VZCZCXRO6845
RR RUEHBI RUEHCI
DE RUEHCI #0228/01 2121215
ZNR UUUUU ZZH
R 311215Z JUL 07
FM AMCONSUL KOLKATA
TO RUEHC/SECSTATE WASHDC 1622
INFO RUEHNE/AMEMBASSY NEW DELHI 1539
RUEHCG/AMCONSUL CHENNAI 0683
RUEHBI/AMCONSUL MUMBAI 0681
RUEHKT/AMEMBASSY KATHMANDU 0450
RUEHKA/AMEMBASSY DHAKA 0443
RUEHLM/AMEMBASSY COLOMBO 0176
RUEAIIA/CIA WASHDC
RHMFIUU/CDR USPACOM HONOLULU HI
RUEIDN/DNI WASHINGTON DC
RUEHBJ/AMEMBASSY BEIJING 0119
RUEHCI/AMCONSUL KOLKATA 1994

UNCLAS SECTION 01 OF 02 KOLKATA 000228 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR INR 
 
E.O. 12958: N/A 
TAGS: PGOV ECON EAGR EIND IN
SUBJECT: LOCAL ELECTION RESULTS IN W. BENGAL MAY MEAN LEFT FRONT GRIP 
IS LOOSENING 
 
REF: KOLKATA 88, KOLKATA 92, KOLKATA 95, KOLKATA 104 
 
¶1.  (SBU) Summary:  Left Front leaders welcomed the July 22 
Haldia municipal election results as indicative of support for 
their policy of industrialization in W. Bengal.  However, of the 
26 seats up for grabs, the Left won 19 and the opposition 7, 
compared to the 2002 elections when the Left won all the seats. 
Communist Party of India-Marxist (CPM) strongman Lakshman Seth 
has transformed Haldia into an urban industrialized hub, but 
adjacent to urban Haldia lies rural Nandigram, a politically 
turbulent zone resisting the state's policy of land acquisition 
for industry.  The March 14 police shooting that killed 14 
people in Nandigram raised CPM concerns about the Left's 
possible loss of support from farmers and Muslims.  Although the 
Haldia results indicate support for Seth and the government's 
industrialization drive (including promotion of a chemical hub 
in the area), it may not be indicative of the mood of the entire 
state, and the agriculture versus industry issue will remain 
significant at the polls.  End summary. 
 
¶2.  (SBU) The Left Front victory in the July 22 Haldia 
municipality elections was hailed by West Bengal's 
pro-industrialization Chief Minister Buddhadeb Bhattacharya as 
"a victory for the people," while Left Front Chairman Biman Basu 
observed that it was a verdict in favor of the W. Bengal 
government's policy of industrialization.  Of the 26 seats in 
the municipality, the CPM won 17, its ally the Communist Party 
of India (CPI) 2, opposition party Trinamul Congress 6 and the 
People's Democratic Conference of India (PDCI) 1.   For many 
pundits in the state, the verdict represents a shift in the 
nature of public opinion on the "land for industry" policy and 
for Bhattacharya's industrialization drive in W. Bengal.   This 
policy has led to widespread violence and resistance to the 
administration in the Nandigram area bordering Haldia (reftels). 
 Notably, in the 2002 municipal polls, the Left won all the 
seats. This time, though, what has been called a "grand 
alliance" - including Trinamul, Congress and the  Jamiat Ulema e 
Hind's political front PDCI - managed to capture 7 seats.  The 
Congress did not win any.  Significantly, the opposition gains 
were in rural areas, while the urban centers favored the Left. 
 
 
¶3.  (SBU) CPM MP and Haldia Development Authority Chairman 
Lakshman Seth is largely responsible for transforming Haldia 
into an urban hub.  Easily the most powerful leader in the area, 
the municipal verdict is being interpreted by some as support 
for Seth's aggressive pro-industry stance.  Seth told Post that 
the poll results have established the people's opinion in favor 
of industry and urbanization in the entire zone.  He emphasized 
that people, including farmers, realize that agriculture cannot 
sustain the economy - and their livelihoods -- in the long run. 
Seth's wife Tamalika has been re-nominated as Chairperson of the 
Haldia municipality. 
 
¶4.  (SBU) Haldia, in the East Midnapore district of southern W. 
Bengal, is situated on the banks of the Haldi river on the other 
side of which lies Nandigram, a politically turbulent zone. 
While Haldia town is an industrial hub, the surrounding 
countryside is populated mainly by agricultural communities. 
Since January, a resistance movement organized by Nandigram's 
Bhumi Ucched Pratirodh Committee (BUPC) against proposed 
acquisition of agricultural land for industrialization virtually 
cut off the area from administrative control by the elected 
government.  BUPC's confrontation with the administration on 
March 14 led to the police killing at least 14 people and 
injuring 71 others.   The BUPC is composed of local CPM 
defectors who are opposed to the government's land acquisition 
policy, opposition party workers and ultra-Left elements. 
Nandigram's local population is largely Muslim and the economy 
is agrarian.  The Nandigram incident and continued violence 
between the local CPM and opposition workers continues to give 
rise to speculation that the Left is losing its traditional 
vote-bank of farmers and Muslims. 
 
¶5.  (SBU) Haldia holds an important place in the state's 
industrial development plan and is an emerging hub of chemical 
and petrochemical industries.   For the Left Front government, 
Haldia is the potential site for a major chemical Special 
Economic Zone (SEZ), and the GOI selected the area for setting 
up a Petroleum, Chemical, Petrochemical Investment Region 
 
KOLKATA 00000228  002 OF 002 
 
 
(PCPIR) covering more than 62,000 acres.  Existing chemical and 
petrochemical units in Haldia cover part of this area, and the 
state government was in the process of preparing a detailed 
project report to identify 10,000 acres more for submission to 
GOI when the Nandigram killings took place.  The municipal 
elections victory boosted the government's confidence, and Seth 
told Post that the government is moving forward with its plans 
regarding the 10,000 acre project. 
 
¶6.  (SBU) Comment:  Prior to the Haldia municipal elections, 
Seth's detractors in the CPM emphasized that his arbitrary, 
thuggish tactics were responsible for alienating farmers, and 
led to the Nandigram incident.  In contrast, Seth's supporters 
insisted that his contribution to developing Haldia and 
organizing the party at the local level was key to the CPM's 
complete control over the area.  The poll results indicate 
Seth's continued grip on East Midnapore and Haldia's industrial 
core of workers and entrepreneurs.  However, the Opposition's 
gains show that the industry versus land issue continues to be a 
dividing line at the polls, and demonstrates the continuing 
challenge for India to bring its poorer, marginalized sectors 
into the industrialization and modernization movement. 
JARDINE