Will it be ta-ta to investment in Bengal?
If the violence against Tata Motors continues in Singur and forces a pull-out, it will be a sad moment of truth for West Bengal.india Updated: Aug 22, 2008 22:02 IST
Ratan Tata is not a man who plays to the gallery. So if he makes a statement about the possibility of the Nano car project being pulled out of Singur, we shouldn’t be treating it as a bluff. If the violence against Tata Motors continues in Singur and forces a pull-out, it will be a sad moment of truth for West Bengal. Given the fast deteriorating environment at the plant — thanks to the political agitation led by Mamata Banerjee — there is no way that the world’s cheapest car will roll out of the Singur facility on schedule later this year. This is a serious loss for West Bengal that badly needs such investments to generate jobs for its unemployed youth. If Mr Tata relocates the Nano project elsewhere, the ancillary industries that have come up in the vicinity to make parts for the Nano, too, will move out. And if a squeaky clean group like the Tatas is hounded out by the likes of Ms Banerjee, the future for other industrialists setting up shop in Bengal will surely look bleak.
Mr Tata’s frustration in coping with Ms Banerjee’s relentless opposition comes at a time when the state’s fortunes are looking up. According to a recent Assocham report, West Bengal is currently among the top preferred destinations alongside Maharashtra, Andhra Pradesh, Orissa and Rajasthan. During the first six months of this calendar year, capacity expansion plans by corporates amount to a whopping $ 243 billion. West Bengal, for its part, has attracted big-ticket investments of $19.26 billion in the steel, hospitality and manufacturing sectors. The Tatas, too, have made significant investments in the state. A pull-out at this juncture will cost Tata Motors and its shareholders a fair deal. But the biggest loser will be West Bengal.
To be sure, Mr Tata will be aggressively wooed by other states for the Nano project facility. He has the option of shifting out of the country as well. It would be unfortunate if an increasing number of businessmen like Mr Tata are ‘tempted’ to take their shops elsewhere. Despite almost two decades of reforms — that were meant to deregulate, delicense and decontrol economic activity — if the pointless exertions of Ms Banerjee can lead one of the country’s finest industrialists to pack their bags and opt out of Bengal, it is a sad moment for India as well.