Getting Tatas to return Singur land is no victory, getting industrialists to West Bengal will be
You have to hand it to West Bengal chief minister Mamata Banerjee. Not only does she announce a R500 crore relief fund to help beleaguered investors in the Saradha Group while she has no money to possibly fund this, she announces a moral victory when the courts ask the Tatas why the group does not return the land at Singur to farmers since there is no factory being set up there any more. Even if you ignore the issue of the compensation the Tatas are asking for in terms of lost time and opportunity costs, just refunding what the group spent on buying the land—R1,800 crore—is something the state cannot possibly afford.
More important than that, however, is that the state needs industry if it is to grow. Among the non-special category states, it has the worst fiscal record and the lowest tax-to-GDP levels. New industry is where taxes will come from and the state’s industrial policy looks at doubling the share of manufacturing to 20% of state GDP in 5 years—this means manufacturing growth has to rise from around 5% right now to 20% in another 5 years. That’s a near-impossible task anyway, celebrating Tatas’ departure only makes it that much harder.