Remember the Tata Nano Singur controversy?
A Left Front government in power for 34 years was brought down by a storm over its dream to revive the state’s industrial glory, specifically over its acquisition of farm land for a proposed Tata Motors automobile factory at Singur in Hooghly district. The factory would have been used to manufacture the Tata Nano, billed as the world’s first affordable small car.
The Left Front government used the 1894 Land Acquisition Act to acquire 997 acres of farmland for Tata Motors and its ancillaries to build the car factory and its ecosystem. Singur was one of the six sites offered by the state government.
Mamata Banerjee, the leader of the opposition at the time, backed the displaced farmers. Banerjee’s “Save Farmland” movement was supported by many, including environmental activists, intellectuals, and even some of the leftist activists.
The Tatas decided to move out of Singur on 3 October 2008, with Chairman Ratan Tata attributing the decision to pull out to the agitation by Banerjee and her supporters. Four days later, on 7 October 2008, the Tatas announced that they would set up the Tata Nano plant in Sanand, Gujarat.
That rang the death knell for the ruling party and industrialisation in West Bengal; catapulted Banerjee into the chief minister’s seat in May 2011.
Banerjee, however, has shed her “anti-industry” image, wooing big industrial houses, including the Tatas, to invest in West Bengal, generate jobs, and boost the state’s economy. Shortly after coming to power, Banerjee launched a series of Bengal Global Business Summits, beginning in 2015.
In February this year, after the 8th such summit, Banerjee claimed that it had attracted investment proposals worth ₹4.4 lakh crore.
Reliance Chairman Mukesh Ambani said his group has invested over ₹50,000 crore in West Bengal over the last decade, and this investment is expected to double by the end of the current decade. The primary investments would be in Jio, retail stores, and solar energy. Reliance has also promised a data centre.
Others, such as Sajjan Jindal, have power projects in the works.
The chief minister said the previous seven summits have attracted investment proposals of ₹19 lakh crore, of which ₹13 lakh crore has been invested.
Despite this, Banerjee doesn’t seem to be happy with what’s happening on the industrialisation front.
Last month, the West Bengal government tabled a Bill to revoke eight incentive schemes for industry launched between 1993 and 2021. Banerjee said in the House that the government would formulate a revamped policy to encourage the setting up of industrial units.
The Revocation of West Bengal Incentive Schemes and Obligations in the Nature of Grants and Incentives Bill, 2025, tabled on 19 March, aims to subserve the “larger public interest.”
The bill also seeks to ensure that “the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment,” as laid out by the Constitution’s Directive Principles of State Policy.
According to media reports, Banerjee said the situation has changed significantly over the last 20-25 years, and some of the incentives introduced by the Left Front government, which ruled from 1977 to 2011, have become “irrelevant” and are being withdrawn.
“Now, various works are being done on AI technology. Many new ideas and approaches have been added to the industry. Therefore, a new policy is being brought with the opinions of all concerned,” Banerjee was quoted as saying.
She said a committee has been formed under the chief secretary to consider what needs to be included in the preparation of a modern scheme, and the committee will give its opinion within a month. Then the government will prepare a modern scheme.
The chief minister also claimed that the government is suffering “not only from the burden of debt imposed by the Left Front government” but also from the “consequences of various unsustainable policies”.
The text of the bill, published in the Kolkata Gazette, gives an idea of what could come in the new format.
It says, “…The objective of this Act is to make state finances available for various social welfare schemes formulated and under operation in the state of West Bengal, which are intended for utilisation by the socio-economically disadvantaged and marginalised sector of the state and not to expend such finances to provide special assistance, financial incentives, state support, benefits, concessions or special privileges at the cost of the marginalised.”
Since coming to power, Banerjee has launched a series of social sector schemes, one of which has won an award from the United Nations.
The 2025-26 budget document for the Women & Child Development and Social Welfare Department lists some of the women-centric schemes. The government says its social services model covers the entire life-cycle of a human being, from birth to death
The Lakshmir Bhandar scheme, which has benefited 2.2 crore women, pays women in the 25-60 age group who are not employed ₹1,000 a month if they belong to the general category and ₹1,200 if they are from a scheduled caste or tribe.
Speaking after the budget, Chief Minister Banerjee said, “All the women of a family, if eligible, will receive the money under the scheme.”
Kanyashree, aimed at encouraging girl students not to drop out of secondary school and discouraging early marriage, has helped 1 crore girl students and also won a United Nations award in 2017. Kanyashree encourages girls to continue their secondary school education with an annual stipend of Rs 500 and a one-time grant of Rs 25,000 upon turning 18, when they wish to pursue higher education in college. Rupashree assists poor families with a lumpsum payment of Rs 25,000 for the marriage expenses of daughters above 18 years of age.
But what exactly does the Act seek to do?
Your guess is as good as mine.
The Act will come into force on the date of notification in the Official Gazette and shall take effect from the date of implementation of each of the schemes.
Industrial units shall no longer be entitled to claim or demand or enforce past arrears or dues in relation to any incentives offered by the existing schemes. They also cannot raise or enforce any future claims or demands for any incentives.
The Chief Minister said the government is revoking incentives for industry to set up units in the districts as her government has improved the infrastructure across the state.[7]
It mentions 10 schemes floated/amended between 1993 and 2021.
The Bill says:
# The continuation of the existing incentive schemes has necessitated significant and on-going financial expenditure from the state exchequer… The positive impact of these incentives has been largely confined to a limited number of beneficiaries and has a minimal effect on the broader process of industrialisation.
# They place considerable strain on the state’s financial resources, which could be more effectively allocated to sectors of greater public interest, such as social welfare, human development through education and health care, or infrastructure enhancement.
# It is essential that state financial resources should be directed towards initiatives that yield direct and substantial benefits for socio-economically and disadvantaged and marginalised communities…
# The current incentive schemes disproportionately favour specific industries, geographic regions, or corporate entities, leading to economic disparities…
# Finally, the objective is to ensure that state financial resources are utilised to uplift socio-economically and marginalised sections… Rather than spending state finances on industrial incentives, in the public interest, the focus should be on initiatives that provide broader social and economic benefits…
In short, West Bengal feels it has done enough for industry. It has spent a lot but hasn’t got much. Now, it’s time to focus on the socio-economically disadvantaged and marginalised sector.
In what form? Let’s wait and watch.
Remember Gopal Krishna Gokhale’s saying “What Bengal thinks today, India thinks tomorrow.” Will other Indian states follow the West Bengal example?
Somnath Dasgupta has co-authored this piece.
The columnist writes Banker’s Trust every Monday in Business Standard.
Latest book Roller Coaster: An Affair with Banking
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