It's truly unfortunate, but at a time when the Government is doing its best to woo foreign investment into the country, two Japanese investors are pleading that they be given fair treatment. Both cases may finally get resolved in an amicable fashion, but who knows what damage it will finally do to the country's image as an investment destination.

The Japanese, as we all know, take a long while in making a decision, and also get easily spooked. So while a host of European and US automobile companies rushed into the country, the Japanese majors were the slowest (Suzuki is not considered to be a Japanese major at least as far as cars are concerned). The first case, that of the problems Suzuki is facing is well known. The second, that of the zipper company YKK and its factory at Rewari in Haryana isn't.

Let's take YKK first. On June 12, a group of 150 villagers decided to protest outside its factory, asking that more locals be employed there. During the course of their demonstration, they caused minor damage to the factory and removed its signboard. YKK India's managers called the police who helped disburse the crowd.

So far, so good. The next day, a minister of the state government visited the factory and told the managers that they had better hire more local staff or it might become difficult for them to continue their operations. (Who the minister was shall remain a secret since the Japanese Embassy which gave this information refused to divulge his name and YKK officials refused to speak on the matter.) Rattled by this, YKK wrote to Chief Minister Bansi Lal who, to his credit, did his best to reassure them. The chief of the Haryana State Industrial Development Corporation and the Deputy Commissioner of the district visited YKK and told the managers that they had Bansi Lal's full support. Yet, on June 20, the driver of the company's bus was beaten up by the locals. Rattled by this, the Japanese Ambassador wrote to Bansi Lal. While Lal clearly did his best to resolve the issue, it is obvious that his writ doesn't run as strongly as it did during his earlier stint.

Incidentally, when contacted a few days ago, the Haryana Industry Minister told The Indian Express that the matter had been sorted out and that an enquiry by the Deputy Commissioner showed that no minister was involved. The problem YKK is facing seems minor to mostcertainly when compared to the attacks, in other states, on the likes of Cargill and Kentucky Fried Chicken. Yet, it brings back memories not so long ago where a former chief minister's son used to terrorise factory owners. The problem was so severe that even the owners of a leading printing press in Haryana decided to expand operations in other states. Suzuki's problems, of course, are of a different kind, and began with the run-in with former industry minister K. Karunakaran who wanted Maruti-Suzuki to locate its new plant in his home state. From then on, the problems just continued to multiply. And despite having a slightly larger shareholding than the Government of India, O. Suzuki felt he was being given the short shrift each time.

The Government was the one that decided that debt, not equity, would be raised to finance Maruti Udyog Limited's (MUL) expansion. It was the Government, not Suzuki, who decided that investigations and prosecution was to be launched against managing director R.C. Bhargava. There was also some problem when Suzuki wanted to upgrade the engine of the 800cc car as a result MUL lost valuable time, while competitors such as Daewoo appear all set to steal a march over the feuding company.

Matters reached a head a few months ago when Suzuki threatened to pull out. As company insiders put it, there was no way he was going to invest big money in MUL if he wasn't even sure who called the shots -- his nominee, Bhargava retires on August 28 and the next managing director will be the Government's nominee. MUL's immediate investment plans include Rs 1,100 crore for a new plant to produce 1 lakh cars annually, near the existing site at Gurgaon.

Over the next 5 years, it plans to spend around Rs 6,000 crore in a gear plant, a new engine plant, replacing the existing paint shop and another expansion in South India to cater to demand there. Suzuki, in fact, is in town to meet industry minister Murasoli Maran and is also trying to meet Prime Minister Gujral. While it is unclear as to what will actually get resolved, it is likely that some temporary solution, at least, will be found -- at the time of writing this piece, Suzuki still hadn't met Maran. The point, however, is that no lasting solution can be found to the problem until such time that the Government realises it has no business to be making automobiles and decides to sell its stake to either Suzuki or to the general public. What is ironical is that this is happening just the day after Maran announced the Government's much-welcome autonomy package for the nine-top or Navratna PSUs.