DNA Edit: Govt must rethink decision to shut Sterlite plant

The Tamil Nadu government’s decision to cancel the land allotted to Sterlite in the area is a knee-jerk reaction. Granted, the death of 13 people who were killed in police firing last week should never have happened. Having said this, the government’s decision to shut down the plants is a bad idea. Not only does it show them as caving in to pressure, but it discourages industry and damages the economy. Employment is a major concern. 

Thousands of people depend on the plant for their livelihood and its closing down leaves them jobless. Then, India desperately needs copper. The reduction of domestic copper in the country will force the country to import copper at huge cost. Finally, lawyers representing Sterlite Copper claim the state government has not followed ‘legal procedure’ when ordering them to shut down. This may or may not be true, but it certainly deals a blow to Tamil Nadu portraying itself as a industry friendly state. To see the damage this can do, Tamil Nadu only needs to look at West Bengal. In 2008, the Tatas moved their Nano car factory out of Singur and into Gujarat. 

The economic fallout was huge with no major industrial house willing to enter the state with a mega project. This remains a big concern for states like West Bengal and Tamil Nadu who need industry to kickstart their state’s economies. It also hurts PM Modi’s efforts to showcase India as an investment friendly country. If domestic industry cannot function how will foreign companies do so? The state government must think hard about such decisions. Shutting plants may make activists happy but the long term repercussions of such an action aren’t good. Let pragmatism prevail over politics.