Friday, September 12, 2008

Tata nabs most of the incentives in Singur, WB

For those who think that Tata Nano is doing a huge favour in Singur, take a rethink. Its Tata who is enjoying most of the incentives!!

Business Line reports on how 'Tata chose Singur as base for Nano plants' :

A comprehensive package of incentives — subsidy on land, concessional power, a soft loan and tax paybacks — to match the benefits that Tata Motors would have got in Uttarakhand or Himachal Pradesh, was what got it to choose Singur in West Bengal for making its low-cost car Nano.

And these are the benefits which had been given by Uttarakhand/Himachal Pradesh:

(a) 100% exemption from Excise Duty for 10 years.
(b) 100% exemption from Corporate Income Tax for first 5 years and 30%
exemption from Corporate Income Tax for next 5 years.

Excerpts from the WBIDC's agreement between the Tata Motors Ltd. and West Bengal Government, governing the long-term lease of land in Singur :

The terms of lease to TML for the 645.67 acres of land for the mother plant are described below. The lease rental payable per year per acre by the vendors will be Rs. 8000/- per acre for the first 45 (forty five) years and Rs. 16000/- per acre for the next 45 (forty five) years. The initial lease tenure will be 90 years. On expiry of 90 years, the lease terms will be fixed on mutually agreed terms at that point of time.

So, whats your take on this?? Tata has been nicely pampered into chosing Singur as its final destination for making the people's car Tata Nano. Keep the comments coming in...


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  1. [...] chosing Singur as its test instruction for making the people’s automobile Tata Nano. Keep the comments coming [...]

  2. Sure! Why not?

    Look at this as a purely business decision.

    Low cost car. So all things helping keep cost low are needed.
    Cost of land
    Tax breaks(excise, customs,ST,IT for this project only,etc)
    Backward area concessions are routinely given to most industrial units

    Any Govt would be interested if they were in a position WB is in: (Kerala Govt is doing hospitality now)
    Low employment generation
    Low Human Development Index
    Backwardness (Remember WB is not Kolkata or the Udayan Mukherjees alone)
    How do you think Baddi in HP or Paonta Sahib become what they are today?

    How else will the commies make a killing by buying up nearby lands and selling after industry moves in?
    They are associsating themselves with a unique challenge of a project, not one with 'just another one' kind of reputation.
    I am only saying that your comments are one sided. Get the overall picture and you will understand everyone's perspectives and compulsions. There are pros and cons, opposition and support, acceptance ane rejection all around.

    Frankly speaking, our city roads are already crowded. People need to be discouraged from using cars and instead using public transport. Now even the small town roads will get overcrowded. The Govt efforts at discouraging people is half hearted.

  3. I would like to second C M Vyas's views. Yes, why not? Pure business decision! Many states would be willing to further even more concessions.

  4. Isn't this Singur Tata Nano discussion ass backwards? Most of the readers appear to have unexamined bourgeois positions on this issue. Yeah, the neoliberal Indian middle class is the worst enemy of equitable development.

    Let me suggest some

    Alternative Questions:

    Q. Why are farmers being displaced? Isn't agriculture of PRIMARY importance in a developing country? Should manufacture be undertaken at the expense of agriculture? What about dispossessed farmers, espcecially when they fall prey to unscrupulous politicians, whether Left, Trinamool or Congress? What about FARMERS RIGHTS and food security for our people?

    Q. Why is Tata manufacturing a CAR when the urgent national priority is PUBLIC MASS TRANSIT -- buses, trains etc. ? Do we really need yet another private vehicle on already crowded city roads? Since Tata already has manufacturing expertise in buses etc, that is what it should be manufacturing in the first place. Shouldn't the Left Govt. insist that Tata manufacture MASS PUBLIC TRANSIT vehicles to promote the Greater Collective Good?

    Q. Why should national priorities be secondary to the consuming needs of the urban middle class? Why should national development priorities be secondary to the GREED of multinational capitalists?

    Think about it.

    Dr. Chithra KarunaKaran
    City University of New York
    See The Rise of the Car Nazis: Ratan and the Tata Wannabes

  5. Dear Chithra,

    I read your blog. I am really surprised at the still infatuation with socialist/communist ideas. The land occupied for singur is less that 2.22% of the whole land amount in Singur. Therefore even if I agree that Tata has displaced some farmers they have actually reduced 2.22% of the whole of the agricultural produce. Chitra if you are so informed how did you forget that we loose about 30-40% of the total farm produce because we donot have sufficient storage. Another fact is that Potatto which is the main produce of that belt suffered a huge downturn because te price went as low as Rs 6 per kg and farmers had to throw their harvest on the road because they didnt get enough buyers. This is simple matematics and statistics. You are welcome to verify any of the figures I presented here.
    Please understand that though land is precious it is possible to buy another land if you get correct compensation. I agree the present land acquisition act actually translates to landgrabbing but that could have been set straight by discussion. The discussions never happened. Mamata Banerjee can squat on dharna but clueless when she sits for negotiations.
    If you are talking of national priorites making an industry like Nano should have ben a national priority. Look to China. You know what has been done for the biggest hydel power project in the world? Over a lakh people are been displaced with pathetic compensation. The hydel project will be twice larger than the biggest hydel project in the world. Now you know why china is even manufacturing the every item in your house. Simple Hydel power is cost intensive infrastructure but once built it gives the lowest cost electricity. So the industry gets low cost electricity and thus keeps the price low. I know it because I was involved though in a very small way.
    Stop thinking about communism ideas. Figures dont lie. Dont oppose something because you need to. Land is not something that cannot be traded. You possibly cannot believe what is the condition of the general people in Westbengal. You need an example. In Haryana a new law is in place that worker has to have a minimum salary of 3500 permonth. I personally know a officer grade employee in west bengal got a salary of 1800 when he retired 2 years back. Thousands of workers in westbengal is unemployed or I should say under paid. I know too many of them.

  6. The previous comment is too long... but one can keep it short and sweet by mentioning just one term "Anchor Investment"

    Guess the picture becomes more clear..and since the last time this blog was posted we all know where TML finally anchored!!

    Anyways, congrats for creating a platform where these issues can be discussed.

  7. With the press release of October 7, 2008, the issue is mute. After the violence in Singur as well as the death of Lalit Kishore Choudhary, Tata made the right move and left.

    For Singur to develop past subsistence farming, they need industry. The way to develop industry is through a predictable regulation and taxation regime that rewards the company for bringing jobs. Violent protests and murder is NOT the way.

    I read a great article titled "Tata says 'tata' to Singur" at that really spells it out.

  8. [...] seen great action on the blog and discussion on a wide variety of issues, right from the Tata-Singur issue to the nuclear deal. We’ve discovered new terms like Conflict [...]

  9. [...] seen great action on the blog and discussion on a wide variety of issues, right from the Tata-Singur issue to the nuclear deal. We’ve discovered new terms like Conflict [...]