With iron ore, coal, coal-bed methane, bauxite, dolomite, charge chrome, and other minerals at its door step along with abundant availability of underground and river water, excellent roads, ports, air service facilities, and steady power supply, West Bengal has been by far the country’s best industrial location since it was first spotted and developed by the British East India Company in the mid-18th century. At first, the East India Company and, thereafter, the British government decided to utilise the facilities and natural advantages to industrialise India for its own gains.
They built the city of Calcutta (now Kolkata) and about 200-km-long industrial corridor spanning up to Kulti in the Burdwan district. The result was: until 1966, Bengal remained as the country’s biggest centre for industrial and engineering production and export. The subsequent introduction of agri-based products such as jute goods and tea added flavour to Bengal’s economic growth.
Unfortunately, since the country’s Independence, Delhi, the nation’s political capital, has always tried to destabilise Bengal’s industrial base by various policy actions and underselling the state’s basic industrial strength to foreign investors, especially after 1992 economic reform when foreign direct investments (FDI) started outpacing domestic investments in old as well as modern industries. Both the Congress and CPM governments in the state, which were politically close to the national government for many years, did little to arrest the steady decline of Bengal’s industrial strength at the behest of Delhi.
It is really a welcome signal that Chief Minister Mamata Banerjee is out to change the mindset of both overseas and Indian investors towards West Bengal. The mindset is basically a political creation by the national government in New Delhi, aided by the short-lived anti-industry and anti-business agitation by an ultra-left group called Naxalites, followed by CPM-led Left Front, which ruled the state for 34 years until May 2011, and its trade union wing called the Centre of Indian Trade Unions (CITU). The CPM and CITU even tried to block computerisation in the state till almost the late 1980s.
Fortunately, under Mamata Banerjee’s Trinamool Congress government, the state now ranks probably the top position in industrial peace. Prolonged industrial strife is a matter of past. Despite a delayed start, the state is doing reasonably well in the information technology (IT) sector with almost all top players in the country having a large presence in Kolkata. The manufacturing sector is doing well and expanding. The construction and services sectors have witnessed a boom in the state despite the slowdown of the real estate business and price crash in other parts of the country.
Mamata Banerjee’s commitment to industry and the state’s economic growth was clearly evidenced on the very first day of her ministry formation over five years ago when she inducted the former secretary general of the Federation of Indian Chambers of Commerce & Industry (FICCI), Amit Mitra, an eminent economist, in her Cabinet as Finance Minister. Mitra was subsequently entrusted with an additional job of industry promotion.
Personally, Mamata Banerjee is making a serious attempt to project Bengal, which has lately made rapid strides in agriculture, and the opportunities the state offers to industrial investors by talking directly to entrepreneurs outside the country, who had been the mainstay of the state’s massive economic progress for over 300 years. Her earlier visit of Singapore and, now, of Germany accompanied by a 29-member team of hi-profile Bengal entrepreneurs to share their perception and vision of Bengal with some of the captains of German industry show that she means business and she wants them to come and invest in Bengal in mutual interest. She had categorically told German businessmen that land would pose no problem for investors as the state has a well-planned land bank to support new ventures.
Availability of industrial land in Bengal was never an issue until, for reasons best known to the former Marxist Chief Minister, Buddhadeb Bhattacharya, who acquired and allotted hundreds of acres of highly fertile annual three-crop agricultural land at Singur to Tata Motors to set up a mini-car plant there. Mamata led a massive farmers’ agitation against the deal which was ultimately revoked by the Supreme Court a few days ago ordering the state to take possession of the agricultural land and unconditionally return them to farmers.
Mamata Banerjee had no personal animosity against the House of Tatas, which has a reasonably good presence in Bengal. In fact, Tatas represented in the Chief Minister’s industry team that visited Germany, last week, praised the industrial climate and opportunities in the state. Her visit to Germany with the industry team has been a great success. Industry and intelligentsia wish she made more such visits in other parts of the first world, including the USA, to seek foreign investments in Bengal. The state has never been marketed by its previous government and was always neglected by Delhi. That may explain why not a single foreign automobile or a telecom gear manufacturer sought to invest in Bengal while almost a dozen each in the two sectors chose to set up plants, mostly in Maharashtra, Tamil Nadu, and Haryana.
Geographically, the state offers the biggest market in the country’s eastern region comprising some 10 states in the eastern and north-eastern parts of the country. Bengal is also India’s gateway to the east and south-east Asia, including countries such as Bangladesh, Nepal, Bhutan, Myanmar, Thailand, Malaysia, Singapore, China, and Indo-China. With Germany, Bengal enjoyed a special historical connect as the former helped the British empire establish its first inter-continental cable connection with Calcutta, which served as India’s national capital until it was shifted to Delhi in 1911. Industrially, Bengal is still ahead of most other states of India. But, it can do a lot better if one takes into account the advantages of raw materials, skilled labour, centuries old industrial culture, ready market, and infrastructure.
In fact, in terms of long-term sustainability, very few industry centres in the country can match the advantage the industrial belt of Kolkata enjoys, the biggest and probably the most crucial of them being the availability of water. Almost all other industrial hubs of the country, including Mumbai, Delhi’s National Capital region (NCR), Chennai, Bangalore, and Hyderabad are perennially starved of water. On the contrary, Kolkata and its large industrial belt enjoy abundant water supply. A good industrial growth of Bengal will benefit all the eastern states and the country.
(The views expressed are strictly personal.)