VZCZCXRO3450
PP RUEHBI RUEHCI
DE RUEHCI #0453/01 2820812
ZNR UUUUU ZZH
P 090812Z OCT 06
FM AMCONSUL CALCUTTA
TO RUEHC/SECSTATE WASHDC PRIORITY 1194
INFO RUEHNE/AMEMBASSY NEW DELHI PRIORITY 1062
RUEHBI/AMCONSUL MUMBAI 0421
RUEHCG/AMCONSUL CHENNAI 0421
RUEHKA/AMEMBASSY DHAKA PRIORITY 0256
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHKT/AMEMBASSY KATHMANDU 0256
RUEHGO/AMEMBASSY RANGOON 0175
RUEHCI/AMCONSUL CALCUTTA 1461

UNCLAS SECTION 01 OF 02 CALCUTTA 000453 
 
SIPDIS 
 
SIPDIS 
 
DEPT PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: EINV ETRD IN ECON EIND
SUBJECT: TATA MOTORS TO GET LAND IN WEST BENGAL COME WHAT MAY, SAYS 
WB GOVERNMENT 
 
REF: CALCUTTA 0411 
 
¶1.  SUMMARY:  On October 4, 2006, an all-party meeting convened 
by West Bengal Chief Minister Buddhadeb Bhattacharya failed to 
reach a consensus on the land acquisition policy for the Tata 
Motors Car Factory in Singur.  With the leading opposition All 
India Trinamool Congress (AITC) boycotting the meeting, the 
Indian National Congress party (Congress)  voiced its opposition 
to the Communist Party of India - Marxist (CPM)'s policy, but 
there are signs that the opposition is backing down in the face 
of CPM determination to complete the deal by early 2007.  End 
Summary 
 
¶2.  West Bengal's Left parties, led by the CPM, have been in 
power for three decades on the strength of land reforms the CPM 
carried out in its first two terms between 1977-1988.  With 
declining agricultural productivity in the state, the CPM has 
adjusted its policies to support industrialization based on 
large scale manufacturing, hoping to stimulate job creation. 
Because industrial infrastructure is generally poor in the 
state, potential investors tend to look for suitable land close 
to the capital city of Calcutta. 
 
¶3.  In early 2006, Tata Motors announced plans to set up 
manufacturing of a low-priced car in India and Chief Minister 
Buddhadeb Bhattacharya took a personal initiative in wooing the 
company to invest in West Bengal.  Tata Motors was shown land in 
various parts of the State and chose nearly 1000 acres of land 
in the town of Singur in the Hooghly river basin, only 45 
kilometers from Calcutta and considered to be the most fertile 
land in the state.  State opposition parties led by AITC leader 
Mamata Banerjee (whose party also represents Singur in the state 
legislative assembly) opposed the land purchase for the car 
project on the grounds that multi-crop agricultural lands were 
being taken for industrial purposes. 
 
¶4.  At the all party meeting on October 4, 2006, the CPM-led 
government told the political parties, "We cannot stop acquiring 
land at Singur under any circumstances.  The Tatas want to start 
producing cars by 2008 and they need the land urgently by this 
year end. We are committed to handing over the land in the 
stipulated period."  The government noted that the total 997 
acres required by Tata Motors had been acquired by the state 
nodal agency, the West Bengal Industrial Development Corporation 
Ltd. (WBIDC).  The land is ready for sale and the WBIDC is busy 
filling in the low lying areas before handing the land over to 
Tata Motors. 
 
¶5.  State Commerce & Industry Minister Nirupam Sen, addressing 
the Opposition's objections, said that of the 997 acres, 900 
acres is "sully" or fallow land with the rest being "suna" or 
multi-crop land.  Also, he noted that the GOWB had changed the 
original site plan submitted by the Tata Motors in order to save 
164 acres of fertile land.  Sen further pointed out that between 
December 2005 and June 2006, 572 acres of land were sold, and 
argued that many non-farmers were already buying land from 
farmers in the Singur area.  So far, the WBIDC has completed the 
purchase of 610 acres of the total 997 acres for the Tata Motors 
project without any objection from the owners. 
 
¶6.  Although the AITC boycotted the all-party meeting, the 
Congress advocated the AITC point of view, making three demands: 
 1) a policy on the planned use of agricultural land; 2) 
creation of a Land Commission; and 3) no hand over of Singur 
land to Tata Motors before the planned use of agricultural land 
policy is decided.  Chief Minster Bhattacharya rejected the call 
for a Land Commission on the ground that an Agriculture 
Commission already has been established,  he rejected the demand 
to stall land acquisition since the Tatas had set a deadline, 
and he said if land is not handed over to the Tatas by the 
stipulated time, the investment project would not come to West 
Bengal. 
 
¶7.  COMMENT:  While the all-party meeting on October 4 failed to 
iron out the political differences on the Singur land 
acquisition for the Tata Motors Car project, the CPM has 
remained firm in pushing forward Tata's land purchase.  A 
planned 24-hour strike on Monday, October 9, 2006 called by the 
AITC was reduced to 12-hours, ostensibly to avoid greater 
inconvenience during the Ramadan period.   The opposition 
realizes that the government will acquire the land at any cost 
in order to showcase W. Bengal's industrialization drive.  The 
 
CALCUTTA 00000453  002 OF 002 
 
 
opposition parties are also keen to avoid the appearance of an 
anti-industrialization stance, while still using the convenient 
political stick of farmers' rights to bash the Left.  The 
Congress is caught in the middle, not only because it runs the 
central government with CPM support, but also because of the 
criticism its ruling coalition is facing from the CPM over the 
similar issue of giving agricultural land for Special Economic 
Zones that Congress-led governments are implementing in Punjab, 
Haryana, and Maharashtra. 
JARDINE