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‘Talks on With Adani Group Over Tajpur Port’: Bengal Govt’s 'U-Turn' Deepens Mystery

Five days after chief minister Mamata Banerjee’s fresh investment call, industries minister Shashi Panka said discussions with Adani are continuing.
West Bengal chief minister Mamata Banerjee. Photo: X/@MamataOfficial

Kolkata: The mystery surrounding the fate of the Tajpur deep sea port development project in West Bengal deepened as the state government, in an apparent U-turn, said that talks were still on with the Adani Group.

“Clarifications and dialogues are going on between Ms Adani group and the state government,” commerce and industries minister Shashi Panja said on Sunday, five days after chief minister Mamata Banerjee gave a fresh investment call for the Rs 25,000 crore project at the state’s flagship business event, Bengal Global Business Summit (BGBS).

“The proposed first deep sea port at Tajpur is ready. You can participate in the tender. It will attract an investment of about $3 billion, meaning Rs 25,000 crore,” Banerjee had said.

When journalists asked Panja if her statement contradicted that of the chief minister, she said, “I am speaking on behalf of the honourable chief minister.”

Adani Port and Special Economic Zone (APSEZ) head Karan Adani received a Letter of Intent from the state government in October 2022.

A lack of consistency between the statements of the state government and the Adani Group regarding the status of the projects over the past few months has given rise to speculation.

While the state government had on several occasions said they were waiting for the Adani Group to do their part regarding necessary permissions from the Union government, the Adani Group had said at least three times that they were awaiting the Letter of Award (LoA) from the government to start with the other processes.

However, the chief minister’s surprise announcement on November 21 prompted many to speculate if this was the fallout of a political tussle between Prime Minister Narendra Modi’s Bharatiya Janata Party (BJP) and Mamata Banerjee’s Trinamool Congress (TMC) involving the latter’s MP Mahua Moitra’s allegedly anti-Adani’s interests.

Banerjee’s public backing of Moitra the very next day strengthened the speculations. “What she (Moitra) used to say inside, she will not be saying outside,” Banerjee had said at a party event. Moitra is known for regularly accusing the Modi government of giving undue favours to the Adani Group as part of a nexus.

After Banerjee’s call for participation in the tender, senior BJP leaders in the state, including Lok Sabha MP Dilip Ghosh, alleged that it was the Adani Group that backed out of the project because of Moitra’s role.

On Sunday, Panja said, reading out from a written statement, that the Adani group was “given a provisional LoI” and that the work for getting permissions required from the Union government ministries like shipping, home, defence and external affairs “are on.”

“The Ministry of Home Affairs has given a conditional security clearance and has made some observations. We are working with the Adani Group regarding those observations and have asked for some clarifications. These communications are going on currently,” she said.

The absence of the Adani Group at the BGBS triggered speculations over whether the group had “snubbed” the government because of the ruling party’s political attacks alleging a “nexus” between the business group and the BJP.

While Panja asserted that the government had sent invites to the group for the business summit, a senior government official, who was unwilling to be identified, said, “Invite was sent as part of formality. The extra efforts that we usually make to ensure top industrialists’ presence were not made for the Adani Group this year.”

After Panja’s announcement, CPI(M) central committee member Sujan Chakraborty took potshots at the government. “The statements of Panja and the chief minister are contradictory. They (the TMC) are sometimes speaking up against Adani to hide their own nexus. But at the end of the day, she (Banerjee) cannot go beyond what Delhi (BJP) tells her to do,” he said.

An Adani building in Australia. Representative image. Photo: Wikimedia Commons/RegionalQueenslander, CC BY-SA 4.0.

‘Important for both’

According to Kolkata-based business and political observers, the Tajpur port project is important to both the state government as well as the Adani Group.

It is the biggest industrial project the state government has taken up during Mamata Banerjee’s 12-year rule – along with the proposed coal mine at Deucha-Pachami – but the work related to Tajpur port has progressed more than the coal mine project.

The government, to smoothen the process of the port development, had also scrapped the state’s only proposed solar project – the Rs 750 crore project to develop a 125-megawatt (MW) capacity solar park.

The state had received Rs 25 lakh from the Union government for preparing a detailed project report for the solar park. The report was complete and the process of securing an international loan had progressed. However, in 2021, the state government decided to prioritise the Tajpur project and handed over the 532-acre plot at Dadanpatrabar earmarked for the solar park to the Tajpur port project.

The government has also expedited the development of industrial corridors, including one from Tajpur to Dankuni near Kolkata.

On the other hand, concession agreements being signed between governments and private industries for the development, operation and maintenance of different new ports and terminals in the country are usually for a period of 30 years, whereas in some cases a period of up to 50 years is being considered. The Adani Group had in August argued in favour of 50-year concession periods.

In that context, the 99-year concession period offered by the state government “is lucrative,” according to a senior business journalist who did not want to be named.

Adani Port’s brochure published in August 2023 highlighted that the 99-year concession given in Tajpur port development was the first instance in India. “The Adanis hurriedly pulling out of such a project out of a political controversy does not make sense,” the journalist said.

The Adani Group bagged the LoI after emerging as the highest bidder, defeating another major business group, JSW.

A senior bureaucrat said, requesting anonymity, that the chief minister’s announcement was “shocking and surprising” as there was no hint of such a measure even a day before.

“The chief minister may have been upset that no one from the Adanis came to give updates on the project. But I totally understand if the Adanis did not send any representative to avoid being asked by the press on the Mahua Moitra episode,” the bureaucrat said.

Senior journalist Avijit Ghosal, however, suspects the chief minister may have miscommunicated what she intended to convey on November 21.

“Mega infrastructure projects like this do not happen overnight and the LoI is nearly the beginning of a very long drawn process of negotiations and a string of agreements,” he told The Wire, adding that the chief minister should have clarified her statement.

“What the chief minister may have meant is that while the Adanis remain the anchor investor in this project, there would be multiple sub-projects with wide investment opportunities for India Inc. She probably invited other industrial houses for wider investment. What she perhaps omitted was providing an explanation for her one-line statement. That’s the explanation that the state industries minister is providing now,” said Ghosal.

The Adani Group will invest Rs 15,000 crore in the project, while the associated infrastructural development cost has been projected at another Rs 10,000 crore. On November 21, the chief minister mentioned Tajpur as a Rs 25,000 crore project.

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