Bengal ministers were at odds on IT park decision

Bengal ministers were at odds on IT park decision
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First Published: Tue, Sep 15 2009. 11 09 PM IST

Scuttled hopes: Land allotted in the Rajarhat area near Salt Lake City to develop an IT township. Indranil Bhoumik / Mint
Scuttled hopes: Land allotted in the Rajarhat area near Salt Lake City to develop an IT township. Indranil Bhoumik / Mint
Updated: Tue, Sep 15 2009. 11 09 PM IST
Kolkata: A section of West Bengal’s cabinet made a strong attempt to stall the state government’s announcement this month that it was scrapping a proposed 1,600-acre information technology (IT) township where Infosys Technologies Ltd and Wipro Ltd were allotted 90 acres each, people familiar with the situation said.
Scuttled hopes: Land allotted in the Rajarhat area near Salt Lake City to develop an IT township. Indranil Bhoumik / Mint
After a meeting of its West Bengal state secretariat on 4 September, the ruling Communist Party of India (Marxist), or CPM, advised the state government to immediately wash its hands of the project, located on the outskirts of Kolkata.
That was after arson in the neighbourhood had exposed forcible land acquisition by a real estate developer building the township in partnership with the state’s IT department.
The state’s IT minister Debesh Das on 7 September announced that the project was being scrapped because the state government didn’t want to be “involved in any illegal activity.”
A section of CPM leaders and some West Bengal cabinet ministers, however, had insisted that the state government delay the decision until after it found alternative land for Infosys and Wipro, according to some leaders of the party who didn’t want to be named.
Infosys and Wipro are India’s second and third largest software service providers and scrapping the project without finding them alternative sites would be a blow to West Bengal’s attempts to woo IT investments, the opponents argued.
“Could there be any debate on how this would impact the industrialization of West Bengal? The answer is obvious,” said the state’s commerce and industries minister Nirupam Sen.
Sen, according to many CPM leaders who didn’t want to be named, was among those who wanted the state government to delay the announcement. Asked if he didn’t agree with the state government’s decision to immediately abandon the project, Sen refused to comment.
Infosys’s director T.V. Mohandas Pai said on 7 September that his firm wouldn’t consider West Bengal for setting up a development centre in the “foreseeable future”. Wipro, which has a large office in Kolkata, said it has a lot of headroom at its existing facility in the city to expand.
Das, too, didn’t wish to scrap the IT township immediately, according to CPM leaders who attended the party’s state secretariat meeting on 4 September.
Asked if the party had pressured his department into issuing the 7 September statement, Das refused to comment.
Arson on 23 August at the Vedic Village resort and condominium, around which the proposed township was being built, revealed that Vedic Realty Pvt. Ltd—one of the private real estate developers building the township—had forcibly acquired around 500 acres of land. It would have acquired at least 1,000 acres more had the township not been scrapped.
On 24 August, the state’s home secretary Ardhendu Sen said land for the township was being acquired at “gunpoint”. Thereafter many cabinet ministers of West Bengal, including land and land reforms minister Abdur Rezzak Mollah, whose department was eventually found to have condoned violations of the land ceiling act by Vedic Realty, said the project should be scrapped.
“We didn’t have a choice. We had to act fast,” said a CPM state secretariat member, who did not want to be identified. “Ideally we should have found land for Infosys and Wipro elsewhere and not said that we were unable to fulfil our commitments, but it was a political compulsion.”
The state government announced it was pulling the plug on the project a day before Trinamool Congress chief Mamata Banerjee—the state’s main opposition leader—expelled three members of her party for allegedly helping Vedic Realty grab land from farmers.
Banerjee, who is also the Union railway minister, announced the expulsion at a rally near Vedic Village on 8 September.
The state’s IT department had in 2008 struck a unique land-for-infrastructure deal with Vedic Realty and Diamond Group, another Kolkata-based real estate developer, to jointly build the township.
Under the arrangement, which was to become a template for other departments that need to acquire land, the IT department was to receive 600 acres of land for free from its private partners, and in return the state government would build the civic infrastructure for the township and a 7km road to connect it to Kolkata.
“It is unfortunate that the project had to be shelved,” said Som Mittal, president of the National Association of Software and Service Companies (Nasscom), an industry lobby. “It had taken West Bengal a long time to build its reputation as an IT destination.”
Aveek Datta contributed to this story.
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First Published: Tue, Sep 15 2009. 11 09 PM IST