Tamil Nadu Elections: Amma Freebies: Made In China?

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April 24, 2016

CHENNAI, TAMIL NADU – As she tours Tamil Nadu seeking a re-election as Chief Minister, Jayalalithaa makes it a point to list the multiple freebies, or handouts, her government has distributed.

April 24, 2016

CHENNAI, TAMIL NADU – As she tours Tamil Nadu seeking a re-election as Chief Minister, Jayalalithaa makes it a point to list the multiple freebies, or handouts, her government has distributed.

These include laptops, mixers, grinders, fans, gold coins and school kits. A rough estimate suggests the state government may have spent close to Rs 21,000 crore on handing them out.

The rival DMK has alleged that contracts to supply these items were handed out in an opaque manner, and that the products are substandard.

This criticism may not apply uniformly to all the handouts.  Laptops, for instance, distributed free to needy students are supplied by Chinese laptop maker Lenovo and have drawn few complaints.

But there have been more complaints over the malfunctioning (or short shelf life) of free mixers, grinders and fans, which together constitute one of the biggest expenses for the state government – close to Rs 9000 crore.

In a village near Salem, a family told us they moment they plugged in the mixer, its power cord sparked and the appliance died.

On boxes of these appliances, no manufacturer is mentioned; there is only a serial number.

The Tamil Nadu Civil Supplies Corporation which procures these three items says they used multiple companies to source these appliances, but under strict terms.

The criteria is not just lowest price, but production capacity of the company, its bank credentials, and past performance. 

They shared with us 15-20 names in each of these categories. When we checked on a dozen of these companies, the results were mixed.

Of a handful of companies that supplied fans, only two appeared to be genuine manufacturers – the Hyderabad-based Yash International and Airoware International, registered as separate companies but with a common director.

They had a functioning website listing various types of fans. When we spoke to them, they confirmed they had supplied to the Tamil Nadu government.

But this was not the case with others, for instance the Chennai-based Arunachala Impex and Bharat Agri International Trading Ltd, which bagged contracts for mixers and fans.

Arunachala (which just had paid up capital of Rs 1 lakh) as well as Bharat Agri described themselves as trading companies that procured mixers and fans from manufacturers and sold them to the state government.

An official at Arunachala told us "We do all businesses like pulses, electronic goods, geometry boxes etc. We are traders and are eligible to do all business."

When asked from where they procured these items, a person at Bharat Agri declined to comment.

We asked the TNCS Corporation to clarify how traders were given contracts since tender rules clearly mention production capacity and experience as criteria. An official there told NDTV that in some cases, contracts for freebies are given to traders who have partnerships with manufacturers who make these appliances at competitive rates. Quite often, those manufacturers are based in China.

This was not the case with companies that had won tenders to supply grinders; of the six companies we scrutinized, at least five were based in Coimbatore and almost all were manufacturers. 

This may well be because grinders –  used to grind dough for  breakfast staples in Tamil Nadu like idli and dosas – are unlikely to be made outside South India.


Courtesy: NDTV