The Chinese have a dilemma in Mamata Banerjee’s Bengal

Beijing seems ready to invest at least some of its purse worth $750 billion, but West Bengal’s inefficiencies and alleged corruption are coming in the way

Written by Esha Roy | Updated: June 16, 2017 12:01:52 pm
Mamata Banerjee, bengal governmnet, Beijing, mamata china, beijing bengal investment, Ma Zhanwu, Ma Zhanwu, kolkata, west bengal development, indian express news, india news West Bengal Chief Minister Mamata Banerjee.

Over the past couple of months, the Chinese Consul General in Kolkata, Ma Zhanwu, has attended a number of discussions and interactions with various chambers of commerce based out of the West Bengal capital, delivering speeches that are uncharacteristically candid for a diplomat.

His main argument, almost a plea to industrialists and government alike, has been simple : The Chinese have a very large sum of money to invest globally, a whopping $ 750 billion over the next three years to be precise, and they would like to invest at least some of it in West Bengal.

“Please be more friendly to Chinese businessmen. Please make sure that the atmosphere here is more conducive to investments,’’ Mr Ma has been saying.

Certainly, the Chinese are dealing with a dilemma in eastern India. This region, more than other regions, is ripe for investment. Despite cheap land and even cheaper labour, very little foreign investment is coming in. Truth to say, the Chinese businessman actually has very little competition here.

A couple of stories recur constantly through Consul Ma’s speeches, like a leitmotif. The first is about a Chinese company called ‘New Hope’, which had to wait for five years before it could even start constructing its animal feed factory in West Bengal. ‘New Hope’ had to apply for 18 different permissions from 18 different departments to simply be able to dig a well.

Meanwhile in Bangladesh , ‘New Hope’s factory was constructed within 10 months, up and running within the year, and churning out a profit for Chinese investors within two years.

Needless to say the General Manager of ‘New Hope’s Indian branch was fired. Its third General Manager is now in charge since the project began. ‘New Hope’ hopes to commence the construction of its factory soon.

The story of a Thai company that has wrapped up its operations is another favourite staple of the Consul General. The unnamed company’s expensive imported machinery was stolen even as it fended off the ruling Trinamool Congress’ pressures to ensure that its cadres were hired.

For the past three years, Mamata Banerjee’s government has been holding the Bengal Global Business Summit annually, in the hope that desperately needed foreign investment will put the state on the path of development and prosperity. After the summit in January, the Chief Minister had rattled off an astonishing set of figures – proposals over Rs 2.35 lakh crores received from foreign and domestic investors, including China’s TEB Technologies which wanted to invest Rs 27,200 crores, the highest proposed investment by any country in eastern India.

But the Chief Minister’s delivery of good news took place in the backdrop of the Bhangar land movement and violent agitations opposing the installation of a sub-station and power grid there. Banerjee glossed over the protests and the law and order crisis, although two protestors died in alleged police firing.  The protests negated both her and Finance Minister Amit Mitra’s claims that the state government had a land bank of 4,000 acres waiting for industries to come and set up operations. The Bhangar activists have said that land has been forcibly acquired.

According to a report by the private think-tank, the Observer Research Foundation, the state is indeed ripe for investment, but with a stern caveat: “West Bengal, despite the gamut of reforms is seriously lacking behind the major industrially developed states in India and only has a meagre 46.9 per cent overall share of project implementation.

“The reality is that the number of project proposals made at business summits supersedes the number of projects initiated and implemented. Also the government has been widely accused of being unable to stop rent seeking activities as well as the growth of political syndicates believed to be in cahoots with the land mafia.

“Thus the current government needs to implement policies apolitically and uphold the rule of law in the state, thereby providing a sense of stability and security to the entrepreneurs,’’ ORF said.

Mr Ma points out that a foreign investor has to navigate an intricate mesh of obstacles. At his residence in the well-planned Salt Lake area, he is worried. There have been numerous queries from Chinese businessmen wanting to invest in West Bengal. Two Chinese companies want to invest – one builds escalators and another manufactures buses. Talks are on, but nothing has been concretized yet. The Chinese remain wary, hesitant.

In contrast, Delhi, Mumbai and Bangalore present an ease of operation the eastern state just has not been able to master. This is evident in the numbers. There are 500 Chinese companies running out of Mumbai; in Kolkata there are barely 30.

If Bengal wants to grab the opportunity being presented, the Chief Minister needs to get her house in order. One way to do this would be to discipline her own unruly party members and ensure that the stories of their alleged corruption, red-tape and inefficiency don’t come in the way of the state’s reputation.

Esha Roy is the Resident Editor of the Indian Express’ Kolkata edition. She tweets @esha_ie

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