`Land reform not an end in itself'

Interview with Nirupam Sen, West Bengal Industries Minister.

"Tell me, where else in the country have all the land-losers been included in the process of development?" asks West Bengal Industries Minister Nirupam Sen, making it clear that the CPI(M)-led Left Front government is not pursuing industrialisation at the expense of agriculture and farmers. "The main aim of the West Bengal government is to include everyone in the growth process," he told Frontline in an interview. Excerpts:

Fencing of the Singur project site has been completed, Medha Patkar has left West Bengal and Mamata Banerjee is still on fast. But is the worst over for the Tata small-car project?

Land acquisition at Singur has been completed and the land has been handed over to the West Bengal Industrial Development Corporation (WBIDC). Now WBIDC is the owner of the land. Till December 2, 2006, Rs.76.64 crores has been disbursed as compensation to land-losers. The number of persons who have received compensation are 9,020, and the area of land in respect of which payment has been made is 635 acres [1 acre = 0.4 hectare]. Eighty-eight recorded bargadars [sharecroppers] have already received a payment of Rs.17 lakhs. The number of persons yet to receive payment, till December 2, is around 3,000.

The situation in Singur is normal. The majority of the people in the area have realised the importance of the project and the overall positive impact it will have on their lives. But most important is that we have been successful in involving a large number of people in the region, who were agricultural workers but are now employed in community development projects in the region. We have been able to create a lot of man-days and that is really appreciated by the local people.

Not only that, we have passed a circular among the affected people, inviting those who have lost their land to take training that would make them employable in industries. Already 1,409 land-losers and 446 landless workers have enlisted themselves. Quite a number of them are women - 341 among land-losers and 38 landless workers.

Out of the first batch of 179 being trained by the Belur Math Ramakrishna Mission Shilpa Mandir, 42 are training as machinists, 31 in welding, 77 in automobile repairing, and so on. This is a four-month course, and per student we are paying the institute around Rs.7,500. We are also paying a pocket money of Rs.500 to each student.

For women also there are training programmes, in sewing and tailoring and in catering, and 40 and 25 women respectively have enrolled for these trainings. We will provide them transport and accommodation in Kolkata during their training period.

So it is only the Mamata factor that remains a thorn in the side of the government?

I really don't get the reason for this [Trinamul Congress' objection to the project]. I can understand that initially there will be certain apprehensions among the farmers who have to give up their land. After all, it is a transition to a new kind of life, a source of concern especially for the older generation. The Trinamul Congress is capitalising on that apprehension. But I think that has changed after the constant dialogue we have had with older farmers.

We insisted on taking a consensus from the people in the region, even though under the Land Acquisition Act it is not obligatory for us to do so. Our effort was to convince them and win them over so they themselves participate in the process of this transition in their lives. I am very happy to let you know that the losers of 952 acres out of the 997 acres have given their consent in writing after prolonged discussions and debates with them.

It is not a question of Singur alone. The automobile industry which is coming up, along with the ancillaries that it is going to bring, will have an enormous impact on the manufacturing sector and on small and medium enterprises. It is a question of not just those who are losing land, but also of the economic growth of the State.

But still, with all the controversy, all the protests and the bad press that the government has received, is this project really worth it?

Definitely. After successful land reforms, the decentralisation of panchayati raj, and the growth we have achieved in the agrarian sector, if we do not go for industrial development, then the entire economy of the State would go to ruin. West Bengal's growth rate is slightly higher than the national average. There are two major components in this growth process - one is the service sector, which is more than 50 per cent, and the other is the agrarian sector.

Now, for sustainable growth, the development of the manufacturing sector is vital. Automobiles is an industry that draws huge manufacturing activities both in the small and in the medium-scale enterprises. To set up one mother plant, you have also to set up ancillary industries around it. Tata Motors will not only set up its own plant here but also bring all the vendors who will be manufacturing components, and that is the reason why so much land is required. This will be followed by a slew of industries in the small and medium sectors.

Anywhere in the world, whether in South-east Asia, China or Japan, it is the small and medium enterprises that provide maximum employment and that is going to be one of the most important milestones in the industrial development of our State.

Is the controversy only related to its location? After all, Singur is a Trinamul Congress constituency and in the last three elections the Left did not win there. Would it not have been more convenient to have the plant in a Left constituency where it would have been easier to convince the people?

The selection of a project site depends not only on the political climate of a particular area, but also on the economics of the project. Actually we tried to convince them to set up the factory in the backward district of West Midnapore near Kharagpur, and initially they were agreeable. But later on they decided against it.

In this competitive environment, the car they would be manufacturing would be the cheapest car available in the country, and the task they have undertaken is a most challenging one. So they have taken into consideration all aspects, including logistics, and because the price factor is so important in this particular project, they cannot compromise on the location.

Apart from the availability of proper infrastructure and skilled labour, they have to take into consideration social infrastructure such as proximity of educational institutions for the children of those brought in from outside to work there.

We showed them six different places and they found Singur to be the most suitable. Finally, it is the investor's decision. The importance of a particular project is also to be considered - whether the project is important for the State's economy or we can do without it. No sensible government can sacrifice a project like the Tata Motors' one, particularly at this juncture when we are trying so hard for industrialisation.

We did apprehend some resistance because of the Trinamul Congress' presence. The magnitude of the project was such that we accepted their decision and were determined to convince the people of the region. Today I can tell you with confidence that we have managed to do so. Besides, it is not that we are totally without influence in the area; we control two of the three gram panchayats there. So we do have quite a bit of support there.

Another allegation against the State government is that land acquired for a private industry cannot be considered a public purpose. It is further alleged that the acquisition of land has not followed the established procedure, that is, the Tatas making advance payment; instead they are being given the land at a very concessional rate payable within 20 years. All this is apparently being kept a secret by the government.

If a particular industry wants a big chunk of land in a contiguous area for setting up a large plant there, it is not possible for the industry to purchase land from each and every farmer, particularly in West Bengal where fragmentation of land is very high. If a large chunk of land is needed for a very important industrial project, will the State government not acquire it for the project? And, of course, it is a public purpose. Industrialisation means employment generation, it means development of society; the entire people of the State will be benefited. Therefore, it is in the interest of public purpose that the land has been acquired. There is no valid point in this criticism.

As far as the agreement between the Tatas and us is concerned, we have a clear-cut, laid-out policy of incentives that are available to everybody. From the early 1990s, when the new liberal economic policies came about, every State, including West Bengal, made its own incentive schemes to woo investors. In West Bengal it was done in 1993, revised in 1999, revised again in 2000, and after the introduction of VAT [Value Added Tax] it was again revised in 2004. In that it is clearly laid down that as far as mega projects are concerned, notwithstanding anything contained anywhere in the Scheme, the State government may consider granting a special package of incentives to a mega project, having due regard of the characteristics of the project, on a case-by-case basis in the following areas:

1. Size of investment; 2. Special nature of the industry; 3. Employment potential; 4. Downstream effect of the industry; 5. Ancillarisation effect of the industry; 6. Export potential.

It is clearly stated that the State government may also consider granting a special package of incentives to units having investment above Rs.100 crores, considering the importance of the project in the interest of the overall economic development of the State. The package of these units will be finalised on a case-to-case basis and the mode of payment will be recommended accordingly. All this is clearly stated in a well-circulated book brought out by the State government.

Tell me, is there any State that is not giving incentives to bring in industries into their State? In 2003, the Government of India extended the exemption of excise duty and income tax to Uttaranchal and Himachal Pradesh, and as a result industries flocked to those States. An industry will come to a State depending on the kind of benefit it can derive from there. They are not here to do charity.

There is no secret about our incentive scheme. Whatever benefits or concessions the Tatas may have got is within the overall framework of incentives already approved by the State government. At the same time, in this competitive environment, we should also be careful about protecting the interest of the third party.

Critics of this project are missing the wood for the trees. The question should not be why we are giving land to the Tatas, but whether we are giving it at the cost of farmers. You know the kind of compensation we are giving farmers and how we are trying to include them in the growth process - that is the most important thing. If the opposition has anything to say on that, we are always willing to listen.

Tell me, where else in the country have all the land-losers been included through organised rehabilitation programmes in the process of development? They are being trained; they have been given employment in community development programmes in and around the area. As I have told you earlier, the main aim of the West Bengal government is to include all in the growth process.

But what about dislocation and loss of livelihood for those not equipped for any other job, especially the elderly?

It is natural that there will be some loss of livelihood, particularly among elderly farmers. But that is true even in the agricultural sector itself, where only the young can find hirers for the arduous job of an agricultural labourer. But we are trying to include at least one member of each affected family in the region to undergo necessary training so that he or she can be absorbed in gainful employment. The land itself is so fragmented in the State that it is wrong to conclude that land itself is the only means of livelihood for a small farmer. It is not possible for a family to survive on that alone and it has to rely on alternative employment to supplement the family income. This is a fact in Singur too. We have to extend compensation to the owner of the land, and the number of owners is high, but the number of families is not.

As for dislocation, there has not been a single case of eviction from homestead that I have heard of till date. For the very few that might be dislocated in the future, we have decided to rehabilitate them in houses we will build for them, better than the ones they are staying in.

If you see the zig-zag way the map for the project site has been drawn, you will understand the pains we have taken to ensure the exclusion of the most fertile tracts of land in the region as well as homestead lands. This is not an ideal map for a factory site, and it took a lot of persuasion by us for the Tatas to accept this.

Why not land available under the Kolkata Metropolitan Development Authority, or in the Hooghly or Howrah industrial belt where old, closed factory grounds with infrastructure in place remain unutilised? Is it only because of the legal hassles?

First of all, you won't get 1,000 acres of land in a contiguous area. Secondly, it is extremely difficult to get freehold land from the closed industries. Most people don't understand the legal complexities and enormous difficulties involved in getting such land. For the past 15 years we have been negotiating for land belonging to the Government of India in public sector undertakings, but the GOI has its hands tied. After a company is closed, it takes years to acquire that land. Moreover, financial institutions have taken possession of much of the land. If we have to wait for the complications to be resolved, we will simply miss the bus and be left behind.

Another accusation against the government is that it is pursuing industrialisation at the expense of agriculture, that the gains made in agriculture through land reforms are not being consolidated.

No. This is not so. If you look at the industrial scene in West Bengal, you will see a large number of investments have come in the petrochemical sector, after the establishment of the petrochemical plant in Haldia. There are more than 700 plastic manufacturing units in the State. After petrochemicals, there have been a lot of investments in the iron and steel sector and in food processing. The flow of investments in the last sector is actually because of our achievements in the agriculture sector.

There are two things we now require, post-land reforms. First is appropriate technology to increase the productivity of land. I don't think agricultural productivity in West Bengal has reached the saturation point. There is ample opportunity for both increasing crops and diversifying agriculture. We are number one in vegetable production and number two in potato cultivation in the country, but the problem is that farmers are not getting the proper price for their vegetables. This problem can only be met through a proper marketing system. Therefore, the entire development that has taken place in agriculture should be linked up with industrial development.

Secondly, in West Bengal most of the land belongs to small and marginal farmers. Land reforms took place way back in the early 1980s and to some extent in the late 1960s. The small plots of land that people received at that time have grown smaller over the years as the size of their families increased, resulting in fragmentation of the land. If we cannot reduce the pressure on land and provide alternative employment, the agricultural sector in the State will be in jeopardy.

In this neoliberal economic framework, it is the agrarian sector that is under attack. This is true all over the country, and West Bengal is no exception. The cost of inputs has gone up, but the price of farm produce has not increased to that extent, so agricultural activity itself is becoming unviable. A lot of people are selling their land. Take the case of Singur itself. In the affected mouzas [revenue unit for a village], from September 2005 to July 2006, 572 sale deeds took place, and most of those who had purchased the land are not from the agriculture sector. Therefore, farmers are already selling their land for other purposes. You have seen the number of petrol pumps, dhabas, hotels and guesthouses, and small industries, all private, that have come up along the national highway, where there was once agricultural land.

Those who do not reside in West Bengal do not understand certain issues relating to land in the State. We have brought out a status report on land, which states that in West Bengal, only 1 per cent of the land is fallow or uncultivable waste, 63 per cent is agricultural land and others are either urban or industrial land. So, in West Bengal, for a big project or an SEZ [special economic zone], agricultural land cannot be avoided totally. What we are trying to do is avoid, as much as possible, fertile, multi-cropped land.

Some of our friends outside the State do not understand the problems we face - the problem of educated unemployed. We have to create employment opportunities. In the agriculture sector, we are going in for crop diversification, forming self-help groups and developing non-agricultural activities in the rural regions. At the same time we are trying to develop the service sector. In this age of jobless growth, our main challenge is to create employment opportunities for all, and development of industry can do precisely that. Land reform is not an end in itself. It is a transition from an agrarian economy to an industrial economy.

What would happen if the Tatas decide to back out?

It will be a very serious blow for West Bengal, no doubt about that. But I don't think that will happen. In today's context, perception matters. There was a problem of perception about West Bengal, and we have tried very hard to remove that. And at a time when investors are once again showing interest in our State, if the Tatas were to back out, it would send all the wrong signals. That is why I have appealed to all political forces that if they are interested in the development of the State they should support this project rather than make politics out of it.

Did you make your appeal to Medha Patkar too?

I had a long discussion with her for over two hours. I tried to convince her how we are trying to include all the affected people in the development process. But I am sorry I think I have failed in my attempt.

I really don't understand what exactly she wants. She has not asked us about the compensation package, neither has she spoken about the rehabilitation programme we have undertaken. She is not ready to believe that the people of the region themselves are in favour of this project.