Capitalism helps stir India's old prejudices: Michael Fathers in Surat assesses why a boom town was unable to look to the future and steer clear of bloodshed

SURAT is India's fastest growing city, the home of the country's diamond cutting and artificial silk industries, with a natural gas terminal and a petro-chemical complex. For many bureaucrats, industrialists and planners it symbolises India's future - a place where prosperity should dissolve the tensions between castes and religious communities.

That hope took a blow in five days of bloodshed and arson earlier this month following the demolition of a mosque by Hindu zealots, 700 miles away in Ayodhya. In Surat, 182 people died. Eighteen of them had been pulled from a train on the outskirts of the city and murdered, 23 were burned alive and the rest killed by stab wounds or police gunfire. Police said 59 of the dead were Muslims, including the train victims and those who died from burns, and 24 were Hindus. They could not identify the remaining dead.

Surat is not a big city, but its population has tripled to 1.8 million over the past decade, migrants pouring in from across India for the work and wages. Nor is it a pretty city. It bears all the dismal scars of rapid development, a property boom and lack of planning. Old monuments, including the 17th-century Mogul walls and old British and Dutch residences, have been pulled down to make way for roads and tower blocks.

It is a city of Patels, the Gujarati trading community whose business acumen took them all over the British empire and eventually to Britain itself. In Surat, which is a modest city by Indian standards, there are 20 pages of Patels in a 200-page telephone book. My driver was a Patel, two police inspectors I met were Patels, the mayor is a Patel, until a year ago the local MP was a Patel, the chief minister of Gujarat is a Patel.

It was in Surat that Britain established its first foothold in India in 1612, when the newly formed East India Company got permission from the Mogul emperor, Jahangir, to set up a trading 'factory'. The Portuguese and Dutch were already there, the French came soon afterwards. Surat was then, as it is now, a very prosperous city, a centre of trade between India, Arabia and beyond. It remained Britain's chief settlement on the West Coast until 1687 when Bombay succeeded to the title. Surat slipped into obscurity and was a memory for 300 years.

Last week Surat was still under curfew, its railway station deserted, its streets empty but for police and army patrols. In the smarter area south of the old city you could see the burnt-out shops of Muslim traders, steel security doors on shopfronts twisted and broken by the mob and blackened by fire.

In most cases you had to go to the outer suburbs to the north and east where the immigrants live in modest tenements to see the burnt-out textile factories and the abandoned and fire-stained homes. The destroyed factories were owned by Muslims and employed mostly Hindus, but that did not concern the Hindu mob.

Muslims had earlier attacked and set fire to a Hindu-owned factory in the centre of the old town on the first day of trouble. The protest against the destruction of the Ayodyha mosque began with stone-throwing, became arson and ended in slaughter.

The curiosity about Gujarat is its people often share the same surname. A Patel can as easily be a Muslim as a Hindu. A Shah can be a Jain or a Muslim or Hindu. Names that sound obviously Hindu, such as Desai, Chauhan and Palanburi, are also Muslim surnames. There is no way an outsider can tell one from the other.

It is an integrated community. Gujarati Muslims do not speak Urdu, the language of India's former Islamic rulers, as Muslims do from neighbouring states. They speak Gujarati; Hindus and Muslims take part in each others festivals; they share the same social customs, the same superstitions. There were conflicts, but as businessmen they depended on each other and co-operated.

It was into this relatively relaxed relationship that immigrant workers, most footloose without their families, and businessmen from other, less tolerant, parts of India - Uttar Pradesh, Madhya Pradesh, Orissa, Maharashtra, Andhra Pradesh, Punjab - and from other areas of Gujarat began arriving in the late 1970s. By the mid-1980s they outnumbered Surat's natives. Today immigrants account for some 70 per cent of the city's population.

A Surat social scientist, Ghanshyam Shah, said it would be wrong to blame outsiders entirely. There was a criminal side to the rioting; old scores were settled, new vendettas begun. Above all, he pointed the finger at local politicians, especially from the Hindu- chauvinist Bharatiya Janata Party (BJP), which controlled the local city corporation and represented Surat at parliament in New Delhi.

The Congress party in its hubris had ignored the immigrants, leaving the field free to the BJP which came to power in Surat two years ago. And as the diamond cutting and polishing and textile industries went into recession they stirred up anti-Muslim sentiment.

Mr Shah said that on the second night of rioting he and his neighbours received telephone calls warning them that a mob of Muslims was on its way to destroy a local temple. 'Every Hindu in the neighbourhood received a telephone call from the BJP, as if we had been targeted,' he said. The report was a lie but it got a large angry crowd out on the streets and the people were not at all upset when Muslim shops in the area were set on fire.

On the main road not far from Mr Shah's flat, a man called to me and asked me where I lived. When I said London he told me the British had done two things that would always be remembered. They had ended Muslim rule in India by coming to Surat nearly 400 years ago, and they had given the world Margaret Thatcher.

It is possible to see Surat nowadays as a Thatcherite kind of city - - fresh raw capitalism laced with traditional prejudices. It is a deadly mixture.

NEW DELHI - The Indian Prime Minister, Narasimha Rao, yesterday defeated a no-confidence vote in parliament following violent Hindu-Muslim riots, earlier this month, Reuter reports.

(Photograph omitted)