India Adani Ports Finance
Has West Bengal lost confidence in 'the ginger trader's' ability to develop the huge Tajpur port project?
Feb 28, 2023
Has West Bengal lost confidence in Adani’s ability to develop the huge Tajpur port project?

In 2022, the government of the Indian state of West Bengal selected the Adani Group as the developer of a major new port at Tajpur, on the Bay of Bengal. However, with the recent meltdown in the value of Adani’s stocks, questions have been raised about the conglomerate’s ability to deliver the project. The conspicuous absence of the previously much-touted development from February’s state budget speech added fuel to the fire, as did the chief minister's reference to Adani as a 'ginger trader' (petty operator). Meanwhile, fishing communities remain fearful that the project’s impacts on the coastline will deprive them of their traditional livelihoods.

Men and women, belonging to a fishing community, engaged in the traditional activity of drying fish near Tajpur.

With the sharp nosedive in the fortunes of the Adani Group in early 2023, questions have been raised about the fate of Adani’s ambitious port project on the Bay of Bengal in the eastern Indian state of West Bengal. On 9 October 2022, a year after being re-elected to power, the West Bengal chief minister, Mamata Banerjee, selected the Adani Group to develop a deep-sea port at Tajpur.

But after no mention at all was made of the Tajpur port project in the government’s budget speech this year, opposition parties in West Bengal were quick to take a dig at Banerjee’s government. Clearly, this budget presentation was a departure from budget speeches of the past few years in which the Tajpur port had featured prominently. In addition, Banerjee’s pointed remarks against the group’s chairperson Gautam Adani, pertaining to questions of exposure of India’s financial institutions to the beleaguered business group, have added fuel to the political speculation.

Speaking at an event in Howrah city near Kolkata earlier this month, Banerjee obliquely referred to Adani as an Adaa’r Byapari, which literally means ‘a ginger trader’ in Bengali language but is a colloquial derogatory term used for petty operators. This occurred barely a year after her widely publicised meeting with the business tycoon to procure financial investments in West Bengal.

‘Where do you (the common people) keep your savings? Many in the LIC [Life Insurance Corporation], many in housing investments, many in banks… Where is all that money going? The money is going to the home of the Adaa’r Byapari [ginger trader],’ Mamata said at the event in Howrah.

Nevertheless, notwithstanding its rout in the stock market, the Adani Group has reportedly made clear its intention to proceed with the Tajpur port project.

Following the budget speech, made by the state’s finance minister Chandrima Bhattacharya in the legislative assembly on 15 February 2023, Opposition political leader, Suvendu Adhikari, pointed to the conspicuous absence of Tajpur. The only mention of the port project pertained to the proposed construction of an economic corridor linking the port with Raghunathpur township on the state border with neighboring mineral-rich Jharkhand. The economic review report of West Bengal for the financial year 2022-23, which was presented by the state government in the legislative assembly on the same day as the budget speech, contains a reference to Tajpur Port regarding a Letter of Intent.

In the budget speech for the previous financial year, Bhattacharya had enthused about how the port project would be the harbinger of economic prosperity for West Bengal.

The under-construction bridge at Soula along the Digha-Mandarmoni marine drive. Ostensibly for tourism, the road could be the first phase in the industrialisation of this stretch of coast.

‘The proposed deep-sea Tajpur Port, a first of its kind in the state, is another large infrastructure project conceived as a long-term initiative for development of alternative seaports and integration of port-rail-road infrastructure for the creation of sustainable logistics infrastructure in the state. Over 1000 acres of land have been identified for developing the Port Project. It will harness huge logistics potential, attract further investment in allied infrastructure and industrial development and provide employment opportunities to a large number of our youth,’ the minister stated in last year’s budget speech.

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The budget speech for the financial year 2021-22 also harped on about the alleged employment generation, economic development and industrialisation potential of the port project.

In the interim budget that was announced by the then finance minister of the state, Dr Amit Mitra, on 5 February 2021, ahead of the pending legislative assembly polls, it was announced that the West Bengal Maritime Board had floated an expression of interest inviting potential bidders for developing a deep-sea port at Tajpur.

In 2022, Karan Adani, the eldest son of Gautam Adani, collected the Letter of Award (LoA) for the project at a cultural event in the state capital, Kolkata, a few days after the hugely popular Durga Puja festival of West Bengal which symbolises the victory of good over evil. Karan Adani is the Chief Executive Officer of Adani Ports and Special Economic Zone (‘Adani Ports’) Private Limited, which trounced another multibillion-dollar business conglomerate, the JSW Group, to bag the project.

Livelihoods threatened? Dried fish being sorted at one of the temporary structures set up alongside the beach near Tajpur.

After accepting the letter of award from the West Bengal government, the Adani Group incorporated a wholly-owned subsidiary in October last year under the name Tajpur Sagar Port for the purpose of developing the Tajpur project. Sources say the West Bengal government is yet to sign a concessionaire agreement with the Adani Group for the port project.

At the same time, the government has maintained a veil of secrecy around the project proposed on the coast of the Bay of Bengal in the state’s Purba Midnapore district, an area that has a history of political violence prompted by land acquisitions. Questions are being raised in political circles as to whether, following the stock-market debacle of the Adani Group, the West Bengal government has lost confidence in the ability of the business conglomerate to develop the port at Tajpur.

Meanwhile, hundreds of families that depend on fishing for their livelihoods in the region of Tajpur have lived lives of fear and uncertainty since the massive port project was announced. Their apprehension first arose when West Bengal’s government pushed a road through the area, apparently to cater for the demands of hotels that have proliferated, allegedly illegally, over the past two decades along the coast in the state’s south-east. Communities presume the port project will adversely affect their livelihoods, in much the same manner as the roads and hotels have done.

Hundreds of families along the coastline earmarked for Adani's Tajpur port are dependent on their fishing boats for their livelihoods.

In reply to a query made through India’s Right to Information Act, 2005 by a Tajpur fishing community, the Union Ministry of Environment, Forests & Climate Change (‘the ministry’) failed to provide details of the proposed project. The information seeker, Purba Midnapore Matsyajibi Forum (where the word Matsyajibi roughly translates into fishworker), was told in the written reply of 28 December to check the ministry’s website to find answers. An appeal has been filed by the applicant in January 2023 with higher authorities in the West Bengal government. A reply is awaited.

Fisherfolk drying and sorting fish near Tajpur. In the background are motorised boats that have been anchored after successfully returning from the sea.

This correspondent contacted the district-level nodal officer of Purba Midnapore who is handling all government-related affairs of the port project at the ground level. However, the official refused to divulge any information regarding the progress of the project. Instead, the official asked this correspondent to submit the inquiries to the chief government official of Purba Midnapore, the District Magistrate, Purnendu Kumar Maji. When contacted, Maji also declined to comment on the proposed port. He told this correspondent to contact Vandana Yadav, the bureaucrat heading the Department of Industries, Commerce and Enterprises of West Bengal, for all queries pertaining to Adani’s Tajpur project.

A questionnaire was emailed to Vandana Yadav asking, inter alia, about the status of various approval processes for the project, the status of land acquisition for the project, as well as details of the concessionaire agreement between the West Bengal government and the Adani Group for the Tajpur project. A copy of the questionnaire was also emailed to West Bengal’s industry minister Dr Shashi Panja. No response had been received to these inquiries, or to a subsequent reminder email, at the time of publication. Nor did Dr Panja respond to numerous calls and text messages. (The award letter for the port was handed over to Adani Group in the presence of Dr Panja.)

Local fishworkers say they have yet to be informed of plans regarding acquisition of land for the project. With the history of violence over such moves in this area, it is evident that authorities are treading carefully. In March 2007, less than 70 kilometres away from Tajpur at a town called Nandigram (also within Purba Midnapore district), at least 14 farmers were killed by police firing at people protesting against land acquisition for a chemical hub by the then Left Front government of West Bengal. The protests and intermittent incidents of violence continued for than two years until the state government was forced to scrap the project. Riding high on popular sentiments against land acquisition, Mamata Banerjee came to power in West Bengal in the assembly elections that were held in 2011. She successfully dismantled the Left Front government which had been at the helm of affairs in the state for 34 years.

A chaotic scene at Nandigram, not far from Tajpur, where at least 14 people were killed when police fired on farmers protesting at proposed industrial development of their lands.

A year before the project was awarded to Adani, the Banerjee government made available more than 400 hectares of land near Tajpur for related industrial development. In a land swap, the West Bengal State Electricity Distribution Corporation transferred a 405-hectare parcel of land that it had earmarked for a solar project to the West Bengal Industrial Development Corporation in exchange for an equivalent plot in an adjoining district. This land is located near Dadanpatrabar village, a major fishing centre near Tajpur.

The budget speech of West Bengal for the financial year 2022-23, delivered at a time when bids had already been invited by the state government for appointment of a concessionaire, stated:

‘950 acres of land earmarked for Goaltore IP has been handed over to Power Department for their Solar Power Project in return for a suitable 1000+ acres of land in Dadanpatrabhar, Purba Medinipore District for augmenting the requirements of Tajpur Port Project.’

Discontent over land acquisition is already rife in the coastal areas of Purba Midnapore as a result of the way in which Mamata Banerjee’s government proceeded with the coastal road project mentioned above. The 29.5-km-long road, which connects four sea beaches at Digha, Tajpur, Shankarpur and Mandarmoni, was formally inaugurated by Banerjee on 14 September 2022, not long before the Tajpur project was awarded to the Adani Group.

‘Only a 2.8-km stretch of the road is awaiting completion,’ the executive officer of Digha-Shankarpur Development Authority, Manash Mondal, told this correspondent. ‘We tried to build a bituminous road along this small stretch but it was washed away during the incessant rains last September just before the inauguration ceremony. Now, we will build a cement-concrete top road over this stretch. The Digha-Mandarmoni road, as it is popularly known, is already open to light motor vehicles.’

Picture of the under-construction bridge at Tajpur. It is very close to the point where the deep-sea port is proposed.

During a visit by this correspondent to the Tajpur region in November 2021, local communities in fishing hamlets seemed to be displeased by the manner in which the state government was executing the road project. They alleged that construction of the road had affected their livelihoods by way of increased traffic and dumping of debris and other waste materials near landing points for fishing boats. Local communities claimed the details and alignment of the road were never shared with them before the project commenced; there were no public hearings. Local families alleged that the government took over the lands forcibly. Landless villagers with temporary rights for agriculture and/or fishing effectively lost those rights without formal notice, paperwork or compensation.

The hotel industry along the state’s southeastern coast, for which the road was constructed, has also adversely affected the environment of the region and the livelihoods of fishing communities. It is alleged that the resorts which have mushroomed have been constructed in violation of regulations for management and protection of marine biodiversity (the Coastal Regulation Zone [CRZ] Notification). Huge sand dunes and large swathes of mangroves, which act as natural barriers against storm surges, were cleared.

Billboards/advertisement hoardings of scores of hotels and resorts that have mushroomed over the past two decades in the Mandarmoni beachside near Tajpur.

‘The hotels have been constructed breaching the high tide line,’ said Srikanta Das, the head of a fisherman community in Dadanpatrabar. ‘Breakwaters have been constructed by hotel businesses, resulting in seawater gushing into village areas after ricocheting of the rocks, and causing erosion. Fish breeding and populations have dwindled, not only because the hotels have encroached into high-tide areas, but also because they release untreated effluents into the water. As a result, we have to venture deeper into the waters for our daily catch. This is expensive, particularly given the cost of fuel for motor-powered boats.’

The prospect of land takeover for the port looms large for local fishing communities. At least four major fish landing centres occur in the area. They employ community women who dry, sort and pack the fish for transportation across the country.

Srikanta Das, head of a fisherman community standing at the edge of the under-construction marine drive road and pointing at a boat that had been tossed inland during Cyclone Yaas. In the background are temporary bamboo thatched structures used by fishermen communities to sort, package and store dried fish.

In May 2022, India’s premier environmental court, the National Green Tribunal (NGT), ruled that most of the hotels in Mandarmoni near Tajpur were illegally established as they violated rules pertaining to the coastal zones of India. The tribunal also concluded that these developments generally operate in violation of environmental regulations that prohibit discharge of untreated sewage directly into the sea. Most of these commercial establishments do not have facilities for the treatment of effluents. Where effluent-treatment plants did exist, they were found to be non-functional.

The Principal Bench of the NGT, headed by its Chairperson Justice Adarsh Kumar Goel, ordered the closing of such hotels and recovery of costs from the owners in terms of damages caused to the environment.

‘Out of 97 hotels, resorts or restaurants, 43 have no consent and the remaining 54 are otherwise non-compliant. 43 which do not have consent are also not shown to be compliant nor are shown to be outside the ‘No Development Zone’ [NDZ]. Even if consent has been granted or ETPs [effluent treatment plants] repaired, constructions in NDZ are not shown to be permissible as per applicable CZMP [Coastal Zone Management Plan],’ the bench stated in its judgement of 2 May 2022.

Local people said the order has not been implemented. An email was sent to senior officials of the West Bengal Pollution Control Board asking, amongst other things, for information on action taken so far to implement the NGT’s order. No response has been received so far.