Bengal in London: A new beginning

LONDON (RAY) 5 Aug — A week ago, the mercurial Mamata Banerjee, chief minister of the eastern Indian state of West Bengal, was in London. Her visit was aimed at attracting British investment to her province, including its capital Kolkata, once the headquarters of British India and the second city (after London) of the Anglo-Saxon Empire.

Of course, the trip was somewhat scuttled by the national mourning announced after the death of former Indian president APJ Abdul Kalam. This meant three official engagements in her programme had to be cancelled.

To come to London when parliament is in recess and most politicians are on vacation or on overseas tours was a mistake. Yet, it is surprising that no British cabinet minister found the time to meet her. One wonders what kind of a recommendation the British Deputy High Commission in Kolkata sent to Whitehall.

The mayor of London Boris Johnson, as powerful as any cabinet minister in Britain, was, however, ready to see her, but Banerjee failed to reciprocate.

The general consensus, though, is the delegation made a reasonable impression with a combination of simplicity from the chief minister and sophistication from the likes of her finance minister, Amit Mitra, formerly secretary-general of the Federation of Indian Chambers of Commerce and Industry (FICCI), and Sugata Bose, a Harvard professor who is now a Trinamool Congress MP in the Lok Sabha.

A key interaction with the corporate sector was ably anchored by Mitra. Indeed, it was shrewd of him to encourage views from businessmen in Banerjee's entourage, where government propaganda would have been less convincing.

Banerjee's only formal encounter with industry took place at Asia House. This was attended by senior executives of KPMG, Anglo American (the mining giant), Barclays bank, Nikkei (who recently acquired the UK's Financial Times newspaper), BP, PA Consulting, PwC and Standard Chartered.

From all accounts, Banerjee more or less rattled off her lines as briefed. The topics discussed included infrastructure development, incentives for foreign businesses, the state's relationship with the centre and efforts to cut bureaucracy and tackle corruption.

Arguably, it will take a while longer for the negative perception about West Bengal to melt. Besides, Banerjee's stance on land acquisition is a stumbling block for mega investment. Furthermore, only appealing returns will trigger foreign funding of the opportunities that were laid out.

Mitra dangled carrots by referring to the state having a population of 93 million, its growth in consumption being 3% higher than the national average, the Gross Value Added Growth being 10.48% as compared to India's 7.5% and that it was the 5th largest economy in the country in terms of Gross State Domestic Product.

Beyond the modest set of memorandums of understanding signed during Banerjee's visit, the Hinduja Group indicated they plan to invest in three different sectors, including restoration of heritage buildings in Kolkata. They recently purchased what was the British War Office during World War II and which they are refurbishing within strict conservation rules and converting into a hotel, residential and office complex.

Kolkata's Heritage Committee may in general have to be flexible on "change of use" of concerned premises to enable financiers to recover their investment.

The Caparo Group, chaired by Lord Swraj Paul, who is originally from Kolkata, declared West Bengal will have "first right of refusal" for a factory to manufacture a comparatively low cost sports car, with technology from Maclaren, who have a Formula 1 team with Honda. What Paul possibly means is West Bengal may have to match concessions that could be offered by other states to clinch the deal.

Analysis by RAY Media.