Global media says Tata pullout part of larger thorny issue

October 4th, 2008 - 6:24 pm ICT by IANS  

New York/London, Oct 3 (IANS) Just as the world media highlighted the unveiling of “People’s Car” Nano by the Tatas nine months ago, the group’s decision Friday to abandon Communist-ruled West Bengal for its commercial production has invited equal attention, especially on the debate over acquisition of farmland for factories.”Tata’s pull-out is a blow for West Bengal,” said a report in Financial Times, which added that the state, which lagged behind others in attracting investments, was hoping the project would anchor a new auto industry that generates thousands of jobs.

“The tiny Nano that is intended to make cars affordable to working-class Indians is supposed to be the world’s cheapest car, initially priced at Rs.100,000 ($2,1200) - or just double the cost of a motorbike,” the Times said, adding that strife over land forced the group to abandon the project.

The decision was announced Friday by group chairman Ratan Tata, who said he was left with no alternative to shifting the project out of Singur, some 40 km from West Bengal capital Kolkata, as the safety and welfare of employees, vendors and contractors could not be compromised.

The pull-out, after hard negotiations between the state government and the main opposition party there, also highlights the severe difficulties companies face in acquiring land for factories in densely populated India, the Times added.

The decision by Tatas underlines a thorny issue for manufacturing investors, said The Wall Street Journal.

“The move followed weeks of demonstrations by dispossessed farmers and political activists against the plant in India’s impoverished West Bengal state,” said the paper.

The Telegraph of London said the 200 million pound factory of Tatas, one of the oldest and largest groups, to produce the cheapest car in the world was forced to relocate even before it started to operate in West Bengal.

The paper said Nano, when it was unveiled earlier this year, had evoked considerable interest in the low-cost vehicle across the developing world as also fear from ecological groups that it would be bad for the environment.

Taking Tata Motors as a case point, the Washington Post, land acquisitions for projects for about 92,000 acres and estimated to be worth $54 billion were stalled in India by protests launched mainly by peasant farmers.

“The plant at Singur was seen as an important test case for the world’s biggest democracy. After Tata decided to abandon the project, pundits on television said the state’s image with potential investors was now tainted,” the paper added.

“Kolkata’s famously Left-wing intellectuals and celebrities were torn on the Tata issue, saying the case is symbolic of a society wrestling with its transformation,” the paper said, quoting people like cricket star Sourav Ganguly.

Newspapers like the International Herald Tribune and The New York Times also carried agency reports about the pullout, while the online version of BBC said the dispute highlighted a wider problem between India’s growing industry and its farmers.

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