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Last Updated: Thursday, 6 September 2007, 22:35 GMT 23:35 UK
Uganda's Asian elite face fresh hostility
By Lucy Hooker
Business reporter, BBC World Service, Kampala, Uganda

Asian man wounded by stoning
Some Asian residents were targeted by the protesters

On 12 April an environmental protest in Kampala turned racial. The crowds began chanting anti-Asian slogans.

Some held placards with slogans praising Uganda's former dictator Idi Amin. "For one tree cut five Indians dead," said one poster.

Violence targeting Asians led to the death of one young Indian man. Shops were ransacked and many Asians sought refuge in the Hindu temple or barricaded themselves in their shops. Pent up frustration over the inequality between Uganda's Asian and black communities found expression on the streets.

"The violence was exceptional, but the bitterness expressed was characteristic," says Dr Moses Musaazi, a university academic turned businessman.

In 1972, Idi Amin expelled the country's wealthy Asian population and expropriated their assets. But in the1980s the exiled were offered compensation and many have returned to re-establish business empires that again dominate Uganda's economy.

Many thousand newcomers have joined them.

Indians make up less than 1% of Uganda's population. But they control some 40% of the economy.

"Asian employers haven't done anything to correct the situation that brought about Amin," says Dr Musaazi. "I didn't think they would make the same mistake again."

An environmental cause

The protest was originally over an environmental issue. Uganda's government had announced that it was giving the go ahead for a sugar cane company to develop a part of Mabira National Park, a protected area of forest.

Our president mostly likes the Indians and the Chinese. He doesn't listen to us blacks
Sarah, the manager of a hardware shop

But the company in question is owned by the wealthy Ugandan-Indian Mehta family.

"Mabira gave an outlet to fears of Asian domination, gave them a voice," says Angelo Izama, journalist and broadcaster.

"There is resentment that the government appears to be favouring an Asian business. It has pitted the communities against each other."

Ugandans feel that Asian business is given special treatment and has the ear of the government in a way they do not. Many Indians are not eligible to vote, but often donate money to support the political campaigns of Ugandan friends.

The Museveni government values the investment and expertise that foreign investors bring to Uganda. And the Indian community now enjoys a kind of political insurance which was absent in the days of Idi Amin.

"The accessibility to authorities in Uganda is so smooth and so simple," says Sanjiv Patel of the Indian Association of Uganda.

"I can assure you if there is a burning issue of Indians or minorities, or pertaining to the country, the president would call us within 24 hours."

Indians in Kampala

It's not obvious to the naked eye but almost all of Kampala's big businesses are owned by Indians including manufacturing, luxury hotels, banks and real estate. The city's finest restaurants are curry houses catering to the wealthy elite.

Most Ugandans refer to Indians with respect

On the street there's the occasional glimpse of a bright sari amongst the boldly patterned African clothes. A glance in many small shops reveals a sea of black faces at the service desk and one Asian in the shadows at the back.

Indians here keep a low profile.

"Because of a lack of integration, any small misunderstanding is blown out proportion," says Angelo Izama.

Ordinary Ugandans readily refer to cases of Asian employers mistreating and underpaying staff. And in the city's market district small traders feel the competition from Asian rivals keenly.

"Their prices are cheaper than ours, so we are not friends with Indians," says Sarah, the manager of a hardware shop.

"Our president mostly likes the Indians and the Chinese. He doesn't listen to us blacks.

"I think Ugandans have lived in harmony with the Indians for quite some time. We have been underpaid by them for quite some time in their factories, their flower gardens and their shops. All this we bear because we are poor," says Issa Sekitto representative of Kampala's city traders.

But there's nothing like the difficult relationship there was between Indian employers and black workers before 1972. Indians have worked hard to overcome the reputation they had for arrogance and cruelty.

Ugandans are also quick to admit that immigrants tend to work harder, put in longer hours and expect the same from their employees.

Not racist

Despite some obvious resentment there's little sign of outright racism against Indians. Most Ugandans, from academics to second hand shoe salesmen, refer to Indians with respect.

They admit that when Idi Amin expelled the Asians it left the economy in a mess. Ugandans who inherited Asian property had little experience in running industry and no money to invest. The economy collapsed.

Most Ugandans are grateful that Asians investors were persuaded to return to create work and wealth again.

But they are suspicious of a community which worships, educates and lives apart.

Future of Mabira

And now the President is preparing to publish a final decision over the fate of Mabira National Park.

The government argues the hundreds of jobs and wealth that will follow are worth the loss of some of the country's protected forest.

But the Indian community is desperately lobbying for the plans to be shelved.

They are quite aware that pursuing the plan could jeopardise the delicate balance of good will that they've built up in recent years.

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