Tata announces Nano pullout from West Bengal, unfortunate says India Inc (Roundup)

October 4th, 2008 - 1:37 am ICT by IANS  

Kolkata, Oct 3 (IANS) Ending days of speculation, Tata Motors Friday announced it was pulling out its Nano small car project from West Bengal’s troubled Singur and blamed the opposition Trinamool Congress, which spearheaded protests against the factory, for the “painful” decision.Dashing the state government’s hopes to somehow convince the auto major to stay on, Tata Group chairman Ratan Tata said: “We have arrived at the painful decision mainly for the well-being of our employees and for the safety of contractors.”

Briefing newspersons after a 90-minute meeting with state Chief Minister Buddhadeb Bhattacharjee at the state secretariat, Tata said Friday: “We’ve taken this decision today because we’ve a timeline to meet and assurances to keep. We did not see any change on the horizon.”

Within hours of Tata Motors announcing withdrawal of its Nano project from West Bengal, Karnataka said a team from the company is expected in Bangalore Monday for talks on possible relocation of the small car project in the state.

“Two senior officials will hold talks with a Tata team, which is expected to arrive in Bangalore Monday,” a spokesperson of Chief Minister B.S. Yeddyurappa said Friday night in Bangalore.

Karnataka has offered 1,000 acres of land in Dharwad district in the north of the state for Tatas to set up the Nano plant. Tatas already have around 900 acres of land in Dharwad, about 400 km from Bangalore, and are operating an equipment manufacturing unit.

The auto major’s decision to pull out from West Bengal comes 32 days after it decided to suspend operations in the Singur factory fearing for security of its employees who were manhandled and threatened by Trinamool Congress-led protesters, demanding the return of 400 acres out of the total area 997.11 acres taken for the project.

Terming the Tata Motors’ decision to pull out of West Bengal as a “joint game plan” between the auto major and the state government, Trinamool Congress chief Mamata Banerjee Friday said it would be “unfair” if the Tatas blame her party for their decision.

“The entire issue is a joint game plan by the Tata Motors and the CPI-M. The decision to shift the Nano unit from West Bengal is simply an outcome of a political joint venture between both parties - Tatas and the CPI-M,” Banerjee told reporters here.

“We still believe industry and agriculture can go hand in hand,” she said, adding, “now it’ll be unfair if the Tatas blame Trinamool for their decision.”

Meanwhile, Indian industry and the government were dismayed by the Singur developments, with a cross-section of India Inc describing the situation as unfortunate.

Commerce Secretary G.K. Pillai: “It is an unfortunate development. But we should not read too much into it. This is an individual, isolated, and an exceptional case. A large number of investments are taking place.”

Associated Chambers of Commerce and Industry of India: “This is the most unfortunate incident of industrial activities in the 21st century.”

Federation of Indian Chamber of Commerce and Industry: “This was not a one-off auto project but would have given a boost to a whole host of ancillaries as well. Bengal’s tradition of engineering and heavy industry had suffered over time because of lack of fresh investments in these sectors in the state and the gradual closure of many of the old engineering industries.”

While announcing the pullour, Ratan Tata had come down heavily on Mamata Banerjee. He had wondered about the source of funds for the prolonged agitation against his project. “I would not like to respond (whether the competitors played a role). But it has made us wonder where some of the funds for agitation and the logistics has come from.”

“I had said earlier that if somebody holds a trigger to my face, he will have to take the decision whether or not to pull the trigger, because I will not move away. I must say Ms Banerjee has pulled the trigger.”

“This decision has been prompted because we do not see any change on the horizon,” Tata said. “Throughout the two years we have faced enormous disruption and assault and intimidation of some of the employees.”

West Bengal’s ruling Left Front major partner, the Communist Party of India-Marxist (CPI-M), has called a 10-hour shutdown in Singur Saturday to protest the “conspiracy” hatched by the opposition that forced Tata Motors to shift its small car project from the area.

The shutdown would begin at 6 a.m. and continue till 4 p.m., the CPI-M said.

A group of CPI-M supporters put up a road block for a brief while on the Durgapur Expressway - part of the National Highway (NH)-2 connecting Kolkata and Delhi - close to the Nano factory.

Tata Motors took up the project to construct the factory for Nano, priced at Rs.100,000 ($2,500) in Singur, 40 km from here, a couple of years back. But it experienced constant resistance from the Trinamool Congress-led ‘unwilling farmers’. It finally suspended work Sep 2 fearing the safety of its workers.

“This is a sad happening. We have to think of something else now to move forward in the path of industrialization,” Harshavardhan Neotia, Ambuja Realty Development Ltd. chairman, said.

A similar concern was echoed by common people.

Nayonee, a research scholar, said: “This is not desirable. This is extremely regressive for the state. All the political parties should have acted more responsibly. It’s a failure of the political system.”

“We hoped that the project will come up here. But now that they have rolled back, we have a question to ask the state government. What will they do with the land they have acquired in Singur from us?” asked Mihir Mal, a resident of Beraberi in Singur, who lost his land for the project.

Cutting across age groups and political leanings, people of the state had hoped for industrialization.

“This is not at all good for the state. All our hopes are shattered. I have a small kid, I thought with industrialization the state will prosper and they will have a better future ahead of them. But now it seems impossible,” Malabika Chatterjee, a housewife, said.

A young banker said: “This is the worst possible thing that could happen in West Bengal at a time when industrialization is the need of the hour for the state.”

“This was a prestigious project. We did not think even in our dreams that the Tatas will go. To gain political mileage, an opposition party and a few people played a destructive role. The opposition acted irresponsibly and destructively,” Industries Minister Nirupam Sen told reporters here.

The minister said the Nano project did not involve only one factory. “We have not lost the small car factory alone. We have also lost its 56 ancillary units.”

“I don’t know who stands to gain politically with this project out of the state. But eight crore (80 million) people of the state, and particularly those in Singur, will suffer.”

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