A critical action area for the National Manufacturing Policy is expected to be West Bengal. As many as 349 of the 6,260 factories in the state have gone to the Bureau of Industrial and Financial Reconstruction, a record among all the states. For the new state government under chief minister Mamata Banerjee, revitalising the industrial sector has therefore become the top priority and that means drafting a policy to reopen the closed factories.

State labour minister Purnendu Basu said, ?We are planning to draft a new policy on the closed factories in the state. This will help us in opening many of them.? According to the Annual Survey of Industries, the number of employees in the industrial sector in the state has shrunk by 2% in the last decade but the state government does not have any ready reference for the number of closed units in the state. Instead, it has fought with the Centre’s ministry of statistics over the industrial statistics for the state.

West Bengal was once a hub for industries like jute, textiles and paints, but most of them have closed down over the last few decades. While paints and textiles have shifted to other states, jute industry faced regular lockouts and bandhs.

Their place has been taken by the almost 27.5 lakh micro, small and medium sector enterprises (MSMEs) in the state, according to the 62nd round of the National Sample Survey Organisation. The state government estimates show that 15.08% of the MSMEs in the state are closed. Moreover, there are many instances where loans were availed for setting up a factory but the projects did not move thereafter.

The previous government had also tried to reopen closed units on its own or through joint ventures. While in some units like Great Eastern Hotel, Gluconate Health and Britannia Engineering it had good results, it did not get much response in most of the cases. It had also taken external financial assistance from institutions like DFID to run the closed units. During 2003-04 and 2006-07, eight units, including Great Eastern Hotel, were restructured either by the West Bengal government alone or through joint ventures. Further, it tried to restructure 14 PSEs through joint ventures with DFID assistance.

The state government has planned to appoint agencies like the Indian Institutes of Management to draw up a detailed plan for reviving the closed units. ?Instead of going in bits and pieces, we will form a high-powered committee to look into the revival of closed units,? Basu said.

Abhirup Sarkar, noted economist and professor, ISI, said in some cases factories which turn illiquid can be revived afterwards. Some factories cannot be revived as either their machineries have become obsolete or the products do not have demand.

According to Indian Chamber of Commerce director general Rajiv Singh, revival became a major issue in the state as it also involved cost implications. Most of the units to be revived have debt burden and look forward to grants and sops. ?The land locked up in the closed factories should also be given for alternative usage. Other industries like call centres or hospitality sector can make use of such land,? Singh said.

Most of the closed MSMEs in the state suffered due to local political interference during the earlier government?s tenure. ?While big units were insulated from political interference from local outfits, MSMEs bore the brunt. Apart from that, militant trade unionism created a havoc for most of the units,? Sarkar added.

.glt is true that all closed industries in the state cannot be opened. But many of them have the potential to be opened and run again. We will talk to the industrialists and find out ways,? Purnendu Basu said.

The state government is also talking to the managements of the recently closed factories like WIMCO. Units like Dunlop, which have closed quite a few times in last couple of years, are also under the scanner. The state government has asked Dunlop officials to be clear about their keenness to run the unit.