Mamata Banerjee came to power a year ago, ending a 34-year Communist rule, but she is rapidly losing urban support and is yet to find a way to improve the state's financial health
On the morning of May 7, nobody in West Bengal’s state secretariat had any doubt that the person who would arrive soon was the most important guest to step into Writers’ Building in the past one year. Chief Minister Mamata Banerjee herself had supervised arrangements to welcome the guest.
Banerjee personally selected the flowers. She ordered new silver cutlery, Makaibari Darjeeling tea and the choicest of cookies. When the guest, US Secretary of State Hillary Clinton arrived, Banerjee was waiting outside her office to receive her. “We have never seen her wait outside her chamber to receive anyone. But she was standing there five minutes before Clinton was anywhere near Writers’ Building,” said an official in the chief minister’s office.
For the attention-seeking Mamata Banerjee, it was indeed a big deal. She was meeting one of the most powerful women in the world on home turf to talk about possibilities and priorities that would help Bengal, most importantly, attract private capital to build industries and create jobs.
“This is a matter of pride that a US Secretary of State has come and talked to us here for the first time after independence,” a visibly elated Banerjee told a news conference after the visit.
Banerjee herself had joined Clinton on Time magazine’s 2012 list of the world’s 100 most influential people for excelling in New Delhi’s back rooms, where political horse trading is the name of the game.
“On the streets, she out-Marxed the Marxists. And as chief minister of her home state, she has emerged as a populist woman of action—strident and divisive but poised to play an even greater role in the world’s largest democracy,” the magazine said.
Banerjee’s role in Indian democracy, especially when it comes to support for economic decisions, has certainly been divisive. Many have called it regressive. She has blocked a government move to allow foreigners to invest in multi-brand retail in India. Banerjee shockingly forced Dinesh Trivedi, the railway minister from her party Trinamool Congress, to quit when he sought to raise rail fares after a decade-long freeze. She also stalled an international water agreement with neighbouring Bangladesh, presumably because Delhi did not consult her properly. Finance Minister and United Progressive Alliance’s chief trouble-shooter Pranab Mukherjee now refuses to deal with her and prefers to speak with state Industry Minister Partha Chatterjee. In short, Banerjee is now considered the enfant terrible of the shaky alliance.
Her reputation for mercurial decisions is such that the foreign ministry was holding its breath during Clinton’s visit. “She [Banerjee] could have suddenly refused to meet, which could have become such an embarrassing situation for the entire country,” says a senior official of the ministry.
Within the state, former supporters have deserted her. The arrest of Jadavpur University professor Ambikesh Mahapatra for circulating a cartoon of Banerjee and jailing of scientist Partha Sarathi Roy allegedly for protesting an eviction drive has shocked Bengal’s intelligentsia. “This is not the Mamata I knew,” says dissident TMC member of parliament Kabir Suman. Revered Bengali writer Mahasweta Devi, who supported her during the Singur agitation against land acquisition, now calls her government “fascist”.
After meeting Banerjee, Clinton, however, had high praise for her. Clinton said it was a remarkable experience “meeting the newly elected chief minister, a woman, who on her own started a new political party and built that political party over many years, and just successfully ousted Communist Party that had been in office for 30, 34 years or so, and who is trying now to govern a state with 90 million people in it”.
At the meeting in Writers’ Building, Clinton is believed to have promised liberal investments into Bengal if Banerjee eased her stand on issues critical to the US, mainly FDI (foreign direct investment) in retail and insurance. “You take one step and we’ll take two,” she is believed to have told her. Clinton may yet succeed in doing what many Indian leaders have not been able to do: Convince Banerjee to co-operate on crucial national economic decisions.
“There was a clear hint from Clinton that if Mamata allows FDI in retail and insurance, then US will certainly ensure flow of FDI into Bengal,” said a person close to Banerjee.
Within a week of Clinton’s visit, a co-ordination committee led by state chief secretary Samar Ghosh and US ambassador Nancy Powell began working overtime to draw up concrete proposals. A business delegation will visit the state sometime in early June following which a state delegation will visit the US in search of business opportunities. “If there is a firm commitment for investment, Mamata will also visit the US sometime this year,” the person said. But progress is likely to be slow as Banerjee is always worried about political fallouts.
“Be assured that Mamata will not make any concessions before the Panchayat elections due in 2013,” said a senior cabinet minister.
For Mamata, allowing FDI in retail and insurance will not be an easy task as it will give the Communists enough ammunition to attack her where it hurts the most. “Rural voters get easily swayed by the fear of losing their livelihoods. The bogey of losing jobs if international retailers come into the market can really hurt Mamata [in the elections],” the minister added.
The government, however, is taking the idea of attracting foreign investment into Bengal seriously and state Finance Minister Amit Mitra is preparing a policy on FDI investment. For Bengal, which is keen to tap one-fifth of India’s IT revenue by 2014, will need serious investment in that sector and the government is preparing a road map which they believe will lure huge investment very soon.
(This story appears in the 08 June, 2012 issue of Forbes India. To visit our Archives, click here.)