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What awaits Amit in industry innings

- New minister’s immediate tasks: get funds for HPL and fast-track project approvals in department

Calcutta, Dec. 26: Partha Chatterjee today resigned as the chairman of Haldia Petrochemicals Ltd, hours after the industries portfolio was taken away from him in a cabinet reshuffle.

“I have resigned as the chairman of HPL,” Partha Chatterjee said tonight.

Industry sources said Partha Chatterjee’s inability to come up with a solution to HPL’s problems could have played a part in his exit from the industries department.

He had replaced private promoter Purnendu Chatterjee as the HPL chairman in March 2012 and established absolute control of the Bengal government over the troubled firm.

If Amit Mitra, who replaced Partha Chatterjee as industries minister, takes over as the chairman of HPL, which sources said was “likely”, he will have his task cut out. Expectations will be sky high from the former secretary-general of trade body Ficci.

The path to the HPL top job could be rocky. Mitra will need the support of financial institutions, especially that of private promoter The Chatterjee Group (TCG), for the Haldia post. TCG is locked in several court battles with the state government.

In HPL, the transition at the top will take place in the most difficult phase of the firm’s decade-long existence. The company has just about enough cash to see it through the middle of January.

Fresh funds will have to be arranged soon to save HPL from turning sick. At the latest board meeting of the firm on Tuesday, Partha Chatterjee had got a Rs 1,300-crore rights issue approved despite opposition from TCG.

HPL will offer 51.2 crore shares for the issue at Rs 25.10 apiece, the rate at which Indian Oil Corporation (IOC) is seeking to increase its stake in the firm. The issue will be completed within 30 days of the HPL management giving notice to the existing shareholders, which, apart from TCG, include the West Bengal Industrial Development Corporation (WBIDC), financial institutions, IOC and two Tata firms.

There is a possibility that the WBIDC may renounce its part of the rights shares in favour of IOC.

Partha Chatterjee had on Tuesday invited IOC chairman R.S. Butola for a meeting next week to discuss the possibility of involving the public sector behemoth in a bigger way in HPL.

It has to be seen if Mitra pursues the matter.

Industry observers did not rule out the chances of Reliance Industries Ltd renewing its interest in HPL in the changed scenario. Mitra was instrumental in bringing RIL chief Mukesh Ambani to the investors’ meet organised by the Bengal government in Mumbai in August.

Partha Chatterjee’s future role in the WBIDC, where he is the chairman, was unclear till late tonight.

Partha Chatterjee had become the WBIDC chairman soon after he was sworn in industries minister after the 2011 Assembly elections. He had succeeded Nirupam Sen. Usually, the industries minister becomes the WBIDC chairman.

In the WBIDC, disbursal of fiscal incentives of over Rs 800 crore among various industries is pending. So far, the industries department had indirectly blamed the finance department headed by Mitra for lack of funds.

Several projects, including the proposed steel and power units by the Jindal Group at Salboni and the eco-tourism and power hubs by Prasoon Mukerjee’s Universal Success at Nayachar, are stuck at various levels.

A section of industries department officials said they were “saddened” by Partha Chatterjee’s exit. “We are sad that he will not be a part of the department any more,” said an official in the industries department.

The industry sources said apart from the HPL issue, other factors such as slow movement of project files could have played a part in Partha Chatterjee’s exit from the industries department. However, some officials blamed a section of bureaucrats for the tardy pace.