The Tata Tea / ULFA Story

            

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Themes: Ethics in Business
Period : 1997-2001
Organization : Tata Tea, ULFA
Pub Date : 2002
Countries : India
Industry : Food & Beverages

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Case Code : BECG008
Case Length : 09 Pages
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The Tata Tea / ULFA Story | Case Study



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Tata Tea's Deals with the Ulfa and the Government Contd...

Tata Tea further claimed that the central government had itself sanctioned the controversial medical assistance scheme. The then IB Director later confirmed that the Tatas had indeed been communicating with the IB about all their dealings with the ULFA, including the Bangkok meeting7. This infuriated the Assam state government as it had not been given any information regarding the Tata Tea-IB and Tata Tea-ULFA dealings.

It was not difficult to understand why the company did not make the Mahanta government a party to these deals. The 1990 airlifting of Doom Dooma tea estate executives out of the tea estates was also done without the knowledge of the Mahanta government. Even the Assam police did not have any clue about the undercover operation. The tea industry was reported to have lobbied with the central government and requested for the AGP government's dismissal after the airlifting.

In November 1990, the Congress-supported Chandrashekhar government dismissed the AGP government and imposed President's rule in the state. In the state assembly elections in 1991, the Congress defeated the AGP. Mahanta was reported to have 'never been able to forgive the tea industry' for this. Mahanta came back to power after the 1996 elections. He soon expressed his displeasure with the tea companies, stating that though they had taken the earlier Hiteswar Saikia government into confidence whenever militants demanded funds from them, there had been no such coordination when the AGP was in power during 1985-90.

Analysts however said that Mahanta seemed to have overlooked the fact that in corporate and business circles, it was believed that AGP had links with ULFA and that the party could not be counted upon to protect their interests8. Mahanta also said that the AGP government had not received any complaints from Tata Tea or its employees working in the state regarding any security infringement. Jafa said, "Most of the tea companies never bothered to tell us their security-related problems."

Meanwhile, militancy in the state had reached alarming proportions. When the Centre began questioning the Mahanta government on the increasing violence, the AGP decided to take firm steps against the militants. When the ULFA realized that the AGP had turned against it, they even made unsuccessful attempts to kill Mahanta and other AGP leaders.

At this time, the United Front government, which the AGP was a part of, was at the Centre. Analysts claimed that Mahanta saw the Tata Tea episode as a chance to take 'revenge' against the tea industry. Mahanta complained to Gujral that Padmanabhaiah was forcing Hrishikeshan to stop the interrogation of Tata Tea executives. This was strongly denied by home ministry officials.

In October 1997, in a conversation with Ratan Tata, Nusli Wadia - chairman of textile company Bombay Dyeing - extended his support to Tata Tea and mentioned the names of people in Delhi who would be of help. The conversation revolved around strategies for countering the Mahanta administration's charges against Tata Tea. The following day, the transcript of the conversation was reproduced in Indian Express, one of the leading newspapers in India.

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7] Business India, October 20, 1997.
8] AGP sources admitted that in several constituencies, the party's candidates were tacitly helped by militants in the 1996 elections.