The Hindu Business Line : The climate change in Kolkata

SINCE THE advent of reforms in China in the late 1970s, as the mighty dragon embraced capitalist economics without giving up communist politics, many in India have been wondering why the Left parties in India have not yet taken serious note of the writing on the wall and attempted a change in their mindsets.

As with many a political leaders who have been the chosen instruments for policy transformations, the present West Bengal Chief Minister, Mr Buddhadev Bhattacharjee, seems to be taking the lead in changing the course of economic history in the country's communist heartland. Also, as if a tradition has been established and he is following it, he has chosen Singapore and Indonesia to make his pronouncements, much to the joy and appreciation of his friends and admirers in other political parties.

In his recent visit to Singapore, with which India has a Comprehensive Economic Cooperation Agreement, the Chief Minister met the city-state's Prime Minister, Mr Lee Hsien Loong, and President, Mr S. R. Nathan, and briefed them on his State's readiness to attract foreign investments.

He also held discussions with Senior Minister, Mr Goh Chok Tong, the architect of much that has happened for the better between Singapore and India. Media reports indicate that Mr Bhattacharjee discussed with Mr Goh how West Bengal could benefit from Singapore's development experience.

Besides meeting the policy-makers, the Chief Minister also held discussions, not only with the leader of the Singapore Indian Chamber of Commerce and Industry, which is a sort of a must for a visiting dignitary from India, but also with the chief of the Singapore Chinese Chamber of Commerce and Industry. It is widely reported that Mr Bhattacharjee has been keen on promoting West Bengal as an attractive foreign direct investment (FDI) destination for airports, ports, special economic zones, health services, and housing.

A high point of his tour was his lecture, jointly organised by the Singapore Indian Chamber of Commerce and Industry (SICCI) and the Institute of South Asian Studies (ISAS). He delivered the second SICCI-ISAS Global Business Leaders Lecture (the first was a few months ago by the Finance Minister, Mr P. Chidambaram) on August 23.

In his lecture on "Economic Opportunities in Singapore and India: The Way Ahead with West Bengal", Mr Bhattacharjee said that although West Bengal has been ruled by communists for 28 years, the workers have been given an open indication that the environment may turn market-driven rather than remain purely Marxist. "I am telling my workers — you have to change. If you fail to change, your company may fail," he said, as reported by the SICCI Web site.

The Chief Minister noted in his lecture that West Bengal has an investment-friendly government, inviting private and foreign direct investments in every sector, including real estate, infrastructure (port and airport), health and IT. Development of a Special Economic Zone and a Health City were also mentioned for possible FDI.

The speech also covered the relatively sensitive issue of privatisation of public undertakings. He clarified that unprofitable undertakings would be sold or closed down. He was quoted as saying: "We are not fools to ignore the changes taking place in the World"; and "We are keenly studying China's policies and we have learnt, `Don't stick to dogmas; change with the times and learn from Life'."

After Singapore, the Chief Minister stopped at Jakarta and the agenda, once again, was to portray his State as a focus of FDI interest. In his wide-ranging interview to Jakarta Post, Indonesia's main English language daily, he referred to the interest of Indonesian investors in West Bengal.

Among others, he mentioned the Ciputra group's township project near Kolkata, and the Salim group's automotive (motorcycle) plant.

Perhaps the `best' question posed to the visiting dignitary by Jakarta Post was this: "Yours is a Leftist government, which is mainly supported by workers, farmers, students and intellectuals. If any labour dispute arises in a foreign company, how will your government deal with the issue?" The answer simply turns around the parameters of apparent constraint to indicators of certain advantage.

The Chief Minister responded thus: "Our involvement in trade unions is an advantage. The majority of workers are in support of this government. And we are trying to change their mindset. I tell them, look this is a new situation. We need FDI; we need infrastructure. Issues like production, productivity and the quality of production are not the headaches of the management alone. You have to share them. Otherwise, industries will collapse and jobs will be lost. Now things have changed."

The Chief Minister added the following in response to another question "Look at China. The situation is completely different if you compare it to before 1978. Deng Xiaoping used to say `We learn truth from the facts, not from books'." Mr Bhattacharjee affirmed that globalisation is a must and nobody can stop it. It is just that he likes to see a level playing field. Upon his return from his visit, in his briefing to reporters, the Chief Minister affirmed that he was for reform of the Marxist mindset. He repeated in no uncertain terms that Marxism is not a dogma, it is a science and one has to learn from facts.

A few days before he left for Singapore and Indonesia, the Chief Minister spoke to a business delegation from Singapore on August 19 and sent out strong pro-reform feelers to global investors, stressing that West Bengal will never block any reform programme and "either you reform or you perish".

What do the people of his State think about their Chief Minister? Here is a cross-section of reactions from readers of a paper published on just one day (August 26):

"Stuck with years of communist baggage that turned West Bengal into an industrial wasteland, Buddhadeb Bhattacharjee has been systematically trying to open the State's economy to private investment since 2000."

"It is strange that CPI(M) ideologues like Prakash Karat and Sitaram Yechury adopt a hardline policy towards foreign investments, while Buddhadev Bhattacharjee, of the same party, is quite convinced that there is no alternative to them.

"Prakash Karat, is a known hardliner, lives comfortably in the Capital, and is not visible to the masses. Nor does he have any obligations concerning the development of a region. Karat is a party chief, Bhattacharjee is a leader — that is the key to the differences between the two."

"The CPI(M) should espouse Bhattacharjee's view of globalisation and the opening up of the economy, so that the Left does not spread any more confusion amongst investors."

When Jakarta Post asked Mr Bhattacharjee: "How would you rate the investment climate in West Bengal?" his response was mainly about investors who have already come in and those who are considering entering the State. Above all, the following is noteworthy: "I try my best with other colleagues to prove that we are an investor-friendly government, not only in our talk but in our actions."

(The author, formerly with the National University of Singapore and the World Bank, is Professor Emeritus, GITAM Institute of Foreign Trade, Visakhapatnam. He can be reached at bhanoji@gmail.com)

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