After decades of industrial decline and economic stagnation, West Bengal is rising again on India's business firmament as an investment-friendly destination. And leading the charge are the big names of Indian and global industry such as Mukesh Ambani, Sajjan Jindal, DP World, Coca Cola and ITC.
A large educated workforce, abundant raw materials, good road, rail and air connectivity with the rest of India and the world and a strategic location as the gateway to the largely untapped markets of the North East of India - Bengal has always had what it takes to become a leading industrial and economic heavyweight among Indian states, as it was till the mid-1960s.
And there are indications that it may be clawing its way back to the ranks of states that mean business, even if it is still some distance away from regaining its glory days of the British Raj and the early decades of Independence.
At the recently concluded fifth Bengal Global Business Summit, held in Kolkata in early February, Reliance Industries Chairman & Managing Director Mukesh Ambani led the charge, committing to invest Rs 10,000 crore in the state's digital sector through Reliance Jio, disruptive but very successful foray into 4G telephony in the country.
“Today our investment stands at Rs 28,000 crore in West Bengal alone, which is one-tenth of our investment in India. We have planned a further investment of Rs 10,000 crore,” he told the summit in the presence of state Chief Minister Mamata Banerjee.
Announcing a new Chair in Calcutta University in honour of scientist Satyendra Nath Bose, of Boson and Bose-Einstein Theory fame, Ambani said
will, as a next step, connect small merchants with his retail network and warehouses to increase their reach several folds. His group already has more than 500 retail stores in West Bengal and the fresh investment would increase this presence as well as its warehouse space in the state manifold, he added.
Having shed its image as a state with militant labour unions, West Bengal is among the fastest growing states in India. According to
(IBEF), a trust created by the Ministry of Commerce, Government of India, to promote the Indian economy and Brand India, West Bengal′s Gross State Domestic Product (GSDP) was $158 billion in 2017-18 while its average annual growth rate from 2011-12 to 2017-18 was about 11.88 per cent.
The state is sixth-largest contributor to India's manufacturing GDP and fourth-largest contributor to the country's services GDP.
Moreover, West Bengal is also a major producer of petroleum and petrochemical products. Production of natural gas in the state is projected to touch 410.30 million cubic metres in 2018-19.
It is also an increasingly important centre for India's massive information technology sector. Total IT exports from West Bengal is about $3 billion. The state government, in which the Big Three of Indian IT - TCS,
and Wipro - has a large presence, has recently introduced the West Bengal Information Technology and Electronics Policy 2018 to encourage the sector and propel the state into the top league within India in the IT, ITeS, ICT and ESDM silos of this sector.
Food processing potential
It is also India's largest rice producer, second-largest producer of potatoes and among the country's biggest fish producers. The world-famous Darjeeling tea is also grown in the state, which is India's second-largest tea producer.
This shows that the state has tremendous potential in the high growth
Speaking at the summit, Sanjiv Puri, Managing Director of ITC, the tobacco to hotels to FMCG giant, said “We are taking our total investment in Bengal to Rs 1,700 crore (about $240 million).” ITC, which is the largest private sector company based in West Bengal will invest in food processing and a new personal care products plant in the state. Besides, it will also upgrade its existing facilities, which includes, among other things, the expansion currently ongoing at its flagship ITC Sonar five-star hotel in Kolkata.
Crème de la crème in attendance
The summit, which had a tagline of “Bengal means business”, attracted almost every A-list industrialist as well as several foreign multinationals, including IKEA, Alstom, D P World, Accor Decathlon, Schneider Electric, P&G, Oerlikon, Capgemini, Metro, IBM, Dell and BT.
The JSW Group, which is doubling the capacity of its cement plant in the state, is also planning to invest Rs 50,000 crore ($7 billion) in a greenfield steel plant in West Bengal.
“You don't have to think twice before investing in the state. We are also setting up a new museum in Bengal which will depict the history of Partition,” said Sajjan Jindal, Chairman and Managing Director of JSW Steel.
Sanjiv Goenka, whose RP-Sanjiv Goenka Group has invested almost Rs 25,000 crore in West Bengal over the last few years said the state offered excellent investment opportunities as “the leadership is clear in decision making and the administration is outstanding and transparent”.
“We will invest Rs 15,000 crore in West Bengal over the next five years,” announced Y.K. Modi, Chairman of Great Eastern Energy Corporation Ltd.
Niranjan Hiranandani, Managing Director of Hiranandani Group also announced large investments in the state. “H-Energy has completed land acquisition and recently received permission to build a pipeline. The company aims to deliver gas to Haldia by 2022. This will bring down the cost of manufacturing in the state and also provide gas to cities. We have already made Rs 3,000 crore worth investments in the state and we will invest Rs 2,000 crore more over the next two years,” he said.
Ports and Special Economic Zones will soon set up a logistics park and a port in West Bengal, said Karan Adani, Chief Executive Officer of the company.
Among the multinationals, Coca Cola committed Rs 500 crore worth of investments in the state while DP World, a large Dubai-based port operator, will invest Rs 3,000 crore to develop the Kulpi port in southern Bengal.
Speaking at the summit, West Bengal Finance Minister Amit Mitra, who is better known outside his home state as the former Secretary General of apex chamber of commerce Federation of Indian Chambers of Commerce and Industries (FICCI), said Swedish furniture giant
is scouting for land in West Bengal and is considering the state for its second store in India.
He added that since 2015, when the first Bengal Global Business Summit was held, the state has a conversion rate of about 40 per cent and that investments worth more than $14 billion are at various stages of implementation.
So what is driving this nascent economic resurgence
Experts and analysts feel a combination of factors, including fatigue and disillusionment with trade unionism, the emergence of the younger, less ideologically-motivated generation that is not particularly politically inclined and a realisation amongst the intelligentsia and the political leadership that industrial rejuvenation was the only sustainable path to political longevity, have contributed to the change in mood about and in Bengal.
This change is evident from the fact that after many decades, three completely homegrown first generation national level players have emerged in three separate and highly competitive sectors - SREI in infrastructure and equipment finance, Emami in FMCG and Bandhan Bank in banking.
Are these the early harbingers of what, if it succeeds, will surely be India's biggest turnaround story It's too early to predict but all indications point to the fact that Bengal is once again open to doing business without letting politics come in the way.