Singur talks on, row unresolved

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New Delhi, Sep 5 : The land row in Singur remained unresolved on Friday even as the crucial talks between the state government and Trinamool Congress-led opposition, was termed as “useful and held in a constructive spirit”, by Governor Gopal Krishna Gandhi, who presided over the meeting.

“We had three hours of useful and constructive discussion in a spirit of understanding. We will resume the dialogue tomorrow,” Gandhi told a press conference immediately after the parleys at the Raj Bhavan.

However, irrespective of the outcome of the final meeting now slated for Saturday, Tatas have decided to have multiple production sites so that future fracas leading to delays and losses is contained. Sources in the know how told FE that the current Singur controversy has already led to delays in the roll out of the much-touted peoples’ car and any further delay would add pressure to its cost.

“If Tatas decide to stay on in Singur, considering that the row is settled in their favour, the company would have to shell out more to compensate the farmers,” says Arvind Jain, vice president, BanyanTree, a Mumbai-based private equity firm.

“However, if they decide to move out of West Bengal, there could be an extra relocation cost of Rs 500-750 crore excluding the loss that will be incurred by the vendors who have set up their bases in Singur to supply exclusively to Tata Nano,” he added. “Though there has been no clear indication from Tatas as to from where the company will roll-out Nano, it is certain that they will meet the October deadline, even if it means a mere 3,000-4,000 units, which would be rolled-out either from the company’s Pantnagar or the Pune plant or even both of them depending upon the feasibility,” says Abdul Majeed, auto analyst and partner, PriceWaterhouse.

Majeed, however, says that the company might not go for mass booking of the vehicle, either before or immediately after the launch, as there is no mass production site available with Tata Motors as yet.

“If the project shifts to an alternate location, there could be a delay of at least three months before the company goes for mass production,” adds Vaishali Jajoo, senior auto analyst, Angel Broking.