Incentive to TATAs

Statesman News Service KOLKATA, Jan. 22: It took the state government an expose by The Statesman and Dainik Statesman on details of its deal, veiled in secrecy, with the Tata Group to admit today that it did sign an MoU in July last year with the Group to allot it 50 acres of land at Rajarhat New Town and 200 acres in the Bhangar Rajarhat Development Authority area for cross-subsidising its small car project at Singur. While the July MoU with the Tata Housing Development Company is separate from the one for the small car project, the agreement with the THDC would be signed after Cabinet approval, Mr Sen clarified. Contrary to the claim repeatedly made by the chief minister that the Tatas had agreed to set up its small car factory in the state “sacrificing” 16 per cent excise duty exemption offered by the Uttaranchal government, Mr Sabyasachi Sen, principal secretary of the industries department, said the Group had to be offered the land as part of an incentive package. According to Mr Sen, the state government decided to offer the land to the Tata Group as part of its policy to set up some “landmark” industry such as the automobiles and at the same time develop the IT sector, “which is another landmark industry.” “The state government doesn’t have the money to implement such a policy, nor has it got instruments such as excise duty or income tax waiver which is the Centre’s prerogative, to attract investment. The Tata Group wanted land near the city to build its commercial-housing complex and IT units...’’ Since the prices of land offered by the Housing and Infrastructure Development Corporation were considered higher by these firms, the state government, according to Mr Sen, decided to offer the Tata Group 50 acres of Hidco land at Rajarhat New Town and 200 acres from BRADA, and lease out an additional 400 acres to the other firms to set up their units. The Tata Group would pay for acquiring the entire 600 acres in addition to the Hidco’s 50 acres of land.