Industrial Development in West Bengal becomes tougher following Supreme Court’s Verdict on Tata Nano-Singur issue; A close look on West Bengal’s Industrializations till date!

It’s been almost 10 years now since the Tata Nano – Singur saga started. Two days back, a division bench of the Supreme Court of India headed by Justices Arun Mishra and V. Gopala Gowda pronounced their verdict on the acquisition of 997 acres of land in West Bengal’s Singur which took place in 2006. The division bench termed the land acquisition made by the then CPM government of the state to be illegal and void. Supreme Court also directed the Mamata Banerjee-led present state government to return the entire land to their respective owners within 12 weeks from the date of the verdict.

All those people who have been closely following this incident for the last 10 years might think that the saga would end here. But wait, the verdict from the topmost judicial body of the country wouldn’t put a full stop to this matter here. The reason for that is again the Supreme Court, which remained absolutely silent on Tata Motors’ compensation.

Now the question arises who would return back Tata Motors the huge amount which it had already spent in Singur! The company may still go for a review petition and demand proper compensation for the losses which it had to incur because of the Singur saga. If this happens, the land owners of Singur might have to wait a few more years for the transfer of land to take place. However, this verdict from the Supreme Court of India is a major blow towards West Bengal’s industrialization programme. At the end of the day, West Bengal loses many things from this victory.

What Bengal thinks today, India thinks tomorrow!

Long before India gained independence from the British rule, Gopal Krishna Gokhale once remarked, “What Bengal thinks today, India thinks tomorrow.” This quote is no longer valid for present day West Bengal. The state which was once a pride for the entire country, now, unfortunately, lags much behind than most of the other Indian states!

Dr. Bidhan Chandra Roy’s Endeavours

In 1947, the British province of Bengal was divided. While India got West Bengal, Pakistan on the other hand, got East Bengal. After independence nothing much happened in terms of development in East Bengal. But, West Bengal continued to flourish. Under the leadership of West Bengal’s second Chief Minister, Dr. Bidhan Chandra Roy, many factories were set up in the state. Many unemployed youths got jobs because of the active industrializations that were taking place in his tenure. The growth continued even a few years after his death.

The Naxalite Movement of the Seventies

Things started becoming bad with the onset of the Naxalite movement that plagued West Bengal during the early 1970s. The unrest created by the Naxal leaders of that time discouraged many industrialists and investors to start their ventures in West Bengal. As the violence began to increase, the state earned a bad name for itself and that halted industrializations. Although the Naxalite movement met its end in the mid-seventies, the bad phase, however, continued until the nineties.

Kolkata could have become the Silicon Valley of India but …

Situations improved in the early nineties, when some of the IT companies approached the state government to allocate them lands in Kolkata for setting up their companies. Jyoti Basu led CPM government was in power in West Bengal at that time. The state government didn’t like the idea of introduction of computers in the state. The top leaders were of the opinion that with the introduction of computers many people will loose jobs owing to increased automation. This was an erroneous decision and the companies were denied to set up their offices in Kolkata. Bangalore saw an opportunity for itself in this decision!

Developments during the late 90s and the early 2000s

In the next few years, Bangalore started witnessing huge growth as more number of IT companies were setting up their offices in the city. Many cities of India also witnessed the same. During the mid nineties, the CPM government of West Bengal realized their mistakes. Now was the time to rectify those erroneous decisions. With continued efforts from the ruling state government, industrialization in West Bengal finally saw some light. Some major IT companies in the world opened their offices in Kolkata and the IT growth in the city continued. By this time, Bangalore went far ahead in terms of development. The city also became synonymous with the tag “Silicon Valley of India”. Nevertheless, Kolkata had the potential to become the IT hub of the country!

During the late nineties and early 2000s, a major percentage of young talents from West Bengal started relocating themselves for higher studies in the South Indian cities. West Bengal didn’t have enough engineering and medical colleges to meet the increasing demands. To stop this brain drain, Buddhadeb Bhattacharjee, the then Chief Minister of West Bengal, took endeavours to turn the state into a higher educational hub. His efforts paid off. West Bengal in the next few years got some government and private institutions. The craze of moving out of the state for higher education stopped as the state became fully equipped to meet the demands. Furthermore, many students from other states also started coming to West Bengal to study further.

Tata Motors chose Singur to set up their Manufacturing Plant

During the tenure of Buddhadeb Bhattacharjee, many industrialists expressed their interests to set up their organizations in the state. In one such example, Ratan Tata requested the state to allocate 1000 acres of land for setting up a manufacturing unit of Tata Motors. He was then working on the vision to roll out world’s lowest priced car “Tata Nano” and to realize that vision he chose West Bengal. The reasons for choosing West Bengal were many. The comprehensive package of incentives which the West Bengal state government offered was quite lucrative. The package included subsidy on land, concessional power, a soft loan and tax paybacks and it was comparable to what the company would have got in Uttarakhand or Himachal Pradesh.

Tata Motors was given some options of sites for developing their factory. After critical examinations of all the sites, the management of the company decided to set up their first Tata Nano plant in Singur, a village located in the Hooghly district of West Bengal. The site at Singur was located beside the National Highway which was well connected with other Indian cities. Moreover, the state capital Kolkata was also in close proximity.

The Agreement

Soon the agreement between Tata Motors, West Bengal Government and West Bengal Industrial Development Corporation was signed. According to the deal, the West Bengal Government agreed to provide Tata Motors a loan of Rs. 200 crore at 1 per cent interest, repayable in five equal annual installments starting from the 21st year from the date of disbursement of the loan. And, WBIDC agreed to hand over 645.67 acres of land to Tata Motors on a 90-year lease. The annual lease rental was fixed at Rs. 1 crore the first five years, with a 25 percent increase after every five years till 30 years.

Tata Motors in 2006 disclosed in a statement made to MLA Sudip Bandhopadhyay that the project would create 12,000 direct and indirect jobs for the people in Singur.

“The Singur plant will initially directly employ 2,000 people. It is expected to create employment for 10,000 people among vendors and service providers in the vicinity of the plant.”

Singur became the face of Ratan Tata’s Visionary Project of Tata Nano

The news encouraged many leading industrialists to venture in West Bengal. Singur soon became the face of Ratan Tata’s visionary project of Tata Nano. Many businessmen of the country also purchased lands around Singur to set up their factories and businesses which would have also led to the creation of many more jobs in Singur. For them, it was a golden chance because Singur would flourish in the coming years.

Singur, Singur Protests, Tata Nano, Mamata Bandopadhyay, Ratan Tata, Tata Motors

Agitation from the farmers of Singur

After the land for the proposed site was handed over to Tata Motors, the land owners started their protests against the Tata Nano project at that site. It was evident that the state government was in a hurry to complete the acquisition of lands. Else, Tata Motors would have shifted their base to any other state. Buddhadeb Bhattacharjee didn’t wanted that to happen. He was of the opinion that if Tata Motors set up their unit in Singur it would send positive messages to all the industrialists of the country to set up their businesses in West Bengal. And, job opportunities for the unemployed people of the state would also increase. But things didn’t go the way he wished.

Buddhadeb Bhattacharjee was a wise person but he was probably the wrong person serving in that place. A person like him shouldn’t have entered politics. Under Bhattacharjee’s leadership, the land acquisition for the Tata Nano factory took place. And, a significant part of the land was not acquired following certain legal rules. The agitation from the unwilling land owners continued.

Singur, Singur Protests, Tata Nano, Mamata Bandopadhyay, Ratan Tata, Tata Motors

Mamata Banerjee saw this as an opportunity for her to strengthen his foothold in West Bengal. She joined the protests and stood by the poor farmers of Singur. In the meantime, Tata Motors started fencing the area and initiated the construction process of their manufacturing unit. Mamata Banerjee continued her protests.

Tata Motors relocates to Sanand, Gujarat for their ambitious Tata Nano project

As the agitation took a bigger shape, Tata Motors suspended their operations in its Singur plant in September 2008. Ratan Tata hinted that if the situation doesn’t improve in a month he would then think of shifting base to any other state. After a series of talks between the state government and Trinamool Congress, situations didn’t improve. Every negotiation failed. The then Governor of West Bengal Gopal Krishna Gandhi also acted as a mediator to resolve the turmoil. That too even failed. In October 2008, Ratan Tata announced setting up of the Tata Nano plant in Sanand, Gujarat. Tata Motors also demanded compensation from the West Bengal government on account of the losses which it had incurred because of the Singur turmoil.

There is absolutely no doubt that it was a major achievement for the people of Singur. Their protests earned them victory. But, West Bengal had to pay a huge price as industrialists and investors turned away their faces from West Bengal. The industrialization programme of the state suffered badly!

Political Dividend from the Singur Victory

It was a huge success for Mamata Banerjee’s Trinamool Congress. She was able to win the confidence of a huge percentage of people of West Bengal. In 2011, her party Trinamool Congress won the assembly elections of West Bengal. It was a landslide victory that ended the 34-year-old CPIM led Left Government rule in West Bengal. Mamata Banerjee became the Chief Minister of the state and announced that farmers of Singur would get back their lands.

Mamata Banerjee has been serving as the Chief Minister of West Bengal since 2011. In spite of her continuous efforts, she failed to create an environment in the state that would attract investors. However, she has remained successful in developing small scale industries in the state. But, that is not enough to generate large employments. Last year, the West Bengal government hosted a reality show on entrepreneurship. The show was much popular among the budding entrepreneurs of West Bengal. The idea was to promote entrepreneurship in the state.

Supreme Court’s verdict on the Land Acquisition in Singur

Last Wednesday, the Supreme Court of India delivered their verdict on Singur – Tata Nano issue. According to the division bench of Justices Arun Mishra and V. Gopala Gowda, the way by which the then CPI(M) government acquired the lands were grossly wrong. Justice Gowda in his judgement said that the land acquisition that was done couldn’t be said to be for a “public purpose” since it was allotted to a private company. Justice Mishra had a different opinion on this. He held an opinion that the allotment could be deemed to be for public purpose because if the factory would have set up in that location, it would have created enormous employment opportunities. Both the Justices, however, agreed that the land acquisition was unlawful on many accounts. They further directed the state government to return the lands to the persons from whom they were acquired.

West Bengal continues to lag behind in terms of Industrial Developments in the state!

The verdict from the top court of the country is surely a big blow to West Bengal’s industrialization programme. Many industrialists would view West Bengal as a state where getting land for businesses is not only difficult but is also a sensitive issue. In the last few years, WBIDC has acquired significant areas of land in different areas of West Bengal for the purpose of industrialization to attract investors. The plots were mainly taken from the farmers and they were also paid enough compensations. Now, if the farmers get motivated with this verdict and start demanding back their lands then this would become a monumental roadblock for West Bengal’s development and growth!

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