Monday, July 23, 2012

Mamta's interpretation of Liability - How long the central government will help West Bengal to float?

What you can do with 19 MPs? Well, a lot. You can scuttle a water sharing deal with a neighbouring country, you can close the door of FDI in retail, you can halt the increase in railway passenger charges and a lot more. Now one more to the list - you may be able to get away with loans.

According to a Hindu report (#1) West Bengal CM Mamta Bannerji told,

"I want to tell Delhi [the Centre] that they should not neglect the interest of the people of Bengal. If required I will urge the people of the State to march to Delhi. We will not pay interest,” she said, addressing a huge public rally organised by the Trinamool in the city."

Another report on Yahoo(#2) says,

"How can we make both ends meet? It is not our fault. The centre allowed the erstwhile Left Front government in the state huge loans..... We only want a three-year moratorium on interest payment. I will wait for a few more days. If I get it, I will be indebted to them..... When the Communist Party of India-Marxist (CPI-M)-led Left Front took loans, why did you (central government) allow it? If we are to make a turnaround, we need money for development. We won't pay this interest."

Well, what will happen if you are taking loan from a commercial bank and after some time going back and saying that I won't pay the interest? Can you accuse the bank for giving loan in the first place if the beneficiary was your ancestors? Isn't it what exactly West Bengal CM says?

Mamta carries a huge baggage of expectations. People want her to deliver results, for some time it make sense to accuse everything on predecessors. But after an optimal period they have to come out of the hangover and face the reality. Blaming everything on previous government may help her to keep her image for some time. But it will neither help her nor the state in long term.

Bengal is not a backward state, blessed with vast mineral resources and human resource potential it has all the possibilities to become the industrial powerhouse of India. But the question is how to utilise it? If government is continuing with anti-industry policies, the entire state may fall into a long term decline just like the current state of Kolkata port. It won't take much time for companies to leave Bengal and settle somewhere else.

There is limit in forcing the central government to back track on major policy decisions and make it feel the helplessness in policy formation. Current central government may be the friendliest one Mamta can ever get. Cooperating with New Delhi, she can serve her state in a better way. Moreover, NewDelhi may not be able to bail out Kolkata considering the current financial condition of central government. If government bailed out Bengal it will only make the other states to raise similar demands. With cooperation she may be able to achieve more.

May be the best way for Mamta to go forward is shedding her anti-industry image, stop blaming everything on predecessors as well as centre, adapt a pro-market policy and reform the bureaucratic framework so that it can deliver.



1. We won’t pay interest : Mamata
2. 'Chalo Delhi' if no moratorium on interest payment: Mamata

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