Why TATA Divorced Singur?; On ground zero

The political backdrop Unlike most of West Bengal, Hooghly district, where the Singur block is located, has never been a stronghold of the Left parties. Even before the Singur crisis, the ruling Communists had been kicked out of several panchayats in the Singur block. It got worse for the Left Front last November when the Trinamool Congress won all 16 panchayats in the gram panchayat elections in the wake of the agitation over the Tata Nano plant.
The Singur attraction The 997.11-acre Tata Motors facility for the Nano and its ancillary vendors is located on land mostly belonging to the villagers of Beraberi. This village adjoins National Highway (NH) 2, better known as the Grand Trunk Road, the lifeline between north and east India. A few kilometres south of the plant near Howrah, NH2 connects with NH6, the main east-west artery of India, linking Kolkata with Surat (and onward to Mumbai via NH3 or NH8). This highway also connects with NH5, the main east-south highway, linking Kolkata with Chennai. Short point: the Tatas chose Singur because of the excellent road connectivity it had on offer.
So, what is the problem?Fed by the river Hooghly, Singur lies in the most fertile part of the Gangetic Delta of Bengal. The land, claim opponents of the project, can support four crops a year and diverting it for industrial use will not only ruin the livelihood of those working on it but also impact food security at a time of rising food prices.
Did the Tatas get a sweet deal? The West Bengal Industrial Development Corporation (WBIDC) was so desperate to get the Nano project that the Comptroller & Auditor General of West Bengal claims that the WBIDC will make a loss of Rs 76.11 crore over the 90-year lease period for the land acquired for the project. Tata Motors will pay an annual lease rental of Rs 94.3 crore for the land (including the land for ancillary units). That said, West Bengal Chief Minister Buddhadeb Bhattacharjee was so desperate to get the project, he made sure the state machinery bent over backwards to woo the Tatas.400 acres or else!TMC chief Mamata Banerjee isn’t attacking the project anymore (as she was doing in the early days of the agitation, when a Tata Motor showroom was vandalised). Her demand now is that the Tatas return 400 acres to the people who have refused to hand their land over to Tata Motors. This can be done outside the project area, but the patchwork of plots inside the plant cannot be feasibly returned.
But is it really 400 acres? Both local and state-level Communist leaders poke holes in Banerjee’s “400 acre” theory; they claim that rehabilitation cheques for only 193 acres remain to be distributed and show maps of plots to prove their point.
Common misconception That the Tatas acquired the land. The land was given by the West Bengal government. So, compensation, too, has to be handled by the government. But clearly, it has made a hash of its R&R programme
Is It Really About Money Ever since the Tata project was announced, land prices in the surrounding area have shot up. While the Left Front government compensated farmers at prevailing market prices in 2006 at a maximum of Rs 12 lakh per bigha (three bighas=one acre), prices have shot up to over Rs 20 lakh per bigha in the adjoining area; villagers are talking about land values touching Rs 1 crore an acre if and when the Nano plant starts production.
Why can’t 400 acres be returned? The anti-Tata movement says: return 400 acres and build the rest of the plant on ‘Communist’-owned land across the road. Sounds simple, but unfortunately, car factories don’t quite work like that. The 400 acres, the Tatas claim, are required for the planned expansion of the Nano factory. After all, in case the people’s car does well, demand will soon outstrip the planned 250,000 units a year initial planned capacity. Besides, as the map shows, the 400 acres isn’t contiguous, which means the Tatas have to take all or none of it.
Can the Tatas return the land reserved for ancillary industries? To be able to sell a car at Rs 1 lakh or thereabouts, the Tatas need to strip costs to the bone. Integrating the ancillary plants with the main one is one way to make the project cost-competitive. Moving them away could make the low-cost car unviable.
Why did Ratan Tata threaten to pull out? There were occasional threats of violence against Tata plant workers. Workers have been reportedly attacked, and prevented from entering the plant. At the time of writing, the Tatas had issued a terse statement: “There has been no improvement in the ground situation so far, hence, the conditions are still not conducive for resuming work today. We continue to assess the situation closely.”
Where will he go if he pulls out?At least five states have sent signals that they are willing to accommodate the Nano project. The Tatas have their own facilities, too; it might just be possible for the company to produce the Nano at its Pantnagar plant in Uttarakhand (currently the mini-truck Ace is made there).
What happens to West Bengal if Tata pulls out? It will dent its image, and few promoters will be willing to come near the state. The Nano project is highprofile but will only bring in Rs 1,500 crore; if the Tatas pull out, promoters planning investments running into tens of thousands of crores will block West Bengal out of their vision.
Reaction from Corporate India Right from Mukesh Ambani to Sunil Munjal to Jamshyd Godrej, India Inc. is with the Tatas on this one.