Left Front’s panchayat poll shock jolts industry

June 18th, 2008 - 11:42 am ICT by IANS  

By Aparajita Gupta
Kolkata, June 18 (IANS) The ruling communist coalition in West Bengal isn’t the only entity jolted by the panchayat polls. The future of several industrial projects too seems uncertain today. The Left Front coalition, led by the Communist Party of India-Marxist (CPI-M), lost a substantial chunk of its rural base, mainly in pockets where it had acquired land for industry.

Riding the backlash against such acquisition was the opposition Trinamool Congress party, which wrested the zilla parishads (district councils) of East Midnapore and South 24 Parganas, besides giving the ruling alliance a run for its money in several other districts.

Having at last found a potent weapon to beat the Left Front, Trinamool has vowed to scuttle any attempt to take land forcibly from peasants. “We will never allow any conversion of fertile land into industrial belt,” said Trinamool leader Partha Bhattacharya.

The offshoot: the state government has gone cold on going ahead with industrial and real estate projects, fearing further erosion in its vote bank in an election year.

The sufferer: Industry.

A prime example of this is construction major DLF’s Rs.330-billion Dankuni mega township project in Hooghly district, adjoining Kolkata. The government has been able to acquire only 200 acres of the 4,840 acres required and, by the look of it, can make little headway after the setbacks in the rural polls.

Realising this, the state government scrapped on June 4 the land procurement committee set up for the DLF project and, in a major shift of policy, decreed that representatives of local bodies would be involved in the land procuring process.

It isn’t the private sector that is the sole sufferer. The West Bengal Power Development Corp’s 3,000 megawatt super-thermal project at Katwa in Bardhaman district has also run into trouble after the authorities tried to acquire land without announcing a relief and rehabilitation package.

The landowners, mostly poor peasants, said they would not part with their fertile land.

State Urban Development Minister Ashok Bhattacharya seems unfazed. “Land acquisition controversies over industrialisation are not unique to West Bengal,” he told IANS.

“This has happened in other states like Maharashtra and Tamil Nadu. But in those states landowners are rich people unlike West Bengal where landowners are mostly poor farmers.”

At the same time, Bhattacharya made it clear that henceforth, the state government would take the local people along in building a consensus. “We will not acquire any land in West Bengal without consensus,” he says.

Sensing the mood of the people, the companies have now come up with innovative incentives for the landowners.

JSW Bengal Steel, which is building a 12-million-tonne mega steel plant that is due to come up in four years at Salboni in West Midnapore, said it’ll offer free shares of the company to people whose land is being acquired.

Bhushan Steel requires 2,500 acres to set up a two-million-tonne integrated steel plant and a 1,000 megawatt captive power plant in the Salanpur industrial belt, near Asansol, around 260 km from Kolkata.

But sensing the mood even before the polls, it made a unique rehabilaltion and resettlement package, under which it is offering free land for land that would be acquired for its project.

Abhirup Sarkar, professor of economics at the Indian Statistical Institute (ISI), accused the CPI-M of mishandling the land acquisition issue.

“The ruling party handled the entire industrialisation and land acquisition process in Singur in a very inefficient way,” Sarkar told IANS. “Industrialisation is likely to get hampered due to the panchayat poll results.”

There are some who are not so pessimistic. Sushil Mohta, governing council member of Confederation of Real Estate Developers Association of India (CREDAI), downplayed DLF’s predicament, saying: “I don’t think this change of power in the panchayat level is going to affect realtors anyway.”

But the panchayat results notwithstanding, investors still find the state an attractive destination.

Videocon chairman Venugopal Dhoot last week promised to pump in another Rs.60 billion in the state.

The company now plans to set up two knowledge parks in the state, one at Siliguri in northern West Bengal and the other at Kalyani in the southern part of the state.

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