A dream gone sour

As two dream projects of West Bengal, Haldia Port and Haldia Petrochemicals, are allowed to flounder and fail, the signal going out to future big-ticket investors is grim. The state government should take it as a wake-up call and sort out the Haldia mess, says the industry

February 1977: A landmark year in West Bengal's industrial history. The Haldia Dock Complex, Kolkata Port Trust's (KoPT) main cargo handling arm, is set up on 6,377 acres, with a large hinterland extending to Nepal, Bhutan, the seven north-eastern states and the eastern states of West Bengal, Bihar and Jharkhand (then Bihar). The port was established 140 km from Kolkata.

August 2000: Another landmark year with the state getting its first foreign direct investment (FDI) through Haldia Petrochemicals Ltd (HPL). A dream project, it was then touted as Asia's most modern petrochemical plant, set up on 1,100 acres.

Cut to 2012, and the financial health and capabilities of both these 'star' projects of the state are in a disarray. And yet, when the Haldia port was conceived, it was expected to boost trade and investment in the east and open a gateway to the far east. When Haldia Petrochemicals was commissioned, the state government had hoped that Haldia would be the Jamnagar of Bengal, facilitating at least 900 downstream industries.

Today, the Haldia port is battling closure, with the Centre threatening to withdraw the R400-crore subsidy it gets for dredging; slipping volumes and low trade, and both Paradip and Dhamra ports eating into its business. Haldia Petrochemicals' problems run even deeper. The state government and the promoters are locked in an ownership battle; the company is mired in loans and will have to go for forced shutdowns to repay loans from working capital.

For would-be investors, the Haldia story isn't good news. If the two 'showpieces' of the state are allowed to flounder and fail, where is the hope for future investors?

... contd.

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