Will The Tatas Heed Mamata’s ‘Come Back’ Plea?
Mamata Banerjee is in overdrive in trying to get big-ticket investors to invest in Bengal.
On the list is the Tatas, who Mamata herself had protested against nearly a decade ago when they wished to set up a car factory in Singur.
It remains to be seen whether Ratan Tata obliges, but one thing’s for certain – his word will count more than anyone else’s.
Bengal Chief Minister Mamata Banerjee has, in a span of just a week, issued two public appeals to the Tatas to return to her state – at Munich last week and then at Singur on Wednesday (14 Sept.). Those who know the egotistical Mamata are well aware that it took a massive swallowing of pride for her to issue those appeals.
But Mamata has realised that she has to get the Tatas back to Bengal. She is desperate to do so because she realises that an announcement of a big-ticket investment in Bengal by the Tatas would have immense symbolic value. Much more than even a Mukesh Ambani committing his crores to Bengal.
After virtually forcing Tata Motors to exit Bengal, which led to the shifting of the Nano car plant to Sanand, Gujarat, in 2008, Mamata came to power in 2011 with a massive mandate. But she soon realised that Bengal needs industries to provide jobs to the vast number of unemployed people in the state. Her efforts to scout for investments through business summits and roadshows yielded little results.
A number of reasons, as elucidated here, keeps investors away from Bengal. And perhaps the primary reason, as Mamata has come to realise, was her act of driving the Tata Motors plant away from Bengal and then revelling in it. The ‘Singur stigma’ continues to haunt her and hobble her efforts to get investors to Bengal.
At all meets with potential investors and with chambers of commerce, Bengal’s bureaucrats are asked about the Singur saga and if Mamata’s attitude towards industry had changed. Their assurances that Mamata had turned business-friendly and wants investors to come to Bengal are met with a fair amount of skepticism. Mamata’s personal assurances that she would make things easy for investors has failed to cut much ice.
Over the last six years (since Mamata came to power), the flow of investments into Bengal has been less than a trickle. There have been no big-ticket investments that could have spurred industrial growth and acted as a catalyst for other investors to follow suit. Tata Motors’ entry into Bengal a decade ago was just that golden chance to turn its fortunes around, which Bengal so desperately required.
But, as illustrated here, that golden opportunity was lost, thanks to Mamata’s short-sightedness and intransigence, and Bengal could not attract any major investment worth the name ever since. Even in Munich, where Mamata led a large delegation comprising her industries minister, the state chief secretary, other senior bureaucrats and a 29-member group of industrialists and businessmen from Bengal, German industrialists had one persistent question: have things changed in Bengal since September 2008 when Tata Motors was forced to shift its plant out of Bengal?
Industries Minister Amit Mitra, a close confidante of Mamata, has been told by many industrialists and businessmen from Bengal and other parts of the country that the one single development that can turn Bengal’s fortunes now is an announcement, or even a firm indication, by the Tatas that they are looking to invest in Bengal. Not by any top honcho of the Tata conglomerate but by Ratan Tata himself. This message has been conveyed to Mamata as well.
Ratan Tata is a well-known and highly respected person in international business circles and his words and actions carry a lot of weight. The Tata group have a lot of heft globally. Thus, when Ratan Tata said in September 2008 that Mamata Banerjee (who was then spearheading a high-decibel campaign against the Tata Motors plant) had virtually held a gun to his head and pulled the trigger and that is why he was pulling the Nano plant out of Bengal, his statement virtually demolished the prospects of any future big-ticket investment in Bengal. Mamata, who is not unintelligent, has come to realise this stark fact.
That is why she has, over the past few years, been careful (in her own bumbling and unsophisticated way) to desist from criticising the Tatas and had, to her credit, acted positively towards Tata group companies. The inclusion of Tata Metaliks MD Sanjiv Paul and Tata Steel’s India and South Asia MD T V Narendran in the 29-member business delegation that went with her to Munich is part of her new outreach to the Tatas.
But it is not Paul or Narendran, no matter how high up they are in the Tata conglomerate’s corporate ladder, whose statements, certificates and endorsements will resonate in domestic and international business circles. It is Ratan Tata’s, and no one else’s (not even that of his successor Cyrus Pallonji Mistry) voice that will matter. Just one word or endorsement from Ratan Tata can change Bengal’s investment prospects.
Mamata does realise that, but perhaps her ego comes in the way of reaching out to Ratan Tata. She also has a grouse against Ratan Tata: while unveiling the Nano in 2009, Ratan Tata had said that he had thought of many names for his small car, including ‘Buddha’ (after the then chief minister of Bengal) and ‘Despite Mamata’, much to the derisive laughter from the assorted crowd of media persons, car enthusiasts and industry leaders gathered there. She took it as a personal affront and had smarted under that insult for a long time.
Unfortunately for Mamata, it is she who will have to break the ice with Ratan Tata. The Tatas have nothing to lose by not investing in Bengal, but Bengal has a lot to lose without the Tatas. Bengal really needs a big-ticket investment from the Tata conglomerate since that will act as a reversal of the Tata ‘thumbs down’ on Bengal and will act as an immediate catalyst for big investors.
Mamata also has to shed her penchant for playing to the gallery and pandering to the anti-capital mindset that is so deep-seated among Bengal’s masses. In her speech at the Singur rally (organised to return the land to the land losers there), she said she would give one month’s time to the Tatas and to BMW to make up their minds on setting up an automobile plant in Bengal. It would appear as if auto majors were falling over themselves to invest in Bengal.
It is ridiculous on Mamata’s part to set any sort of deadline to auto majors. Decisions on setting up manufacturing plants are not taken within a month and she ought to know that. She also ought to know that Tata Motors has no plans, and no reason on earth either, to set up a plant in Bengal. She also ought to have known that BMW has no plans to set up another plant in India when its assembly plant in Chennai has a lot of spare capacity.
Perhaps she knows all this but is always overtaken by the urge to reinforce her pro-poor and Ma, mati, manush (mother, land and the common man) image, whatever it means, among the masses. In Bengal, the best way for a politician to appear pro-poor is to position himself or herself as anti-private capital.
Mamata’s urge to play to the gallery also overtakes her saner instincts always. At Wednesday’s rally at Singur, she ended up referring to the Tata Motors top management (including Ratan Tata) as ‘Tata babus’. That is not a very respectable way to address people you are so keen on investing in Bengal. She also ended up blaming the Tata Motors management for pulling out of Bengal in 2008 – they lacked patience and were stubborn (in insisting on the land at Singur), she alleged. Ironical, because impatience and intransigence are Mamata’s dominant character traits.
In the ultimate analysis, much as Mamata may want Tata Motors to set up a manufacturing plant in Bengal or the Tata group to announce a big-ticket investment in Bengal, there are no indications that she will be obliged. Mamata will have to work much harder to prepare the ground in Bengal and make it investment-friendly and investor-friendly before her wishes come true. And for good measure, she will have to mend her ways.
As for Ratan Tata, he’s probably sitting back and watching Mamata’s desperate appeals for investments in Bengal failing to make any impact. And also deriving pleasure from the fact that Mamata now wants Tata Motors, a company she had so viciously targeted a decade ago, to return and trigger Bengal’s resurgence. The wheel has surely turned full circle for Ratan Tata who was, just two years ago, accused of having lost his mind by Amit Mitra. Mitra, tasked by Mamata to liaise with the Tatas, is having to eat humble pie now.
Singur: A Sad Tale Of Lost Opportunities
Why Wooing Investors To Come And Invest In Bengal Is An Exercise In Futility
As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.
Our business model is you and your subscription. And in challenging times like these, we need your support now more than ever.
We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.
Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.