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September 21, 2015

Good macro, infra push drawing business to Bengal: Dr Amit Mitra

Good macro, infra push drawing business to Bengal: Dr Amit Mitra

Private investment comes when you have infrastructure development, West Bengal Finance and Industry Minister  Dr Amit Mitra said in a recent interview, adding that capital expenditure has risen more than six-fold to Rs 13,325 crore since the time Trinamool Congress came to power in 2011. An improving macro environment and infrastructure development are the two factors attracting industry to West Bengal, he said.

Excerpts of the interview:

Q: You have been reaching out to investors across the country as well as in foreign countries, UK was your first destination I understand, soon you will be visiting the US. You talked about ‘the future begins in West Bengal’ and a lot of data has been put together, I am looking at the data that has been supplied by the West Bengal government as well as the Central Statistical Office (CSO). At gross value added (GVA), the West Bengal growth rate has come in about 10.48 percent for FY14-15. The agriculture and allied sector growth is much higher than the national average at 6.46 percent, services growing at about 12 percent, industry at 8 percent per capita at almost 13 percent. If you can give us a sense of how much you have been able to draw in by way of private investment because the story is looking better on several parameters as I have just pointed out but what has that resulted in terms of private investment into the state?

A: I think private investment comes when you have certain parameters meet. The first of which of course is macroeconomic parameter, which have so succinctly summed up for us for the state, data coming from the centre. Second of course is the private investment comes when you have infrastructure development. Now you would be happy to know that the growth in infrastructure — it is phenomenal, so I will give you the exact number, say for example state plan expenditure which goes into various forms of things that industry gives that has grown by 311 percent in the last four years, which is a record of sorts. More interesting is that capital expenditure from where you had roads, bridges etc that has gone up by 601 percent. To give you the exact figure, Rs 2,225 crore when we came to office, it is Rs 13,325 crore now. So industry looks forward to capital expenditure both in human capital, social infrastructure and physical infrastructure. Now all this is the backdrop to the fact that companies after companies are now expanding. I will give you two quick examples — Tata Consultancy Services (TCS) has got 40 acres of land on which they are building for 20,000 additional IT professional. Now you go to manufacturing — Tata Metaliks , which is located in one of our parks, has just asked us few weeks ago for another 300 acres in our own park for expansion. You take the case of Anil Ambani’s group, a Rs 600 crore investment in a cement plant. You will be interested to know we are now just probably going into production in the largest fertiliser plant — not only eastern India probably among the largest in the country Matix, which is a sister body to Essar Group, they have put on the ground Rs 6,500 crore and now moving to Rs 8,000 crore, that is over a billion US dollars. Very next to it is the HR Johnson tiles and I was so happy in Delhi when Ashok Kajaria came to the meeting and said I am going to go and do tiles and great thing was tiles uses gas.

Q: Is there a cumulative number? You have given us several instances of companies that are now either hiking their plans in West Bengal or putting in fresh investment, is there a number over the last four years of what you have been able to do?

A: Absolutely. There is a number and I said it on the floor of the assembly, which means I can be eligible for privileged motion if I don’t say rightly. Till last month, the total — since we came to office — is Rs 87,000 crore, which is either completed or in the process of completion. So the examples I have given you are only indications of this Rs 87,000 crore by the way this is only medium and large industries. I will give you example from small industries. We may have as many as 52,000 additional small and medium enterprises over the last four years, number of clusters have grown from 48 to over 300, they are very labour intensive, creates many more jobs.

Q: Since you are talking about labour let me bring to you attention the World Bank report. You have come in at the 11th position as far as the overall state ranking is concerned, percentage wise on the 90th parameters that the World Bank has assessed states, you have come at a little under 47 percent. A lot of work needs to be done as per that report. Acceleration required on a whole bunch of parameters, for instance single window clearance and I know the government has made the attempt to go in for single window clearance through your Shilpa Sathi program. Other areas where they believe acceleration is required, for instance on e-courts and so on and so forth but on one front they have very clearly acknowledged the work that has been done by your government and that is as far as tax related norms but using technology concerned and you are one of the three states that has been able to move that, the e-taxation. What do you make of the report and what more can we expect in terms of the areas where the World Bank report says more needs to be done?

A: We need to understand what is the methodology. Number two, the DIPP came to Kolkata, we did not see the World Bank guys. So, we would like to know from the Bank as to what is the contribution that the bank made. If we are short somewhere, if we are weak somewhere we will rectify it but our e-taxation is number one, we got the highest award in the country given by the central government in Gandhinagar. Therefore I don’t see why we are 11, I am sure there are reasons, I would like to study them. Q: Political reasons you believe? A: I don’t know. The top 5 states I find are probably all from one political perspective, may be they are doing well.

Q: With the exception of Andhra Pradesh.

A: Andhra Pradesh is also an NDA state don’t forget but that is okay. I am not going to make this into a political debate. The point is ideally I would like to know the methodology from which we will arrive at where we are weak, where we are strong and whether we are strong has been weighted correctly. The trick to this is how you weight it. So, I would not like to dispute this without having the methodology in front of me.

Q: Irrespective of what the World Bank says, let us talk about the road ahead because you yourself have acknowledged that more work needs to be done to draw in private investment and to get the business climate to be a lot more robust. What more can we expect for instance as far as labour reforms are concerned? Land is not an issue as per your government, you believe that you have 4500 acres that is available with physical infrastructure for the taking if private sector wants it. What can we expect at least on issues like land, labour and so on and so forth.

A: What is interesting is as far as land is concerned, you have said 4500 crore which is in our own parks – ready to go but in addition we have a lakh acres with different departments of the government which can be availed for industry. For example, just now the animal husbandry department has given over 300 acres to the industry department – West Bengal Industrial Development Corporation to develop an industrial park. So, the land bank as Mamata Banerjee has repeatedly said consists of one lakh acres along with of course a developed infrastructure land which is 4400 plus another 4000 under infrastructure construction. So, as far as land is concerned this is a red herring. In West Bengal there is no problem with land, whoever has lost the land gas got it immediately. The second question which you have asked how we are going to improve ourselves further? There is no end to improvement, we should be world class, we should be competitive. You would be happy to know that in a month and a half or so you will see something which I would like to keep as a mystery.