Ratan Tata remains unenthused by the lack of clarity in the Singur pact thrashed out between West Bengal Chief Minister Buddhadeb Bhattacharjee and Trinamool Congress chief Mamata Banerjee. Tata Motors’ decision to suspend construction and commissioning work at the Nano plant, therefore, continues. As if on cue, other leading corporates like Infosys have also decided to rethink their plans due to the ‘fear psychosis’ in West Bengal. Such developments are the worst possible auguries for the state government’s efforts to kickstart rapid industrialisation. The business environment is bound to remain vitiated so long as politics remains in command and transformational projects like that of the Nano get caught in the crossfire of rivalries.
Mr Tata’s disenchantment with setting up shop in Singur does not necessarily stem from his frustration with farmers refusing to sell land. True, he has stated in his interviews that “as each generation develops, the children of the rural economy must decide whether they want to continue to work on the farms”. The reality is that his project might well have become a model for industrial projects elsewhere in the country had the state government used its organisational heft at the grass roots, gram panchayat level to ensure that land acquisition was done equitably. The complicated land-for-land settlement between Ms Banerjee and the state government, without involving the Tatas, is the worst publicity for attracting investment to that state.
The upshot is that the Tatas will probably roll out the Nano from elsewhere. The options include Pantnagar in Uttarakhand, Pimpri in Maharasthra and Dharwad in Karnataka. The ancillary and vendor base, which has come up in the vicinity of the Singur facility to make parts for the Nano, too, will move out. Industrialists losing heart to invest in the state represents a loss of face for the government. As it is, the business environment is not worth writing home about. Allowing politics a freer rein to impact the viability of the Nano project makes it even worse.