he said.

Since the attack, the police have made sweeping arrests, charging about 13 people with murder. But business representatives in Noida criticised the police for their slow response to Monday’s violence at the plant.

Mr Chaudhury’s death comes against the background of a high profile stand-off between protesters and Tata, the industrial conglomerate, in Singur in West Bengal.

Farmers, backed by the opposition Trinamool Congress, have laid siege to land intended for the plant that will produce the Nano, billed as the world’s cheapest car and a flagship of India’s technical advance. Activists have staged often violent protests demanding that the government return 400 acres to farmers who had not accepted compensation for their relocation.

Business has warned that the damage inflicted on a project of such international acclaim threatens to deter foreign investment in India’s fast growing economy.

Copyright The Financial Times Limited 2008






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