Bengal govt reaches out to Tata Group, seeks to resolve ₹765.78 crore compensation dispute over Singur

The BJP-led Bengal government initiated talks to set up new industries and resolve a dispute over compensation of ₹765.78 crore that previous govt didn't pay.

The West Bengal government has initiated talks with the Tata Group to set up new industries and resolve a legal dispute over compensation of ₹765.78 crore that the previous government under the Trinamool Congress (TMC) did not pay to Tata Motors for losses suffered in aborting the Nano car project at Singur in 2008 following a two-year agitation by then-opposition leader Mamata Banerjee, officials aware of the matter said.

“Efforts are being made to reach an out-of-court settlement with the Tata Group,” official said. (File Photo/ PTI)

“Our officers went to Mumbai this week and talked to the Tata Group. Of course, we want them to return to Bengal. Had Mr Ratan Tata been alive I would have touched his feet and requested him to set up an industry here,” industry minister Tapas Roy said.

“Our state is saddled with debts piled up by the former government. The court ordered that a compensation of around ₹766 crore be paid to the Tatas. All these issues are being discussed,” Roy added.

Officials aware of the matter said if the initial talks bear fruit then finance minister Swapan Dasgupta and Roy may visit Mumbai.

Known for multi-crop farming, Hooghly district’s Singur made headlines in 2006 when Tata Motors set its sights on the land to build its ₹1-lakh car, the Nano. The Left Front government acquired 997.11 acres along the NH-2 and handed it over to the company. However, Mamata Banerjee, then in the Opposition called a hunger strike demanding the return of 347 acres of farmland that she alleged was “forcibly” acquired.

Following a two-year agitation by Banerjee and several litigations, the Tatas moved out in October 2008 and shifted the project to Gujarat’s Sanand.

The Tata Group moved the Calcutta high court seeking compensation for the losses and the matter was referred to an arbitration tribunal which directed the West Bengal Industrial Development Corporation (WBIDC) in October 2023 to pay a compensation of ₹765.78 crore along with 11% annual interest to the Tatas. The state challenged this order at the Supreme Court but its appeal was rejected.

“On May 7, three days after the BJP won the Bengal polls, the Calcutta high court turned down WBIDC’s prayer for an unconditional stay on the arbitration tribunal’s order and directed WBIDC,” a senior state official said. “Efforts are being made to reach an out-of-court settlement with the Tata Group,” he added, asking not to be named.