If recent reports emanating from West Bengal are anything to go by, the State is now moving towards creating a entrepreneurship-friendly image to help boost its industrial status, reports Huned Contractor

A news report published in The Telegraph dated July 20, 2010 states that the CPM has hauled up its ministers and asked them to try and reassert the image of a "do-it-now" government in a desperate bid to stem the slide in its electoral fortunes. The CPM State Secretary Biman Bose has also been reported to have expressed resentment over "lack of coordination among ministers", saying it had affected development work. "In land acquisition, setting up industries, issuing below-poverty-line cards or streamlining the public distribution system, where several departments are involved, coordination is a must," Bose was quoted as saying. This is not just a political move. As the State's Chief Minister Buddhadeb Bhattacharjee has earlier pointed out, it is a necessity of the times to be able to attract investments in the State so that West Bengal is not left too far behind as compared to the other States in the country.

This can also be borne out from what the State's industry minister Nirupam Sen had to say in the course of an interview conducted in March last year. "There may be some negative perceptions about our State but if we look at the facts, West Bengal is still in the front row as far as investments are concerned. In 2008, West Bengal got the highest numbers of industrial entrepreneurs' memorandum (IEMs) among different States. The proposals amounted to almost Rs 95,000 crore," he stated. The emphasis is on maintaining the momentum. However, a report published by the Associated Chambers of Commerce and Industry of India (ASSOCHAM) stated that West Bengal had slipped from the fourth to the 13th position as an investment destination. Clearly then, there is something not quite right in terms of matching the vision with the ground reality.

Has it been a fall-out of what happened with the Tata Group's Nano plan at Singur? Sen doesn't think so. According to him, that was just a one-off incident and hasn't really affected the industrial status of the region. A lot of proposals, as per his statement, have been received in the iron and steel sector. According to the Ministry of Steel, 222 memoranda of understanding (MoUs) have been signed with various States for planned capacity of around 276 MT and major investment plans are in Orissa, Jharkhand, Chattisgarh, West Bengal, Karnataka, Gujarat and Maharashtra. To give credence to the fact that West Bengal is still in the reckoning, Korean steel major Posco has begun checking out West Bengal, raising hopes of the State hosting an investment by Korea's biggest steel company whose plans to set up a 12 million tonne plant in Orissa have been swinging high and low.

According to a media report, Posco officials visited the Kulti Growth Works (KGW) of the Steel Authority of India Ltd (SAIL) near Asansol in West Bengal. KGW has the capacity to make mostly non-ferrous castings as well as some steel castings. Posco India sees the Indian market as one with huge potential as much for the growing market for steel (mainly for infrastructural projects) as also for the country's mineral resources. Adhunik Corporation, which is planning to set up an integrated steel plant in West Bengal, has been provided 505 acres at Raghunathpur in Purulia district. Adhunik Corporation's project involves setting up a steel plant with a capacity of 1.1 million tonnes per annum along with a 1,000 MW captive power plant and a 1 million cement plant at Raghunathpur.

Meanwhile, after putting its steel project in West Bengal on the right track, JSW Steel plans to commission two units of its 1,600 MW power plant in West Bengal by 2015. In a regulatory statement, it said the company board has approved the formation of a special purpose vehicle (SPV) by its subsidiary JSW Bengal Steel jointly with JSW Energy for setting up the power plant using thermal coal from Ichhapur mines. "The power plant will be set up as two units of 800 MW each with an investment of about Rs 9,680 crore, comprising Rs 7,680 crore for setting up the power plant and Rs 2,000 crore for the development of mines. The project is proposed to be funded on a debt-equity ratio of 3:1 (Rs 7,260 crore and Rs 2,420 crore respectively)," the statement said.

In another positive development, India Resources Ltd (IRL), a mining firm listed on the Australian Stock Exchange, has decided to enter into contract mining of coal with Bankura Coal Co in the Raniganj sector with a total investment of over Rs 100 crore. This is also perhaps the first instance of contract mining by a foreign company in the coal sector which is dominated by public sector major, Coal India Ltd. Bankura Coal has six sponge iron companies under its wing and has been allotted a lucrative coal block in the heart of the State's Raniganj coal belt. The mine has total reserves of 95 million tones. India Resources will start operations at the new mine within three years.

"The output from this mine is expected to peak in the seventh year of operations when it is estimated to produce half a million tonnes of coal," Arvind Misra, Managing Director of IRL, said. This is part of India Resources Ltd's strategic move to get into the exploration side of the mining business in India. Such projects send out a clear signal that India Inc still has a lot of faith left in West Bengal's economic and industrial stance. "The policies are working in the right direction to make Bengal's industrial prospects conducive," is how ASSOCHAM's Secretary General D S Rawat puts it. In another step forward, Mackeil Ispat and Forging Ltd has set up a plant with a production capacity of 40,000 tonnes annually at the industrial town of Durgapur in West Bengal for an investment of Rs 200 crore.

"We have funded the Rs 200-crore project through debt and internal accruals and may visit the capital market for a maiden public offering of shares at a later stage to fund the second phase," is what the company's Chairman P Chakraborty told reporters after the plant was commissioned. He further revealed that the company plans to set up a steel melting shop of 3,00,000 tonnes a year at Durgapur with an investment of Rs 500 crore by December 2011. The furnaces that will be used to make the forgings will be fuelled by coal bed methane gas and liquefied petroleum gas sourced from Great Eastern Energy Ltd.

As for the often-heard complaint about the scarcity of power in West Bengal, here is some heartening news. At a seminar, West Bengal Green Energy Development Cor-poration's Managing Director S P Gon Chaudhuri said, "We are expecting to generate 110 MW from land-based solar power plants to be set up with the help of private sector companies. Another 5 MW will be produced through rooftop panels by 2013." Around Rs 1,500 crore will be invested to produce the 115 MW. The government has given a proposal to the New and Renewable Energy Ministry to get this amount. At present, the State produces only 15 MW of solar power. According to the National Solar Mission, India should have an installed capacity of 20,000 MW by the end of the 13th Five Year Plan in 2022, implemented in three stages. "Out of 20,000 MW by 2022, we want to produce 2,000 MW," Gon Chaudhri said, adding that six companies - Webel, Moser Baer, Reliance Industries Ltd, Synergy Solar (P) Ltd, Astonfield and Videocon - have shown interest in making solar modules in the State.

West Bengal is also among the fastest growing States with regard to the IT sector and the IT and ITeS sector is projected to contribute 15-20 per cent to the State's economy by the end of 2010. In the first five years of his tenure, Bengal Chief Minister Buddhadev Bhattacharjee focused on the IT sector. He got Wipro and hoped for Infosys, while TCS expanded. In fact, Wipro's chief Azim Premji once said that Bhattacharjee was the best chief minister. The chief minister also stepped in to allocate land to Wipro and Infosys. Both the companies were earlier offered land at an IT township called Kolkata Links located near a spa resort called Vedic Village which erupted in controversy, involving the State government as well. One of the reasons why IT has enjoyed such growth in West Bengal is that there is no dearth of highly skilled manpower in the State, given its tradition of stressing on the importance of education.

Placed in the larger picture, it is not surprising to find that the ASSOCHAM study indicates that the State's business confidence index is at a more-than-satisfactory 6.5 on a scale of 10. The study was conducted among 280 chief executive officers and managing directors and over 225 respondents opined that the State can be rated on par with favourite investment destinations like Gujarat, Maharashtra, Karnataka, Andhra Pradesh, Rajasthan and Himachal Pradesh. Over 200 CEOs observed that apart from domestic investment, West Bengal can attract investment from overseas players in clean energy, biotech and nanotechnology, healthcare, education and infrastructure. As per the ASSOCHAM estimates, West Bengal received investments up to Rs 5.3 lakh crore till September 2009 over a 12-year period. As pointed out earlier, there are high stakes riding on the hope that this kind of progress will remain on track.