The present government in West Bengal does not believe in doing anything by halves. The government first refused the permission to Infosys to build a SEZ in the state. This has been followed by the announcement to repeal the state SEZ act, which had been promulgated by the previous government. It would be erroneous to argue that this decision to abolish the act grows out of the desire to undo what the Left had put in place in West Bengal. The decision is actually grounded in a fundamental and ideological opposition on the part of the chief minister, Mamata Banerjee, to the very idea of SEZ. She admitted this herself when she said that she had felt sad denying the permission to Infosys but she was against SEZs and on this matter her views were not subject to change. The abolition of the SEZ act is a direct outcome of such an intransigent attitude. It is obvious that the consequences of this decision and her attitude are of little or no consequence to her.
The consequences are dire for the economy and the people of West Bengal. Given the fact that no major industrial investments are available for West Bengal, the state cannot afford to turn its back on the idea of SEZs. They represent an attractive opportunity for investors. Investments in SEZs will open up avenues for employment. The state cannot afford to ignore these benefits that can accrue from SEZs. More importantly, the decision to abolish SEZs and Ms Banerjee’s obstinacy sends out all the wrong signals to potential investors. Faith and confidence underpin all investment decisions, and these have been woefully lacking so far as West Bengal is concerned. The first blow to investor confidence came with the exit of the Tata small car project from the state. No action of the present government has been directed at restoring the faith of potential investors in West Bengal. The decision to repeal the SEZ act will further buttress the prevalent impression that the present government is not seriously interested in attracting investors to the state.