Column Singur, the other story

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: The Singur drama seems to be finally nearing its climax. What a brilliant cast of characters it has been! The maverick Mamata, enfant terrible, irresponsibility incarnate, frittering away Bengal’s only hope to stay in the industrialisation game. Buddhababu, Bengal’s own Deng Xiaoping, making amends for decades of Left hostility towards industry. Ratan Tata—India’s standard bearer in the global corporate battlefield, media-shy purveyor of the aam aadmi’s ultimate dream of dignity through car ownership, who had smiled upon West Bengal and has every reason to sulk now. And, last and least, an indeterminate group of farmers, too obtuse to understand what is for their own good, and too obstinate to let the country run its business as usual.

But is this the whole story? Let’s start at the very beginning. Why Singur? Why a thousand acres of well-irrigated fertile multi-crop land here while thousands of acres of barren land lay a few hundred miles to the west? Nearness to Kolkata, good roads and infrastructure, are parts of the reason for sure, certainly from Tata’s perspective.

What is perhaps less obvious is that Singur is one of only two assembly constituencies in the Hooghly district to have returned an opposition MLA. The other 17 MLAs belong to the CPM and its allies. Worse, it did the same in 2001. So, when it is time to locate the project meant to turn the ignition key for Bengal’s industry, what better location than Singur? Such projects, and the land acquisitions that go with it, are neighbour’s windfall, owner’s ruin. If industrialisation of the state is a must then what is better than making your opponent’s voters pay for it? A political masterstroke indeed.

To be fair, this is standard practice. Governments are unlikely to privatise firms, for instance, in regions where they face tough political competition. Opposition strongholds are the best places to show your determination to reform and industrialise.

Now for compensation. If the price paid exceeds market price, why should the farmers object? Truth is, in real estate, private valuations differ significantly from market prices leading to an illiquid market. To assume that a small premium over the market price should make the owner happy is economic naiveté.