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It is difficult to imagine how a small enclave not more than six kilometres in diameter can pack more than 100 groundnut oil mills.

Harder still to fathom is how the oil that flows out from them can grease the wheels of power in Gujarat.

But seasoned political observers will tell you, Gondol, around 40 kilometres from Rajkot, can and does determine the politics of Saurashtra, and influences the politics of the state too.

The mill owners, derisively dubbed telia rajas by the media, insist that they are simple businessmen looking for a decent profit and have no interest in politics whatsoever.

Hwever, things are not as simple as they would like to portray.

The complex linkages between the telia rajas, political leaders, interested guilds, apolitical outfits, political parties, the bureaucracy and the government begin with the price of the groundnut.

Groundnut is bought through auction in the open market. That is, unlike foodgrains, like rice and wheat, the government does not fix the procurement price.

The Gondol Oil Mill Owners Association works out the procurement price in consultation with the big farmers. Most often than not, big farmers have their own mills.

What this means is that a farmer-mill owner knows exactly how much stock he and others of his ilk have in hand.

In other words, the GOMOA acts like a cartel, determining the amount of groundnut to be released in the open market and the amount to be released for crushing. This in turn determines the availability of groundnut oil in the market and its price.

Manish Patel, owner of Gayatri Oil Mill, says the current price is between Rs 285 to Rs 375 per 20 kg depending on the quality of the seeds, the parameter being the 'percentage' of oil that can be extracted.

The 'percentage' of oil is determined by mill owners, but without using any scientifically established standards. This renders the small farmers at a disadvantage as the mill owners, acting in concert under the aegis of the GOMOA, can determine the 'percentage' to suit their convenience, and consequently the price of the groundnuts.

 This leads to dual pricing with small farmers getting a raw deal. 

Groundnut is a water-intensive crop grown between July and October.

"Though there can be more than one crop in a season, for the last 3-4 years, most of the small farmers have been growing just one crop," says Devabhai Jetabhai, a small farmer.

The mills function at peak capacity from October-end to January-end, called the crushing season. "During this time, close to 3300 kg of groundnut is crushed daily at my mill to yield 1400 kg of oil," says Manish Patel.

The oil is either canned at the factory and sold directly, or sold to bigger companies, who then sell it under their brand names.

Rakesh Patel, owner of Lakshmi Oil Mill, is a typical example of a big farmer-cum-mill owner. He owns 300 bighas of land and has a 50-tonne capacity mill.

Asked why the price of groundnuts is kept low, more often than not artificially, Patel says the price of the oil is not high enough to merit an increase in the price of groundnut.

"At present, a 15-kg canister of oil costs around Rs 900. To effect an increase in the price of groundnut, this has to go up to at least Rs 1200," he says.

Lack of a good yield for the past three years due to deficient rainfall, labour problems and erratic power supply have kept prices low, he said.

Where do the politicians come into the picture?

It goes something like this.

The big farmer-mill owners generously fund community programmes, for instance concretising roads, and generate goodwill for themselves. One such act of goodwill is to lend money to the small farmers, which in due course gives them the power to influence their political leanings and brings them to the attention of politicians.

Additionally, these mill owners also fund political parties and candidates willing to take up their cause at the political level.

Finally, most of the mill owners are from the dominant Patel community. Their numerical strength ensures that their leaders don't have to look elsewhere for support.

Thus they have the financial clout, the influence and also the numbers necessary to be counted as a powerful politico-economic force capable of determining state policy.

For the telia rajas, the BJP's Keshubhai Patel is one of their tallest leaders.

The big farmers and mill owners in Gondol see him as a sagacious leader while Narendra Modi ‘is a good person, but a city-bred leader who does not understand the farmers'.

"Keshubhai understood our problems. He constructed a 700-km pipeline into Gondol to provide water to the groundnut farmers. He also subsidised electricity, both for farmers and oil mills.”

"Under his regime, mill owners could get loans from banks at low interest rates, both for constructing new mills and for expanding old ones," says Bhimabhai Patel, whose plans for owning his own oil mill were stymied by the exposure of the cooperative bank scam.

Kalpak Maniar, director of the Rajkot Nagrik Sahakari Bank, says, "Many cooperative banks were forced to close down operations due to the profligate loan schemes launched during the Keshubhai Patel regime. Many mill owners defaulted on repayments resulting in the collapse of several banks.”

"The government did not put any pressure on the defaulters for recovery of the loans," he adds.

"When small investors in rural areas around Rajkot tried to register complaints, the police simply refused to register their FIRs because the mill owners were involved," Indrasinh H Zala, an advocate in the Gujarat high court, says.

But, GOMOA president Vithalbhai Dhadok is livid when he hears these allegations.

"If you can prove that any of the oil mill owners contributed even one single paisa to any political party, I will give away my mill to you in charity," he challenged.

Sitting in his plush air-conditioned office adorned with countless photographs of him with Prime Minister Atal Bihari Vajpayee, Deputy Prime Minister Lal Ksihenchand Advani, former chief minister Keshubhai Patel and former BJP state chief Vajubhai Vela, the irony is completely lost on Dhadok.

"Oil mills are not responsible for the cooperative bank scam. It is just a ploy to malign us," he insists. "You [media] have also contributed to a large extent to our poor image by referring to us as telia rajas." 

"As a result, the banks have stopped lending money to us. It is all because of you [mediapersons]," he adds.

This despite oil mill owners contributing 30 per cent to the tax kitty of the Gujarat government, he claimed.

In fact, several mills have been lying idle for anywhere between six to nine months, as we have not been having a good crop for the last three years due to poor rainfall, he said.

One of ways in which the government can alleviate their problems, he said, is by removing groundnut oil from the purview of the Essential Commodities Act.

"While controls on the import of soya, palm, cottonseed and rapeseed oils have been removed, groundnut oil still comes under the ECA," he points out.

He also demanded some kind of control on the quantity of soya, palm, cottonseed and rapeseed oils being imported.

Perhaps, to guarantee a market for groundnut oil, and ensure the clout of the telia rajas endures in the corridors of power.

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