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AN ASSINGMENT ON:
SINGUR ROW: THE ULTIMATE WINNER
SUMMITED TO ENDEAVOR INSTITUTE:-
MADE BY: SHAH URVIJA BANSAL SIDDHANT PARWANI VISHAL PAREKH VISHAL [D – 8]
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ACKNOWLEDGEMENT EXECUTIVE SUMMARY TATA NANO : AN INTRODUCTION SINGUR A MOTHER PROJECT PROBLEMS IN SINGUR MAMTA BENERJEE’S ROLE DECISION TO QUIT FROM SINGUR RELOCATION TO GUJARAT ULTIMATE WINNER
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We have been benefited a lot from the guidance and suggestions given to us by our institute ENDEAVOR and all the faculty members, for their immense help in conduction of the project. Their ideas and contribution towards our project has helped us a lot.
Our vision towards Indian economy and Automobile industries became clearer and properly shaped. We also express sincere thanks to our all the teachers for the help, without their co-operation and support it would have been difficult to complete our project.
We are very thankful to our colleagues and friends for their invaluable support in data collection, who constantly supported and encouraged us in preparation of this report. This is a genuine effort from our part, but if any error is highlighted, please regrets us for that.
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The introduction of the Nano received media attention due to it's targeted low price. The car is expected to boost the Indian Economy, create entrepreneurial-opportunities across India as well as expand the Indian car market by 65%. The car was envisioned by Ratan Tata-Chairman of the Tata Group and Tata Motors-who has described it as an eco-friendly "people's car". Nano has been greatly appreciated by many sources and the media for its low-cost and eco-friendly initiatives. The choice of Singur was made by the company among six sites offered by the state government. The project faced massive opposition from 2,000 of the 12,000 displaced farmers. The unwilling farmers were given political support by West Bengal's firebrand opposition leader Miss Mamata Bannerjee with an eye to the upcoming Lok Sabha (Parliamentary) elections. Due to opposition to Tata's Singur car-factory by Mamta Banerjee, Tata Motors decided to cease operations in Singur on 3 October 2008 and started manufacturing Tata Nano at its Pantnagar plant. On her protests and the consequent pullout, the media heavily criticised her and The Telegraph even said "India is being raped by those who profess to be her soldiers, the guardians of peace." Currently, Tata Motors is reportedly manufacturing Nano at its existing Pantnagar (Uttarakhand) plant and a mother plant has been proposed for Sanand (Gujarat).
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TATA NANO: AN INTRODUCTION
“Dream-dream and dream, because dream gives vision, vision gives thoughts and finally thoughts lead to the action". Each letter of these motivational words said by India's former President Dr. A.P.J. Abdul Kalam goes exactly with Mr. Ratan Tata, Chairman of Tata group, who in the year 2003, dreamt of producing a safe, affordable Car for the common man. Finally after the wait of five years, crossing all financial and technological barriers, Ratan Tata kept his promise and unveiled Tata 'Nano' on 10th January 2007, at the 9th Auto Expo 2008 in New Delhi. Tata Nano, cool & smart, launched by Tata Motors is world's cheapest Car with a price tag of $ 2500. The project has literally become India's claim-for-fame in the international media due to Tata Motors' innovation in developing the car, as well as keeping it low in price. The car itself is expected to boost the Indian Economy, create entrepreneurial-opportunities across India, as well as expand the Indian car market by 65%.The car envisioned by Ratan Tata who has described it as an eco-friendly "people's car". Nano has been greatly appreciated by many sources and the media for its low-cost and eco-friendly initiatives which include using compressed-air as fuel and an electric-version. Tata Group is expected to mass-manufacture the Nano in very large quantities, particularly the electric-version, and, besides selling them in India, to also export them world-wide. One of the efficient thing done by the Tata Motors which has made the Tata Nano more promising is there pricing strategies. Tata initially targeted the vehicle as "the least expensive production car in the world", aiming for a starting price of 100,000 rupees or approximately $2500 US despite rapidly rising material prices. As of August 2008, material costs have risen from 13% to 23% over the car’s development, and Tata now faces the choice of:
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Introducing the car with an artificially low price through govt-subsidies and or Foregoing profit on the car, or Using vertical-integration, or
Partially using inexpensive polymers or biodegradable plastics instead of a full metalbody, or Raising the price of the car.
An increased price on the Nano will likely decrease demand.
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SINGUR ON THE ROAD TO BECOME A MOTHER PROJECT
In May 2006, the West Bengal Government decided to acquire 997 acres for the Tata Motors small car factory in Singur. Singur is in Hooghly district, 45 kilometers from Kolkata. According to a govt. Statistical Handbook on Singur block, 83%of the land is irrigated and the crop density is 220%. The crops produced are mainly paddy and potato but jute and a variety of vegetables are also grown in the fields.There are five modern cold storages and a host of wholesaler's sheds (arat) in Ratanpur-Singur town. Almost 6,000 families, including many agricultural workers and marginal peasants will lose their land and livelihoods and in return the project will generate 10000 jobs directly and indirectly. Ratan Tata told the media that he was really impressed with the sincerity in the way Buddhadeb Bhattacharjee - the Chief Minister of West Bengal- and Nirupama Sen - State Industry minister - functions. He knew the C.M since the time he took over. After his decision to withdraw the Haldia Petrochemicals complex from West Bengal due to certain problem he promised the C.M that he will come back later. Later the C.M and the State Industry Minister both invited him to setup an automotive industry in West Bengal and promised to facilitate him with the necessary infrastructure, land and amenities. The state offered the Tata’s various sites like kharagpur and singur. Since TISCO it has been the policy of TATAS to acquire land free of cost i.e. 70% from government and 30% by paying to farmers at nominal rates. Same game they chose to play in Singur. A comprehensive package of incentives — subsidy on land, concessional power, a soft loan and tax paybacks — to match the benefits that Tata Motors would have got in Uttarakhand or Himachal Pradesh, was what got it to choose Singur in West Bengal for making its low-cost car Nano. These are the benefits which had been given by Uttarakhand/Himachal Pradesh: (a) 100% exemption from Excise Duty for 10 years. (b) 100% exemption from Corporate Income Tax for first 5 years and 30% exemption from Corporate Income Tax for next 5 years.
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These are the excerpts from the WBIDC’s agreement between the Tata Motors Ltd. and West Bengal Government, governing the long-term lease of land in Singur:The terms of lease to TML for the 645.67 acres of land for the mother plant are described below. The lease rental payable per year per acre by the vendors will be Rs. 8000/- per acre for the first 45 (forty five) years and Rs. 16000/- per acre for the next 45 (forty five) years. The initial lease tenure will be 90 years. On expiry of 90 years, the lease terms will be fixed on mutually agreed terms at that point of time.
This particular area is most amenable for setting up a factory. Singur's topographical location and its proximity to Kona Expressway, one of the best roads of West Bengal, easily make it the finest spot for setting up the car unit. The only official document publicly available on the project, the Gazette notification under sec 4(1) of the Land Acquisition Act 1894 between 19th and 24th July states that the “land as mentioned in the schedule below is likely to be needed to be taken by the Government/ Government undertakings/ Development Authorities, at the public expense for a public purpose viz., employment generation and the socio economic development of the area bysetting up a Tata Small Car project”.
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PROBLEMS FACED IN SINGUR
The struggle of a substantial number of the people of Singur against the land acquisition began from day one when the Tata company representatives and the officials went to see the land. The people refused to let them reach their fields and blocked their way and the Tata team had to be rescued by the police. Though the State Government has decided to compensate the land owners, no policy has been taken for the landless agricultural workers, unrecorded bargadars and other rural households who are indirectly dependent for their livelihood on land and agricultural activities. Almost all the land owners had also expressed their unwillingness to give their land from the inception of the project, but these appeals have fallen on deaf ears. The farmers complain about 2 things - first is about the low compensation and the second is about the lack of faith in getting the promised money from government. This is what one of the farmer Prasenjit Das in Khaserbheri village says "What use is cash to me? Putting money in the bank and earning interest is not enough, especially looking at the rising inflation. With land, my asset remains intact and what I earn from selling my produce is a bonus." Das has another argument to press his case: "Even if the government promises to give me a job, it fails to secure my children's future." The farmers aren't sure whether government will give them the promised money or not. The acquisition of the entire 895 acres of private land is virtually complete. Each of the landowners has given his consent to acquisition at prices which are much higher than the prevailing rates. Disbursed payments for 550 acres and the rest will be completed within the period of December 2007, the State Commerce and Industry Minister, Mr. Nirupam Sen, told media persons. On 31st Aug, 2008 - 9 months after this statement from Mr. Nirupam Sen and still the payments weren't in the hands of farmers..? If yes then they shouldn't be agitating and if no then the government has to answer why farmers haven't been paid up till now? Mamta Banerjees 'uncompromising' stand on the disputed 400 acres (compensation is pending for 305.47 acres of land among which 51.11 acres are under legal disputes. The actual figure then is 254.36 acres, where the owners have truly refused to accept compensation. Therefore, Mamata Banerjee's demand to return '400 acres' is a blatant lie) of the Tata Motors plant at Singur is approaching the predicted outcome. The Durgapur Expressway was blocked as a protest. Some 5,000 Singur farmers today gheraoed the block development officer’s office and held up hearings on claims and objections to acquisition of land - for the Tata Motors car factory - by first disallowing officials to proceed to the camp and later boycotting the hearing when the officers did manage to get there under police escort. Mamta Banerjee went on a hunger strike urging the West Bengal government fulfilled her demand to discontinue land acquisition for the Tata project at Singur, farmers, who handed over their lands for the setting up of a car plant appealed to Trinamool Congress leader to end her hunger strike.
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MAMATA BENERJEE’S ROLE IN SINGUR ROW
Trinamool Congress (TMC) chief Mamata Banerjee blamed the West Bengal Government for the Singur row as it broke the terms of the agreement with her party. Banerjee, while alleging that Chief Minister Buddhadeb Bhatterjee was taking all the decisions without consulting TMC, said, “West Bengal government doesn’t respect us. It has broken the terms of agreement. We are not ready for any more talks,” said Banerjee, and expressed her views on not having the TATA NANO plant in the state. Banerjees statement came barely hours after Governor Gopalkrishna Gandhi called for a “spirit of accommodation” that was evident during the talks he presided over to break the Singur deadlock. Bhattarjee offered 70 acres in lieu of the Tata Motors project site at Singur to unwilling farmers and monetary compensation to those whose land fell outside, which was rejected by the TMC chief on Friday evening. Sonia Gandhi’s Congress sought to project itself as a responsible Opposition party in Bengal as it rolled out the welcome mat for Ratan Tata and his proposed car project in Singur. While rallying behind Mamata Banerjee in her bid to get Tata to relocate the project, Congress leaders stressed that they didn’t want the protest to come in the way of Tata’s dream — to roll out a Rs 1-lakh car from Bengal — or Buddhadeb Bhattacharjee’s vision of an industrialized state. The Singur agitation intensified On December 4 with Miss Mamata Banerjee going on an indefinite hunger-strike and declaring her moral support to tomorrow’s SUCIsponsored bandh. Miss Banerjee began the hunger-strike at Esplanade in central Kolkata after the state government had rejected her demand for stopping fencing work at Singur and withdrawal of police forces from the area. Fifteen farmers, including five elderly women, began a fast-unto-death at Singur today in protest against police excesses and land acquisition. Miss Banerjee declared that her party would block roads all over the state. “You get lost”, was her final message to Mr. Buddhadeb Bhattacharjee. The Trinamool Supremo apologised for the inconvenience caused by bandhs. “We are not in favour of bandhs. But there is no alternative’’. The farmers assembled near the spot where Mamta Banerjee is on fast. They urged her to work towards ensuring them a better future. They said in an open letter to Banerjee that they were satisfied with the financial compensation provided to them by the West Bengal Government for the land they had handed over voluntarily.
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The letter said: "If you continue your hunger strike, it will only worsen our hurt. If your protests are aimed at ensuring our well-being, we request you to call off your hunger strike soon and cooperate towards setting up the Tata Motors project at Singur.” However, the appeal seems to have fallen into deaf ears with Mamta Banerjee unrelenting
After 25 days of persistently refusing to end fasting, on 28th December Trinamool Congress chief Miss Mamata Banerjee called off the hunger strike today. The MP, who had Complained of a blurring vision, told reporters that letters from President Dr APJ Abdul Kalam, Prime Minister Dr Manmohan Singh and former Prime Minister Mr. Atal Behari Vajpayee had persuaded her to take the decision. In Japaiguri, Buddhadeb Bhattacharjee said the state government had “specific” information that the rivals of the Tatas were encouraging trouble over the car factory project in Singur, Hooghly. The comment comes a day after Ratan Tata accused “some…competitors” of fuelling the fire, adding a new dimension of corporate intrigue to the existing political issue. In an interview to a private television channel, Tata had expressed the determination to see through the project that will turn out cars costing Rs 1 lakh at the site some 40 km from Calcutta. Farmers opposed to land acquisition in Singur twice set fire to fence posts at the Tata car plant site ON 25TH January. a group of villagers wrapped jute bags soaked in kerosene around 10 wooden posts and set them on fire at Beraberi, a group of women came to the site and set fire to the posts again. The police gave chase but could not catch anybody. A police team later raided two clubs in adjoining Bajemelia in search of the culprits but did not arrest anyone. This is the third time that villagers have set fire to the fence posts since January 21, when the Tata Motors authorities performed bhoomi puja (Land worshipping). In Calcutta, chief minister Buddhadeb Bhattacharjee reviewed the situation with chief secretary Amit Kiran Deb, industries secretary Sabyasachi Sen and other officers.
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ULTIMATE DECISION TO QUIT FROM SINGUR
Amidst the rising protests of the dissatisfied farmers and instances of violence springing around the singur project of tatas, Ratan Tata finally decides to quit Singur on 23rd September, 2008. “The decision was taken in order to ensure the safety of its employees and contract labour. The company has assessed the prevailing situation at Singur after five continuous days of cancellation of work and believes that there is no change in the volatile situation around the plant,” The Tata Motors’ announcement came when the agitation, led by the Trinamool Congress outside the site demanding the return of 400 acres of land which it alleges had been acquired forcibly for setting up the project, entered its tenth day. The situation around the Nano plant continues to be hostile and intimidating. There is no way this plant could operate efficiently unless the environment became congenial and supportive of the project. We came to West Bengal hoping we could add value, prosperity and create job opportunities in the communities in the State,” a Tata Motors spokesperson said. Nirupam Sen, the State’s Industries Minister, described the development “as very unfortunate and very bad news for West Bengal.” “The existing environment of obstruction, intimidation and confrontation has begun to impact the ability of the company to convince several of its experienced managers to relocate and work in the plant. Further, several persons engaged in the construction and commissioning work who had taken accommodation at Singur and nearby areas have since vacated and gone away due to intimidation and fear,” the statement said.
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RELOCATION AT GUJARAT
On 5th October,The Gujarat government may be claiming that the Nano unit is headed for a site near Ahmadabad but there are indications that the race to host the plant is far from over. Senior Tata Motors officials said that its MD, G Ravikanth, will be in Karnataka and Andhra Pradesh to meet ministers. He will weigh up options for rolling out the Rs 1-lakh car from a site in either of two states. Ravikanth will be in Dharwad to inspect a site for the Nano plant, officials in Karnataka confirmed. This will be followed by a meeting between Karnataka major- and medium-scale industries minister Murugesh R Nirani and Tata Group CEO Ratan Tata. "I am meeting Ratan Tata soon. We are confident the Tatas will select Dharwad for relocating their Nano manufacturing unit," Nirani said. Ravikanth will also be visiting Andhra Pradesh. Gujarat officials, however, claimed that a site near Sanand in Ahmedabad was the frontrunner in the race. In what could be a personal triumph for Gujarat chief minister Narendra Modi — and add insult to injury for communist Bengal — senior Gujarat officials said Ratan Tata had agreed to relocate the Nano plant. The site is located 25 kms west of Ahmedabad. A formal announcement, most probably on October 7, when Modi completes seven years in office. At present, the 2,200-acre site serves as a college and cattle-and-seed farm for the Gujarat Agriculture University. Things are already moving fast within the Gujarat government. The university has been informed about the decision to transfer the land to the Tatas. The necessary paperwork for the transfer has been completed. The revenue department issued a notification to acquire 60 acres of land in Chharodi and Iyawa-Vasna villages for building broad approach roads to the site. While pulling out of Singur, Ratan Tata had mentioned that locations in "three or four states" were being considered. While Maharashtra, Uttarakhand, Karnataka and Andhra Pradesh were in contention, what finally swung the decision in Gujarat's favour were Modi's incentives to the Tatas. The deal given by Gujarat is just as good as the one offered by West Bengal and, in some respects, better. As against 1,000 acres on initial offer in West Bengal, Gujarat is offering 1,100 acres. This land is unencumbered and would be sold to Tata Motors at prevailing market rates. Tata Group said the Sanand plant being planned for a capacity of 5 lakh cars a year, up from the Singur plant’s proposed capacity of 3 lakh cars.
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MEGA ADVANTAGE TO NANO OFFERED BY GUJARAT
Soft Loan of rs.9570 crores, at 0.1% interest to be repaid after 20 years. Relief from immediate 200% of gross V.A.T payment.
Repayment of deferred tax after 14 years.
Payment for land in 8 annual installments with compound interest of 8% per annum.
Exemption from stamp duty, registration charges, transfer charges, electricity duty, cost of
water and gas pipeline.
Government assured last mile connectivity.
Tata Motors, which is developing small car Nano project in Gujarat's Sanand, will get benefits worth Rs.95 billion from the state government for developing infrastructure around the project area, sources said. Tata Motors will get 20 years from the commencement of the project to repay the amount at an interest rate of 0.1 percent. The amount will be repaid by adjusting value added tax dues of the company, the sources said. The company would use the fund to build a township and a 'transport nagar' near the plant location in Charodi village near Sanand to meet the logistics support needed by the project. The government had also pledged to provide 100 acres for Tata for developing the proposed township. Tata Motors officials said the total amount was an aggregate of "various concessions", including the 100 acres, stamp duty exemptions and concessional power tariff.
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THE ULTIMATE WINNER
The narrow vote seeking politics of mamta banerjee and trinamool congress can share the winning position along with the people of Gujarat. The majority of the title deeds were clear but ms.banerjee fought for the interest of the few farmers and for her selfish interests ultimately driving the much needed industry out of the state. The people of Gujarat are the ultimate winner as under the dynamic leadership provided by the chief minister narendra modi. Along with the jobs generated in the industry at sanand, a lot of ancillaries are also coming up in the surrounding area which are generating a lot of jobs. Roads are being built up and other amenities are coming up increasing the standard of living of people. Tata group had to suffer a huge loss because of relocation of the nano plant from the relocation of their plant from singur to sanand in Gujarat. Tata motors'' decision to make low cost Nano car in Gujarat has kindled hopes of a lucrative business among the auto-parts making small-scale industrial units in Rajkot. Industry experts feel that the setting up of Nano car plant in Gujarat will give an boost to the manufacturing units in Rajkot. According to the manufacturers, the setting up of the Nano plant in the state will also help them in cutting down on their logistics cost as they would save around 1.6 million rupees a month on transportation alone. Experts say the entry of Tata motors is also bound to encourage other auto giants to come to Gujarat and aid the growth of auto parts manufacturing industry in terms of business and also generate more employment opportunities. Hence in this whole scenario of the NANO plant the ultimate winner is GUJARAT.
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TIMES OF INDIA ECONOMICS TIMES INDIA TODAY
WWW.GOOGLE.COM WWW.SCRIBD.COM WWW.TIMESOFINDIA.COM WWW.ECHEAT.COM WWW.YAHOO.COM WWW.WIKIPEDIA.COM
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