India’s Naxalite rebels, for years bottled up in the poverty-stricken middle and eastern regions of the country, have forged a new strategy to infiltrate into India’s premier industrial hubs, intelligence officials say.

According to the Union Home Ministry, the Maoists have formulated a major change in strategy designed to further expand out to target India’s commercial areas including the states of Gujarat and Maharashtra, the country’s commercial capital of Mumbai and the diamond hubs of Surat and Vadodara.

The intelligence officials say the new strategy is to zero in on the country’s vulnerable industrial pockets. Large numbers of ultras have been reported to have been apprehended and interrogated in Maharashtra recently, including 10 Maoists from West Bengal in the southern city of Pune. They were said to be masquerading as casual laborers in different industrial units.

Security agencies suggest that the Naxalites, formally known as the Communist Party of India (Maoist) are likely to further expand their turf through what they call a ‘Golden Corridor Committee.” The rebels’ urban unit, they say, is recruiting cadres in different cities of Maharashtra and Gujarat. The underlying message is ominous -- that western India, which was hitherto considered relatively safe from the group’s terror activities -- will now be one of the eight strategic areas for their operations. Already 221 Maoist violence-related deaths have been recorded in Maharashtra between 2008 and November 2011. The state has reported 51 deaths this year, a rise from 45 in 2010.

These fresh revelations highlight the Congress-led United Progressive Alliance government’s continued inability to tackle the Maoist menace. The coalition branded the group a terrorist organization on 22 June 2009. As of June 2010, 83 districts in nine states had been identified as Naxalite targets.

The Naxalites currently operate across a “red corridor” stretching from the southern state of Andhra Pradesh to the central state of Chhattisgarh and into West Bengal, bordering Nepal and Bhutan. They have also forged close fraternal ties with northeastern insurgent groups like the Revolutionary People’s Front (RPF) and People’s Liberation Army (PLA) of Manipur while tapping Nagaland for procurement of their ammunition.

Prime Minister Manmohan Singh has described the Maoist insurgency as “the biggest internal security challenge since Independence.” In 2009 alone, the group launched over 1,000 attacks and killed 600 people.

The insurgents started their armed struggle in 1967 with a peasant revolt in Naxalbari village in West Bengal. After regrouping in the 1980s, they recruited thousands of poor villagers, arming them with rifles snatched from police. The rebels currently have an estimated 20,000 combatants, including 6,000-8,000 hardcore fighters.

The Naxals have been charged with running an extortion economy under the garb of a popular revolution. They extract enormous sums of money from mining companies, police say. According to a Reuters report, the rebels extort about US$300 million from companies in India every year to fund their movement.

The effect of the insurgency has taken a heavy toll on business. Work on a US$7 billion steel plant by India’s third largest steel producer, JSW Steel Ltd, has been delayed. Rebel strikes have also slowed work on two separate plants by the world’s leading steelmakers Arcelor Mittal and the South Korean-owned Posco in eastern India.

Two years ago, the Indian government launched `Operation Green Hunt,’ a coordinated military operation to seek to cleanse the eastern states of Maoists. The operation now covers most Maoist strongholds like Chhattisgarh's Bastar region, southern Orissa, the Jangalmahal area of West Bengal, Jharkhand and Bihar. The operation has succeeded in eliminating several Maoist leaders and turning popular sentiment against them to some extent.

The military has also dealt a blow to Maoist cadres by killing top leaders including Sende Rajamouli, Patel Sudhakaran Reddy, Cherukuri Rajkumar alias Azad and Kishenji. Four tier-two leaders - Narayan Sanyal, Sushil Roy, Amit Bagchi and Kobad Ghandy are currently in jail. Experts describe Kishenji's recent death as a decisive blow to Maoists’ rank and file.

However, observers point out that while Operation Green Hunt has dented the Maoists militarily and eroded their support base, it has not tackled the root of the problem.

“The government’s anti-Maoist military operations have ravaged entire villages, destroying the villagers’ habitats and livelihoods,” said Pradeep Mahanto, formerly with the Central Reserve Police Force. “This has deepened the villagers’ resentment against the state.”

However, one benefit has accrued to the government. “Unlike in the past,” Mahanto says, the villagers no longer see the Maoists as Robin Hood-style saviors. “They’ve seen how the ultras deserted them, hiding in forests while Operation Green Hunt was on. This has welled up public angst against them.”

Another manifestation of popular anger against the Maoists came during the November by-elections in the tribal-dominated Umarkote constituency in the eastern state of Orissa (now called Odisha). The polls saw thousands of voters turn up in defiance of a Maoist call to boycott the elections.

But why has the Indian government not been able to fully contain the Maoist menace? Theorists suggest that the rebels get clandestine foreign support and that their agenda is scripted outside the country. RSN Singh, author of the book `Asian Strategic and Military Perspective’, writes that the Maoist leadership is “not a bunch of alienated people”. They are aided and abetted by China, he charges.

“For China,” Singh writes, “the Maoists are the most reliable tool in the proxy war that it is waging against India. In the event of an Indo-China armed conflict the Maoists would act as ‘fifth columnists.”

Experts say a logistical problem in managing the ultras’ threat in India is an unambiguous overlap of authority. While national security in India comes under the domain of the central home ministry, state governments too have to be involved in military strikes at their level which creates multiple points of authority for those manning the anti-Maoist operations.

Scholar Althea Carbon writes in her award-winning essay, “Naxalism - The Biggest Security Threat to India” - that the movement “highlights various underlying weaknesses of India’s governance, political institutions and socio-economic structure.”

In other words, the Naxalites’ socio-economic alienation and their economic and political inequity can’t be tackled through military force alone. The problem calls for a three-pronged solution: social and economic development, multi-lateral dialogue and military force, Carbon suggests.

Currently, however, the main instrument employed by the government to address the threat is increased deployment of the armed forces. This creates more problems than it solves. For instance, the enforcement of the draconian Armed Forces Special Powers Act -- which endows limitless power upon police personnel to shoot anybody they perceive to be a `threat’ -- is a travesty of human rights. The act has created widespread resentment against the military among the tribals, who then end up supporting the ultras.

“It’s a classic Catch 22,” sums up Mahanto. “The multi-faceted Naxalite problem requires a nuanced and sustainable solution, not brute force.”

(Neeta Lal is a New Delhi-based senior journalist.)