The Telegraph
Thursday , November 1 , 2012
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HBT seeks to pull out

Calcutta, Oct. 31: Private cargo handler Haldia Bulk Terminals (HBT) has announced its decision to pull out, yanking back into the foreground the “Singur syndrome” that has been clouding the Bengal government’s efforts to attract job-generating projects.

The judiciary is now expected to play a decisive role in bringing closure to the Haldia controversy with the Calcutta Port Trust (CPT) rejecting the termination of the contract by HBT.

A settlement may or may not be reached eventually. But the pullout announcement a day after chief minister Mamata Banerjee declared that “nothing happened” in Haldia became a lightning rod for a debate on the industrial environment in Bengal.

The HBT announcement came days after its three employees were allegedly taken away from a flat at gunpoint and packed off from Haldia.

HBT, a joint venture between shipping and port player ABG Group and LDA of France, today informed Calcutta High Court of its decision to terminate the 10-year contract with the CPT to handle cargo in two berths at the Haldia port. Eight years of the contract are remaining and HBT had invested Rs 160 crore in installing six mechanised cranes and earth-moving equipment.

The project initially threw up 725 jobs — largely under local political pressure — but 275 workers were laid off last month as volume of business slumped because of the downturn and amid suggestions that cargo-handling was being diverted to a company with ties to Trinamul. Around 350 employees remain on the roster at the time of the pullout announcement.

HBT today blamed the “ever-worsening” law and order in Haldia for terminating the contract.

The CPT declined to accept the termination letter and asked HBT to report to work. Port chairman Manish Jain threatened to slap a penalty on HBT for loss of business.

Lawyers said the ability to prove sufficient ground for termination would decide if a fine would have to be paid. The court will now decide if there was sufficient ground — a parallel with the Singur case that has now reached the Supreme Court.

Justice Sambuddha Chakrabarty of Calcutta High Court said he would hear the Haldia case on November 2.

Although the profile and the sweep of the Tata Motors’ abandoned project in Singur and the Haldia venture cannot be compared, the circumstances that led to the flashpoints are marked by the alleged use of force and political blessings.

“That (the abduction) was the last nail on coffin. We have been working under threats anyway. But it is now impossible to work anymore. How can I ask my people to go to Haldia if I cannot go myself?” asked Gurpreet Malhi, the chief executive officer of HBT.

However, industries minister Partha Chatterjee said: “ABG (the parent company of HBT) did not have any agreement with the state government. Ask the port authorities. We are aware of what industrialists think of Bengal.”

Such a neutral stand in public and eventual behind-the-scenes persuasion could have helped resolve the issue. But Trinamul leaders chose to dictate terms.

The chief minister compounded the problem when she asserted yesterday that “nothing happened”, only to add in the next breath that “I do not know the details”.

HBT today sought the court’s permission to remove the heavy equipment but the CPT said it would not allow that. The port also threatened to float a fresh tender if HBT did not start work.

CPT sources said HBT was a “crippled child from birth”, saying it quoted extremely low and uneconomical rates to win the contract. (The bidder who quotes the least price to handle cargo bags the tender.) “It would have pulled out anyway,” a CPT official added.

Industry sources said if that indeed was the case, the government should have ensured that it did not play into the hands of the company by allowing Trinamul to interfere and gifting HBT an excuse with wide implications for the image of the state.

HBT chief Malhi said the company lost Rs 60 crore in the past two years — a possible reflection of the low quotes. But other company sources said ABG was known to quote low rates and make profits from higher volumes: they cited an example in Vizag where the high volume surpassed the estimates of initially sceptical port officials and helped ABG post profits.

When the pie shrank in Haldia, probably because of the downturn and the mining freeze, allegations surfaced that entrenched players were being favoured. The entry of Trinamul, keen to shore up support after the civic poll blow in Haldia, changed the complexion of the dispute and has now boomeranged.

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