WHO WAS REALLY BEHIND TATA’S TROUBLES AT SINGUR?
So it’s happened. After months of violent protests over loss of farming land, after vicious battles by self-serving regional politicians, and after seemingly endless attempts at a compromise, Ratan Tata has pulled down the shutters on Tata Motors’ low cost Nano car plant in West Bengal and is off to make the car elsewhere.
“We have little choice but to move out of Bengal. We cannot run a factory with police around all the time,” was one of several memorable wrap-up quotes that he produced last night to explain his decision.
“We have to shift because of Mamata Banerjee,” Mr Tata said at a press conference in Kolkata last night. So this fiery politician’s ambitions have robbed a state that desperately needs industrial development of a $350m project that would have generated thousands of jobs in the main car factory, in component suppliers located on the same site, and in other downstream businesses.
This is the second time that politicians and powerful pressure groups have turned investment away from West Bengal. A battle between the Communist-led Left Front and Trinamool for control of another part of West Bengal led last year to plans being abandoned for a 25,000-acre chemicals special economic zone (SEZ) at Nandigram amid violent protests where 14 people were killed.
Protests by farmers and the landless labourers against their land being used for industrial development are understandable – and in many cases justified. As Kamal Nath, India’s Minister for Commerce and Industry, said to me last month when I was talking to him about delays in Orissa on a steel plant planned by Posco from Korea, “In a democracy all the stake-holders have to have a voice – and in India they have a particularly loud voice”.
The irony is that Ratan Tata, who heads a government –sponsored Investment Commission set up to help foreign companies like Posco manage their projects in India, could not turn Singur round – which brings me to a final thought………Is there something happening here that has not been publicised?
Was someone else encouraging the protests?
I would not be surprised to hear that Tata’s problems were fanned by another autos manufacturer wanting to disrupt the “one lakh” Nano’s launch. I have no evidence of this but such dirty tricks are not unknown. Ratan Tata himself has said publicly that he wonders “who’s financing the protests”.
There were rumours a few years ago that bureaucrats and politicians were being paid by a foreign car company to disrupt the appointment of top management at Maruti Suzuki, a highly successful Japanese-India joint venture, in order to delay the launch of an important new Maruti model. Has the same sort of thing happened here? Politicians always need funds!
The Tata Nano was unveiled at Delhi’s auto show in January with a price tag of around 100,000 rupees ($2,130). and was due to be launched on the market this month. The plan was to make 250,000 cars a year at Singur, rising later to 350,000. That will not now happen. Instead the car will be produced in smaller numbers at other Tata locations till a new permanent site is found.
So who has gained? Not Tata, nor West Bengal – nor, in political terms, either the Left Front which has been shown to be weak, or Mamata Banerjee, whose protests have lost jobs, nor the people living in the area, some of whom have lost both their land and Tata jobs.
The only winners are other auto firms that need longer to get their rival cars ready for market.